Speaking the language of the fast growing and increasingly desirable Latino audience, Walt Disney Co.'s ABC News and Univision Communications are teaming up to launch a 24-hour English-language news network.
The yet-unnamed cable channel, announced Monday, is expected to launch during the first half of next year. The two companies plan to get a head start this summer with a website and content for social networks and mobile devices devoted to covering the U.S. presidential election — which some analysts say could be decided by Latino voters in battleground states.
The most recent census shows that more than 50 million Latinos live in the U.S., making up 16% of the country's population. Advertisers are increasingly looking for ways to reach young and upwardly mobile Latinos who have disposable income and are fluent in English.
"This is a recognition of the new American reality," said Cesar Conde, president of Univision Networks. "Our mission is to inform and engage the Latino community, and we think this [cable news channel] is the natural evolution for us."
According to the 2010 census, the Latino population in the U.S. grew 43% between 2000 and 2010 — four times as fast as the overall population.
"The math is profound," said Ben Sherwood, president of ABC News. "That huge population surge is already happening, and we get it. It's happening in California, and it's happening in the rest of the country. We've got to figure out a way to deliver culturally relevant programming in English to this rapidly growing and very influential population."
The two firms had an incentive to collaborate. Univision, the nation's largest Spanish-language TV network, has seen its most reliable source of new viewers — immigrants from Mexico — shrink as fewer people cross the border. The population growth now comes from U.S.-born Latinos.
The trend has challenged Univision to find ways to reach young Latinos, in English, without alienating the company's loyal audience of Spanish speakers.
For ABC, the venture should provide immediate heft and credibility in reaching this audience. Unlike competitors NBC and Fox, Disney's television group has little programming devoted to Latinos, with the exception of sports channel ESPN Deportes. NBCUniversal, in contrast, owns two Latino-focused networks — Telemundo and the bilingual cable channel mun2 — and Fox is beefing up with new Spanish-language network MundoFox.
The new channel also would enable ABC to plug a programming gap. ABC has been at a competitive disadvantage to Fox and NBC, which each own lucrative cable news channels, providing them greater resources to finance costly news gathering operations.
Without its own cable news channel, ABC News has been aggressive in recent years in trying to find new audiences online and through partnerships with such established players as Yahoo and now Univision.
ABC News and Univision will each own 50% of the joint venture, which will have its own management team and a board of directors. It is unclear whether the parties will buy an existing cable channel, such as one owned by Disney, so that it could reach millions of households from the outset rather than start from scratch.
"This is going to be a very interesting joint venture," said Carmen Baez, president of Latin America for advertising behemoth Omnicom. "If it does well, it could benefit both companies and become a powerful force in reaching this fast evolving market."
The ABC-Univision partnership is not happening in isolation. NBCUniversal has been devoting more resources to its Telemundo network and mun2. News Corp. in February said it would launch the Spanish-language MundoFox broadcast network this year in collaboration with Colombian broadcaster RCN Television Group.
Comcast Corp. plans to launch four independent channels on its cable systems targeting minorities in the next two years, including two English-language channels owned by Latinos. One, named El Rey, will be co-owned by film director Robert Rodriguez ("Spy Kids," "El Mariachi") and is expected to launch in 2014.
Increasingly, media companies see the most potential in reaching English-speaking Latinos.
According to a 2009 Pew Hispanic Center study, U.S.-born Latinos are more likely to watch English-language television. About 70% of such first-generation Latinos watch English-language channels, according to Mark Lopez, associate director of the Pew Hispanic Center. The number exceeds 90% for second-generation U.S.-born Latinos — those who have parents also born in the U.S., he said.
An estimated 41% of U.S. Latinos age 16 to 25 are bilingual, Lopez said. More than a third, or 36%, are English-dominant and an estimated 23% are Spanish-dominant.
"It's clear that reaching this market is becoming a business imperative for media companies, and they recognize that," Omnicom's Baez said.