Mexico’s Media Baron Steps Down From TV Empire

Emilio Azcarraga, an iron-willed tycoon who built a group of TV stations into the world’s biggest Spanish-language media company but who has suffered medical problems lately, has stepped down as the head of his corporate empire, Grupo Televisa.

Azcarraga’s televised announcement from Los Angeles late Monday marked a watershed at one of Mexico’s biggest companies and most important institutions. With its fervent pro-government policies and wide reach, Televisa has been a pillar of the political party that has ruled Mexico for seven decades--earning itself the derisive nickname “the Ministry of Communications.”

The 66-year-old Azcarraga, often compared to media barons such as Rupert Murdoch, has extended his empire far beyond Mexico, even to countries such as Russia and the Philippines, where his syrupy soap operas have millions of fans.

But he is stepping down as fresh competition is eating into Televisa’s domestic audience while the firm is making a big but risky investment with Murdoch himself in a Latin American satellite television venture.

In a surprise announcement on his network’s late-night news show, “The Tiger,” as he is known by some, said he needed to slow down.

“The truth is we are a bit tired, and now the challenges that are coming in this new era of images, cable and satellite call for young, aggressive and, I hope, intelligent new blood,” said the strapping Azcarraga, interviewed by Televisa in Los Angeles, where he has been receiving medical treatment since February.

Azcarraga announced that his 29-year-old son, Emilio, would succeed him as president. But, in apparent recognition of concerns that the younger Azcarraga lacked experience, the Televisa chief handed his title as chairman of the board to the company’s chief financial officer, 37-year-old Guillermo Canedo White.

Canedo White vowed Tuesday that the two younger men would maintain Televisa’s philosophy and plans. But he pronounced the end of an era in which the company was “centered in one person” endowed with “superpowers.”

“The company is beginning today a process of institutionalization,” Canedo White told the Times in an interview. Most key decisions, he said, would be made by an executive committee including prestigious outsiders.

Televisa’s stock rose 3% on the Mexican stock exchange Tuesday. Some analysts interpreted the move as a sign of investor relief that the younger Azcarraga hadn’t assumed all his father’s power. The Azcarraga family owns a controlling share in Televisa.

“In the last few days, everybody was selling Televisa because people were worried this guy with no seniority [Azcarraga Jr.] was going to become chairman of the board and the principal of Televisa,” said one Wall Street analyst, speaking on condition of anonymity.

“The news was a bit better than expected.”

It’s been 25 years since the senior Azcarraga’s father left “my son, the idiot” his stake in Televisa, then three TV channels. Proving his father wrong, Azcarraga turned Televisa into an international Goliath with interests in music recording, radio, TV programming, cable and publishing.

The firm owns about 20% of Univision, the Spanish-language U.S. network, as well as 8.5% of PanamSat, the Connecticut-based satellite firm. Last year, Televisa’s sales were $1.44 billion.

Even today, the company often resembles an old-fashioned Hollywood studio, in which budding stars are groomed in a school and actors who go to the competing network are sometimes blacklisted. But the company is now facing historic challenges to what was long a near-monopoly in the Mexican market.

With an upstart new rival, TV Azteca, aggressively promoting its soap operas, true-crime shows and news programs, Televisa’s share of the Mexican television audience has slipped to about 75%, analysts say.

Meanwhile, the company has invested heavily in a Latin American direct-to-home satellite television project, in an alliance with Murdoch’s News Corp. and U.S. cable giant TCI Communications. It may be years before the investment pays off--if it does.

“This will be a very big challenge for these two young men” now taking over Televisa, said Raul Trejo, a media critic.

The new chairman of the board, Canedo White, describes himself as a “self-made college dropout.” He has won respect from analysts for shrewd management of Televisa’s finances.

But little is known of the younger Azcarraga, a San Diego State graduate who joined his father’s company in 1988 and was named chief operating officer last year.

Analysts say the younger Azcarraga has only gotten deeply involved in the company in the last few years. But Canedo White insisted Azcarraga was up to the task.

“You have to remember that [he] was born in this business, and grew up in it,” he said.

The elder Azcarraga, one of Latin America’s richest men, said in the interview that he would remain involved in satellite projects. He has been on leave from Televisa since early February for unspecified medical reasons. He has suffered heart problems in the past.

One tantalizing question raised by the management changes is whether Televisa will retain its boosterism for the government and the Institutional Revolutionary Party, or PRI, which has ruled for nearly seven decades.

The network is famous for ignoring street demonstrations and opposition politicians, and carefully toeing the government line on the president’s activities. In return, it is believed to have received government help in discouraging competition and reaping big profits.

In a sign of Azcarraga’s close ties with the government, he even reportedly offered to hand over $50 million of his own money at a PRI fund-raiser with a small group of business tycoons in 1993. Such blatant influence peddling is becoming less acceptable in Mexico.

“Mexican society, very slowly, is beginning to be more demanding of the government, the parties, TV Azteca and Televisa,” said Trejo.

Televisa offered no signs of any such shift on Tuesday. For one thing, it named a PRI politician close to the government, Miguel Aleman Velasco, as vice chairman.

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Mexico’s Media Giant

Grupo Televisa, the world’s largest Spanish-language media company, is losing its chairman, Emilio Azcarraga, only the second chairman in the company’s 67-year history. He is stepping down because of ill health. A look at Televisa’s empire:

* Television: Owns four networks broadcast on about 300 stations throughout Mexico, where it captures an estimated 75% share of the TV audience. The company owns about 240 of the stations. Operates two stations on the Texas-Mexico border. Owns a 49% stake in Red Televisa Megavision, a Chilean broadcaster with 34 TV stations. Holds a 20% stake in Univision, which reaches more than 92% of the Latino TV audience in the U.S.

* Television programming: Produces more than 50,000 hours of programming annually, more than the output of NBC, ABC and CBS combined. Exports programming to more than 75 countries.

* Radio: Owns 17 AM and FM stations throughout Mexico, reaching an audience of more than 45 million, or almost half of Mexico’s population.

* Music: Holds three record companies.

* Cable: Holds a majority stake in Cablevision, Mexico’s largest cable TV system, with a leading market share of 16%.

* Direct-to-home: Began offering direct-to-home satellite television service in December through its 30% stake in Sky Entertainment Latin America.

* Publishing: Prints more than 50 magazines, including Spanish-language versions of Cosmopolitan and Good Housekeeping.

Sources: Times and wire reports

Researched by JENNIFER OLDHAM / Los Angeles Times