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TWST: What are the demographic characteristics that should make the Spanish-language broadcasters particularly attractive to advertisers?

Ms. Thompson: A couple of things. You have a population that is growing between 3 and 5 times faster than the overall population in the US. In Los Angeles, the Latino population increased by 24% between 1990 and 1999 to represent over 30% of the area’s population. This a very young demographic with a large household size. And Spanish-speakers tend to listen to more radio than other groups. There’s also the fact that disposable income and the level of wealth are increasing at a faster pace than for the overall US population. Families are large, they’re spending more, and they’re young. I think that’s an incredibly important demographic that advertisers want to reach. Yet, while the US Hispanic population is almost 12% of the total, less than 2% of every dollar spent on advertising goes to Hispanic media. Both television and radio broadcasters have been working very hard at closing this gap, to get advertisers and marketers to allocate a larger portion of their budget to Spanish-language media.

TWST: What’s a second stock that investors should be taking a serious look at?

Ms. Thompson: We also like Hispanic Broadcasting (NYSE:HSP). This is one whose share price took a hit recently on the back of a pre-announcement that earnings were going to be below expectations. And again, I think there’s probably more competition within the radio space than there is within television because radio is easier to program. You can convert stations from English to Spanish — it’s a conversion process that often takes 12-15 months, yet English-language broadcasters can do this. I think music is a little bit more accessible than actually establishing contracts for good-quality television programming. But having said that, Hispanic Broadcasting has a good strong hold here in Los Angeles. It’s a very well-run company with very solid, very good investor relations.

TWST: Are the advertisers predominantly local, or is there a good smattering of national advertising?

Ms. Thompson: It’s both national and local.

TWST: I understand that Spanish-language and African-American broadcasters have made tremendous efforts to attract advertisors..

Ms. Thompson: Yes, definitely. As I said, I think this has been an under-represented and overlooked area for many years and, perhaps, a misunderstood area too. Marketers traditionally did not allocate a large enough budget to Spanish-language. They didn’t understand it; they didn’t have the expertise in it; the advertising agencies weren’t really pushing it as hard as they should have. I think the Latin explosion over the last two years diverted more attention to Spanish. And executives at all the major Spanish-language media companies have gone out and actively knocked on doors and said, “You need to spend on this demographic.” They’ve been very active in opening up accounts.

TWST: Are any of these English-language sitcoms or comedies subtitled or dubbed into Spanish?

Ms. Thompson: I don’t think that works very well. I think you need to be either one or the other. There have been moves by English-language broadcasters — HBO on the cable side with their Latin channel – to try to cross over. Again, what I would point to are the ratings, and the fact that novelas, which are in Spanish with Hispanic faces and Hispanic culture, are really the bread and butter of the industry right now. But I think programmers are thinking very carefully about how they should program for the changing experiences of this audience.