DirecTV to Push Local Spanish Channels

Direct-broadcast satellite lobbyists may be licking their wounds following a long, losing battle against must-carry requirements for cities in which they carry local broadcast stations, but their marketing counterparts are quietly enjoying the benefits of those additions.

Among the new broadcasters that came to DirecTV Inc. late last year to satisfy the Jan. 1, 2002, must-carry deadline are the DBS provider's first local Spanish-language offerings. The addition of the broadcasters — available in 16 markets — removes DirecTV Para Todos's last barrier to purchase for its key target audience in those DMAs, said DirecTV Para Todos and international services vice president Yolanda Macias.

The DirecTV Para Todos package offers a bundle of popular English and Spanish cable channels for a single price. In the 16 markets in which Spanish broadcasters have been added, all of the local channels will be included as part of a new standard package that will sell for $37.99, instead of $31.99.

"This market cannot find an equivalent value of English and Spanish programming at this price anywhere else, either on cable or EchoStar [Communications Corp.]," Macias said.

Even when DirecTV offered national feeds for popular Hispanic networks such as Univision, there was still strong demand for local affiliates in such markets as Los Angeles and New York, Macias said.

"Our customers say they want to see their local news and programming," she said.

Los Angeles has the strongest concentration of local Hispanic broadcast stations, with six added to the DirecTV and DirecTV Para Todos lineup since must-carry kicked in. New York, Miami and San Francisco each have three Hispanic stations on the service.

Other DirecTV markets with Hispanic broadcast channels include: Atlanta; Boston; Chicago; Cleveland; Dallas; Denver; Houston; Phoenix; Sacramento, Calif.; San Antonio; Tampa, Fla.; and Washington.

Macias hopes the availability of additional local channels will quadruple the service's penetration. About 60 percent of the new Para Todos subscribers projected for 2002 should come from the markets in which local Spanish broadcast channels have been added, she said.

In the 25 markets where DirecTV offers only English-language stations, there are either no local Spanish-language channels or the outlets are low-power broadcasters not subject to must-carry rules, according to Macias.

In Los Angeles and Miami, affiliates of Spanish broadcasters Univision and Telemundo have outperformed those of such English-language networks as NBC in the ratings, Macias said.

DirecTV Para Todos will use a regional approach to market the Spanish stations. In Los Angeles, it will push the availability of the new network Azteca America, a U.S. feed of the popular Mexican network TV Azteca. DBS rival EchoStar previously had exclusive U.S. multichannel-distribution rights to that service.

"We understand the power of that brand," Macias said, noting that 50 percent of Los Angelenos are Hispanic, and, of those, 90 percent are of Mexican heritage.

"We're going to shout about TV Azteca in our advertising," Macias said, pointing to outdoor, radio and print ads that broke last Monday. DirecTV Para Todos will also promote the local channel's availability on Azteca America itself.

DirecTV Para Todos also expects to receive marketing support from its retail dealers. "They're thrilled to sell a cable-replacement product," Macias said.

Dealers are also pleased that Hispanic DBS subscribers tend to purchase more second receivers than the average DirecTV customer.

Because Hispanic households are often bilingual and multigenerational, "there are more viewing preferences within those homes," Macias said.