The biggest news about ethnic media ownership didn’t emerge until the beginning of 2006, as the Spanish-language broadcast giant Univision announced it was putting itself up for sale. The company owns and operates 62 television stations in the U.S. and Puerto Rico and has branches in cable, radio and the Internet. If and when it is sold it would be a powerful tool for its new owner in an attempt to reach Spanish-speakers in the U.S., and the companies expressing interest were among the nation’s largest media operations, including News Corp., Time Warner, Disney and CBS.
Univision and Telemundo continue to be the dominant owners in Spanish-language television, with Univision far out front. With its 62 owned stations and more than 90 affiliates, it reaches 98% of U.S. Hispanic households.8 [1]
If the company is ultimately sold to one of the mainstream companies that seem to make up the bulk of the early interested parties, it would raise some serious questions for Spanish-language TV in the U. S. Would such an owner mean less Spanish-language TV production and more translated programs from the parent company? Would such ownership lead to an infusion of cash that would allow Univision to strengthen its grip on the market? Would English-language programming make it into Univision’s lineup as a way to build brand loyalty as second- and third-generation Hispanics switch over to English-language TV?
In the end, many analysts believe that if the company is sold it may well go to private equity firms looking for an investment. Large mainstream media companies potentially face problems because of federal regulations that limit overall ownership to stations that reach 39% of the nation’s television households.
After some large shakeups in the year before, 2005 was quieter again for ethnic print media. There were no large-scale mergers on a par with 2004’s uniting of La Opinion in Los Angeles, El Diario in New York and La Raza in Chicago, which made ImpreMedia the giant of Hispanic newspapers.
But ImpreMedia didn’t sit completely still. In October, it launched the Domingo Network, a free Sunday edition in the three largest cities where it has papers already. The Sunday papers are delivered to 650,000 targeted homes in New York, Los Angeles and Chicago.9 [2] The edition provides “the largest print vehicle in the top three Hispanic markets,” the company says, and aims at Latino women and households. And ImpreMedia purchased two more newspapers for its stable — El Mensajero, a weekly in the San Francisco Bay area with a circulation of 112,000, and La Prensa, a weekly in central Florida with about 50,000. The company’s weekly distribution is now 1.9 million.10 [3]
There were signs that more mainstream outlets were taking serious note of the growth of Spanish-language print outlets. In the face of falling circulations, many media companies have made forays into the ethnic media world as a way to offset lost readers.
In Boston, the well-known alternative weekly the Phoenix made a move to buy into the growing Spanish-language market by purchasing a 35% stake in El Planeta, the largest Hispanic weekly in the area. El Planeta, just launched in 2004, publishes four editions in Massachusetts and Rhode Island, with a fifth slated for Connecticut .11 [4]
In magazines, several established companies and well-known titles launched Spanish-language editions in 2005. Time Warner test-launched Sports Illustrated Latino in April and distributed three issues during the year to half a million Hispanic households, subscribers to People en Espanol or to Comcast/Time Warner Hispanic programming packages. The struggling hip-hop magazine The Source launched Source Latino in May.
And investors are still looking at Spanish-language print outlets as a place for their money, though the market may be cooling off. In early 2005 Meximerica Media, which publishes the Rumbo chain of newspapers in Texas , looked to be in trouble when its original financial backers, Recoletos Grupo de Comunicacion of Spain , pulled out. In June, though, Meximerica received an investment of $18 million from Pinto America Growth Fund and Rustic Canyon Partners.12 [5] Pinto is a Texas-based equity fund focused on companies in the U.S. Hispanic market. Rustic Canyon is a venture-capital and private-equity fund established to invest a portion of the funds created by the recapitalization of Times Mirror (later acquired by Tribune Company).
Also in June, Publicitas-LHM, the Hispanic division of the Swiss company PubliGroupe/Publicitas Promotion Network, announced plans to build a national advertising sales platform for Rumbo and Hoy Newspapers.13 [6] The goal was to nationalize ad sales among more Spanish-language newspapers.
There were some significant closings in the Hispanic media last year as well. Zoom media, publishers of Poder and Loft magazines, lost its backing and shut down when the Columbian Universal group walked away. But both titles were niche publications, and their fate may not speak to the broader ethnic media climate. Both Poder, a Hispanic business magazine published in English and Spanish, and Loft, a Hispanic men’s lifestyle magazine published in English, were aimed at very targeted audiences, some of which were already served by other publications. And neither was primarily a Spanish-language outlet.
The biggest ownership issue for some ethnic print outlets may be the role the mainstream media will play in the future. Mainstream companies bought into the ethnic market because they saw potential for growth. But those struggling mainstream owners now may present some challenges. The deep pockets they have provided come with other strings.
In October of 2005, the Knight-Ridder company closed its Spanish-language weekly in the San Jose area, Nuevo Mundo, and began to distribute Fronteras de la Noticia, which is produced in Mexico. The company also announced it was selling Viet Mercury, its Vietnamese newspaper in San Jose.
If Knight Ridder is sold (see Newspaper Ownership [7]), what will happen to other ethnic outlets the company owns, such as El Nuevo Herald in Miami? Indeed, if the current wave of consolidation continues across the English-language side of the newspaper industry, what will happen to all those ethnic-media investments those companies have made? Much will probably depend on the specific company and even the specific market, but the net effect is that those outlets could face some turbulent times.
In the world of ethnic television, things are more stable. The creation of AZN by Comcast suggests that companies are looking for the next big wave to catch in ethnic TV, but it’s not clear whether it is a sure bet.
For many ethnic groups, the easiest form of TV transmission probably will continue to be satellite. Broadcast television demands a high density of people who speak the same language. New Skies Satellite has research showing that the number of ethnic channels moving around the globe expanded from 378 at the end of 2000 to roughly 1,000 at the end of 2003.14 [8] And providers are offering those stations to viewers. Both DirecTV and the Dish Network offer extensive language- and ethnicity-specific programming, with Dish providing a wider ranger of options – everything from Polish to Farsi to Armenian. Both have a large number of Spanish-language options. Globecast, based in Paris, offers nearly 140 worldwide channels to viewers in the U.S. And Home2US, a satellite firm based in Virginia that was founded in 2003, now has more 100,000 subscribers in the U.S. viewing its offering of ethnic channels from around the world. Its goal is 600,000 to 700,000 subscribers by 2008.15 [9]
Summary
Looking at the whole picture, there is little question that the ethnic media are growing. Ad revenues, ratings figures and new startups show a market still relatively immune from the downward slide of much of the mainstream media. But there are some real questions on the horizon.
As large mainstream print outlets struggle, what will happen to the ethnic papers they started and/or joined with? Looking at how some circulations are falling and holding steady while others are rising in the Spanish-language press, have some markets reached maturity, while others are more dynamic? With a new Asian network in the offing, are mainstream media owners ready to try and nationalize other ethnic audiences? Or will different dialects and languages get in the way of nationalizing groups that are not Spanish-speakers?