Mexico City -- Mexican media giant Grupo Televisa S.A. will
pull the plug May 1 on its partially owned financial-news channel, Conexión Financiera.
"The reason for the closure was financial," said
the channel's director, Eduardo Torreblanca Jacques.
When it launched in April 1997, the channel was given five
years to hit operating breakeven, he added. But with fiscal discipline being the order of
the day at Televisa, the decision was made to shut the channel down only two years after
Distributed largely in Latin America, Conexión Financiera
is the second Spanish-language news channel to bite the bullet in that region. NBC closed
its Spanish-language news channel, Canal de Noticias NBC, in early 1997.
News of Conexión Financiera's closure followed press
reports that Televisa had already severed ties with its joint-venture partner in the
channel, Spanish publisher Grupo Recoletos, which is part of British media company Pearson
Last year, Televisa and Recoletos intended to jointly own
Conexión Financiera by each taking a 50 percent stake in a new company called Expansión
Financiera that would own the channel. However, the joint venture broke up before the
company was officially established.
Torreblanca attributed the breakdown to a lack of
understanding between the partners over the concept of the channel, as well as to more
nitty-gritty issues, such as budgets.
"Our Spanish partner never wanted to build a global
signal, but you have to play in global terms," he said.
Recoletos officials couldn't be reached for comment,
but Torreblanca described the split as amicable. "It was a gentleman's
agreement," he said.
Conexión Financiera has news bureaus in Mexico, with a
staff of 100; in Spain, where 60 are employed; and in New York, with a staff of five.
Only 12 of the channel's staff in Mexico will continue
with Televisa. They will be integrated into its 24-hour pay TV general-news channel, Eco,
where Torreblanca will assume the position of director of financial information.
Televisa has invested some $15.5 million in Conexión
Finaciera, Torreblanca said, including the $7.5 million that it cost to launch and run the
channel in its first five months of business.
This may represent a sliver of Televisa's overall
expenditures, but nevertheless, it underlies the spirit of fiscal discipline resonating
throughout the entire company, said Christopher Recouso, a Latin media analyst for Bear
Stearns & Co. in New York.
"At Televisa, you are not seeing such expansive media
projects ... It is a function of [chief financial officer Gilberto] Perez Alonso's
discipline," Recouso said.
Business news is also a notoriously costly programming
genre, pointed out Peter Kosann, manager of international media distribution for Bloomberg
"It is expensive to do business news, and in Latin
America, you have to take a long-term approach," he said.
Although it is a decade old, Eco is still struggling to
reach operating breakeven.