English Articles > Written March 03, 1998
France Telecom acquires Miami-based Hero :
World's fourth largest telco expands in TV broadcasting and production.

Likely acquisition of Miami-based Hero productions by Paris-based France Telecom will provide an excellent base from which to develop broadcast services across the Americas, said Michel Combes, CEO of GlobeCast, the France Telecom's subsidiary that will take over 100% of Hero's issued and outstanding capital stock for an undisclosed amount after regulatory approval and a definitive purchase agreement are cleared.

"The purchase of Hero productions is part of GlobeCast's strategy to expand its commerce with the burgeoning Latin America market", Mr. Combes said. "Miami is in an ideal location to benefit from the new awareness of the substantial consumer market for Spanish-language programming, transmitted from the US to Latin America, or vice versa," said Robert Behar, president of Hero Productions. Mr. Behar founded Hero Production in February 1992 and will remain CEO of the company after its sale to France Telecom.

Six years old Hero made $18 million in 1997
Hero Productions operates in the very technical field of television broadcasting and production. It describes itself as a full-service international teleport and television production facility offering production, post production, mobile production, language conversion, master control and transmission services, as well as capacity on domestic and international transponders. In a more colloquial language, the main business of a teleport consists of using a huge satellite dish to transfer images to a satellite for a local TV producer or from a satellite for a local TV network, a spokesperson for Hero Productions explained. Hero has 21 professional satellite dishes - 8 transmitters and 13 reception antennas - with the five largest antennas sporting a diameter of more than 30 feet.

Hero is a tenant on major TV satellites, such as PAS III, Intelsat or Hispasat, which means it rents transmission channels on an ongoing basis and sublets them to its clients, including the Discovery Channel Latin America, GEMS Television, HTV, TeleUno, Travel Channel Latin America or TV Filme. The production side of Hero's activities is closer to the traditional movie production business. It consists of supplying studios, cameras, audio consoles, edit bays and other movie tools to TV producers who want a turn-key service. This type of clients include TeleCompras Shopping Network, a 24-hour Spanish-language home shopping service.

GlobeCast subsidiary gathers global offerings
Hero Productions has been very successful in running its business. After six years of operating, the company has reached revenues of $18 million in 1997 and employs 105 people. Part of that success relied on the partners' background. Mr. Behar began his broadcast career in 1970 as master control operator, founded Hero Communications as a satellite equipment company in 1978, started Hispanic Broadcasting Company in 1986 and sold it the next year to Telemundo Network where he held the job of COO and turned the company from an 18-person to a 300-staff operation in five years. Daniel Sawicki, a chemical engineer and business administration bachelor from Buenos Aires, joined Hero Communications as a controller in 1986 and grew the sales more than seven fold from $1.6 million in 1986 to $12 million in 1992.

France Telecom, which is the world's fourth-largest telephone company - with revenues of FRF 156.7 billion in 1997, or about US $26 billion - has 35 years experience in broadcasting. But it has only incorporated GlobeCast last year to gather all its international subsidiaries into what it claims to be "the world's first and only global communications provider for local, regional, around the world and multi-domestic broadcasting. The trend towards a global broadcasting marketplace allows broadcasters to expand their operations and target new audiences in markets which were traditionally off-limits for economic or regulatory reasons," said Mr. Combes. "France Telecom's goal is to establish itself, through GlobeCast, as the number one worldwide partner for the broadcasting industry," a corporate release states.

20% marketshare by the year 2000
GlobeCast actually started as a combination of the France Telecom broadcast services worldwide transmission department in Paris with the recently acquired Maxat in the UK, California-based Keystone Communications Corp. and Telepuerto Internacional de Buenos Aires, a joint venture with Keytech, the leading video transmission operator in the region.With 30 teleports worldwide last year, GlobeCast was the number two signatory on Eutelsat and the number four on Intelsat. Its combined revenues from broadcasting services were about $1.3 billion in 1996 and the group claimed a 10% marketshare of the world's broadcast transmissions and 15% of the world's broadcast feeds. "The goal set by France Telecom is to capture 20% of the world's contribution feeds by the year 2000," a company spokesperson said. Telecom's ambitions and deep pockets are apparently warmly welcome by Hero Production's Mr. Behar. "We are delighted to become part of the GlobeCast ream, and are sure that our clients will benefit from the expanded base of services offered by this global telecommunications and broadcasting company," he said.

Gilles Pouzin