NBC Universal's Spanish-language Telemundo television network and Mexican broadcasting powerhouse Grupo Televisa are expected to announce a programming sharing agreement today that could lead to a closer alliance between the two.
Televisa would be allowed to run Telemundo programs on one of its broadcast networks in Mexico as well as a separate cable channel, according to people familiar with the deal. That would give NBC Universal an important distribution outlet for its programs and a potentially lucrative source of new revenue. It also would help expose Telemundo's shows to Mexican viewers, some of whom might eventually migrate to the U.S. and become a part of Telemundo's audience here.
The deal marks a change in strategy for NBC Universal, which is owned by General Electric Co. It had been hoping to launch a third broadcasting service in Mexico to distribute its programming, but Mexico's political leaders have said that there would not be a new broadcaster in the nation any time soon.
Mexico's airwaves are dominated by Televisa and TV Azteca.
The agreement, first reported on the Wall Street Journal's website, also is noteworthy because Televisa has been trying to end its long-term programming deal in the U.S. with Telemundo's chief rival, Univision Communications Inc.
Televisa's arrangement with Telemundo signals that Televisa, Mexico's largest entertainment company, might be looking for life in the U.S. beyond its partnership with Univision.
Televisa had been a minority owner of Univision for nearly 15 years. That came to a close last year, when a group of private investors, including Los Angeles billionaire Haim Saban, acquired Univision in a $12.3-billion deal that took the company private.
The new owners of Univision offered to let Televisa keep a minority stake in the company, but Televisa declined.
Eventually, Televisa would like to grow its presence in the lucrative U.S. Spanish-language television market and could see Telemundo as a more beneficial partner than Univision.
Televisa, however, is still tethered to Univision by a programming agreement in the U.S. that expires in 2017. Until that time, Televisa must provide its hugely popular telenovelas, or soap operas, to Univision. Those shows fuel Univision's gigantic prime-time ratings.
The programming agreement with Univision has long been a source of tension. Televisa executives have felt that Univision does not compensate the Mexican company for the full value of its shows. Televisa has sued Univision to bring an immediate end to that contract, and that trial is expected to begin next month in Los Angeles.