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Prisa Bets on U.S. Radio Market
Publisher Shifts to Chase Huge Latino Audience Amid Stiff Competition
By David Roman
The Wall Street Journal, August 15, 2005

MADRID -- For years, Xtra 690 AM was a sports-focused Southern California radio station, with endless talk about the region's many professional and college teams.

This fall, the station will switch language and join the growing number of U.S. media outlets broadcasting in Spanish to reach a rich potential market of 40 million Latinos.

The station's purchase earlier this year by Madrid-based Promotora de Informaciones SA, or Prisa, is part of an aggressive move by companies in Spanish-speaking countries into the growing U.S. Hispanic radio market.

For Prisa, the $28 million (€22.5 million) investment is also an effort to move away from its roots as publisher of Spain's largest-circulation newspaper into a field with brighter prospects.

South Florida Operations

'We do believe a lot in radio, and I believe strongly in the Spanish-speaking U.S. market,' says Prisa Chief Executive Juan Luis Cebrián. In addition to Xtra 690 in Los Angeles -- the biggest U.S. Hispanic market with 4.4 million potential listeners -- Prisa has been operating Radio Caracol Miami since 2000 in South Florida. That area is the third-largest U.S. market with a Hispanic population of 1.6 million, behind Los Angeles and New York, according to marketing research firm Arbitron Inc.
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Of course, Prisa is hardly alone in trying to profit from the U.S. Hispanic market. According to Arbitron, there's now more than 650 Spanish-language radio stations across the country, out of a total of some 14,000 radio stations.

Univision's Dominance

Los Angeles-based Univision Communication Inc. leads the U.S. Hispanic radio market, with 66 stations. Large English-language operators also are moving into the Spanish market. San Antonio, Texas-based Clear Channel Communications Inc., the overall U.S. radio leader with 1,200 stations, operates 16 Spanish-language stations in the country and is switching as many as 25 English-language stations to Spanish within the next few months.

A longer-term challenge facing Prisa and other companies coveting the U.S. market is the fact that not all of the 40 million Hispanics in the country speak Spanish. America Rodriguez, a media professor at the University of Texas in Austin, says the U.S. Hispanic population is learning English as quickly as other language-based minorities, such as Germans and Italians, did in the past.

Prisa believes radio is less vulnerable to this trend than print media by appealing to Hispanics who don't need a particularly strong command of the Spanish language to enjoy Latino music, a staple of most Hispanic radio stations including many of Prisa's properties. It also hopes to provide information and entertainment for Spanish-speaking newcomers who may be drawn to brands and formats they already were familiar with in their countries of origin.