by Cory Barker
LOCAL OUTPUT
Netflix was aware that in order to gain acceptance in Mexico, it had to do more than translate its interface to Spanish language—it had to become more local in terms of content. Internet protocols are geographically sensitive. This enables Netflix to divide its feed and tailor the content for each country. Indeed, Mexico has its own Netflix feed, which features content that is not available in other countries of the region, and vice versa. This differentiation responds both to diverse tastes and to the “need to buy” rights for each country. Moreover, it is generally accepted that Mexico’s geographic proximity to the United States means that Mexican audiences have a taste for American film and television. More than 80 percent of movie theater screens present imported fare, most of it coming from the United States. American series (both comedy and drama) constitute a substantial part of the schedule in television channels devoted to entertainment as well as on cable and satellite systems.26 In spite of this visible preference for Hollywood productions, most Mexicans would prefer to watch national newscasts, sports, reality shows, comedy series, and telenovelas on the leading broadcast networks. Telenovelas are a very well established genre that garners large followings and the highest shares of overall television ratings.27
The preference for local content over foreign content of the same type and quality has been noted by media scholars, and theorized as “cultural proximity.”28 Generally, local audiences choose films and television programs that spotlight situations and characters closer to what they experience in their daily life, and not only that—they also want them to be told in their traditional, familiar narrative forms. Audiences apply a “cultural discount,” implying that they reject audiovisual products that are too distant to their own way of life.29
In terms of taste, scholars have considered Spanish-speaking Latin America as a “geolinguistic region” with certain shared characteristics such as language, ethnicity, history, and ways of life.30 As such, Netflix was forced to include some local, or at least Latin American, film and television beginning with its launch in Mexico. At the regional level, Netflix announced a deal with the NBC Universal’s Spanish-language broadcaster Telemundo in July 2011, which would provide 1,200 hours of programming per year, including hit series like La Reina del Sur (2011).31 In August 2011, Netflix made similar agreements with the Argentinean Telefé and the Colombian RCN, producer of the international success Yo soy Betty la Fea (1999–2001).32
In Mexico, the acquisition of local catalog content was achieved very early, by signing deals with such producers as Televisa and TV Azteca. These agreements were made public in May 2011, in preparation to the launch of the service in the country. Televisa would give Netflix non-exclusive access to 3,000 hours of catalog telenovelas and series a year after they had been broadcasted, while TV Azteca would provide another 1,000 to 1,500 hours of programming.33 Additionally, Netflix signed a contract with the Mexican indie studio Canana, producer of the successful series Yo soy tu fan (2010–2012), which previously aired on Mexican public television.34 With these deals in place, Netflix obtained access to a vast catalog of the most successful Spanish language telenovelas earning an excellent position to cater to the tastes of its new audiences.
Another step of Netflix’s adaptation to the Mexican market was executed in August 2014, when Netflix started offering an exclusive telenovela, Camelia La Texana, a narco story produced by the independent studio Argos.35 In the United States, this telenovela aired on Telemundo, but it failed to reach Mexican screens either on pay or on free-to-air television. For Netflix, it constituted a first attempt at product differentiation for the region, in its ongoing effort to lose the label of a mere aggregator of old titles. Meanwhile in 2014, Netflix acquired a slate of high-profile Mexican films like Cásese quien pueda (2014), Cansada de besar sapos (2006), and No se aceptan devoluciones (2013). Likewise, in March 2015 Netflix began streaming the political satire La Dictadura Perfecta, the highest grossing Mexican film of 2014, which, incidentally, parodies the relationship between the federal government and Televisa.
Offering exclusive local content was a logical move for Netflix, but in doing so, the company announced itself as a direct competitor to the established telenovela outlets, particularly Televisa and TV Azteca—both of which provided significant amounts of content to Netflix in Latin America. The breakup with Televisa would come after four years of collaboration. Following the launch of its second OTT service (Blim), Televisa announced that it would withdraw all of its content from Netflix in the last quarter of 2016, in order to strengthen its own strategy of cultural proximity.36
PRODUCTION OF LOCAL PROGRAMMING
The final step in the model of localization adapted from Chalaby is the production of original local content. Netflix positioned itself as a new distribution channel for local producers, but later it became a direct competitor for viewer attention, and eventually grew into a desired outlet for producers hoping to reach those viewers. On April 2014, Netflix announced the production of comedy series Club de Cuervos, created by Gaz Alazraki, the director behind the most successful Mexican film of recent years: Nosotros los Nobles (2013). The 13-episode Spanish language series was shot entirely in Mexico with an international cast from Latin America and Spain. It launched in August 2015, and renewed for a second season in October of the same year. The story revolves around a family that owns a soccer team, and while a dramedy, it offers clear melodramatic characteristics and even includes some classic telenovela subplots. Much of the humor stems from the sardonic depiction of the world of soccer, thus profiting from the high interest of Latin Americans for everything that has to do with the sport.37 Almost simultaneously in August 2015, Netflix launched Narcos, a series based on the life of the notorious Colombian drug dealer Pablo Escobar, starring Wagner Moura and directed by Brazilian José Padilha.38 This production is partly spoken in Spanish and includes an international cast of actors from Chile, Colombia, Mexico, and the United States. Finally, for 2016, Netflix announced new original productions based in Latin America: the Mexican political drama Ingobernable (2016–), starring Kate del Castillo, and the Brazilian dystopian thriller 3%, to be spoken in Portuguese, which deals with the issue of social inequality.39
The significance of Netflix’s original production in Latin American lies in its regional scope. It builds on the existence of a geolinguistic region that covers also the Hispanic population of the United States, thus ensuring large economies of scale for the company. Just as the Latin American media companies have been doing for decades, Netflix is producing Club de Cuervos and Ingobernable in Mexico, Narcos in Colombia, and 3% in Brazil knowing that these programs will be watched throughout the continent and, with some luck, around the world. In this sense, Netflix is very wisely creating series based on topics—crime, family, social inequality, and soccer—preferred by audiences of the region but which also have universal appeal.
The Importance of Localization
Despite its age, Chalaby’s model can be applied with some adaptations to study the entry of Netflix in Latin America; the case is a fundamental example of a global firm adapting to a regional marketplace. The general strategy for Netflix in the country and the region seems to be focused on increasing the cultural proximity of its offerings; at the same time, it continues to provide international and Hollywood content. This mix of local and global content is a general practice of Netflix in international markets. Ted Sarandos, Netflix’s Chief Content Officer, explained that programming is “around 15 percent to 20 percent local … with the 80 percent, 85 percent being either Hollywood or other international content. One of our first indicators that we are getting the mix right is how many hours of viewing people are participating in.”40 For Mexico, the mix seems to have been compelling enough, since in 2012 Mexicans were reported to be “watching more Netflix than their counterparts in the US, Canada, or the UK.”41
From this data comes a picture in which content has proven crucial for a successful regional expansion. Be
it in the form of careful selection of catalog content or the production of new original series, local/regional content is a key competitive advantage for Netflix in Latin America, just as the original series are for its domestic market. As I stated at the beginning of the section, culture could act both as a deterrent and as an enabler for the entry and evolution of a global player such as Netflix. Local culture is an initial deterrent because it demands adaptation, high initial investment in language translation (subtitling and dubbing), and the acquisition of catalog content that should follow local preferences in genre (e.g., telenovelas) and theme (e.g., soccer, narco stories). However, for a company like Netflix that employs sophisticated tracking tools used to identify the tastes of the viewers, culture can rapidly become a catalyst for further growth.
First, the existence of a unique language and shared cultural traits opens an opportunity to create content that could resonate in the whole region. In this sense, the decision to produce Club de Cuervos in Mexico comes from the awareness of the country’s standing as a traditional producer of endearing comedy series (e.g., El Chavo del Ocho [1972], El Chapulín Colorado [1972]). Narcos, on the other hand, builds on the recent tradition of hugely successful crime telenovelas from South America (e.g., Colombia’s El Cartel de los Sapos [2008]). After the initial learning curve, Netflix seems to have reached a level of knowledge about Latin American audiences that took decades for the regional leaders to build. The success of its Spanish-language programs, which were quickly renewed for second seasons, seems to prove this point.
Secondly, shared language and culture bring opportunities for distribution of series that are absent from the traditional television outlets either because they are considered too foreign (e.g., Spain’s El Tiempo entre Costuras [2013]) or too old (e.g., Colombia’s hit telenovelas Café con Aroma de Mujer [1993] and Yo soy Betty la fea). There are cultural implications stemming from the availability of this content simultaneously for the entirety of the Latin American region. It demonstrates the diminishing gatekeeping abilities of the local media incumbents, while on the other hand it raises questions about the changes in preferences and practices of the audiences.
Audiences
It should be noted that Mexico is a country with profound inequalities, so that Netflix is a service aimed at local elites: people from middle and upper classes who can pay for broadband Internet at home and for enabled devices (personal computers, smart television sets, video game consoles, tablets, and smartphones). Every piece of analysis regarding the changing habits brought about by systems of digital distribution in Mexico has to consider these social structures. In their recent work on the responses of traditional telecom operators to the entry of OTTs in Latin America, Juan José Ganuza and María Viecens assert, “In the short to medium term, it is expected that in LATAM, the OTT content that requires the high speed access networks will be limited only to reduced areas with consumer segments with high purchasing power.”42 Sinclair makes a similar point when discussing the two largest Latin American media companies. He writes, “The base of both Televisa and Globo remains their pre-eminence in free-to-air domestic markets in countries marked by severe income inequalities between the globalised elites and the common people, la gente corriente, who just love their telenovelas.”43 Hence, Netflix’s audiences have less to do with the massive audiences of the free-to-air national networks, and more to do with the clients of satellite television and cable systems as well as with the consumers of online piracy.
The next venue of exploration for Netflix in Mexico should be related to reception: who uses it, and for what? What are the new viewing practices? How has it altered the audience’s experiences of seriality in television (especially where melodramas are concerned)? However, at of this moment there is a lack of official sources on the matter since the company keeps all of its data confidential. Likewise, scholarship is equally undeveloped on this topic. Instead, I offer some personal observations that might point to general trends.
I was an early adopter myself, opening an account on launch day. I recommended it then to colleagues, who tried it but became disillusioned before the end of the one-month trial because they thought that the offerings were both scarce and aged (they were otherwise well served by pirate streaming and illegal downloading). In the four years since, I have received scattered accounts of Netflix use during informal conversation. I have heard of kids’ fascination with the huge availability of cartoons and Disney series, of housewives binge-watching old classic Mexican telenovelas and the Spanish El Tiempo entre Costuras (2013–2014), and of a couple (both older than 70) staying awake well into the night watching movies and series. I have seen my own parents enthusiastically learn how to use the interfaces of their Nintendo Wii and Apple TV to watch The Nanny (1993–1999), Café con Aroma de Mujer, and Cantinflas’s films from the 1960s. Nevertheless, I also know of a friend who had both Apple TV and Netflix but had to cancel the latter because he moved to an area not yet served by an Internet or cell phone signal. Finally, I have heard of high-income acquaintances that do not even know what Netflix is, because they are subscribers of premium satellite television (Sky). These disparate stories nonetheless suggest wider changes in the ways that Mexicans now conceive of and partake in access to television and film.
Brand Awareness
In the United States, Netflix has established its brand over an extended period, with DVD rentals and later as a distributor of streaming video content. However, in Mexico, Netflix was a completely new brand, not connected with the local entertainment imaginary. Given that only a minority of Mexicans has access to broadband, services such as Netflix still seem like a novelty to the general population. The company identified this reality very early. The letter to shareholders from the first quarter of 2012 explained that “while there is limited current OTT streaming competition in the region … this lack of OTT competition means that the concept of on-demand streaming video (outside of piracy and YouTube) is nascent, requiring us to do more work in driving consumer understanding and acceptance of our streaming service.”44 In order to increase brand awareness in Mexico, Netflix launched in 2014 the advertising campaign “Vive Netflix” (live Netflix), evoking the nationalist phrase “1Viva México!” The campaign consisted of three spots: Oribe, Abuelita, and Autobús. This campaign provides a glimpse into how Netflix presents itself to viewers outside of the domestic market and reveals which cultural traits it activates in order to become accepted in the new environment.
1. Oribe: Launched just after the end of the 2014 World Cup in Brazil, this spot features Oribe Peralta, a star of Mexico’s National Soccer Team. The spot plays with the conventions of thrillers. The popular player gives his wife a scare because he arrives home “too early.” When the wife notices his low spirits she cheers him up with the news that the second season of Orange Is the New Black is available on Netflix. This advertisement empathizes with the nation’s sadness after being disqualified from the World Cup in the heartbreaking match against the Netherlands; it also portrays a beloved soccer figure and at the same time points to both the original content and accessibility of the platform.
2. Abuelita One and Two: The first version of this spot is a wink to film fans. The camera follows a little boy on a tricycle that approaches the figure of an old woman sitting on an armchair in a clever spoof of both The Shining (1980) and Psycho (1960). When the point of view changes, the figure is revealed to be a sweet old woman, wearing high-end headphones connected to a tablet. She asks the boy if he wants to see cartoons and sits him on her lap so they can watch together. The protagonist of the spot contradicts the stereotyped image of Mexican grandmothers watching telenovelas on free-to-air television, while it simultaneously shows the ease of use of the Netflix platform for elderly people and children alike. The second version of the spot repeats the introductory part with the child approaching the rocking chair from behind; however, this time, the grandmother appears to be sleeping (with earbuds on) and does not react when the boy trie
s to wake her up. The kid runs away, thinking that she is dead—and only then does the grandmother wakes up smiling to continue watching House of Cards. Again, this second version humorously promotes Netflix’s original content and the use of the platform by the elderly.
3. Autobus: This spot focuses on mobility as a characteristic of digital delivery. The protagonist is a boy riding an urban bus and is exchanging glances and smiles with a beautiful girl. The boy gets off the bus but turns around suddenly, screaming: “Wait!” Then he starts running after the bus. The girl thinks that he wants to talk to her, but soon realizes that he has forgotten his cell phone, which is streaming a series. When the boy finally gets on the bus again, the girl is holding the phone in her hand. So, they both start watching Netflix together. The main idea behind this specific ad is affordability, emphasizing that young people that take the bus can actually pay for a monthly subscription.
