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DirecTV's Spanish Steps

For Hispanic viewers, DBS delivery is the popular choice, particularly among newer immigrants who are more accustomed to satellite TV and believe it offers more channels from their homelands than cable. In many markets, EchoStar and DirecTV often have the edge over cable.

“Satellite has always had great impact on the Hispanic market,” says Adriana Waterston, marketing director for Horowitz Associates, a research firm that zeroes in on the Hispanic market. “When cable wasn't even interested in the market, the satellite companies were already offering Spanish-language programming packages at very affordable prices.”

EchoStar's Dish Network has offered Hispanic programming and channels since 1996 and now offers three separate packages. DirecTV, the larger of the two DBS services, has been offering its DirecTV Para Todos (DirecTV for Everyone) for five years. In this Q&A with Magaly Morales, Neal Tiles, DirecTV EVP of marketing, explains the DBS provider's plans for expansion under the new management of Rupert Murdoch's News Corp.

Tell us about your current marketing strategy to reach the Hispanic community.

The service was designed for and is being marketed to Hispanic households that are multigenerational and have different levels of acculturation. These consumers have a wide variety of Spanish-language viewing and speaking needs, which is why we provide both English- and Spanish-language programming as a bundle within all of our DirecTV Para Todos packages. The focus is Spanish-dominant, bilingual and multigenerational households or a bicultural Hispanic household.

We've done extensive research assessing needs, the availability of channels, and drilling down to the packages and price points.

What has been the reaction?

The platform experienced 160% growth compared to the same quarter of the prior year. It is clear this programming strategy, along with our targeted marketing efforts, has paid off.

The idea is to give programming from several Spanish-speaking countries?

We recognize that U.S. Hispanics have diverse needs when it comes to television viewing: programming that caters to the needs and interests of each of the different nationalities within the Hispanic community.

For example, we offer ONCE México and México 22 direct from Mexico; and TyC Sports or Telefe Internacional from Argentina; Caracol from Colombia; WAPA-America from Puerto Rico; Colorvision from the Dominican Republic; Ecuavisa from Ecuador; TV Chile from Chile, and so forth. We really live up to our name: DirecTV Para Todos—for everyone, not just one specific segment of the market.

Which kind of programming is most successful with your Hispanic viewers?

Sports—particularly soccer—is immensely popular, and we have created what we believe is the strongest sports programming lineup of any Spanish-language pay-TV platform, with GolTV, the only 24-hour soccer channel, added this month and our existing programming exclusive to TyC Sports and Fox Sports en Español.

What you do think is the most significant advantage that satellite has over cable?

Cable is at a competitive disadvantage in most Spanish-language markets, particularly the smaller markets where [operators are] reluctant to commit capacity to Spanish-language channels that will only be seen by a small number of viewers. With our national reach, we have the ability to provide DirecTV Para Todos to every Hispanic household that wants it, no matter how small the community, no matter where it's located in the U.S.

Tell us about the challenges ahead, particularly in terms of churn and retention.

We are also placing increasing emphasis on customer satisfaction, through enhanced customer service.

Another part of the retention strategy is applying more-stringent credit policies, so we're acquiring quality customers who have solid credit reports. But most importantly, by adding the channels mentioned [before], a total of eight new channels in 2004, we feel that, by delivering relevant content, coupled with the efforts mentioned [before], we have a very compelling product that will attract and keep customers.