Class,pay TV access and Netflix in Latin America: Transformation within a digital divide

Abstract

In the context of international flows of media products, this article offers an exploration of pay TV and the prospects for streaming television usage in the Latin American region. Based on audience preference data gathered by Kantar Media, the article offers an overview of how the pre-Netflix era looked like in the region. Drawing on the theories of cultural proximity and cultural discount, our results suggest that the international nature of Netflix programming is of particular interest and appeal among the upper middle class and elite, who have the cultural capital to enjoy and appreciate it. The findings also indicate that access to streaming television is hampered by a new digital divide, based in both age or generation, class and geography, which will limit the extent to which services like Netflix will disrupt broadcast and cable/satellite television.

Keywords

Pay TV Netflix Latin America social class

Introduction: From fear of flows to class-based flows and their social impact

The international flows of media products (such as film, television, news, comics and music) and their possible impacts on other cultures have been a source of fear for the receiving countries since at least the 1970s. The flows of television in particular, which was the most rapidly emerging medium of the time, was one of the most prominent issues in the New World Information and Communication Order debate in UNESCO in the 1970s. People feared the ideological impact of media from other cultures, such as the increased acceptance of consumer capitalism and the desire to be part of the middle class (McPhail, 1989). They feared, in a more abstract way, that the large flow of media products from the United States would lead to an Americanisation of their cultures and a homogenisation of other cultures to resemble America or Europe (Ritzer, 2004). This was part of a wave of concern centred on the idea that US-dominated media flows were part of a larger cultural imperialism, which also included a turn towards global capitalism. These concerns were linked to the spread of more commercial media systems supported by advertising (Janus, 1983), the support of consumer lifestyles (Dorfman and Mattelart, 1984), as well as a movement towards absorbing and copying US culture (Hamelink, 1983) and the loss of cultural and political autonomy (Schiller, 1976).

When it comes to television as a cultural product, much of the fear of uneven global flows has been linked to new waves of television technology at key junctures over the years, from 1950 to now. The licensing and sale of US television programmes to other countries, beginning in the late 1940s to early 1950s (Kackman, 2008), triggered much of the debate in UNESCO. A UNESCO study conducted in 1973 demonstrated that over half the TV programmes airing in most countries originated in the United States (Nordenstreng and Varis, 1974). Debates about the prospect of direct cross-border satellite television transmission to homes in the UN started in the 1950s, well before it was a real technological possibility (de Sola Pool, 1979). Both global and regional flows of television expanded tremendously in the 1980s–present, as satellite TV and cable TV both proliferated in most countries around the world (Barker, 1997). Although much of this was US in origin, other programming including European, Japanese, Korean, Indian, Brazilian, Mexican, Egyptian, Lebanese, Turkish and others also expanded into the world via satellite (Sinclair et al., 1996; Straubhaar, 2007).

Currently, the most recent wave of global TV flows consists of those distributed via the internet, with the popularisation of platforms such as YouTube, video over social networks like Facebook and subscription video on demand services, such as Netflix. With the so-called new golden age of American TV (Damico and Quay, 2016) flowing out into the world on these platforms, to what extent do they represent a new form of media imperialism, in the sense of renewed or even increased US dominance of TV flows? Or should we see it as a new form of globalisation of TV, or a complex new transnationalism (which will be defined below)? This article aims to examine this overall question by paying special attention to the Latin American region, using audience preference data gathered by Kantar Media for multichannel TV. The analysis of this data allows us to depict how the pre-Netflix era looked like in the region and come to conclusions as to how the future of Netflix’ potential disruption of existing television systems may be somewhat limited there by lack of infrastructure and access, by limits of cultural capital and by the continuing strength of cultural proximity (Straubhaar, 1991).

Another interesting question is how the eras of television technology have differed in Latin America and how that affects the current impact of these platforms in the region. In the context of the United States, Amanda Lotz (2007) identified three periods of significance while looking into the production components: first, the network era (1952 to mid-1980s), where a few broadcast programming options available were consumed through the TV set. That era has lasted much later in most of Latin America, where the main broadcast networks still hold much of the audience (Straubhaar et al., 2016). Second was the multichannel transition in the United States (mid-1980s to mid-2000s), when both technological developments and the emergence of new TV channels expanded viewers’ choice and control. That era came much later, with much less impact, in most of Latin America. In most countries, until the 2010s, it affected only the upper middle class and elite. The third television era for Lotz was the post-network era (mid-2000s to today), when the viewer assumes more independence and television consumption expands into new platforms, largely on the internet. Almost a decade later, Lotz recognises that those three periods are ‘rough periodizations without exact starting and end points’ (2016: 127). She also argues that the concept of ‘post-channel’ would have described better the two main characteristics of the third period, that is, ‘textual innovation introduced by original, scripted cable series and the technological capacity for nonlinear distribution’ (Lotz, 2016: 125). This third era in Latin America has arrived relatively more quickly, since Netflix targeted the region as its first major area for international expansion. However, it still targeted only the upper middle class, those who have the broadband internet access, the money and the cultural capital, linked to a certain sense of taste (Bourdieu, 1984), to get access to it and enjoy it. As we will show, this period can hardly be called ‘an era’ as the changes are still highly restricted in their effective reach by social class and the geography of infrastructure and access. Indeed, we will argue that the television eras and services, including the new Netflix era, are much more divided and restricted by social class and access to infrastructure in Latin America than in the United States or the global north. These technological and socioeconomic frames shape the context into which Netflix and previously satellite and cable emerged in Latin America. This limits the degree to which Netflix can disrupt the overall system of television in Latin America, but it can and probably will continue to disrupt the way that upper middle classes and elites consume television, which is a significant disruption in itself, particularly since these are still the classes most pursued by a variety of advertisers and media.

A series of social factors related to preferences for national, regional or US television programmes and channels affect the flow of programming. One key framework is the historical development of a generalised preference for local or national television, often referred to in the context of two related theories, cultural discount (Hoskins et al., 1989) and cultural proximity (Straubhaar, 1991). A competing framework to explain why people still like US, European and other television programmes from beyond their immediate geographical region comes from the ongoing development of a set of human capitals that also affect cultural and media preferences: cultural, economic and linguistic capitals, as theorised by Pierre Bourdieu (1984, 1986, 1991). These frameworks help explain preferences in Latin America for national, regional or US programming, which will affect Netflix’s strategy and decisions about whether to rely on US programming and to offer more transnational programming from Europe and Asia, or to emphasise local/national or regional programmes, that it might either acquire, produce or co-produce.

This article revolves around the following three research questions: What are the emerging audience preferences for national, regional and US programming in the metropolitan regions of eight major Latin American countries? To what extent do cultural proximity and cultural discount allow us to explain and theorise those viewing preferences? What limits are placed by economics, access to the internet and internet infrastructure on platforms such as Netflix’s evolving strategies in the region?

Prior to present the empirical results, the next section presents an overview of the key theories this article draws on.

National TV and cultural proximity

While a study by UNESCO in 1973 found a very unequal television flow dominated by the United States, national television production by domestic networks was growing rapidly in a number of the countries with the best developed TV industries: Brazil (Straubhaar, 1984), Mexico and other Latin American countries (Antola, Rogers et al. 1984), Japan (Ito, 1990), Hong Kong (Curtin, 1999), South Africa, Egypt and other developing countries. This challenged two key tenets of cultural imperialism: that the United States and other core countries (Wallerstein, 1979) would dominate flows (Boyd-Barrett, 1977) and that their firms would tend to dominate less developed countries’ systems (Schiller, 1976).

The empirical support for these theories was complex and mixed. On one hand, more and more countries began to present commercial media reliant on advertising, which cultural imperialism predicted. On the other hand, these countries also tended to make more of their own television programmes (Antola, Rogers et al., 1984; Straubhaar, 1981), which cultural imperialism did not predict.

This upsurge in national production started in the 1970s, gradually spreading to other medium-size or even smaller countries in the 1980s and 1990s (Sinclair et al., 1996). This has led a number of the scholars (cited above) to question the extent to which unequal flows of television from the United States were really challenging national cultural production. A new wave of research noted that production costs had dropped, production technology was cheaper and easier to use, local genres like telenovelas were developing in regions like Latin America, local/national writers, producers and stars were developing and audiences seemed to respond better to locally produced programmes (Straubhaar, 2007, 2009).

Efforts to theoretically understand the evolving preference for national versus imported television remain as relevant today in understanding the slow growth of cable TV in Latin America and in trying to understand Netflix’s strategy in the region. Two major lines of thinking evolved in the 1980s–1990s, which reflect and support each other: the cultural discount and cultural proximity. The cultural discount approach argues that audiences come to discount or select against programmes in languages and cultures that are unfamiliar or less interesting to them (Hoskins and Mirus, l988). Conversely, cultural proximity, similarity and relevance led audiences to tend to prefer national television programmes (e.g. telenovelas in Mexico and Brazil) over foreign productions (Straubhaar, 1991). The idea of cultural proximity is based on the higher relevance of national or regional topics, themes, news mentions, shared history and various other aspects of topicality and locality. It relies on recognition of jokes, stars, ethnic types, land and cityscapes, as well as various indications and symbols of day-to-day life. It led audiences to prefer national TV programmes, especially telenovelas, sports, music, comedy, variety shows and news.

There is a second aspect or layer of cultural proximity, that is the attraction of regional or cultural linguistic-based programming to national audiences, so that even though a Brazilian show might have to be translated from Portuguese to Spanish for Chilean audiences, because of linguistic, historical, cultural, ethnic and other similarities between the two Latin American countries, it will likely seem more proximate or relevant to the Chilean viewer than a show from China or even the United States. However, this regional cultural proximity seems very dynamic and subject to both interaction and change over time in how countries in a region relate to each other.

Technology can also either enhance or reduce the impact of cultural proximity. Much of the relevance of cultural proximity theory for East Asia, in particular, had to do with the expansion of satellite and cable TV in the region, which began to increase the number of accessible channels from other parts of Asia, which rapidly became popular (Sinclair et al., 1996). For instance, the remarkable popularity of Japanese programmes and channels in Taiwan, where satellite antennas could pick up Japanese signals directly (Iwabuchi, 1997). In Latin America, the impact of regional cultural seems to have been highest in the broadcast, when countries that could not afford to produce expensive shows like scripted comedy or telenovelas tended to import them from other Latin American countries. In contrast, first cable and satellite television, then streaming television, has predominantly brought in a much larger volume of US shows, to which Latin America audiences have responded positively (Straubhaar et al., 2016).

The cultural proximity theory would predict, empirically, that television audiences, particularly in regions like Latin America, which has had a fairly strong regional market in television programming since the 1970s–1980s, ought to show a preference, first for national programming, because those would be the most relevant and attractive shows in cultural terms (Straubhaar, 1991). At least hypothetically, then, their second preference might well be for programming from within their region, since it will show similarities of historical experience, religion, ethnicity and various aspects of culture (Straubhaar, 1991). In contrast, how high are the audience’s preferences for US or European programming? We will examine this question empirically, using audience preference data from Kantar Media.

Methodology

This article uses data from Kantar Media, particularly data from their Target Group Index, a syndicated survey conducted in eight Latin American countries. TGI respondents answer questions about lifestyle, product consumption and media habits. TGI has been in the market since 1999 and all data sets can be trended. The analysis presented in this article focuses on data from 2004 through 2014, which covered major metropolitan areas, not true national samples, in eight countries in Latin America: Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Peru and Venezuela. Although the total number of respondents for all eight countries was 61,300, which represent a universe of more than 185 million people in the region covered, we have to remember that we focusing on the major metropolitan areas and rural less-populated areas may behave differently. The sample design guarantees representation of the universe of the study: people 12–64 years of age in urban centres. (They do collect data on people over 65, but their sample is optimised for audiences 12–64, and the populations of these countries are younger on average than in the United States.)

For each country, a multi-stage stratified probability sample was projected to represent the total household and individual population. With the exception of Mexico, where the sample represents 28 cities across Mexico, most of the samples are limited to a few major metropolitan areas – 10 (nine major cities + Campinas) in Brazil, far fewer in most other countries. This is important because people in major metro areas are richer, better educated and more connected to a variety of communication technologies than the national general population. For example, in 2012, 64% in the Kantar metro sample in Brazil had access to the internet, while the number in the general population was 44%.

TGI Latina surveys are conducted door-to-door, with a combination of personal interviews and a paper survey left behind by the interviewer to be retrieved later. Interviewers followed a skip pattern for sampling based on the physical location of respondents’ homes. The skip pattern in the upper class neighbourhoods may be higher than the lower SES levels, where the response rates are generally higher. SES gathers TGI Latina samples disproportionately within the region. These disproportionate rates are adjusted properly in reporting the data by weighting mechanisms. In order to properly analyse the higher SES level are over-sampled and therefore, an under-sample of the lower class areas. This is created in order to have a robust sample size for analysis per social class. The weights applied in the TGI Latina survey are proportionate to the last national census or growth estimates in order to represent the overall population within each market.

Limitations

These findings are limited to the characteristics of the data collection. First, the sample is based on cable and satellite subscribers in major metro areas, not general national populations, as noted above. Second, in order to have access to the data, we had to utilise the analytical programmes of Kantar Media, which essentially limit us to cross-tabulations with significance analysed by the χ ² statistic; more advanced statistical procedures and measures were not performed in Kantar’s system. Third, because of the large sample size and our need to rely on cross-tabulation, we run some risk of Type I error here, finding false positives in significance due to our large sample (61,300).

Results

Satellite/cable TV and regional/global audience preferences

In Latin America, the pay TV expansion was more limited in Latin America than in other parts of the world. Some of the resistance to satellite and cable TV came from political reasons: some national political parties were allied with national broadcasters, such as the overt alliance of the ruling PRI party in Mexico with Televisa, which included former presidents among its owners (Sinclair and Straubhaar, 2013). Relatedly, some governments, like the military regimes in Brazil (1964–1984) preferred to see national programming to reinforce national identity (Mattos, 1982). More resistance came from the industries where the dominance of strong broadcasters with political influence held back legislation that would foster growth of competing pay TV interests. Even more important were economic reasons: poor economies with unequal distribution of wealth saw not many people able to afford pay TV on cable or satellite (Reis, 1999).

Demand for cable or satellite TV in Latin America was also simply not as high as in other parts of the world. Penetration of pay TV in Brazil was only about 12% in 2004 (see Figure 1), much lower than most comparable countries. This lack of interest in cable TV characterised much of the region. Significant exceptions were Argentina and Colombia, which have historically had much higher audiences for cable and satellite television, due to government policies that stunted broadcast networks at the moment that cable was coming in (Sinclair and Straubhaar, 2013). For example, in Argentina, cable TV was already well established in part by nationalisation of the dominant private television networks by both the military and Peron governments from 1974 to 1984 aimed at limiting their political power (Silvestri and Vassolo, 2009). While broadcast networks were greatly diminished, new networks and independent producers expanded via cable TV in the country, which remained popular among audiences even after the return of broadcast networks. In the case of Colombia, broadcast television networks were also limited by government, which leased out time on networks it owned to television producers, who arranged their own advertising (Fox, 1975). Figure 1 shows that cable/satellite TV penetration in those two countries was much higher than the others in 2004.

Figure 1.

Multichannel TV in metropolitan area homes by country, 2004–2014.

To some degree, this limited adoption of pay TV defied the logic of economic growth, as the slowly building middle class in the region between the 1970s and the 1990s could probably have afforded cable television (Ferreira et al., 2012). One hypothesis in this era was that nationally based programming on the broadcast networks in Latin America was so attractive – partially in terms of cultural proximity – that national audiences felt no need to pay what were often substantial sums (upwards of US$50 a month for cable subscriptions), or to acquire a VCR as another means of supplementing national TV. This was an unjustifiable economic burden for many people because their interests in a variety of things including fictions, sports, music and comedy, among others were met by national broadcast television (Boyd et al., 1989).

In the 2000s, satellite and cable TV had finally begun to grow in the Latin American region, bringing in many more US television channels and programmes, increasingly dubbed into Spanish and Portuguese. Figure 2 shows Latin American TV viewing preferences according to the origin of their favourite TV show and film for 2014.

Figure 2.

Latin American TV viewing interests by country or regional origin of their preferred television and film programming, 2014.

For the average of all eight countries in the TGI Kantar media survey in 2014 (the left-hand columns), Figure 2 shows that an average of 59% of domestic audiences across the region prefer domestic programming. That shows that national level cultural proximity is still at play even in the era when far more people, particularly in the metropolitan centres that the survey covers, have access to cable TV, satellite TV and internet-based television. Only in Peru did more people prefer US television to national.

More startling, the survey shows that the secondary preference is for US programming (52%, the average of the national preference in the eight countries). The preference for regional programming is at a much lower level (31%). Furthermore, the average preference for regional programming at 31% is only slightly higher than the preference for European programming at 30%. So it seems that, at least in these Latin American countries, which are the largest and best developed, cultural proximity to the national and a strong preference for US programming has overcome secondary cultural proximity to regional programs. That will require serious theoretical re-thinking.

Figure 2 also shows that this pattern is slightly irregular in certain countries such as Mexico, where the relative preference for national programming is somewhat greater: 68% as opposed to 51% for US programming. In Peru, preference for US programming at 58% is actually slightly higher than preference for national programming at 55%. This may reflect its status as a smaller, less affluent country with less fiction production than many of its neighbours. The other anomaly to the general pattern is Venezuela, where both national fiction and regional fiction are preferred at a lower level of 44%, but still higher than American fiction, at 35% and somewhat higher than European fiction, at 41%. This atypical pattern in Venezuela probably reflects the political conflicts that happened under the Presidency of Hugo Chávez, who drove out one major fiction producing television station due to its opposition to him. Moreover, the remaining large producer, Venevisión, reduced its television fiction production, which used to be roughly one telenovela per year, because of concerns over government controls and also reduced market support for TV production (Acosta-Alzuru, 2013).

Another reason for the eventual growth of cable and satellite TV is the way in which they made new genres of television accessible. In terms of content, relatively few national television industries in Latin America were producing certain genres, such as action series or feature films, high quality dramatic and comedy series and other subgenres within television fiction that begin to characterise what has come to be called the new golden age of American television. That new golden age was first perhaps characterised by HBO on cable and satellite TV, however is also coming to be characterised by series such as Orange is the New Black (2013–), produced and carried by Netflix. Drawing on this, one interesting new hypothesis is that middle and upper middle class audiences with an interest in such series-based TV fiction may have been drawn to first cable channels and more recently internet-based services like Netflix in order to have access to new genres of fiction that interested them. One disruption that services like Netflix, as well as HBO, are creating is a much greater taste for dramatic and comedy series, which are only now being very widely produced in Latin America. That widening genre proximity (La Pastina and Straubhaar, 2005) has contributed to a change in cultural proximity by origin.

Explanations for changes in audience preferences in Latin America

Since the mid-2000s, Latin Americans are turning more to pay television and, since the mid-2010s, to Netflix, and in both cases, to more US programming. We will argue that this has to do with the expansion of economic, cultural and linguistic capital across Latin America (Bourdieu, 1984, Bourdieu, 1991), leading not only to an increased economic ability to afford the cable, satellite and internet technologies that are bringing in a huge amount of television programming from beyond Latin America but also a notable increase in many people’s likelihood of understanding and enjoying it, thus in effect partially overriding cultural proximity.

In several of the countries under discussion here, a very large degree of economic mobility and social mobility in the last decade has helped audiences change their access to television and expand both their educational and professional horizons. As a result, the cultural nature of these viewers’ preferences for television may have also changed. If we think about economic mobility and economic class in terms of the theories of Pierre Bourdieu, it helps us understand how audiences are formed both in terms of economic capital (what they can afford) as well as cultural capital (what they understand and enjoy). For example, Bourdieu (1984) sees economic capital in the ways that are largely used to describe social class and access to work or other economic resources that a person can use in various fields of competition. Economic capital can buy access to better education, which is also related to an increase in cultural capital, the knowledge and skills that one has to deploy in a field in which one wishes to compete (Bourdieu, 1986). Families experiencing social mobility linked to economic capital tend to start desiring greater levels of education, new forms of travel and learning and new forms of consuming cultural products (e.g. in their original language). In the following, we will unpack these forms of capital in relation to the data.

Economic capital

Increasing levels of social mobility since the 1990s have seen radical changes in the distribution and impact of economic capital for millions of people, depending on the countries involved. Argentina, Brazil, Colombia and Mexico have all experienced substantial economic mobility, lifting people from working-poor/working-class into the lower middle class and, in some cases, lifting people from the lower middle class into the middle or even upper middle class. Economic capital gives families much broader choices about acquiring new forms of media technology, such as cable or satellite TV and broadband internet, where available in terms of infrastructure.

In 2012, the World Bank estimated that the middle class now outnumbered the poor in Latin America and the Caribbean for the first time (Ferreira et al., 2012). In other words, there has been a steady growth of the middle class for 10 or 15 years and towards the formation of a new lower middle class, from at least the late 1990s or early 2000s in the case of Brazil, and somewhat longer and steadier in the case of Mexico and Chile. For example, in Brazil there is an estimate that from the early 2000s until 2012, roughly 40 million people moved out of either working poor/ working class into the new lower middle class (Zizola, 2014). Needless to say, this is a controversial idea. Even though this new lower middle class has a revised purchasing power to, for example, afford cable TV and internet connection, it does not mean that they are necessarily as well educated, critically among the adult members, as were previous generations of the middle class. This would explain why people in Brazil and Mexico are fiercely discussing what it means to be part of the middle class (O’Dougherty, 2002; Scalon and Salata, 2012).

Another aspect noted by the World Bank’s study about the growth of the lower middle class is its instability (2012). It might continue to grow and solidify but within an economic depression such as the one Brazil has suffered from 2015 to the present, members of this new lower middle class are in fact falling back into the working class, if not into working poor. Particularly relevant to this study is a large number of Brazilians from the new lower middle class who have been giving up their cable, internet and cell phone subscriptions because they simply can’t afford them anymore (Alves et al., 2016; Mayrink, 2016). So, although the new lower middle class and the expanded middle class are both real, they are not necessarily stable economically and therefore their media consumption habits are not either.

If we examine the impact of increasing economic capital (which is measured in the TGI study by an overall measure of social economic status that is focused on income, household possessions, as well as education), we will see that it is in fact related to increased interest in US-based film and television programmes. As Figure 3 (based on the same TGI surveys) shows, in 2004 the interest in US domestic programming among the richest 10% of metropolitan area residents of the eight Latin American countries studied was almost equal to domestic programming, perhaps slightly preferred by 1% or 2%. In fact, perhaps the most significant trend in the graph is that the preference for national programming stays evenly high across all the time periods and income groups, at around 60%, despite increasing interest in US programmes. This is visible in Graph Three, which breaks preferences for television content from different regions down by socioeconomic status, which is rooted in economic capital.

Figure 3.

Latin American TV viewing interests by SES and by country or regional origin of their preferred television and film programming, 2004–2014.

However, if we look at preferences based on socioeconomic status in 2014, we notice that US programming is now preferred to a much larger degree – a margin of 7% or 8% – by the richest (Top 10%). If we examine the next richest (Next 20%), which would correspond to the upper middle class and middle class, domestic programming is preferred over American by almost 7% or 8% in 2004. By 2014, however, US programming is almost as popular as domestic programming. It is interesting to note in this graph that while domestic programming remains almost equally popular among all social classes in both 2004 and 2014, the preference for American programming tends to increase rapidly not only among the elite and upper middle class but also among those in the next 30% (the middle and lower middle classes) as well as somewhat among the poorest (next 40%).

Increased economic capital in a family also tends to parallel increased choices and options and schooling for their children, which is then linked to the acquisition and use of cultural capital (Bourdieu, 1984). Particularly in Mexico and Brazil, social mobility in schooling terms has also been increased by government initiatives such as Brazil’s bolsa escola. ¹ This measure pays parents to keep their children in school rather than drawing them out to do work in order to help the family’s economic fortunes. By paying poor families to keep their children in school, Brazil and Mexico have also directly addressed the question of the formation of cultural capital, by making it economically easier for poor parents to keep children in school. At least in Brazil, this has roughly doubled the number of children in both elementary and secondary schools (Glewwe and Kassouf, 2012).

Cultural capital

Cultural capital itself has also been growing in tandem with economic capital from the 1990s through the 2010s in much of Latin America. This is due to increases in education, but also travel, learning other languages and family-level exposure to more cultures and new ideas in the process of social mobility (Bourdieu, 1986). This has also changed not only the access to television technologies but also the nature of audience preferences. To some degree, national television and preferences for it have been reinforced by a strongly nationally focused cultural capital that many people in Latin America have grown up with, experienced in school and also through national holidays, maps, sports loyalties and other sorts of resources. This is described by Benedict Anderson in his landmark work on the imagined community (1983). He explains how national identity is formed, billed and reinforced through the creation of education and other resources, often funded and directed by the state, to develop and reinforce national identity. However, this national cultural capital is now being supplemented by the other forms of cultural capital people gather when studying for a university degree, learning a new language, getting to know people from other countries, travelling, working in international environments and having access to a wide range of cultural products created in different countries.

In qualitative interviews starting in the late 1980s and continuing in various intervals since then in Brazil, Joseph Straubhaar has discovered that more and more people are in fact gaining increased knowledge of the outside world from a wide variety of sources in such a way that their interest in outside or foreign cultures has in fact increased. These interviews also seem to reveal the gradually increasing levels of interest in programming from outside the region (Straubhaar, 2007). Figure 4 shows how the preference for US television was related to low, average and higher levels of education on average across the eight countries studied in Latin America in 2004 and 2014.

Figure 4.

Interest in or preference for US television by education, or cultural capital.

Preference for US television increased notably among the best educated in metropolitan areas of these eight Latin American countries (those with at least some higher education) from 2004 to 2014. It increased somewhat among those with some basic education (middle school or some high school). Preference for US television remained consistently lower among those with less education. These results show that cultural capital, as indicated by a person’s education, is significantly related over time to their preference for US television. This result is interesting in itself. It reinforces earlier findings that higher cultural capital tends to offset the effects of national and regional cultural proximity (Straubhaar, 1991, 2003). It also begins to answer one of our research questions, whether Latin American audiences are to some degree being separated or stratified in their tastes as more people acquire the cultural capital that enables them to better enjoy foreign cultures through television, while less educated people with less cultural capital in the region are not changing in that direction very much. We begin to see a social situation in which people are indeed increasingly stratified by taste, related to both income (economic capital) and education (cultural capital), just as Bourdieu (1984) might have predicted. This trend also sets a significant context for Netflix and similar services. When internet video services entered Latin America in the early 2010s, they found an increasingly fertile climate in which increasing numbers of people had the cultural capital to understand and enjoy the foreign, largely US content, which they offered.

Linguistic capital

A somewhat similar phenomenon plays out with what Bourdieu called linguistic capital (1991). He defined this largely as someone’s ability to know the dominant language of a country or culture, so that one had both literal and symbolic access to its culture and resources. We can redefine linguistic capital slightly to see how someone in Latin America, or other non-English speaking countries, might acquire important advantages from using linguistic capital in terms of knowing English as a second language. Bourdieu discussed the more overtly embodied cultural and symbolic power of a degree from a prestigious university, or the ability to speak a prestigious language (like English or French in Brazil). So this article modifies Bourdieu’s concept of linguistic capital just slightly to emphasise the international dimension of linguistic capital, which we will call international linguistic capital, indicated in practice by someone’s ability to speak or understand English, building on research about the international value of speaking English as part of globalisation (Park and Wee, 2013). Once people have that linguistic capital, it also aids them in accessing and understanding programming from the United States. If consuming such US programming is considered prestigious, then it also grants the person who watches it what Bourdieu called symbolic capital.

When someone in Brazil brags to his friends about how much he enjoys watching Orange is the New Black or House of Cards (2013–2018) which Straubhaar has observed a number of times since 2015 in several seminars he has taught to Brazilian students,² that person is displaying and using cultural, linguistic and symbolic capital all at once to impress their friends and maybe even gain some social power, since as Bourdieu (1984) notes, the exercise of capital is often the exercise of power.

Figure 5 shows how self-defined knowledge of English is associated with a greater preference for US television and film programmes. It is interesting that while the preference for US programmes increases from 2004 to 2014, the audience’s self-defined knowledge of English does not. The implication is that although knowledge of English is not really increasing, it seems to still be associated with increasing preference for US television and film.

Figure 5.

Interest in or preference for US or European television by linguistic capital.

Limits on access to new forms of television by the digital divide

One severe restriction to the expansion of television in Latin America beyond broadcast and cable/satellite TV are the limits placed on access to digital streaming television by income, geography and broadband infrastructure. Our third research question is whether these limits will tend to reinforce the class structure of television consumption in Latin America that we have been profiling above. Access to and use of television in its various forms, such as pay TV, is already severely stratified by the various elements of social class, as defined and described by Bourdieu (1984; 1991): income (economic capital), education (cultural capital) and foreign language knowledge, particularly of English (linguistic capital). Those are strongly related to preferences for national versus US television, which will already structure demand for transnational services like Netflix, which feature a great deal of English language programming.

Access to broadband internet, which is required for the kind of extensive digital streaming used to watch services like Netflix, has grown in some countries much more than others, as noted in Figure 6. As noted above, incomes have been consistently growing in some Latin American countries, like Argentina, Chile, Colombia and Mexico. These are the places in which internet access has also grown the most. Others had strong growth for over a decade, but are now suffering recession, like Brazil. Venezuela has all but economically collapsed in the last few years under government mismanagement of its oil industry, agriculture and trade. However, a surprising number of people still have internet connectivity. Those with consistent growth have also largely managed to grow their internet infrastructure.

Figure 6.

Internet users per 100 people by country. Source: ITU Annual Report 2018.

In countries like Argentina, Brazil, Chile, Colombia, Mexico and Venezuela, internet penetration rates have grown rapidly overall, from 10% to 20% in 2004 to around or even over 60%, by 2016. However, some substantial percentage of the internet penetration rates reflect lower income people using the internet primarily through mobile smartphones or in public computer centres or cyber cafes. To be sure, those in small town and rural areas don’t even have the option of fixed broadband, no matter what their income, because the infrastructure doesn’t extend to them yet. The overall internet penetration also includes many who have mobile broadband only, accessed through smartphones, which may let users watch short videos but can be cost-prohibitive (depending on data service packages) as an effective device for streaming services like Netflix.

However, what is most crucial for streaming services like Netflix is how many households have access to fixed broadband internet infrastructure. As Figure 7 shows, that has also grown over the same period, so these broadband users can now reasonably access services like Netflix. The percentages of homes with broadband range from about 7% in Peru to over 22% in Chile. Brazil and Mexico, which have been two of Netflix’s target markets in their initial internationalisation, only have a little better than 12% home broadband penetration, which limits the service to the elite and part of the upper middle class. Even though the potential base of the service in technological terms has now grown considerably, there are still many small towns, interior provinces and rural areas where the internet infrastructure is much weaker, so even their elites and upper middle classes are excluded by geography and infrastructure.

Figure 7.

Fixed broadband connections per 100 households. Source: ITU Annual Report 2018.

Conclusion

An analysis of audience preference data from Kantar Media shows that there is a potentially very strong audience for Netflix in Latin America. Latin American cable and satellite subscribers, in most of the eight countries studied, still prefer their national programming, which Netflix is starting to commission in the two largest producing markets of Mexico and Brazil. Therefore, Netflix’s initiative to produce nationally and regionally should be appealing. Perhaps even more important, after a consistent viewer preferences for national television, Latin American audiences on average tend to prefer US programming, which is both a disruption of the Latin American television market and a gift for Netflix as it seeks to expand in Latin America with a mix of US, European and Latin American programmes. If national programming receives an average of around 60% of cable and satellite audience preferences, US programming receives around 50%. Thus, there is clearly an audience for American television of the so-called golden age, which is one of Netflix’s specialties in global distribution. This is particularly for the expanding upper middle class in Latin America, who are more likely to have access to the internet, as we will see below, therefore the most likely audience for Netflix. Audiences overall in Latin America are notably somewhat less interested in regional programming from the rest of Latin America and in television from Europe. While that might seem to limit some of the appeal of Netflix, which also brings in quite a bit of programming from the region as well as from Europe, it is not necessarily so. A breakdown of the Latin American audience by class — which is to say by economic capital, cultural capital and linguistic capital in the terms defined by Bourdieu (1984; 1986) — suggests that the international nature of Netflix programming will find audiences among the upper middle class and elite (the richest 10% and the next richest 20%).

However, these same audience profiles show some of the limits on Netflix’s potential expansion into Latin America. Many potential viewers in Latin America don’t have the money to subscribe to Netflix, even at regional fees that average in the $8–12 range. Furthermore, many audiences in Latin America lack the cultural capital or education to find US, European and other programming from around the world relevant, interesting, compelling or funny. In other words, lower middle class, working class and working poor audiences show a predicted preference for national programming (see Straubhaar, 1991). Conversely, they apply a cultural discount to programming which is not familiar, relevant, or funny to them (Hoskins and Mirus, 1988).

Another serious barrier to Netflix’s expansion in the region comes in the form of infrastructure limits. Only an average of 50% to 60% of Latin Americans currently use the internet (ITU 2017). Many access the internet in public places like cyber cafes or on mobile data plans on smartphones. Access to broadband internet at home, which is typically associated with Netflix use, tends to be limited to between 10% and 22% of the Latin American population, even in the most affluent countries. There are severe limits to Netflix expansion into regions outside the affluent areas of the major cities in Latin America simply due to poor infrastructure, by the geography that’s related to the expansion of infrastructure and by the economic aspects of social class in terms of the money required to acquire the kind of high-quality access to the internet that Netflix favours. On the other hand, the middle and upper middle classes are expanding, which expands opportunity for access to both multichannel and streaming television. That includes economic capital to acquire new technologies and afford often expensive data plans, cultural capital to enjoy/understand foreign cultures, foreign travel and linguistic capital that aids in extending the understanding and enjoyment of foreign culture on television, reducing the effect of the cultural discount.

Footnotes

Acknowledgement

The authors would like to show our gratitude to our colleagues from Kantar Media for giving us access to their database.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Deborah Castro

Notes

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