Isabel Rafferty, CEO & Founder at Canela Media, was interviewed by Nextv News Latin America and gave details about what will be the launch of Canela.TV, the company’s AVOD OTT, in the region, after its launch in Mexico, the US and Puerto Rico. In addition, the executive reported that the company plans to launch another ad-supported platform in September.
How did the initiative to launch Canela.TV come up and why was the AVOD format chosen?
Canela.TV was officially launched on May 19 last year, in the US. We saw a great opportunity there, since, as in Mexico and other Latin American countries, there are many very large media companies that have dominated the market for many years. In the US in particular, cable is very expensive and many people do not have access to that technology, and Latins who want to connect with their Latin roots have almost no options. Knowing that this was a problem, and that there was a lack of Latin programming to access cheaply, the idea of launching a streaming platform came up.
Something that happens in the US and many Latin American countries is that there is not such a high penetration of credit cards. 60% of Latin audiences in the US do not have access to credit cards, which is why they are very limited in the options to consume content via OTT. For that reason we believed it was very important to launch an AVOD model, to achieve greater access to that content. We saw the opportunity in the US, where there were already AVOD platforms that had performed very well in the market, but Latins were not being given importance, which is one of the most powerful sectors in the US. For this reason, we decided to concentrate our efforts 100% on them and give them free programming and different content than what they are used to. Literally, what has been watched in the US is pure Mexican programming, because Univision is part of Televisa. There is nothing wrong with Mexican programming, but it is important to have a variety of content because Latin audiences in the US is very diverse. We aimed at launching Canela.TV with that diversity, with free programming from Argentina, Colombia, Spain and other countries, and it has been a success, where we saw that the AVOD model was a model that was needed.
What were the main reasons for choosing Mexico as the first market to launch Canela.TV in Latin America?
We always had the desire to launch in Mexico, and we saw it as the first market to expand the company. We saw a great opportunity in that market, because we noticed similar situations to the ones we saw in the US. Mexican audiences have historically been fed by content from Televisa and TV Azteca, and have not had much demand flexibility. In the SVOD market, there are companies with a strong presence, such as Netflix and Disney+, but there is always the opportunity to have an AVOD as a complementary offer to those services, or to be offered as a service for people who choose not to pay for Netflix or who are looking for a different type of programming, other than what they are already used to consuming.
After a year of its launch, how has Canela.TV’s performance been in the US and Puerto Rico?
The launch of Canela.TV included the US and Puerto Rico in a first phase. The second phase was Mexico, and we will go forward to launch it in the rest of Latin America. We saw a great opportunity in the US at first, where we saw a greater willingness of brands to invest, which was important in order to strengthen the platform. In Mexico, the initial idea is to enter into market share, and we are building a very strong sales team there. Our desire is mainly focused on the growth of the audience, and that people get used to the service and like the content.
We plan to end this year with around 8 million active users in the US on the platform. We had a pretty good reception. In Mexico, however, we are even more impressed, because, on the third day after launching the Canela.TV app, it was ranked as the fifth most downloaded in the entire Android Store in the country, above Disney+ and Amazon Prime Video. Looking at the numbers we are achieving, we are realizing that the impact of Canela.TV in Mexico is going to be much more powerful than the one we achieved in the US. We have Mexican content in our catalog, but we are seeing a lot of interest in the international content offering, which shows the audience’s hunger for something different.
What strategy is planned at Canela Media to follow for the launch of Canela.TV in the rest of the Latin American countries?
The first step for the launch of Canela.TV in Latin America was our launch in Mexico, but we will launch throughout Latin America, and we will end up in Brazil, where we plan to launch between November and December. We decided to leave Brazil as the last market to launch in the region, because we are currently in the process of acquiring suitable content for that market, which will be offered in Portuguese.
What are the ways to access Canela.TV’s catalog? Is Canela Media in talks to join streaming devices or pay TV operators?
The Canela.TV app is currently available on Android, iOS devices; Roku, Amazon Fire TV, Google TV; and we also have FAST linear channels. We are also launching with some TV networks available in Mexico; and in the US we are available with brands such as Samsung, Vizio and Plex. We are pre-downloaded on all Vizio TVs; and in the process of being pre-downloaded on all Xfinity systems. We have a very aggressive distribution plan. When we launch in Latin America, we will available as a D2C platform, and we will work with some broadcasters to have the app free downloaded on some devices. We would be open to integrating the app into pay TV operator’s STBs, but it is not a common way of distribution for AVODs.
Are there possibilities to create a freemium model for Canela.TV?
We want our users to have no doubt that, if they enter our platform, they will be charged something or there is some content that they cannot access. We want them to know that the entire Canela.TV offer is free, and that there is no content that has an additional cost. We made the choice to be a 100% free platform.
With which Latin American content partners are you currently working and how is the platform’s catalog made up?
We have premieres available on the platform every Thursday, where we have between 10 and 15 premieres. We work with more than 98 producers, although the number is growing. Some of our partners are Atresmedia, Caracol TV, Polka, RCN, Cinepolis, and also small producers. We are currently bringing many Hollywood movies to our catalog, and we are in the process of launching several linear sports channels. We will bring more sports content, more content for children’s audiences, and we are working with production companies to launch originals in 2022. In addition, we have our own news in the US, and we have the desire to expand this initiative to Mexico. We do daily news from Monday to Friday, through a free newscast. We want to bring news to Latin America, and to all this is added that we will be launching a new platform in September, which we will announce soon, and it will complement Canela.TV’s offer.
Where will the new platform be launched? Will it be available in Latin America?
It will be launched initially in the US, and, a month later, in Latin America. It will also be an AVOD platform, and it will be a very different offer than the one offered on Canela.TV. It will be a very good complement for Canela.TV.
What linear channels are joining Canela.TV’s offer?
Users like how linear channels traditionally worked. Linear offering is growing very fast in OTT, because it is something that users are used to. Therefore, we are making a lot of efforts in the FAST (Free Ad Supported Streaming TV) field. We initially had one channel, and we are launching seven more. Our idea is not to offer a platform with 50 channels, but to have more ‘curated’ content, which is of interest, to offer more variety of content. Our initial channel includes soap operas, news, and movies. We will launch a specific channel for Hollywood movies; another for soap operas; we will have three sports channels; a channel focused on romantic movies and another for children’s audiences. We also plan to launch FAST channels on other platforms, such as Samsung TV+ and other providers.
What expectations does Canela Media have for the launch of Canela.TV in Latin America?
We already achieved what we expected. In Mexico, seven days after our launch, we achieved metrics that we expected to achieve in three months. The Mexican market has surprised us in a very pleasant way. I think there is a good opportunity for various complementary services that users subscribe to. We have a differential solution, and our content is different. Users are seeing it that way, and that is why we have had such a good reception in Mexico. We have never thought of this growth so fast. We have more products and innovations to launch this year, which will continue to fuel our platform and make it even more different from all the other products that are on the market. Users have got used to a high quality standard, which we must keep.