Many Web sites target the Latino market, from broad portals that seek an international or national audience to independent sites that focus on individual cities. Hispanic Broadcasting Corp. is taking a different approach that aims to combine the appeal of localization with the heft of an established media company.

HBC, the top U.S. Spanish-language radio broadcasting company, owns and operates Netmio, a network of bilingual community Web sites that provide culturally relevant content in the nation's top 10 Hispanic markets: Chicago, Dallas, Houston, Los Angeles, Miami, New York, San Antonio, San Diego, San Francisco, and 'The Valley' in Texas, which includes the border cities of McAllen, Brownsville and Harlingen.

Netmio sees its competition not so much as being Univision, StarMedia or Terra. Rather, it considers its rivals to be sites that are used as city guides, such as the English-language City Search and Digital City, the Latino-oriented guides El Puente Latino and Tu Rumbo, and various independent city and Spanish-language newspaper sites.

'I think what we're doing is unique in that we are not trying to be all things to a homogenous U.S. Hispanic that doesn't exist,' says Lawrence Arevalo, the vice president and managing director of the Houston-based HBCi, the broadcaster's online media arm. 'The Hispanic market in Miami is vastly different than that in Los Angeles, which is vastly different from that in New York.'

The company's goals are to use its radio stations to promote the Web site, to position itself to take advantage of the future convergence between radio and the Internet, and to possibly provide local content to the big national and international Latino sites.

Different Strategy

HBC is in as good a position as any other Spanish-language media company to tackle the Web because it has deep pockets, it can use its radio stations to promote Netmio to its millions of loyal listeners, and the U.S. Spanish-language population continues to grow faster than the overall population.

The Dallas-based company owns or programs 47 radio stations in 13 top Hispanic markets that reach more than 8 million listeners weekly. It also operates the HBC Radio Network, which reaches 77 percent of the U.S. Hispanic market. Estimated annual revenue this year has dropped to $247.5 million from $267 million due to lower ad spending.

When HBCi was created in 1999, it was trailing lots of smaller competitors that had already created an Internet strategy, says Arevalo. The company carefully scrutinized what other Latino players were doing on the Web. That's when HBCi decided to focus on what the big competitors were not doing - and that was providing content tailored to the very different local Latino markets, he says.

The radio stations are Spanish-language stations, but the site is bilingual because many site visitors prefer English. 'We did not want to shut those listeners out, especially now, when research shows that the first adopters of the Internet were more acculturated Hispanics who largely prefer English,' he says.

HBCi has other key strengths. The radio stations allow the company to extend the Netmio brand name, which is also done by sponsoring local events such as Cinco de Mayo or Puerto Rican Day festivals, and health and job fairs.

'The general problem with dotcoms is that it takes a huge amount of money to get their brand out and for people to know about them. They have to be constantly spending,' says Arevalo. 'The problem with [Latino sites that have gone under] is that they didn't have something like radio to back them up.'

But most important, HBCi, which also benefits from centralized technology, can use the parent company's large, existing sales force.

'We have 20 to 40 sales professionals in each market that already have advertising relationships,' says Arevalo. 'It's a lot easier to sell new products to an existing client base than to try and build a new client base altogether, which is what a lot of dotcoms had to do.'

So far, HBCi's strategy is working, says Arevalo. The number of ad impressions has grown from 3 million per month in July 2000 to 25 million ad impressions in June 2001. Netmio also has 20 national advertisers and about 200 local advertisers that provide about $2 million in annual revenue, he says.

The company also has kept its spending in check by operating at a much smaller scale than other Latino portals and Web sites. HBCi, which has 45 employees nationwide, and has an annual burn rate of about $4 million, far lower than many other big sites, says Arevalo.

Site Design

The site itself is easy to navigate. The home page features a logo of two intersecting street signs - one says 'www' and the other 'Netmio.' Visitors can click on a radio station or a city, and can choose either English or Spanish. When you click Los Angeles, for instance, the street signs change to 'LA' and 'Netmio.com.'

Besides the usual fare, such as free e-mail, chats and personals, the site provides Latino-oriented news and selection choices such as bars, restaurants, arts and culture, immigration, soccer and travel, to name a few.

A few of the features, however, look embarrassingly amateurish. Photos of contestants from last year's Miss Mexico Los Angeles pageant, for example, showed these young women with their eyes half closed, the tops of their heads cut off or sprawled across their couches or beds.

Netmio used to subscribe to various wire services to provide news to the site. Now, small local teams provide a limited amount of local news content, while a national and international team of 12 in Miami provide a bit more. Promotions and advertising also are localized.

'We're not trying to be a news source. 'There's no way we can compete with CNN en Espa?ol,' says Arevalo.

The name 'Netmio' is a loose translation of 'my net,' which in Spanish would be 'la red mia.' Arevalo says the company wanted to create a new word that juxtaposed English and Spanish, and along with the logo conveyed the idea that the site would be a very personal experience for Latinos.

Convergence, Other Opportunities

Arevalo says Netmio is a key strategic division for the company because it may be able to provide local content to the big national and international sites. 'We've talked to a few (national and international sites), and while I can't say there's anything blooming in the near future, there is interest out there,' he says.

Netmio also has potential for convergence between its various media outlets, some of which is already taking place. Listeners can already tune in to Internet radio stations from their computers. Arevalo is ramping up for a time when one of their listeners who hears a new Jennifer Lopez song on the radio will use a PDA (say, a Palm Pilot or cell phone) to look at the CD?s cover, and either download it or buy it.

'We're gaining experience now to prepare us for this eventual convergence,' says Arevalo. 'But our short-term goal is to be a self-sustaining, profitable company in our own right, hopefully by 2003.'

While convergence will provide many potential opportunities for Netmio, it will also pose a potential threat to the parent company's traditional radio stations in much the same way cable did by fragmenting the market for ABC, CBS and NBC, the big three television networks.

But HBCi is excited about other dotcoms, particularly Hispanic sites, because they drive people online, which means a bigger pie for everyone. 'We recognize that nobody uses just one site. People use the Web as it suits their needs,' says Arevalo.

Cynicism

Not everyone agrees with the rosy picture painted by HBCi. 'I'm terribly cynical about these efforts,' says Abbott Wool, contributing editor for media and research at Hispanic Market Weekly, adding that he believes Latino Web penetration has crested and is now slowing down.

Wool dismisses the idea of convergence as mostly 'hoopla' from technology writers, and says it is 'ludicrous' to think that a national company with strong local news programming such as Univision would want or need any sort of local content from a radio group, even one as large as HBC.

As for the Netmio site itself, Wool says he is particularly annoyed that potential advertisers who want to learn more about rates are asked to fill out a long form and e-mail it to Netmio in order to get more information. Asks Wool, 'Why is there anything other than a phone number for local ad sales person?'