EXECUTIVE SESSION WITH KEVIN CUDDIHY

Univision’s Second Language: Market Share

Univision Television Group President Kevin Cuddihy says his stations are out to take business away from English-language stations, while warding off incursions on their own turf by the likes of NBCUniversal's tenacious Telemundo and the soon-to-launch MundoFox. Key to that strategy is heavy investments in local news and close collaboration with other facets of Univision — network, radio and digital.

Spanish-language TV may not be getting its fair share of the advertising dollars yet, but it has one great advantage over its English-language counterparts — a fast growing population of viewers.

As president of the Univision Television Group, whose 62 stations (41 full power and 21 low power) represent the O&O backbone of Univision, the No. 1 Spanish-language network and its Telefutura flanker network, Kevin Cuddihy enjoys the ratings and revenue growth that comes from the favorable demographic dynamic.

But as becomes clear in this interview with TVNewsCheck Editor Harry A. Jessell, the 30-year broadcast veteran is also keenly involved in the share game.

With heavy investments in news, he says, his stations are out to take business away from the English-language stations, while warding off incursions on their own turf by the likes of NBCUniversal’s tenacious Telemundo and the soon-to-launch MundoFox.

According to Cuddihy, the Univision stations expect to take share by continuing to invest in local news (the typical Univision station now airs a three-hour broadcast in the morning and 6 and 11 p.m. newscasts leading into network news) and by doing what they can to attract Hispanic voters and the political dollars that will naturally follow.

It also helps that all the components of Univision — networks, digital, radio, TV stations — work closely together to boost ratings and sales, he says.

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What’s next? Watch for developments in multicasting and social media, he says.

Cuddihy was named president of the Univision stations May 2011 after serving as EVP of sales.

Prior to joining Univision in 2009, Cuddihy spent eight years at Comcast Spotlight Sales rising from VP and GM of Detroit Marketlink to SVP of advertising sales. Prior to that, he spent close to two decades with the CBS O&Os. After moving up from account executive to general sales manager at WCCO Minneapolis, he went to WWJ Detroit where he was director of sales and later GM. He also served briefly as GM of LIN Media’s WNDY Indianapolis before joining Comcast.

An edited transcript:


How’s business?

It’s been great. Obviously, coming out of the recession was very difficult. But the momentum has definitely switched in our favor. We finished the fourth quarter with core up 9.7% and we finished January at plus 5%. That’s much better than the English-language market is doing. So we’re definitely taking share. It’s driven a lot by our largest category — everybody’s largest category — auto.

What’s the outlook for the rest of the year?

We have got a good core year coming. I would say it will be in the upper single digits. That’s half the number, right? The other half is the political number.

We will continue to see strong auto. There is no reason that we should see a slowdown there. Obviously, there’s some concern about the price of gasoline, but the auto manufacturers have a lot more cars compared to what they did the last time this happened. Because of the easy winter, it’s been a great early spring for the manufacturers.

And how about political?

The PAC money this year will be bigger than ever so we’re certainly taking advantage of that. We had our best share of political dollars ever in 2011. If we can do that again, we will certainly be into the double digits for growth in 2012.

We have been aggressive in trying to attract political. We have built a political team with experts from both sides of the aisle. Our local stations in markets like Florida, Texas and California run debates. We have got a comprehensive campaign to help raise awareness among Hispanics.

It’s interesting. In the last election, 85% of registered Hispanics voted. So while the percentage of Hispanics registered is lower than the national percentage, the percentage of Hispanics who actually vote is nearly triple the national average. We have a campaign called “Ya Es Hora,” which is, “It’s Time.” It’s really about going out and getting people registered because when they register, they vote. Quite frankly, when people buy political time, they’re buying people who vote.

Given all that, are you getting your fair share of the political money?

Getting an increased share, I would say. There is still room for growth in share versus our viewing percentages.

We had one media buyer tell us that that Hispanics account for 17% of the U.S. population, but that Hispanic media are getting only 4% percent of the ad dollars. Does that sound about right to you?

Well, it really is a market-by-market situation based on the penetration of Hispanics. If you look at the media dollars being placed in, say, Miami, that’s not the case. There, I think that the dollars being spent for Hispanic media are pretty much the same as what they are for English.

But there’s no question that while we continue to gain share as we did in the fourth quarter and as we are in the first quarter, there’s room for more share growth to equalize our share of viewing. Our television stations in Los Angeles, Houston, Dallas, Phoenix are No. 1 in news regardless of language in adults 18-49.

So, your revenue is not commensurate with the ratings in some places?

No. And, in fact, it should be greater in some places. If we index at 113% on mobile users or we index 113% in QSR [quick service restaurants], then my fair share might not be my viewing share, it may be 13% more than my viewing share. But we don’t have the right to win in every category —  no television station does — but we have the right to win in some key ones though.

In how many markets are you now airing local news?

I would say virtually all of our markets, with the exception of a couple that we took over through a bankruptcy. We’re not in Salt Lake and we’re not in Cleveland, but we have launched news in the past year in Raleigh [N.C] and Atlanta. This year we will have more personnel in news than at any time of the Univision station group’s history. So we’re definitely reinvesting in our news product and growing it to where it hasn’t been before.

Regardless of how good of a sales department you have, if you don’t have any ratings, it’s tough to succeed. We just had a fantastic February sweep period. We had five of the top 10 most-watched late local newscasts in the country in 18-34, regardless of language.

Where were they?

LA and New York were No. 1 and No. 2. Houston was No. 3. Chicago and Dallas came in at six and eight. There were significant increases across the board, but even more so in Chicago and Dallas where we went fully HD with our newsrooms and had brand new news sets as well.

You were in English-language television for 30 years, in station sales and management. How is the Hispanic market different?

When I first started in English-language television in the late 1970s and I dealt with a retailer or an auto dealer, he was probably older and post-World War II. He did more business this year than he did last year and it wasn’t because his television spots were better this year than last year. It wasn’t because he was a better marketer this year than last year. It was because there were more people this year than last year. That’s because of the baby boom.

But after that, there was only one way to grow your business. It became a share business, right? So, you’re going to buy the F-150 from me. Or, you’re going to buy it from the Ford dealer five miles away. Or, you might just go out and buy a Chevy Silverado. It’s all about getting shares. So what do you do? You get rebates, you get low financing, etc.

But today in Hispanic media you can sell more this year than you did last year. Why? Because there are more Hispanics every year in the United States. So, we talk about core growth and assets. We talk about business owners who can get more growth year after year by attracting the Hispanic customers because there just will be more next year than there are today.

But is that really true? Aren’t second- and third-generation Hispanics straying away into the English-language world just like every other immigrant group?

That’s a concept that’s been put out there that frankly is not really that accurate. Interestingly enough, the most quote-unquote acculturated city in the United States is San Antonio, Texas, where a vast majority of Hispanic citizens speak at least some English as compared to other heavily Hispanic markets. And yet we’re No. 1 in early news, we’re No. 1 in late news and we’re No. 1 in primetime in that market. So it can’t be about language. It’s about cultural relevance.

I know that Univision and Hispanic TV in general must be doing well because Fox is coming into the marketplace with a new Spanish-language broadcast network. What’s your take on MundoFox?

Every time that there’s another entrant, it’s a recognition that this is just something that’s not going away, that this is a way for people to grow their businesses. It’s no longer numbers you can ignore at 50 million-plus and growing. So it’s kind of “join the bandwagon.”

We will see more of that. But it’s our job to be the best and we were the early movers. We serve our communities, and we work to educate them, to help them do better in their communities. We’re here to stay and we’re here to win. We’re a competitive bunch.

It’s nice that Fox is endorsing your business, but it’s a tough competitor out there trying to take share.

Telemundo is trying to take some. Azteca is trying to take some. There’s plenty of people out there trying to take some. We’re still the No. 1 Hispanic media company in this country and we have things that they don’t have quite frankly. We have got a solid digital platform and we have got a solid radio platform. Our competition can’t say that.

Do you think there’s room for even more Hispanic broadcast networks?

Well, when I was in journalism school in Syracuse, I wrote a paper as to why there would never be more than three broadcast networks. So seeing as how I knew nothing then, I will assume that 30, 40 years later I know nothing now. Just say, I would never say never.

Do you sell the radio with the TV?

As a company, we are 100% collaborative whether it’s digital, whether it’s radio, whether it’s local, whether it’s network. Whatever we can do to fulfill our clients’ needs, we will do it. So, absolutely, we will sell radio with television all day long.

I worked 20 years at CBS and I didn’t have a lot of luck even as a general manager [of an O&O] in getting commitments from the network to do things to help the station group. 

It sounds like you are where the Big Three networks and stations were 50 years ago — real partners.

Absolutely. There’s probably not a couple of days that go by that I am not talking to network news and network entertainment to see what we can do to help grow our ratings. Honest, open discussion and bringing that family together are things that our competition won’t have.

Do you have a multicasting strategy, a plan for putting the rest of your channels to work?

Not all of our Telefutura stations are full-power stations. So, we have been able to use the .2s [subschannels] of our full-power Univision stations to extend the coverage of Telefutura stations in some markets. In addition to that, we’re kind of looking at other ways to serve the community. You will see additional .2 and .3 programming from us in 2012.

How important is your over-the-air coverage?

We spent time at the FCC on spectrum issues. I have got two general managers in D.C. today who will be talking about spectrum again. As I said, we use some of it for boosting Telefutura’s coverage. But, more important, we have got markets in Texas and Arizona where 40% to 50% of our viewers are over the air. That is clearly critical for us. We’re going to be protective of our spectrum.

Do you know what percentage of your group-side audience relies on over-the-air reception.

We believe that’s about 18%.

Is there a market for English-language Hispanic TV?

There hasn’t been to date. There has not been significant revenue placed against that to date.

You hired Sandra Thomas last year to head news at the group level. Why did you think there was a need for that?

Sandra was our news director in San Francisco and I had been without a centralized news leader for the television station group and felt like we could use some consistency around what we’re doing and having her work with our news directors around the country to make sure that we’re putting the best product out there.

She also works very closely with our affiliates. Our largest affiliate group is Entravision. We do have an affiliate news operation that supplies video, not only for our own stations, but for our affiliates as well. So she does have that responsibility in addition to the owned and operated group.

What’s happens next on the news front? More HD?

Certainly more HD both in studio and on the streets. So there’s no question that we will continue to upgrade our product as well as our sets. In addition, we’re looking right now at other franchise opportunities from entertainment and technology as we attract a little bit younger average demographic in our news than say English language does.

Our strength is 18-34 and 18-49. You know, typical English language news is 50-plus. So we want to make sure that we’re giving our viewers things that they’re interested in. You will see a lot more social media from the station groups, a lot of tweeting and Facebook.

Why does Hispanic news skew younger?

I think it’s a function of the overall age of the Hispanics in our marketplaces.

So you have no advice for your English-language counterparts on how to get younger viewers?

They can stay 50-plus. That’s fine.


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