Univision’s English-Language News Network, Fusion, Targets Millennials

Bloomberg Businessweek
Companies & Industries

By Graeme Wood
September 05, 2013

Univision's English-Language News Network, Fusion, Targets Millennials

Photograph by Stefan Ruiz for Bloomberg Businessweek

(Updates the name for Jorge Ramos’s show in the 16th paragraph. Corrects the time period Univision says its ratings among 18- to 49-year-olds beat ABC, CBS, NBC, and Fox in the fourth paragraph.)

Isaac Lee, the Colombia-born 42-year-old in charge of news at the Spanish-language network Univision, is a traitor: first to his native tongue, and second to his generation. As the architect of the forthcoming all-news channel Fusion, Lee is plotting the first English-language broadcast for a network whose main draw for the last half-century has been that it’s en Español. In that niche, which has long since grown into a mass market, Univision has dominated its rivals, styling itself, with just a hint of hubris, as “the Hispanic heartbeat of America.” When Fusion goes live on Oct. 28, Univision’s programming will suddenly be bilingual, with 24 hours of English to match its 24 hours of Spanish.

The greater betrayal, at least for reporters of a certain age, is Lee’s determination to reach millennials with cable news. Television news audiences have been graying across networks, and Fusion is supposed to cater to 18- to 34-year-olds, who would as soon listen to Bing Crosby as watch Brian Williams. “If one year from now, you turn on Fusion and it looks for a second like it’s Univision news, I should be fired,” Lee says. “Right now our target viewers probably don’t watch any news,” he adds. “They watch The Walking DeadSons of Anarchy, and Girls. When they do watch news, it’s a different type of news: Jon Stewart is news; The Colbert Report is news. What we have to do is understand what it is that this generation wants.”

Univision’s viewers have changed dramatically in the past two decades. So have the demographics of American Latinos, who used to come to America by crossing borders, but increasingly arrive in its hospital maternity wings. They speak English perfectly, often better than Spanish. Univision’s news audience already skews young, but to lock in its lead among the cherished 18- to 49-year-olds, programming in English is essential.

That doesn’t mean the evolving strategy is risk-free. In July, Univision reported quarterly profits of $40.7 million, up 28 percent from the year before. That same month, the network crowed that, for a month, its ratings among 18- to 49-year-olds dominated ABC (DIS), CBS (CBS), NBC (CMCSA), and Fox (FOX). National ads boasted, “Número Uno is the New #1.” Its ratings have enjoyed a steady rise as the Hispanic population has grown 43 percent in the past decade. Historically, telenovelas (soap operas), not news, have attracted the most eyeballs; most of Univision’s telenovela programming has been produced by Mexico’s Grupo Televisa(TV).

Fusion is a joint venture with ABC. With 20 million subscribers at launch, through partnerships with six of the major cable distributors, the network will have one of the biggest debuts in years. The launch is estimated to cost $275 million, according to an analysis of Miami-Dade County documents by the Miami Herald. Industry analysts have compared its magnitude to the much-heralded 2009 debut of the MLB Network. Fusion reflects, depending on how one looks at it, the success of the Hispanic American community in general and of Univision in particular. Or it may portend a dangerous new era for the network, when its audience is not as linguistically captive—and may not be as loyal.

Isaac Lee, president of Univision’s news division
Photograph by Stefan Ruiz for Bloomberg Businessweek

Isaac Lee, president of Univision’s news divisionLee lives as an expatriate outside Miami, in a lush and wealthy suburb whose muddy roads, blue swimming pools, and overgrown vegetation recall the prosperous neighborhoods of many Latin American capitals. He frequently meets with his Fusion team in his home’s modern white breakfast nook. On a morning in June, Lee wears a black T-shirt and clear-plastic glasses. His dog, Chocolate—pronounced “show-co-LAHT-ay”—begs for scraps under the table, while the editorial team discusses Fusion programming ideas and a Univision documentary about the abuse of farmworkers.

Lee arrived at the network in early 2011, roughly the same time as his counterpart at ABC News, Ben Sherwood. Sherwood says his interest in anglicizing Univision grew out of a book idea he had in the late 1990s about the population decline of white America. He abandoned the book, but the demographics remained convincing. “I’m a Californian, and in the 1990s I saw California go through the demographic changes that are now taking place throughout the United States,” Sherwood says.

Univision approached ABC with the idea for a collaboration, and Sherwood, Lee, and Univision President Cesar Conde had lunch at ABC headquarters in New York in March 2011 to discuss a partnership for 2012 election coverage. Julie Townsend, a spokeswoman for ABC News, says the “bromance” among the three men blossomed from there, and the deal for Fusion was inked by December 2012. Univision is leading the content production, and ABC will run the back end, including drawing advertisers.

Lee has a long résumé of running successful magazines and websites. He began his career in Colombia editing one of the most influential magazines in South America,Semana, which specializes in political investigations. As an aggressive editor in Colombia in the 1990s, he led a series of investigations that exposed the influence of drug money in politics. He founded Poder, a business-focused weekly, as well as Animal Político, a tabloid-style political website, both of which remain popular in Mexico. His work has always been in his native language, but his English is fluent, spirited, and almost as persuasive as his Spanish.

Univision’s current news offering, which Lee oversees, spans a mere three hours per day. It’s a conventional-looking broadcast: Anchors Jorge Ramos and María Elena Salinas sit behind a desk and cut away to correspondents in the field. Lee regards the format as stale, and the demographics of his Fusion staff reflect that. Juan Rendón, a 36-year-old Colombian filmmaker and journalist, explains that Lee coaxed him to Univision with the promise of letting him start a documentary unit. His first project was mostly animated. “At Fusion, you’ll be surprised to find anyone past the age of 30,” Rendón says. “When you go into a Univision newsroom … .” He trails off diplomatically.

Boris Gartner, his 31-year-old vice president for strategy and new initiatives, finishes the thought: “You’ll be surprised to find someone who’s been on the job less than 30 years.”

“Well, 20,” Rendón allows.

Fusion, Lee says, “has to be completely different. Not just the language, but also in tone, music, and attitude.”

Univision and ABC reporters will be expected to repackage their stories for Fusion. “What we don’t want is the ABC correspondent standing up with a microphone here and saying, ‘Reporting from Syria [for Fusion],’ ” Lee says. “Instead, we can have someone from Syria, living in the U.S., invited as a guest to our studio. What does their family tell them? Can we have their telephone number? Let’s call them right now.”

To many journalists, this may sound like reporting on the cheap. Lee acknowledges that Fusion’s news won’t rival correspondents in the field for gathering facts: “I don’t pretend to compete with anyone in Syria, and I’m not going to send my people where I do not have an advantage.” But he promises the result will be hipper and more “human-centric.”

One clue to the channel’s sensibility is its recent hire of Billy Kimball, a former writer for The Simpsons, as chief of programming, and David Javerbaum, a formerDaily Show With Jon Stewart head writer, as executive producer. Most of the content, Lee says, will be stories that would in normal circumstances not appear on Univision’s news shows at all. Lee points to David Beckham’s recent plan to build a Miami soccer team as a potential Fusion story that might consume a good chunk of a day. “Justin Bieber’s meltdown might be another,” adds Joel Kliksberg, Fusion’s director of business development, who worked with Sherwood at ABC. Lee says that for millennials, news might also include a show such as Locked Up Abroad, the National Geographic program about hapless Americans and Brits jailed overseas in roach-infested cells.

Lee plans to introduce young talent such as Derrick Ashong, a 37-year-old Ghanaian hired away from Al Jazeera English (the Qatar-based English-language sister channel to Al Jazeera), and Alicia Menendez, 30, formerly a host at HuffPost Live and the daughter of U.S. Senator Robert Menendez of New Jersey. To season the network’s youth with the credibility of an older generation, Ramos, the lead anchor, will have an interview show, America with Jorge Ramos, sans necktie—a concession to the new channel’s informality he has never made on Univision.

Since Univision first went on-air in 1962, many Hispanic viewers have treated it like a shadow government, to the point of calling up the station when their homes are on fire. The Univision switchboard would at least be able to respond in Spanish, if not with a fire truck. (An employee says they tell callers to hang up and dial 911.)

Univision started as the Spanish International Network, which slowly began absorbing and assimilating Spanish-language local UHF stations across the country. In 1986 it took the name Univision, and about that time it hired what are still its most recognized names: Don Francisco, host of Sábado Gigante, the longest-running variety show in the world; and Ramos, then a barely known, 28-year-old Mexican immigrant, fresh from a reporting gig with a Univision affiliate in Los Angeles.

In 2006 an investment group led by billionaire Haim Saban bought the network; Randy Falco, the former president of NBC and chief executive officer and chairman of AOL, became CEO in 2011. Univision claims to now capture about 96 percent of the Spanish-language audience in America. Most remarkable is the Nielsen (NLSN)“unduplicated audience” statistic, which refers to the percentage of a network’s viewers that doesn’t seem to watch any other network at all. Univision’s unduplicated audience is 72 percent. It’s as if its viewers have lost their remote controls.

Telenovelas earn the network’s highest ratings, yet its credibility with the Hispanic community derives principally from its three hours of daily news. Ramos, now 55 and silver-haired, is by some measures the most trusted man in Hispanic America. He receives fan letters not only praising his journalism but also seeking his financial and legal advice. When he and co-anchor Salinas scored interviews with the candidates before the 2012 election, 3 million 18- to 49-year-olds tuned in to Univision and waited eagerly for Ramos to roast Barack Obama on immigration reform.

When the anticipated question came, Ramos started with a preamble that caught the president and the network off guard. “I don’t want this to get lost in translation,” Ramos said in English, leaving Univision’s expert simultaneous interpreters unsure whether to intervene. In the end they did not. “A promise is a promise,” Ramos continued, “and you broke your promise.”

That line—not Obama’s response—became Univision’s sound bite of the night. And when it went viral, the network felt vindicated for its controversial decision, made more than a year before the interview, to start broadcasting with special attention to the Hispanic demographic that happily consumes its media in English. “For many decades, it was a taboo to talk about the possibility of producing English programming at Univision,” Ramos says. The whole reason for the network’s existence has been, by most reckonings, to serve a Hispanic community left behind by other media.

Cesar Conde, president of Univision, at the new Fusion studio outside Miami
Photograph by Stefan Ruiz for Bloomberg BusinessweekCesar Conde, president of Univision, at the new Fusion studio outside Miami

According to Ramos, the network’s executives felt duty-bound to keep that misrepresented audience at the center of its mission, even though a huge amount of the network’s production—including most of the off-camera, commercial-break chatter during its nightly news broadcasts—is already in English. Conde, Univision’s 39-year-old president, characterized the decision as a “healthy” debate that his side won, arguing that serving Hispanics ultimately meant covering issues of importance to Hispanics, rather than focusing exclusively on Spanish-language broadcasts.

“In each election cycle, you can see how the Univision coverage has improved,” says Federico Subervi, the director of the Center for the Study of Latino Media and Markets at Texas State University-San Marcos. And Latinos with strong ties to foreign countries tend to have interest in political news that other communities might not, particularly with regard to immigration. “There’s a big appetite for rigorous stories, when they’re about whether or not you can go visit your mother on Christmas if this law or that law passes,” says Félix Gutiérrez, a professor who studies Hispanic media at the University of Southern California. In markets with large Hispanic populations, such as Los Angeles, Univision is the No. 1 news outlet in any language.

“They used to say [Univision] is an entertainment network that happened to have a newsroom. That is not so anymore,” says Gerardo Reyes, director of its investigative unit. “I feel lucky that while other newsrooms are closing down investigative units, we’re creating one.”

In August about 100 Fusion employees moved into their new digs, a 150,000-square-foot warehouse in Doral, a Miami suburb dominated by Venezuelan and Nicaraguan immigrants, just a few miles from Univision’s current studio. Soon, the rest of the network’s news division will migrate to the warehouse, too.

The facility, called the Newsport, stands on South Florida wetlands, between Miami International Airport—right under the roaring flight path of Runway 8-Left—and the headquarters for the U.S. military’s Southern Command. Michael Siegelman, the vice president of engineering, who is managing the studio’s construction, speculates that the building might have served as a distribution point for flowers or medical supplies or both. It’s now one of the most advanced facilities in television, and it was consciously designed to force a marriage between Univision and Fusion. “We want to keep the news teams intermingled,” Siegelman says. “The moment you draw lines on the ground in the studio, and have north vs. south or east vs. west, you lose synergies.”

For legacy employees, there’s still some trepidation. “It is what it is,” Reyes says, referring to Fusion’s new style. “We do classic, old-fashioned journalism. But young people now need joking to know the news, and there is nothing I can do to stop this train.”

Acquiring a young audience won’t guarantee that advertisers will follow. Marketing experts are cautiously optimistic, but they note that Fusion’s quest for advertisers will be difficult, at least at first. “Everyone is very interested, and some advertisers are going to lean in, but a lot are going to wait and see how it performs,” says Steven Wolfe Pereira, executive vice president at the media agency MediaVest. Univision’s big advantage, he says, will be that it’s a “one-stop shop” that will reach older Hispanic audiences through its legacy channels but also the millennials through Fusion. And it has backing from ABC and its parent company, Disney. “They’ve got major operators behind them, and they’re going to force this to be a success,” says Derek Baine, research director at SNL Kagan.

A broader concern for Univision is a reversal of the demographic trends that have fueled its success. As Hispanic populations have grown, they’ve changed in composition. Immigration, both legal and not, has increased the Hispanic population from 15 million at the beginning of Ramos’s tenure with Univision to almost 55 million today. But the shift in the past five years is toward an immigration equilibrium across the Rio Grande: About as many Latinos leave the U.S. as arrive.

The native-born Hispanics fueling the demographic growth in this country are unlikely to throw their remotes out the window and watch Univision—or Fusion—full time. “The next generation is not only increasingly bilingual but has many more choices as it moves to online platforms,” says Andrew Heyward, a former CBS News president who has consulted for Univision News. “This generation has many more choices for news, and Univision’s value proposition has to become so much more complex.”

“Latino media has traditionally been media of chance,” says Gutiérrez, the USC professor. “If you happened to speak Spanish, you went to the Spanish-speaking channel or the one Spanish-speaking newspaper. Now, with the multiple channels out there, Latino media consumers have more choice, and it’s only logical that among the choices you will now find choices in English.” Not to mention the other Spanish channels associated with major English counterparts: CNN en Español(TWX) and Mundo Fox. Telemundo, acquired in 2002 by NBC, has duked it out with Univision for years over viewers and advertisers. Univision has been beating Telemundo solidly in prime time ratings, though: During the last week of August, according to Nielsen, 1.89 million households tuned into Univision during prime time. Only 730,000 households tuned in to Telemundo’s prime time lineup during the same period. Emilio Romano, president of Telemundo, says his company has no plans to change course. “We are absolutely focused on being the best in Spanish media,” he says. “This is a very good business to be in, and our strategy is panning out.”

Ramos says it was the stark demographic shift that convinced Univision that a 24-hour news channel had to be in English. “Isaac and Cesar saw the numbers, and we saw we had to adapt,” he says. “My kids—Nicholas is 14, Paula is 26—they never watch me, you know? Their friends don’t watch me, and their generation is not watching us.” The people who approach Ramos on the street used to say, “I watch you on TV,” he says. Now they’re more likely to say that their grandma watches. “We saw that if we didn’t adapt to the reality that the majority of Latinos will feel more comfortable with English than Spanish, then Univision will disappear in just a few years,” Ramos says. “It was really a matter of survival.”

Conde, who’s been in charge of Univision since 2009, points out that half of the network’s audience is already bilingual, and its average age of 39 is already younger by more than a decade than that of CNN. “They can already watch anything they want,” he says. “The reason they watch us is because we have a cultural connection to this community they just can’t find anywhere else.”

If the immediate challenge for Fusion is clear enough—to lure the prized demographic of Hispanic millennials—the long-term challenge will be to see whether Univision, in appealing to that demographic, will improve or degrade what is now possibly the most successful news formula in the U.S.

“Are young Latinos watching television at all?” Ramos asks. “If the answer is no, we’re in trouble.”