Technology

Brazilian government changes pay television regulation in order to benefit streaming and new business models

According to Valor Econômico, an expert of the Brazilian economic team said that if the law doesn't change now, regulation could come too late

Brazilian government changes pay television regulation
  • The Brazilian government decided to reduce regulations on the pay television industry in the country
  • If approved, the new policy will allow those telecom companies to attract more subscribers by producing exclusive content and buying the rights of event transmissions directly

The media and entertainment industry has completely changed after the boom of streaming channels. In Brazil, traditional pay television channels lived its gold year in 2014 with 19.5 million of users, although the number of users have gradually dwindled over the years. Currently, there are 16.7 million pay television subscribers in Brazil. Meanwhile, Netflix announced it has a total 27 million subscribers in the country as of June of 2019. 

That’s why the Brazilian government decided to update the regulation in the media and entertainment sector, doing away with some old restrictions in the Brazilian pay market. The current law in Brazil doesn’t allow for the cross-ownership between companies that spread their content among subscribers – in Brazil, the telecom companies –  and those who produce or sell the TV programs, such as TV stations or producers. This law also put restrictions for telecom companies to buy the rights of events, programs or hiring artists directly. 

Under current regulation, telecoms in Brazil can operate in the selling process of paid TV, but they are totally dependent on the content offered by their partner channels and are not allowed to attract more subscribers with exclusive productions or buying directly a transmission of specific events, for instance. And this is exactly what the government wants to change. 

The proposal for changing this scenario was finalized by the government’s economic team and depends on the technical approval for it to become an official statement, but the main goal is to break the barriers of the current difficulties that new media business models have in growing in the country. 

The expectation is that the new regulation could put Brazil at the same pace as the global market in a matter of audiovisual new business models.