Local TV Economics

Hispanic television had a good year in 2005. Spanish-language and cable television stations gained more than other media in advertising spending, over 10 percent, highlighting advertisers’ shift to formats that allow them to target people with specific interest.18 The growth in viewership has attracted advertisers and generated notable revenues for the nascent medium. According to BIA Financial Network estimates, the growth rate for stations affiliated with Spanish-language networks (like Univision, TeleFutura, Telemundo, and TV Azteca) outpaced the growth of the overall local TV market. Established local TV stations affiliated with these Hispanic networks increased advertising revenues by 9.5% in 2004 (outpacing the growth of the entire local TV market by 2 to 4 percent). Further, BIA reported that the number of local television stations affiliated with the major Hispanic networks had increased by over 56% in the last five years.19

Moody’s Investors Service issued a report in October 2005 that noted the tremendous growth of Spanish media. It predicted that over the next several years, most growth will likely accrue to media that target growing populations like Hispanics. Companies that are already leaders in the Spanish media market, such as Univision and Telemundo were predicted to achieve above-average growth over the next decade. The report also noted that some mainstream media companies are venturing into the Spanish-language arena to “at least partially mitigate stagnation” in their English-language businesses.

Over the last decade, advertisers have increased spending in Spanish-language media from $1.2 billion to $3.2 billion. That is still only 5% of all advertising spending in the U.S., suggesting that higher spending levels are likely since Hispanics (most of whom, polls show, get at least some of their news from Spanish-language outlets) are now the largest minority group in the country.20

And the Spanish news media are benefiting from the overall growth. Across the country, Spanish-language TV news is gaining viewers and attracting advertisers.

The two biggest names in Spanish-language television are Univision and Telemundo. Univision (along with its second network, Telefutura) owns and operates 62 stations and has duopolies in 15 markets. All of its full-power stations broadcast local news twice daily, and many of them offer news on the weekend. NBC Universal’s Telemundo group has 15 owned and operated stations and 1 independent station. All but two of them broadcast local news, and many are expanding into new parts of the day like early morning and weekends).21

Though the two Spanish-language broadcasters dominate the audience, they face growing competition not just from other Spanish-language networks such as Azteca America but also from the English-language broadcasters, who are also looking for ways to tap into the growing Hispanic audience.22 In 2005, ABC began offering its entire primetime lineup in Spanish — either dubbed or close-captioned. NBC Universal was working to improve its distribution of Telemundo and concentrating on owning and operating stations in areas with a growing Hispanic population. In January 2006, in fact, it sold four if its small stations and sought more duopolies of NBC and Telemundo stations.23

Indeed, in the largest Hispanic markets, Spanish newscasts, which benefit from a relative lack of options for Spanish-speakers, are edging out their English counterparts in ratings. In August 2005, Univision’s evening newscast was No. 2 among the key 18-to-49 demographic in New York , the nation’s largest market. In the same month, the Spanish prime-time and late newscasts did better than the English ones in both Miami and Los Angeles.24 There was a rapid proliferation of Spanish-language newscasts across the nation during the year.25

In August of 2005, the NewsMarket, a leading online platform for aggregating and distributing video content over the Internet, said it had experienced a sharp rise in the number of journalist registrations and media requests from Hispanic news outlets in the U.S.26