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Cable's historic channel-capacity disadvantage to satellite in serving ethnic markets is about to be turned around, David Jensen , Comcast's vice president of international programming and content acquisition, said during a B&C/Multichannel News Multicultural Breakfast panel at The Cable Show 2011 in Chicago last Wednesday.
"For the first time, we have the bandwidth throughput to reach these communities with new product," he said. Comcast now has "a strong superiority message, and we're backing that with a lot of marketing dollars."
Comcast and other cable operators have been freeing up channel space through such methods as converting analog channels to digital. For example, Comcast's Project Cavalry has enabled the country's top MSO to roll out a 60-channel Spanish-language package in all major markets, with South Florida being the most recent, Jensen said.
Like Comcast, Time Warner Cable also has gone hard after the Hispanic market, which is attractive to both MSOs given the population growth in that segment and each operator's respective presence in such markets as New York City, Los Angeles, Texas and South Florida. (The 2010 Census also showed sharp gains in Asian Americans.)
Time Warner Cable has focused on what Marissa Freeman, SVP of brand strategy & marketing communications, called "the four Ps: product, promotion, packaging and price." As part of that strategy, the MSO has rolled out versions of a blended English- and Spanish-language service called El Paquetazo; the New York version of the package has 140 channels.
On the promotion side, Freeman cited the high-profile launch of Univision's Lo Mejor On Demand service in New York's Times Square and extensive work with popular talent, helped by programming providers.
"We discovered Karen Rodriguez," the 21-year-old New York woman who made it to the final 13 in the recent American Idol competition and was a Time Warner spokesperson for a contest promotion, Freeman said.
Panelists also said IPTV programming would be key to targeting multicultural markets. Such content bolsters cable further in that it's "longer-tail" ethnic programming that complements what cable already offers. Going forward, Comcast plans to add IPTV programming to its product offering using MPEG-4 compression, Jensen said; the company will start its first IPTV trials next year.
"When cable is finally able to unicast or pointcast ethnic content to specific households, then I think it's game over because our architectural advantages on the cable plant will be so great that we will take back the architectural advantages that satellite has had," Jensen said. "That day is like two or three years away."
Even now, without IPTV integrated into the cable mix, the availability of ethnic fare on IPTV works to cable's advantage, Jensen said. He noted that the most popular ethnic programming carried on cable and satellite can't be streamed online for free because of their distribution deals. And Freeman pointed out that cable's high-speed online platform "is the very best way to watch IPTV."
The panel included some debate over whether foreign-language fare should be included in the most widely distributed digital-cable tiers.
Jessica Rodriguez, SVP at Univision Cable Networks, which has announced plans to launch three cable networks (sports, telenovelas and news) next year, said Univision gets affirmation of its content's broad popularity in the form of nightly ratings. Univision is the fourth-rated network (ahead of NBC) in the 18-34 demographic one or two nights a week, she said, and of the top 50 programs in bilingual Hispanic households, 42 are on Univision.
"We are the only ones that are growing in the broadcast space, she said. "We are mainstream."
Rodriguez said a cable channel of Univision soccer-heavy sports content also would help boost cable penetration into Hispanic homes, as El Mejor On Demand helped introduce VOD to Spanish-speaking viewers.
Michael Schwimmer, CEO of Si TV (which is being renamed nuvoTV), an English-language service aimed at Latinos, said he "disagreed" with some of Rodriguez's points. He cited statistics to support his point, noting that 90% of the TV programs viewed by English-dominant Hispanics are in English and that cable penetration of Hispanic households has already risen to around 83%.
Schwimmer also put in a plea for all distributors to place his channel on more broadly distributed digital tiers, as Comcast and Time Warner Cable (in New York and Los Angeles) have done.
Jensen joked that Comcast first put SiTV on a Hispanic tier "and it used to drive Michael nuts." While Comcast soon realized that wasn't appropriate placement, it decided to keep it on there a bit longer "because it drives him so nuts."
