Capturing opportunities in Latin America FIPP Conference May 2003 Paris, France Eduardo Michelsen

1.Latin America is a very attractive market with interesting growth. Nevertheless, it is unstable, dynamic and highly heterogeneous within itself. 2.Only a few players have been able to penetrate and consolidate regional leadership with a targeted portfolio offering. The largest is Editorial Televisa 3.The key factors of Editorial Televisa´s market success are: Relevant mix of regional and local content ¨Glocal¨ marketing strategy and execution Pan regional and local advertising sales and support teams Influencing distribution at a block level Very flexible cost structure 4.A new entrant must evaluate if these factors can be acquired or developed. If not, an association is the safest bet. MAIN MESSAGE

Latin America is an attractive consumer market USA EuropeLatin America USA 3.0 EuropeLatin America It has the size... Population (M)...and grows at least as fast as developed regions despite local crises.... GDP (%) Source: World Bank Group 2001 *Does not incude Brasil Source: Arithmetic average for years 1997, 2000, 2001 World Bank Group

While consumer market has still room to grow, advertising expendeture growth looks good USA 90 EuropeLatin America 95e 86** ,045 Although reader penetration is still low Household reach of monthly magazines (M) Heavily concentrated, rapidly growing ad market Advertising Investment US$ (K) * Mexico Source: Zenith Media, FIPP 32* Source: IFS; Zenith, Optimedia ** Argentina CAGR 11% Other Colombia Argentina- Chile Mexico

LATAM GDP Growth Index (x USA) USA Mexico Argentina Venezuela Colombia The region however, is very volatile and dynamic Source: Zenith Media, FIPP

The region is currently and for the upcoming years undertaking deep political change (hopefully for growth) Mexico Argentina Colombia Venezuela Other The largest most stable and fastest growing country in the region elected almost 2 years ago the first non PRI president in over 70 years. Has had 5 Presidents and 7 Economic Secretaries in the last 4 years. Note, 2 of them lasted less than 1 week. Extreme right / left outlaw militia groups controlling significant drug business, currently at war with legitimately elected government Current extreme leftist military government confronting crescent internal opposition inside and outsie the country At least one “Coup des etats” in the last 20 years in: El Salvador, Ecuador, Guatemala, Nicaragua, Panama, Peru and Paraguay

1.Latin America is a very attractive market with interesting growth. Nevertheless, it is unstable dynamic and highly heterogeneous within itself. 2.Only a few players have been able to penetrate and consolidate regional leadership with a targeted portfolio offering. The largest is Editorial Televisa. 3.The key factors of Editorial Televisa´s market success are: Relevant mix of regional and local content ¨Glocal¨ marketing strategy and execution Pan regional and local advertising sales and support teams Influencing distribution at a block level Very flexible cost structure 4.A new entrant must evaluate if these factors can be acquired or developed. If not, an association is the best bet. MAIN MESSAGE

Mexico, US Hispanic, Colombia, Puerto Rico and Venezuela are the top markets Adspend Large Small SMALL ABC+Population ARGENTINA CHILE PERU ECUADOR VENEZUELA COLOMBIA US HISPANIC MEXICO CENTRAL AMERICA BPU Large P. Rico Source: Zenith Media, FIPP