DTV carriage: V-me’s first step to viability
Among public TV’s suddenly congested multicasting channels, the Spanish-language venture V-me, launched in March, has won spots on 27 stations — enough to reach a potential audience of 30 to 40 percent of U.S. households, though with gaps in four key states.
As the country’s Latino population grows, V-me is aiming to reach as many of the country’s 11.6 million Hispanic TV households as possible, says President Carmen DiRienzo.
The investors who are partners in the venture with New York’s WNET have given it three years to find its revenue legs, and V-me has made a 10-year commitment to the public TV stations that carry it. In addition to assembling a network to reach U.S. viewers, the business plan includes selling ancillary products and licensing its programs abroad. DiRienzo says both are progressing.
To supplement the distribution by pubTV stations, V-me arranged carriage on the two major direct-to-home satellite broadcasters, DirecTV and Dish Network, though that has led to conflict with HITN, another noncommercial Spanish programmer (separate story).
Carriage has grown from 18 stations at launch to 27.
V-me’s route to the public is through public TV stations’ DTV multicast channels, which ordinarily gives it carriage on local cable systems, thanks to public TV’s 2005 carriage agreement with major cable operators.
But stations have many other options they can plug into the few multicast streams — typically four — that they compress into their DTV signal. Options include high-def broadcasts, local or statewide education channels, and two packaged channels jointly developed by WNET and WGBH — the lifestyle channel Create, distributed by American Public Television, and the doc and public affairs channel PBS World.
As V-me gets carriage, it must also win Latino viewers’ attention against Spanish-language giants Univision and Telemundo, cable services Galavision and Discovery en Espanol, and the noncommercial Hispanic Information and Telecommunications Network (HITN-TV), among other alternatives. And for the half of Latinos who are bilingual and the 15 percent who say they communicate mostly in English, there’s the boundless competition of mainstream TV.
But V-me execs believe the service’s public affairs, science, lifestyle, performance and children’s educational programming sets it apart. “V-me provides the same alternatives to that [Spanish-language] commercial television programming that our primary services in public broadcasting provide to the commercial services in English,” says DiRienzo.
“We don’t suggest that the programming that’s broadly available on Univision and Telemundo shouldn’t be there,” she says, “but we do think there should be an alternative for people who need or prefer Spanish-language television.”
The challenge for V-me, DiRienzo says, is “rising above the cacophony. Building the awareness is going to be an uphill battle.”
A “growing part of our public”
Of the 15 states with the largest Hispanic populations, as listed in a 2005 study by the Pew Hispanic Center, V-me is available in 11. Georgia, North Carolina, Pennsylvania and Massachusetts, all in the top 15, are absent from its lineup.
DiRienzo says V-me’s absence in these states is mostly because pubTV stations there have no uncommitted multicast channels. Create and World, both developed jointly by WNET and WGBH, are the main national competitors. Create reached 65 percent of U.S. households (through 184 stations) in its second season. PBS World reaches 29 percent (with 57 stations).
In the Southeast, where the Latino influx is relatively new, DiRienzo thinks stations have the challenge of evaluating whether the size of the Spanish-speaking community warrants the service. “In some communities, the station’s view is that they can serve the Hispanic community together with the general market and that the Hispanic community’s needs are not so great as to demand the allocation of an entire channel,” she says.
Communities’ responses to V-me have generally been positive. There was a ripple of opposition from a Maryland state legislator, Del. Patrick L. McDonough (R-Baltimore County), who joined the alarmed reaction of some in Maryland, where the Hispanic population grew by more than a third between 2000 and 2005. McDonough has advocated a law forbidding day laborer centers from helping undocumented immigrants find jobs and increasing penalties for crimes committed by the undocumented. Soon after V-me launched, he questioned whether it was a good use of a state-owned channel.
Maryland Gov. Martin O’Malley and Lt. Gov. Anthony G. Brown, both Democrats, were vocal supporters of V-me. “There have been far too few outlets of intelligent, quality programming for Marylanders who speak or are fluent in Spanish . . . . But that’s about to change,” Brown said at the local V-me launch.
Maryland Public Television’s basic mission drove its decision to carry V-me, says President Rob Shuman. “The Hispanic community in Maryland is a growing part of our public,” he says. “[I] saw that . . . and then we viewed V-me. We loved the quality kids’ programming — and the adult programming. We thought it was very unique.”
DiRienzo was surprised by the negative reaction in Maryland. “Unfortunately, the people that began to lash out at the service had never seen it,” she says. She thinks V-me has actually improved — and expanded — stations’ community relations. “Many of the stations,” she says, “have kindled or rekindled associations with important community group leaders as a result of presenting V-me.”
A private-public partnership
V-me is a for-profit venture backed by private financiers — the Baeza Group, an investment firm aimed at the Hispanic market, and Syncom Funds, a venture capital firm focused on media. Educational Broadcasting Corp., licensee of WNET and WLIW (and operator of Current), owns 20 percent of the project.
EBC guides program decisions and licenses V-me to pubTV stations, which get the service free if they sign on for 10 years. “The stations’ commitment is to promote the service and to include V-me in appropriate outreach opportunities,” says DiRienzo.
Mario Baeza, a member of the EBC Board of Trustees, heads the Baeza Group and is founder and executive chairman of V-me. In 2003, Baeza asked that his annual financial contribution to WNET go toward development of a Spanish-language service, and his firm eventually became the primary investor. After that, according to WNET, Baeza recused himself from any board discussions and decisions about the service.
The plan is for the investors’ funds to help keep V-me going for three years, by which point it will be turning a profit. “I think that we are certainly on track to achieve that goal,” says DiRienzo. “The investments span over time, and obviously we need to generate support from corporations and foundations.”
She believes funders “can be confident that even without any further growth, we’re reaching over 40 percent of the Hispanic market, and after 2009, when more people are able to view the broadcast signal [when all TV signals convert from analog to digital], we will grow exponentially.”
In addition to underwriting, program licensing and merchandizing are critical to the business plan, according to DiRienzo. V-me is selling DVDs of some programs and working to license its programming outside the country. DiRienzo says the channel is also working on a deal to create program-related books and other educational materials.
Who’s watching?
It’s difficult to get a clear picture of the potential U.S. audience for Spanish-language programming, says DiRienzo.
“We know that of approximately 12 million Hispanic TV households, just under 3 million get satellite—there may be more.” The estimate is based on the number of households that subscribe to premium Spanish-language services, so there could be families who make do with ad-supported channels such as Telemundo. “The same thing with cable,” she adds.
Based on indications like those, she says, “Our educated guess is that approximately 60 percent of Hispanic households have either digital cable or satellite.” They therefore are within reach for V-me. And after the move to DTV in 2009, V-me will likely gain over-the-air viewers, DiRienzo says.
Not everyone in Hispanic households is a full-time Spanish-speaker, however, and many prefer TV in English. A Pew Hispanic Center study last month notes a generational shift. While fewer than one in four Latino immigrants say they speak English well, 88 percent of their U.S.-born adult children say they do. Nearly half of U.S. Latino adults — foreign and native-born — are fluent in both English and Spanish.
DiRienzo says V-me continues to get positive feedback — in both languages — from the Latino community, particularly on the channel’s website. “On the English side, public television has been serving the general market for many years and serving it well, and people forget to say thank you,” she says. “But because this is new, and because it is so clearly an alternative to what is otherwise broadly available, people everywhere are saying thank you.”
She offers testimonials, including this note to V-me: “As a history teacher in the Chicago public school system, ‘I’m like a kid with a new toy,’ happy and satisfied to be able to use in my classroom the information you offer.”
Another wrote: “We were all so tired of only having telenovelas on Spanish TV.”
Web page posted March 3, 2008
Copyright 2008 by Current LLC
