Univision’s $2.3 billion acquisition of Hispanic Broadcasting Corp. was coming under increasingly heavy attack from Democrats in Washington last week, largely out of concerns that the combination of the biggest Spanish-language broadcaster and largest radio chain may be too GOP for the Democrats’ good.
A chief concern, according to sources, is that Univision CEO Jerrold Perenchio, 71, could lean on the news operations of HBC’s 65 radio stations, bending them more toward his personal view-turning them into an electronic platform to recruit Hispanics for the Republicans. Mr. Perenchio has had a controlling interest in Univision since 1992 and took the company public in 1996.
Stephanie Pillersdorf, a Univision spokeswoman, denied that Mr. Perenchio, one of the nation’s largest contributors to GOP causes, had any influence on the news presented on Univision stations or that he would impact news on HBC. “His [Mr. Perenchio’s] political views are as irrelevant as those of [The Walt Disney Co. chief Michael] Eisner or [Viacom CEO Sumner] Redstone,” she said.
But Univision’s critics allege the widely distributed network showed its colors recently by giving favorable news coverage to beleaguered Bush administration judicial nominee Miguel Estrada, while giving short shrift to the arguments of the nominee’s Democratic critics.
However, Ms. Pillersdorf disagreed: We represented both sides.”
Mr. Perenchio, whom Forbes estimates has a fortune of $2.3 billion, is one of the top five biggest donors to the Republican party, according to the Center for Responsive Politics. In 2001 and 2002 he gave at least $480,000 just to Senate Republicans for local and national campaigns. By comparison, he gave Democrats around $20,000.
More publicly, the deal has also come under attack for allegedly consolidating too much power over Spanish-language broadcasting into the hands of Mr. Perenchio, a long-time media industry executive who is not of Hispanic descent.
P.C. Koch, a lobbyist hired to fight the merger by Spanish Broadcasting System-a competitor of Hispanic Broadcasting that owns 27 radio stations, 11 of those in Puerto Rico-said that Univision, with 50 TV stations, already commands more than 50 percent of the market for Spanish-language broadcasting in the United States. Acquisition of the Hispanic Broadcasting Corp., according to Mr. Koch, would give Univision 69 percent of the market.
Mr. Koch also said a recent poll he commissioned demonstrated that more than 90 percent of bilingual and Spanish-speaking-only people rely primarily on Spanish-language radio and TV for their news and information.
“This [the Univision/Hispanic Broadcasting merger] is bad for the Spanish-language consumer because it means fewer voices and less editorial independence and increased non-Hispanic control,” Mr. Koch said.
Also giving some Democrats willies about the deal is Clear Channel Communications’ 30 percent stake in Hispanic Broadcasting. But in a statement, Univision said that Clear Channel will have only a 3 percent voting interest in Univision after the deal, with no board seats or involvement in the company’s operations.
“Adding radio to its wide range of Spanish-language media will enable Univision to do even more for the Hispanic community and will add, not subtract, from the flow of news and information to Hispanics,” Univision said.
Despite Univision’s assurances, it’s the arguments of the company’s critics that appear to resonate with Capitol Hill Democrats, and more than 20, including Senate Minority Leader Tom Daschle, D-S.D., and Hillary Rodham Clinton, D-N.Y., have sent letters to the FCC protesting the deal.
Said Sen. Daschle, in recent letter to the FCC: “I am deeply concerned that approval of the merger … could dramatically reduce both competition in Spanish-language media and the opportunities for Hispanic media ownership.”
Added Sen. Clinton in different letter, “Hispanic Americans, like all consumers, are undoubtedly best served by a diverse and competitive media market.”
At least some allied with Univision’s cause attribute the opposition to sour grapes from Spanish Broadcasting, whose own offer for Hispanic Broadcasting was spurned.
“Efforts to tar this merger as a non-Hispanic takeover of Hispanic media is a case of mistaken identity at best and a competitor’s smear job at worst,” said Univision in its statement.