Venture Will Provide Digital Program to Cable Firms
San Diego-based AEGIS Broadband plans to take its digital technology to Latin American and Caribbean households via the movies.
AEGIS, a developer and manufacturer of enhanced digital systems for cable operators and Internet service providers, has teamed with Atlanta-based Latin American Pay TV (LAPTV) to offer a low-cost solution allowing cable operators throughout Latin America and the Caribbean to provide competitive programming to their customers and to enhance the value of their cable systems.
The new VisionNet service is expected to eliminate the economic barriers many Latin American and Caribbean cable operators face in offering premium channels.
This will allow some of the smaller cable operators to be more competitive, said Carlos D & #237;az, vice president and general manager of LAPTV, which offers movies and creates and distributes premium and basic channels for pay television systems in Mexico City, Caracas and Buenos Aires.
“Both AEGIS and LAPTV already have a presence in the Latin American market, but it’s not as an extensive market as we would like due to technological barriers,” D & #237;az said. “The alliance was designed to break down those barriers.”
He said cable operators in Latin America and the Caribbean who want to carry premium channels usually have to invest at least $100,000 to $200,000 in technology to deliver extensive programming.
Under the VisionNet service, cable operators pay a minimal upfront investment, plus a small monthly service charge.
Genaro Rionda, CEO of LAPTV, said half of the roughly 15 million pay-TV subscribers in Latin America belong to big cable operators that have access to capital.
“Installing VisionNet will allow our customers to generate additional revenue and profit with minimal financial risk,” Rionda said.
D & #237;az said the LAPTV and AEGIS partnership will also help increase both companies’ revenues by spreading the reach of premium movie channels throughout Latin America and the Caribbean.
Diaz predicts 30-35 percent of the 100 million households in Latin America will become pay TV subscribers in the next decade, making the potential pay TV market there worth more than $10 billion.
Rionda pointed out LAPTV’s revenues have jumped 22 percent a year over the last few years in a market that has been only growing 10 percent.
AEGIS executives are also hoping to increase their market value with the recent VisionNet alliance, which is said to be the first of its kind.
“This partnership was basically formed to address the marketplace,” said Collin Boyd, vice president of sales and marketing for AEGIS, which also has offices in North America, Latin America, Europe, India and the Asia-Pacific region.
‘Desire For Programming’
“Our customers in Latin America have a desire for programming that LAPTV provides. We needed some kind of technology that could protect the programming content. Part of the strategy is for the operator to get access to the technology and the content.”
D & #237;az said LAPTV , a partnership formed about seven years ago by Universal Studios, Metro-Goldwyn Mayer, Paramount Pictures, Twentieth Century Fox and SACSA, a Latin American media company in Argentina , will begin to rely more and more on technology partners to help bring TV entertainment to the masses.
“AEGIS has shown a great deal of sensitivity and flexibility in approaching the marketplace,” he said. “We’re so focused on the entertainment business. We cannot keep our focus on our efficiencies if we’re trying to develop (technology) capabilities in-house. So developing teaming arrangements is an important strategy for LAPTV.”
AEGIS President and CEO George Stathakis hopes to form similar cable TV and technology partnerships in other parts of the globe.
He said the future possibilities for digital technology are endless.
“We’re already seeing a number of possibilities multiply daily,” Stathakis said. “What we see coming to the marketplace is Internet services over broadband. We see that as a major delivery mechanism of content. What (LAPTV) brings to the table is content. That’s the most important asset of the equation.
“All signs point to this being a very successful relationship,” he said.