A Breakdown of the Recent Merger between ABC and Univision

ABC is attempting to capitalize on the upcoming Election 2012’s heavy news cycle with its announced joint venture with Hispanic TV powerhouse Univision to launch an English-language news, information and lifestyle network targeting Latinos. The as yet unnamed network plans to tap into cable TV’s stronghold on election coverage, spearheaded by rivals Fox and NBC with their first place Fox News and second place MSNBC channels, to gain traction for its launch.

The network is a 50/50 spilt between the 2 entities, and will target Hispanic Americans while delivering the majority of its content in English. Many Hispanic Americans, particularly those who were born in the U.S., maintain strong cultural roots but prefer to consume media in English. Media companies are aware of this rapidly growing demographic and are shifting their programming to capture this audience for their advertisers. Nielsen projects that Hispanic buying power will grow faster than the rest of the population’s — increasing 50 percent from 2010’s $1 trillion figure to $1.5 trillion by the year 2015.

According to a press release issued on the new enterprise, “editorial coverage will focus on the issues most relevant for U.S. Hispanics, including the economy, jobs, health care, immigration, education, politics, entertainment, health and wellness and more” and that it is “an important moment for journalism in the U.S. and for the U.S. Hispanic community” that will “provide all audiences with a multiplatform current events perspective on the issues that matter most to Latinos.”

Benefits of the deal to The Walt Disney Company-owned ABC include access to cable subscription revenues, lower costs by sharing facilities and resources with Univision and further branding reach to the nation’s youngest and fastest-growing consumer group that continues to expand its economic and political clout.

ABC News president Ben Sherwood said the venture will allow his company “to deepen and expand our conversation with a rapidly growing part of the population that is hugely influential.” As a demonstration of its commitment to the venture, ABC staff members are purportedly being asked to brush up on their Spanish language skills by going through courses being offered by the news division in preparation for the launch.

From Univision’s fiscal perspective, gains will be realized from penetrating the English-language market for the first time in its history. The company dominates Spanish-language programming over rivals such as the Comcast-owned Telemundo, but seeks to keep up with the growth of the second- and third-generation Hispanic population to remain competitive.

“This is adding a new dynamic to the portfolio of Univision: a service in English for our community,” said Univision Networks president Cesar Conde, speaking in the same interview as Mr. Sherwood. Furthermore, the prestige of Univision’s news division is expected to benefit from the new association with the more established and recognized ABC News brand.

Challenges to the venture include a somewhat glutted market with the aforementioned Fox News and MSNBC; CNN and its subsidiary, HLN; the business-specific CNBC, Bloomberg and Fox Business; plus other networks trying to gain footholds in the cable space such as Current, Al Jazeera and BBC World. Also, ABC has failed before with an attempt at launching its own cable news channel in 1996, which was quickly scrapped.

A website, plus mobile content and social media platforms will be introduced this summer, with a television network expected to launch sometime in the first half of 2013. The news operation will air from Univision’s primary studio complex in Miami, a stronghold of Hispanic diversity with a population composed of  many Caribbean and South American émigrés, unlike the predominantly Mexican Los Angeles  immigrant community.

 

About the Author: when Steven Taylor isn’t writing about Time Warner Cable Business Class Offers and the best in class business class cable bundles they provide, he is covering up to the minute industry news stories to keep his readers informed!

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1 Comment

  1. Victor Diaz
    Victor Diaz June 1, 2013 at 11:42 pm

    Great Story on the ABC UNIVISION Merger/Venture.
    Is it all going to be called “FUSION”,? I didn’t see that
    I’m the article, great story!
    Thanks.,

    Victor Diaz,
    News Photographer/
    Broadcast Operations
    USA

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