Alan Sokol convinced Sony to buy Telemundo, reaping billions. Now he has his eyes set on a new target.
Alan J. Sokol uncovered the power of Spanish-language television more than a decade ago, when he did some research into Telemundo. Noting the nation's growing Hispanic population, he recommended to his bosses at Sony that they buy the network.
Sony did just that, partnering with Liberty Media and Apollo Adviseres to purchase the company in 1998 for $539 million. Four years later, they sold Telemundo for $2.7 billion. It remains the best deal in Sony's history.
Now Sokol (left), who spent time as COO at Telemundo during the Sony years, is ready to unleash that power in the world of cable as the CEO of Hemisphere — which, began trading on Friday, is the first public TV company dedicated solely to Spanish-language fare.
Formed by the mergers of assorted smaller companies, Hemisphere operates two U.S. cable networks. One of them, Cinelatino, is the second largest Spanish-language cable channel in the United States.
Sokol is convinced that Spanish-language cable is television's next gold mine.
“Hispanic cable in the U.S. is a sweet spot not just of Hispanic media but all U.S. media,’ he told TheWrap. “Hispanic cable is akin to where the general cable market was 25 years ago when the audience was growing.”
Back then, cable networks like MTV and CNN were just starting to find an audience, but advertisers had not yet caught up. They were not ready to embrace these upstarts with small but loyal audiences.
Cable went on to take the television industry by storm, and most media companies now make more money from their cable channels than anything else.
The Spanish-language cable industry finds itself in a similar position. Networks like Telemundo and Univision have parlayed their large audiences into advertising relationships with almost all of the nation's biggest companies.
Yet while McDonald's and Coca-Cola see a lucrative opportunity on broadcast networks, they have yet to embrace Spanish-language cable — which now reaches about 19 percent of the total Spanish-language viewing audience, but receives just 12 percent of its advertising dollars.
Sokol approaches his new company Hemisphere with the conviction that both of those percentages are about to rise dramatically. He acknowledges plans for strategic acquisitions to bolster the company's portfolio, but for now his focus is on growing what they have.
The company's biggest network is CineLatino, a cable movie channel that boasts 12 million subscribers across the U.S., Latin America and Canada.
While the majority of that audience is in Latin America, it has about 4.3 million subscribers in the United States, reaching everyone who subscribes to a Hispanic program package.
“We are uniquely positioned as the dominant channel in the current movie space,” Sokol said, pointing to deals for all the most popular and recent movies in the Spanish-speaking world.
His other two networks, WAPA TV, the top broadcast network in Puerto Rico, and WAPA America, its stateside cousin, will target what he considers underserved portions of the Hispanic market, in particular the 15 million non-Mexicans in the United States.
“Univision and Telemundo are squarely focused on the Mexican audience and that leaves the rest of the market underserved,” Sokol said. “It's not that a Dominican won't watch a Mexican soap opera, but they don't have the same level of connection. We want to be the destination for viewers seeking an alternative.”
Sokol sensed a similar opportunity 15 years ago with Telemundo, and his prediction turned out to be correct.
“I joke to some of our investors that I know more about Spanish-language media than any Jew in America,” he said.
If his joke has some truth in it, those will be happy investors.