Globoplay succeeds to halt Globo declining TV revenues

In 2018, Globo initiated a reorganisation project. Despite its size, Globo was traditionally structured as a local media company rather than a global digital player. This project merged its various entities—TV Globo, Globosat, Som Livre, Globo.com, Globoplay, DGCorp, and other divisions—into a single company, ‘Globo’. Also, the Brazilian TV major entered the streaming battlefield in 2015 with the launch of Globoplay, its SVOD service.  Facing increasing competition from other platforms for viewership and subscriptions, what is the five-year outcome of Globo’s strategy and Globoplay’s position? Is the group’s plan to address declining revenues from linear television working? Globo still accounts for 60% of TV networks revenues in Brazil FTA television has historically had a very high penetration in Brazil and reached 49m households in 2023. In this context, Grupo Globo has been the most dominant media group in Brazil in the last decades. In 2023, Grupo Globo's share reached almost 60% of total TV networks revenues in Brazil, slightly declining from 63% in 2018. With total TV networks revenues down in 2023 vs 2022 in Brazil, media groups redirect their content investments to OTT. The other local networks SBT, Grupo Banderaintes and Rede Record come far behind, while the US networks Disney and Warner, who both invested intensively in their OTT services in the last year, keep a stable share of the TV business. Among other networks, US-based studios such as Paramount, A&E or Sony Pictures only generated a few millions of USD on television in Brazil. OTT subscriptions revenues now top 10% of Globo’s revenues With revenues over 4 billion USD in 2017, Globo relied mostly on its linear activities that accounted for 87% of its revenues with FTA advertising boasting half of the groups' revenues. Grupo Globo's linear revenues started decreasing before the pandemic. Globo owns a portfolio of several FTA and Pay TV channels (Canal Brasil, Canal Off, Globo, Globo News, GNT, Gloobinho, Megapix, Viva Brazil…) and therefore accounts for half of the total Brazilian Pay TV affiliate revenues.  The media giant also owns several Premium Sports Packages and OTT services.  Over the past six years, Globo's reorganization and digital strategy has led to notable changes in its revenue distribution. OTT subscription services now just make up 10% of its total revenues, while OTT advertising revenues remain under 1%, similar to Pay TV advertising at less than 2%.  Still, the group showed positive growth in 2023, with total revenue reaching $2.73 billion, approaching pre-pandemic levels. With OTT, Globo has added a D2C layer that compensates the decline of the traditional advertising and affiliate-based business and enters the top 5 of video groups in Latam in terms of revenues. Globoplay: the local champion competing with US streamers Behind...