America Online goes Latino to net growing Hispanic dollar

AOL Time Warner responded to the changing ethnic make-up of the United States when it launched a Spanish language version of its America Online internet service yesterday.

AOL Latino is aimed at US-based Hispanics, who overtook African-Americans this year as the nation's largest ethnic minority - a fact the media industry has been slow to recognise.

The new service will incorporate dedicated Spanish language programming in news, sport, entertainment, music and lifestyle. It will also have the usual features and functionality of the internet service provider in Spanish, including email, customer support and instant messaging. The launch is a significant initiative in AOL's attempt to arrest declining subscriber numbers. The US customer base fell by 846,000 to 25.3 million in the second quarter of this year. AOL research suggests that the service already has 2.3 million Hispanic subscribers, but they tend to be English speakers.

The US Hispanic population is estimated to be in the region of 39 million and is growing at nearly four times the rate of the overall population. In AOL Time Warner's magazine division, People en Español, a Spanish language version of its popular celebrity title, has been a notable success. Its circulation grew by 16% last year to 413,545.

"I don't think corporate America has the luxury of ignoring this market," said David Wellisch, vice-president of AOL Latino, who moved to the US from Ecuador when he was 18.

The company has signed up content partners among Latino newspapers and broadcasters in the US, as well as the Spanish language version of the BBC. "It's not just AOL in Spanish," said Mr Wellisch. "It's about issues Hispanic communities face - immigration; issues about their countries."

Hispanic spending power is slowly forcing advertising agencies and media owners to take note. The agency MediaCom says this section of the US population commands a buying power of $581bn (£348bn).

NBC, part of General Electric, bought the Spanish language cable network Telemundo two years ago. Advertising revenues on Telemundo and its larger rival Univision are growing at 15% to 20% a year.

According to the media buyer Initiative, the number of Hispanic actors on network television has grown fivefold since 1990, though they are still far less visible than African-Americans. Two new Fox productions, Luis and The Ortegas, focus on Latinos in shows the network hopes will have crossover appeal.

Procter and Gamble, a big advertiser, broke new ground with a Spanish language commercial for Crest toothpaste during a network broadcast of the Grammy awards this year.