Univision/Televisa Deal Raises Online Stakes

 

Univision and Televisa have finally kissed and made up. After years of bickering, last week's reconciliation seems to be a win-win for both parties.

From a financial perspective, Televisa will invest $1.2 billion in Univision for a 5% equity stake and assume a huge chunk of Univision's debt in exchange for an additional 25% equity stake. Perhaps more importantly, however, the deal grants Univision exclusive U.S. rights to Televisa's broadcast and digital assets through 2020.

There is no disputing that Univision dominates the U.S. Spanish-language media industry especially when it comes to television and radio. Univision's television network reaches nearly twice as many household as the No. 2 player, Telemundo. In radio, Univision reaches 73% of the Hispanic market through 73 stations -- compare this to its nearest competitor, Spanish Broadcasting System, which has only 15 radio stations.

Univision is also the No. 1 player in the Spanish-language online market, but competition is much tighter when compared to Spanish-language television and radio. The following data from Quantcast.com show a more competitive Spanish-language online industry:

1. Univision.com 1,500,000*
2. Terra.com 1,100,000
3. Telemundo.com 581,000
4. Amigos.com 533,000
5. EsMas.com 430,000
6. QuePasa.com 350,000
7. MedioTiempo.com 323,000
8. Starmedia.com 263,000
*Monthly U.S. users

Barriers to entry in the online world are significantly lower than those in the television and radio markets, making compelling content that much more important online. And compelling content is exactly what Univision gets through its renewed partnership with Televisa.

Televisa has a wealth of highly attractive digital content

Televisa is the largest multimedia conglomerate in the Spanish-speaking world, and Univision is now Televisa's distribution platform in the U.S. In addition to its hugely popular telenovelas, Televisa also owns three Mexican soccer teams, including the popular Club America; Editorial Televisa, which produces and distributes 178 magazine titles, and Televisa Cine, which produces original feature films, just to name a few.

With access to Televisa's digital content, Univision is well positioned to continue to succeed in the U.S. Hispanic online market. It just has to figure out how to leverage it to attract and engage more users by 2020.

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Lee Vann is founder and CEO of Captura Group Captura Group. For nine years he has led Hispanic interactive initiatives for clients including the U.S. government, Allstate Insurance Co., Century 21, PayPal and Ford Motor Co. Reach him here.