Cable Operators

Prime Latino Time

12/19/2004 7:00 PM Eastern

Since his days as a door-to-door cable salesman, Time Warner Cable’s senior vice president of marketing, Brian Kelly, has recognized the important role that Spanish-language television plays in the core of the Hispanic community — as well as the need for effective marketing strategies to reach it.

By visiting Latino neighborhoods back then, Kelly — who prides himself on knowing just enough Spanish to be dangerous — learned, for instance, that he could amuse Hispanic women by relating the plotlines of their favorite soaps.

Today he’s following a different Hispanic plot. “It is pretty clear that because of the different markets that we serve and from the feedback that we’ve been getting from our divisions, that the multicultural marketing is becoming more and more of a priority within the Time Warner Cable marketplace today,” Kelly says.

Time Warner Cable’s major Hispanic markets include New York, New Jersey, San Diego, Texas and the Carolinas. The company has been developing resources in its corporate marketing department, tailoring products and services to fit each of the communities it serves.

To help in these efforts, the company recently hired Maida Chicón as its new multicultural marketing director. Chicón — who has worked in multicultural and communications capacities for Verizon Communications and Colgate-Palmolive Co. — has already made an impact at Time Warner Cable, Kelly says, especially in the Southwest markets, where some of its divisions are predominately Hispanic.

“Maida will serve in large measure to aggregate and share best practices among the divisions so that we don’t 'reinvent the wheel,’” he says.

While Chicón’s arrival is an important sign that the operator is pumping up its nationwide efforts to target Hispanics today, the MSO is actually considered by many as a pioneer in the space.

In early 2003, its New York City system rolled out the MSO’s first Spanish-language digital package. That move was followed by Hispanic package rollouts in a number of other systems, each customized to fit the individual markets.

“I give credit to Time Warner, which in my opinion was one of the first MSOs that started truly recognizing that there was a tremendous market there,” says John Figueroa, director of sales and multicultural marketing at the MSO Charter Communications.

That view is echoed by Jorge Fiterre, a co-partner of Condista, a company that handles distribution for a number of Hispanic networks, many of which are distributed by Time Warner.

“Last year [Time Warner] launched a package that included 30 Spanish-language channels, which was competitive with the number of channels that satellite features,” Fiterre says. “It was an all-out effort to compete with satellite and offer as much programming as they did.”

One of the masterminds behind that strategy, Bob Watson, vice president of programming and new business development at Time Warner Cable, fully understands the threat posed by DBS services like Dish and DirecTV.

Watson notes that surveys of Hispanic consumers in New York City show that awareness of satellite offerings is 20 points higher than cable.

A fair amount of this competition is surmountable by being more communicative and by creating more awareness of the services that TWC is offering, Kelly says.

“I think it’s just a matter of rolling up our sleeves and doing as much research as we possibly can to understand what are the things about our products and services that resonate with the Hispanic community,” he adds.

While Time Warner Cable’s New York systems offer a very streamlined package for about $28, the MSO still requires subscribers in many of its other markets to buy up through the digital tier and pay $50 or more for Spanish-language programming.

This is likely to change soon, however. The company is now revamping its offerings and is expected to roll out a lower-cost tier that doesn’t require customers to buy through.

That said, the MSO is increasing its subscriber fees for all consumers, and subscribers to digital Spanish-language tiers will see a slight price hike next year.

Kelly says the cable operator is looking at trials in some of its predominantly Hispanic markets. Among them, San Antonio is front and center.

Last February Time Warner launched a Spanish-language digital package in that Texas city, home to one of its most successful divisions. The cable operator currently has about 7,000 Hispanic subscribers there — of which about 90% are subscribing to at least one premium package.

The San Antonio market has also provided Time Warner with one of its highest VOD revenue-per-digital-customer numbers, a fact that is particularly noteworthy because it’s the only market where TWC offers free VOD. Kelly says VOD resonates in Hispanic homes.

Additionally, the San Antonio division is heavily marketing its long-distance phone service and RoadRunner high-speed Internet service to the population in general, and those efforts have now been incorporated into special Hispanic marketing strategies, including special phone rates between Texas and Mexico.

“Going forward it is important for MSOs like Time Warner to brand the entire cable platform — not just video, but also phone, broadband and advanced services like VOD — to the Latino market, including the market opportunity represented by bilingual and English-oriented Latinos,” says Adriana Waterston, director of marketing and business development at the research firm Horowitz Associates, Inc.

Kelly says the company has made strides in working with Spanish-language networks to provide programming on a free-VOD basis.

“That technology [is] amenable to a testing environment,” he explains. “So if someone has a programming concept that is viable, then I believe they should put their programming content to the test, and get it into a video-on-demand platform, do some promotion, and live with the results.

“If customers support their product and show interest, that would send a big message to the cable company,” Kelly adds.

He keeps his cards close to his chest in discussing how fledgling networks — many of which get very little advertising revenue — can thrive in a free on-demand environment.

But despite the revenue question, Fiterre sees benefits to be had with free on-demand.

“It is a very effective form of promotion for programmers who otherwise have no outlet for their programming,” Fiterre says.

“There are customers who may not be familiar with your programming,” he adds. “But if you offer part of it on a VOD platform, there is a chance it is going to generate interest from the customers, which hopefully will be noticed by the cable operator.”

Kelly says that the thing about cable television that he’d always loved is that the industry doesn’t necessarily define the audience’s limitations.

“One of the major selling points in the days when we first came on the scene was that we were not encumbered by the programming definition of the broadcast community,” Kelly says. “We could serve niche audiences, and we could serve communities.”

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