Betting on Fusion

In 2011, the news division presidents at ABC and Univision met in New York to discuss working together on coverage of the 2012 presidential election. Ben Sherwood, who is transitioning now into the role of co-president of Disney/ABC Television Group, had a talk with Isaac Lee, who was trying to reach the growing number of English dominant Latinos.

“For Ben, it was a chance to expand the reach of ABC News to one of the fastest growing audiences in the country,” said David Ford, vice president for media affairs at Fusion, the cable news channel that was born out of the joint venture that was formed two years later.

For Lee, Fusion was the next logical step in bringing Latino coverage to the mainstream. Since December 2010, Lee had been president of news at Univision. When Fusion launched in October 2013, he added chief executive officer of the fledgling network to his titles. Lee has plenty on his plate, as he is also strategic and editorial overseer of Univision’s television, radio and digital platforms.

From the beginning, Fusion has benefitted from cross-promotion on both of the parent networks. Univision has shared its top newsman, Jorge Ramos, who is showing a younger, English listening audience his hard-hitting interview style. And while Fusion executives will not disclose financial information, it is apparent by the talent coming aboard that the Miami-based network is flush with cash. Some of the high-profile hires include Billy Kimball, co-writer of “Waiting for Superman,” as chief programming officer, and David Javerbaum, former executive producer of “The Daily Show,” who created two news parody shows for Fusion in conjunction with The Henson Company. Hong Qu, a veteran of YouTube and Upworthy, was hired as chief technology officer.

Shortly before Fusion’s launch, Univision unveiled a new studio in Doral, just west of Miami’s airport, called the “Newsport,” which would not be out of place in the next Star Trek sequel. It’s got five control rooms, fifteen robotic cameras, 950 miles of cable, and even two 2.25 megawatt generators, in case a hurricane strikes. According to documents filed in Miami-Dade County, Univison and ABC planned to spend $275 milllion to set up the network with a projected payroll of 350 within 5 years.

Much like the millennial audience Fusion hopes to reach, however, getting a read on the network is a slippery endeavor. It is not yet Neilsen rated and will not be until sometime in 2015. Senia Viegas and Jessenia Garcia, media buyers for Lopez Negrete Communications in Los Angeles compared Fusion to NUVOtv and El Rey Network, other English speaking newcomers to cable that want Hispanic millennials watching their programming. Each is going about it in unique ways.

NUVOtv brought in Puerto Rican pop superstar Jennifer Lopez as chief creative officer. It’s loaded the schedule with reality TV shows that focus on topics of interest to young Hispanics. El Rey is a Robert Rodriguez creation that launched with a library of action and horror films, and two dark and edgy dramas, one based on From Dusk Till Dawn and the other about a secret agent/soccer star called Matador. Univision also took a minority stake in El Rey, which won’t get its first Neilsen rating until the fourth quarter of 2014. Fusion lacks the star power of its rivals. With the exception of Jorge Ramos, its on-air talent is young and inexperienced. And its Latino identity is somewhat diffuse, begging the question if it’s for millennials or Latinos, or both. But Fusion has garnered kudos for its mix of hard news and current events with a comic twist.

Without Neilsen ratings, another way to gauge success is by tracking website traffic. is claiming two million unique monthly visitors. “That would rival,” Garcia said, “but I can’t fully credit that because they’re not in comScore, the rating agency for websites. The two million is Fusion’s internal analytics number.” One indicator that does impress is Fusion’s number of social media followers. It is far ahead of NUVOtv, El Rey or even Mun2, a Spanish language version of MTV owned by Telemundo that has been on Twitter since 2007 and has only 70 percent of the following Fusion built in nine months.

“Millennials were born into a new era of technology, and have come of age during the rise of Facebook and Twitter. Social media is a key part of our strategy as we build a media brand finely attuned to this generation’s digital tendencies,” Ford said.

Key hires in this area include Anna Holmes, founder of the young women’s website Jezebel, and Jane Spencer, a founding editor at The Daily Beast. Holmes joined to be editor of digital voices and Spencer is editor-in-chief of digital platforms. Fusion’s social media team is planting flags across all digital platforms, including Facebook, Tumblr and Reddit. And it’s tailoring content unique to each site. “For example, we have formed a team of producers dedicated to creating micro-videos for platforms like Instagram and Vine,” Ford said.

Looking at the bigger picture, however, media buyer Viegas cautions that these English-language Hispanic market experiments are taking place in a much more competitive arena. “In Spanish, there’s 10 top channels. With English, there are hundreds of cable channels,” Viegas said. And for many media companies, it’s proved difficult to monetize all those “tweets” and “likes” on Facebook. “Right now, we’re in a holding pattern for El Rey and Fusion,” says her colleague Garcia.

Fusion launched with six distributors--Cablevision, Charter, Cox, AT&T U-Verse, Verizon FiOS and Google Fiber. It boasted access to 20 million homes, but Viegas notes that only 4 million of those homes are Hispanic. In March, Fusion expanded by inking a deal with Dish Network. Fusion’s business plan is to reach 60 million homes by 2018 or sooner.“Disney/ABC handles distribution for Fusion and they continue to have conversations with Direct TV, Comcast and Time Warner Cable,” Ford said.

Without ratings, Fusion has to sell itself on what sets it apart, Viegas said. The network also promotes Ramos as its star newsman, but accordimg to her, it remains to be seen if Ramos is as relevant to millennials as he has been to their parents. But Fusion invested heavily in off-the-field coverage of the 2014 FIFA World Cup with its “Soccer Gods” program and its website.The spring line-up had seven original shows and three more new series were scheduled to debut in the summer. Consistent with its political news roots, Fusion will air a one-hour primetime special featuring “Daily Show” correspondent and comedian Al Madrigal, who will travel the nation to discuss the influence of the Hispanic community in advance of the midterm election.

Fusion’s creators believe there is a demand for the news they want to report. And for ABC, the network fills a gap intended to keep it competitive with the other 24-hour cable news providers. In fact, ABC retired the 24-hour ABC News Now cable channel, which was broadcasted for almost nine years, on Oct. 28. Fusion was promoted as its replacement. “In February, Fusion stood out as one of the only American networks to provide comprehensive coverage of the violence happening in both the Ukraine and in Venezuela,” Ford said.

While Fusion tapped into the global resources of ABC to cover the unrest in Ukraine, Fusion helped ABC cover the events in Caracas with Mariana Atencio reporting live for ‘ABC World News with Diane Sawyer.’ When news broke that Mexican drug lord Joaquin ‘El Chapo’ Guzman was detained, Fusion’s Mariana van Zeller, who had reported a documentary on El Chapo in October 2013 for Fusion, provided added value to ABC’s coverage of the news by appearing on ‘World News’ and ‘Good Morning America. “More recently, you have also seen Alicia Menendez providing a unique, millennial perspective on national affairs on ABC’s Sunday program ‘This Week with George Stephanopoulos,’’” Ford said.

But whether or not Fusion’s “unique millennial pespective” will gain an audience is a difficult question. It’s equally hard to get a handle on the protean Isaac Lee, who declined to be interviewed for this article. The network’s press materials describe him as “an ambitious visionary with the great virtue of making people believe in his ideas and bringing them to life -- finding ways to make the impossible possible.” A native Colombian, Lee was editor-in-chief of Revista Semana, a Colombian news magazine. According to Fusion, “the magazine published a cover story which forced two Colombian cabinet ministers to resign a couple of days later.”  Lee later moved to Miami, where in 2001 he founded Zoom Media Group, which published two magazines: Loft, for men, and Poder, with a business focus. Along the way, Lee had become friends with Mexican media mogul Emilio Azcarrage Jean, CEO of Grupo Televisa. Loft fizzled but Azcarraga added Poder to his stable of magazines and brought Lee on board.

Poder flourished until early this year, when its U.S. edition was shuttered. But Televisa is Univision’s numero uno content provider with its ever-popular telenovelas, and in 2012 it acquired up to a 35% stake in Univision for $1.2 billion. Since Lee came from Televisa, his appointment as president of news for Univision, replacing veteran Aline Falcon, was viewed by observers like Jose Cancela as Azcarraga flexing his muscle. But Lee’s debut was marred by a nasty feud with Senator Marco Rubio. It began with a news story about the drug bust of Rubio’s brother-in-law, many years before. As reported by the Miami Herald as well as the New Yorker, Rubio objected and this led to a phone call  between Rubio’s staff and Univision executives, including Lee. Rubio would later claim that Lee offered to pull the story if Rubio appeared on “Al Punto,” Jorge Ramos’ news show, which Lee vehemently denied. In true Miami fashion, the argument sputtered out amid counter-accusations and conspiracy theories, but the damage was done, and most Republican candidates boycotted Univision’s presidential forum in January 2012.

Lee was named CEO of Fusion after the sudden departure of Univision Networks president Cesar Conde, reporting directly to Univision CEO Randy Falco in New York. Conde had been president for six years but joined NBCUniversal, parent of Univision’s arch-rival Telemundo. Yet Fusion’s fate may not depend on Lee. Univision’s owners made noise on Wall Street this summer when it came to light they are trying to sell the company for $20 billion. To date, there have not been any takers. CBS Corp. and Time Warner Inc. were approached, and both said the asking price was too high. The equity partners, led by Los Angeles billionaire Haim Saban, find themselves in a dilemma familiar to anyone who paid top dollar before the 2008 economic crash. They bought Univision in 2007 for $13.7 billion. Univision scored high ratings with the World Cup (see below), but has been looking over its shoulder lately, as Telemundo outbid it for the next two World Cups.

If Saban finds a buyer, it raises a question about Fusion’s future. Depending on the terms of the joint venture, the new owner may try to exit, particularly with Fusion’s big-spending ways. However, Univision had its own good reasons for working with ABC--changing demographics. In the last few years, immigrants have become the minority group among Latinos in the workforce. U.S.- born Latinos are more likely to speak English and more likely to watch English programming such as Fusion’s. But Televisa, led by the canny Azcarraga, will still be a force to reckon with, no matter who runs Univision. That may be the sequel to this story.

By Adolfo Pesqueira