TIME EUROPE
May 1, 2000 VOL. 155 NO. 17
A TV Triumph
Broadcasters and producers join the Web and go global
By STEVE ZWICK Cologne
Zlatko trpkovski doesn't own any stock options in Spanish telecom giant Telefónica, but he may have done more to boost shareholder value than most of the 100 executives who cashed in options last year. His great accomplishment: getting royally rejected on German national TV three days after Telefónica bought Dutch production company Endemol Entertainment, the producers of the German version of the voyeuristic Big Brother, in which Zlatko took part. He had endured a month in cramped quarters with some of the most fascinatingly boring exhibitionists ever to capture the German imagination. Millions tuned in to the Big Brother TV show every night, and even more logged on to the website, to watch the five men and five women form alliances and cliques — some consummated under the sheets.
Every 10 days, participants nominated two of their number for expulsion from the group, leaving viewers to decide which one would go. When the popular Zlatko got the boot, 6,300 screaming fans turned up to watch him emerge from the compound. Now Endemol has given him his own TV show: Zlatko's World. This may be bad news for civilization as we know it, but it's good news for Telefónica, whose shareholders agreed to purchase Endemol for $5.3 billion — double the company's market capitalization in early February. The transaction is one of the latest to fuse formerly independent production companies like Endemol with companies like Telefónica, which fill a niche previously occupied by broadcasting companies. "We don't talk about production companies and broadcasters anymore," says Endemol spokesman Thomas Notermans. "We talk about production companies and platform providers. It's not about the 45 minutes or so [Big Brother is] on the air; it's about the 24 hours of continuous Web feeds and people tuning in around the clock."
With Telefónica, which owns broadcasters and Internet service providers throughout the Spanish-speaking world, Endemol can extend its proven ability to convert tacky ideas into multimedia gold around the globe via the Internet. Even before the merger, Endemol had agreed to produce the TV side of Big Brother for U.S. network CBS and Scandinavia's SBS Broadcasting.
The merger is not an isolated event. On the same day that Telefónica shareholders voted to buy Endemol, Germany's Bertelsmann and Luxembourg's Audiofina agreed to merge their jointly owned CLT-UFA, Europe's biggest broadcaster, with Pearson TV, one of the world's largest independent TV producers.
All these combinations mean longtime customers and clients are now parts of competing operations. CLT-UFA, for example, also owns RTL, Endemol's biggest customer in Germany. So far these existing relationships have remained intact. RTL says it has no intention of cutting itself off from the Endemol hit factory just because Endemol now belongs to a potential competitor. Notermans notes that the Spanish rights to Big Brother were sold to Tele 5, a direct competitor to Telefónica's Antena 3. "We have more to gain through Terra, Telefónica's Internet service provider, than we do through its broadcasting operations," he says. Likewise Zlatko's website promises to be a lot juicier than Zlatko's World.
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May 1, 2000
COVER
Zimbabwe in Flames
Robert Mugabe has kept his grip on power by manipulation and intimidation. Now, it's all spinning out of control
Voice of Protest
Despite a ban on radio play of Thomas Mapfumo's latest song hits, detailing the grim state that Zimbabwe is in, his album is a best-seller
Viewpoint
The hired thugs who do Mugabe's bidding are threatening to hold peace a hostage to autocratic power
EUROPE
A New Arms Race?
Once consigned to the cold war trash heap, a U.S. national missile defense system — if revived and deployed — could shatter key accords with Moscow and renew the arms race
The End for D'Alema
Italy's first ex-communist Prime Minister is crushed by center-right election gains
Innocent No More
After symbolic bombings in France, Breton nationalists claim a life at a McDonald's outlet
Viewpoint
Going for the throat is Vladimir Putin's style
BUSINESS
Nordic Pace-setter
Finland's Merita-Nordbanken leads the way in Internet and mobile phone banking
A TV Triumph
Broadcasters and producers join the Web and go global
FASHION
The Suit is Dead; Long Live the Suit
Bankers dressing like Internet executives create the biggest threat to the suit in 100 years. Can it survive?
DEPARTMENTS
To Our Readers
World Watch
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