Cesar Cruz likes to talk. The more you hear Cox’s multicultural marketing director on the phone, the more passion erupts off the hook. He is especially loquacious when opining about growing an audience of Latino, Asian and Russian customers for Cox. The only way to shut Cruz up is to ask him where—exactly—one of Cox’s Spanish-language digital network tiers has been able to arrest satellite penetration among Latinos. "It’s too early for us to answer," he says. "Ask me that same question a year or 18 months from now, and we’ll make a significant dent with DBS in all our markets with Hispanic product." Cruz is not alone in this quest. The problem of attracting ethnic subscribers has bedeviled the cable industry for as long as EchoStar and DirecTV have offered specific ethnic programming tiers. Other cable operators have hired people like Cruz to develop campaigns to take the video high ground among ethnic households—the exclusive domain of DBS until 18 months ago. By all accounts, cable is making inroads. The problem is that MSOs don’t have the numbers to back up this claim—or at least they aren’t making those numbers public. MSO and satellite companies keep such statistics internal. In the last year, some operators have imposed a policy not to release national or local system statistics for digital, high-speed and other advanced services. MSO executives acknowledge the head start DBS has had in ethnic markets and are open when talking about satellite’s perceived advantage, with its digitized national footprint giving it the bandwidth to rush in with a large programming supply. "They could launch a Russian channel and every Russian could have the ability to take it," says David Jensen, Comcast’s VP of international programming. "We can put on a Russian channel in Boston and Philadelphia, where you have a sizable audience for that, but not in Sacramento, because the demographic was just too small and didn’t make sense to devote precious bandwidth for that." Satellite providers also scored with their early marketing strategies. With research documenting that Latino citizens do the majority of their shopping five miles or less from home, satellite dealerships fanned out to local groceries, consumer electronics stores and eateries to make their pitch. "They were in those Radio Shacks and retailers within those five-mile radiuses, working directly through the neighborhood and building trust," says Robert Daleo, regional director for Adelphia’s systems in Los Angeles and other parts of Southern California. What Should Cable Do? The good news for operators is that capacity isn’t an issue anymore, now that systems are deploying digital services. That means cable executives should put more time and effort into programming the channels and marketing the ethnic services, Cruz says. "It’s all about the product," he says. "You must see what’s available out there from programmers and whether it’s culturally relevant to the audience. Then you have to put a package of marketing or promotion avenues together and market in a mass way. DBS did the legwork, but it all started with a respected product." In some ways, cable should treat ethnic marketing the same way it handles the marketing of other video services. That means touting their biggest advantages over DBS: VOD and bundling. When a VOD system introduces ethnic content, operators should be able to follow through with a traditional bundle of high-speed, telephone and other advanced services. At that point cable will usurp satellite from its special audience perch for good, Jensen predicts. "Take that same Russian channel I talked about earlier, take a core four or six hours of programming from there and distribute it nationwide on your VOD platform. Refresh it daily or every few days. We will not only compete better with DBS, but we have a much more powerful platform for the public," he says. Beyond VOD, operators also should emphasize their voice/video/data bundles as a hook to leapfrog DBS in ethnic consumer choice. "We have to take that approach and not assume that these households will be late adopters of telecommunications. That’s a lot of rubbish," Jensen says. "You can’t leave anybody out." A few weeks ago, Cruz and Cox hired Cultura Advertising out of Dallas to drum up a Latino bundle awareness campaign involving TV, print, radio, direct marketing and grassroots promotion tactics. That effort is expected to begin in most of the MSO’s markets this winter. Immediately, Cruz and Cultura are making over Cox’s digital Latino tier, which premiered last spring with little success, having encountered major churn issues because of poor program quality. A new tier will launch in one or two systems this fall and will be more culturally minded, Cruz says. "The old tier has been put in a drawer and the new tier will address our audience in a quality, value-driven way," Cruz says. Cable operators also should be developing deeper outreach marketing relationships with Hispanic channels as they look for any advantage they can get to stem or reverse DBS penetration, says Galavision SVP and general manager Joanne Lynch. "We’re laying the groundwork with operators now for more outreach. There’s always important values to promote, and we want to work closely with operators who make Latinos a high priority," she says. "On the whole, operators have done a good job marketing our service." So how will satellite respond to cable’s increased focus on ethnic programming? From DirecTV’s perch, the answer is to launch more linear services. That’s all DirecTV EVP, programming, Stephanie Campbell will spell out now, as the DBS operator’s strategy with News Corp. in charge still is under development. "We’ll analyze the packages we have to make them stronger," she says. "Other channels will be launched. It’s no secret." Getting With the Program Most top MSOs have deployed digital Latino tiers in major metropolitan areas since last winter, and several are planning to launch similar ventures for other ethnic audiences. Cablevision is rolling out subscription video on demand as an option for Latinos in the New York metro area through World Picks, programmed by subsidiary Rainbow Media. This fall, Comcast should begin breaking ethnic VOD loose on a free or low price per-title basis. Spanish titles will go up first, followed by product in other languages. Comcast’s Latino-tier launch helped the MSO double its Hispanic customers over the last 14 months. So far, cable’s ethnic programming counterplays have made small chinks in DBS’ armor. But MSO officials approached for this feature unanimously agree that cable is starting to level the ethnic playing field. "We are playing catch-up. We are the insurgents in this space," Jensen says. "We like prospecting a business proposition from that position, especially when you have a robust digital and VOD platform to work around." Insight VP, programming Terry Denson agrees. "We’re chasing DBS because they got there first," he says. "This is a textbook example of the right thing to do and executing good business sense for it." Even the competition is acknowledging that cable has made some inroads in this space. "It seems they are responding to a competitive environment," says Campbell. "They’ve done what they’ve done in response to what we’ve done, and we’re happy with the results of what we’ve done." The Roads Taken DirecTV fired the first salvo in the fight for ethnic subscribers in October 1999. That’s when it launched Para Todos, its collection of 45 Spanish-language networks. Jade World, a five-channel package, was introduced two years later. EchoStar joined in the game in 2000 with a 60-channel international offering. It featured programs in more than 25 languages, including 31 Spanish channels. Early last month, EchoStar’s Dish Network launched a five-channel "Super Pack" in Mandarin Chinese, arranged by media supplier ETTV. At first, individual cable systems with spare analog channel capacity reacted to satellite’s ethnic blitz by introducing individual basic or premium services, such as Galavision or an International Channel-provided net. As digital cable spread, CNN, Discovery, ESPN, Trinity Broadcasting Network and other English-language nets introduced Spanish versions. In several markets, Adelphia introduced its "en Espa�ol" tier, combining broadcast basic with 12 channels for $25 per month. By mid-2002—three years after DirecTV’s ethnic tier launch—other cable operators began to think of their own such tiers. International Channel, Galavision parent Univision and other multilingual service outlets also considered ways to fill those tiers up. Time Warner Cable ignited its Latino tier movement in January 2003 with DTV en Espa�ol in New York and other markets. Within six months, Comcast went national with its Cable Latino packages, Cablevision Systems introduced iO en Espa�ol and other operators whipped up their own ethnic tiers. Tier programming included fare from packagers Canales � (International Channel), OlympuSat and Condista, and new channels such as all-soccer GolTV and kid-vid-centric Sorpresa! The additional nets "resulted in a more compelling offering for our customers, and given us a significant competitive edge over satellite providers like DirecTV and Dish," states Matthew Weiss, Cablevision’s VP of digital product strategy, through a statement released to CableWORLD. As for Voom, the satellite service launched last fall by Cablevision chairman Chuck Dolan, there’s plenty of original HDTV channels to separate it from DirecTV and Dish, but no ethnic packages. "While we will continue to look at all programming distribution opportunities and certainly have explored ethnic marketing, we have no plans at this time," offered Voom EVP of sales and marketing Bill Casamo. The Problem With Buy-Through At first, cable priced Latino tiers with buy-through conditions—subscribers had to take digital or expanded basic along with the tier. The results shouldn’t have been all that surprising: Buy rates in targeted markets were underwhelming and churn rates were way too high. Eventually, most operators moved away from that model for their ethnic packages. One such MSO, Adelphia, introduced additional ethnic alternatives in the Los Angeles area last November. For Asians, several International Channel-distributed premium nets premiered at $10 to $20 per month, depending on the service. One service aimed at local Filipinos drew an 8% response rate among 59,000 non-subs, Daleo says. Direct mail, ads in Filipino newspapers and event appearances directed at those non-subs promised half off their first monthly cable bill when taking the channel. With Latinos, Adelphia started Basico, a 12-channel Spanish tier for $5.95 per month, and Especial, offering six different nets for $4. For $8.95, consumers could order both together. Daleo says the system’s Latino customer universe has increased substantially since November, but didn’t specify how much. AT&T Broadband’s San Francisco system was among the first to market premium channels to Asians in early 2001. Now as Comcast—and inside a cluster of systems reaching 1.6 million Northern and Central California basic customers—19 Asian-language pay channels are available a la carte from $10.95 to $25.99 a month. Last October, eight months before launching Cable Latino, Comcast launched Dragon TV, a bundle of seven Mandarin channels running for $21.99 per month. The system has increased its non-Latino ethnic sub count by 43% in the last 12 months using cross-channel spots, ethnic print ads and plenty of event appearances. "On results, we’re on par with our DBS friends," says Natalie Rouse, the system’s ethnic marketing manager. "One advantage we have over satellite is that we’re local, with employees in the neighborhood. You must get into as many events and local opportunities as possible, so that you’re accepted as part of the culture." Besides extensive media and event campaigns, Comcast uses a co-branded Spanish website with PlanetaTV.com to sell both Cable Latino and high-speed access. That effort started seven months ago and is contributing to a Latino sub lift, says Leslie Villem, who works in tandem with Rouse on Hispanic marketing. Comcast has pegged her system to be among the first to deploy ethnic VOD. Insight will begin a company-wide Latino tier rollout later this month. The model for this, Para Ti (For You), was introduced to 75,000 Rockford, Ill., basic subs in February. For less than $30 a month, subs get 25 Spanish-language nets, plus broadcast basic and bilingual mun2Television. Columbus, Ohio, will be next in line for Para Ti, followed by Lexington, Ky., before mid-September. At least three more Insight systems will start the option during the fall. Insight’s Denson is asking networks on the tier to provide resources and talent for events and other community-building avenues comprising the bulk of Para Ti promotion. "[Religious channel] Enlace will help us reach out in the churches, and ESPN Deportes will bring sports celebrities for personal appearances," he says. "You have to be nontraditional and get out to the people to be effective. Because we’re new to the game, it’s important to listen into the market and apply that listening to our marketing."

The Daily


ATSC Oh No: LG Exiting NEXTGEN TV a Sign of Larger Patent Issue

ATSC 3.0, or NEXTGEN TV, has been broadcast television’s next big thing for several years now, but it is becoming harder for device manufacturers to integrate the standard’s 4K tuners into their products

Read the Full Issue
The Skinny is delivered on Tuesday and focuses on the cable profession. You'll stay in the know on the headlines, topics and special issues you value most. Sign Up


Dec 6
2023 Most Powerful Women Awards Nomination close on September 8, 2023.
Full Calendar


Seeking an INDUSTRY JOB?

Hiring? In conjunction with our sister brand, Cynopsis, we are offering hiring managers a deep pool of media-savvy, skilled candidates at a range of experience levels and sectors, The result will be an even more robust industry job board, to help both employers and job seekers.

Contact [email protected] for more information.