Univision, Hispanic Merger Criticized
Critics of Univision Communications Inc.’s $3.1 billion purchase of Hispanic Broadcasting Corp. say the deal creates a Spanish-language media empire with too much control over news and entertainment in the growing Latino market.
The companies completed their merger Monday, soon after receiving approval from the Federal Communications Commission. The Republican-dominated commission voted 3-2 to accept the deal, with the two FCC Democrats contending the merger would hurt competition and limit choices for Spanish-speaking Americans.
“The company is aptly named Univision – ‘one vision’ – because that describes what is likely from Spanish-language media from now on,” Democrats Jonathan Adelstein and Michael Copps wrote in a 22-page dissent.
The three Republicans disagreed, saying in a joint statement that the deal has broad support in the Hispanic community and “will give Hispanic media a better opportunity to compete against big media companies, capturing more advertising revenue to allow it to expand unique language and cultural offerings to its audiences.”
Los Angeles-based Univision already owned the Univision and TeleFutura TV networks, the Galavision cable network and 50 television stations nationwide.
With the merger complete, Univision now has the top Spanish-language broadcast TV network, cable channel, record label, Internet site and radio network, as well as the largest group of television and radio stations.
“One media conglomerate will totally dominate the Spanish-language media landscape,” said Luis Figueroa, a policy analyst for Consumers Union, publisher of Consumer Reports magazine. “This is another disappointing example of the FCC’s open-door policy for media consolidation.”
Univision rivals, including Spanish Broadcasting System Inc. and Telemundo, also complained the deal would harm competition in the growing Hispanic market.
Hispanics are the nation’s largest minority group. The nearly 39 million residents comprise 13.5 percent of the U.S. population.
The issue of whether Univision dominates a separate Spanish-language market or is a small player in a larger one divided the commission.
The Republican majority supported Univision’s position that there is no separate market. The company had argued that it has a small presence in broadcasting overall and it competes with English and Spanish-language networks for advertisers and viewers who often are bilingual.
Ray Rodriguez, president of Univision Television Networks, said because of the merger the company “will have more funds available to reinvest and make our products and services better for the Hispanics in this country.”
The FCC allowed Univision to acquire HBC’s 68 radio stations but required the company to sell two of them – one each in Houston and Albuquerque, N.M.
The commission’s decision had been expected for weeks. The agency planned to announce a decision two weeks ago but postponed it at the last minute as commissioners reworked their statements.
Rep. Bob Menendez of New Jersey, chairman of the House Democratic Caucus, said the FCC decision was influenced by political contributions. A. Jerrold Perenchio, Univision chairman and chief executive, is among those dubbed “pioneers” by President Bush’s re-election campaign for raising more than $100,000.
“I can only see that partisan vote as one that is clearly, clearly promoted by the White House,” Menendez said.
The FCC spent more than a year considering the merger, which was announced in June 2002. The Justice Department in February approved the merger after Univision agreed to reduce its 27 percent ownership of Entravision Communications Corp. to less than 10 percent over the next six years.
Entravision is the largest owner of Univision TV affiliates and owns 55 radio stations, many of them in the same markets served by Dallas-based HBC.
HBC’s stations are concentrated in California, Texas and Florida, with others in Arizona, Nevada, Illinois and New York. They offer programming that includes international top 40, Latino mix, Tejano and sports talk.
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On the Net:
Federal Communications Commission: http://www.fcc.gov
Univision: http://www.univision.com