Isaac Lee, president of Univision News, was named CEO of Fusion, the new English-language channel for millennials being launched as a joint venture of Univision and Disney Co.'s ABC News, just a few weeks before the network's launch later this month. In an interview, Lee talked about the new channel and its audience.
What still needs to be done before the channel is ready to launch?
I think we have everything that we need now for launch. I think we are in the process of tweaking, adapting, making things better, rehearsals. And by the way, what I've been telling the team all the time is that this process that we're going through in this last 20 days is what we will continue to do after we launch. We have to be a permanent process where we feel like we're in a lab and we are identifying what works, we're improving, we're changing and we are moving faster than the trends. I think we have what we need. We have a great morning show. We have a very cool primetime and we have definitely a couple of very interesting surprises.
You've been working on this channel all along and suddenly they make you CEO. How did that happen and why did it happen right before the launch?
I don't know what clouded their judgment and they decided to make me CEO. I think it has to do with the fact that our parents are very successful companies in their field. Univision is doing better than ever. Our ratings are through the roof, we were the No. 1 network in the month of July. We are incredibly happy with the result and our partner is the American Broadcasting Company and the Walt Disney Company. It doesn't get better. Having such powerful and smart parents, what matters is the execution of the content and the creative part is taken care of. And I think that is why they got to the conclusion that they should focus their attention on that. And since I was the one driving that process since the beginning they decided to go for it. I'm so excited about this project. I feel like it's such an opportunity and such a privilege. I couldn't imagine myself doing anything more exciting than this. So I didn't think about it for a second. I think it's exhilarating.
Can you talk about your target audience and why they'd want to watch this channel?
My target audience is a millennial audience that today has a different set of values than what people think of. That lives in the digital world, but definitely enjoys television and enjoys good content and over-indexes in information. They are getting their breaking news via Twitter, they're getting their opinions about everything that goes on in their Facebook pages. They are watching several YouTube channels and they are into cable and broadcast and movie theaters and they don't have a network that is targeting only them that has the focus of creating content especially for them. And we have a huge advantage because the Hispanic population is incredibly young. The average age is 27 years old. We know it incredibly well. But to reach them effectively, you cannot treat them as a ghetto, you cannot treat them as a separate audience. They want to be part of the same conversation, in the same room. And by doing that, by creating good content for millennials, you don't just reach Hispanics. You reach them all. We have had two years of research, of testing, of doing hundreds of focus groups, and we understand what this target audience wants and we will be producing the right content for them. That's more how we see it. We have 17 million Americans in the age 18 to 34. Their spending is huge and it's a very attractive market for us. By understanding millennials, by knowing what their values are, by getting into the way they consume media and they consume news and what is of interest to them, we will be able to provide the right content and the right distribution for that content.
This group gets their information and entertainment from a lot of different places. How do you lure them back to cable television in an era of cord-cutting?
Cord-cutting is more a concern than a reality. You look at the numbers of how many hours they're spending watching television, it's actually at a pretty healthy amount of time. And I am not concerned about models like Netflix because what it proves is that content is king and we are not going to be watched because we are on cable or on digital or because of the way we are going to reach the audience. We are going to be watched because of our content. I think that by identifying what this audience wants and by introducing these types of content with the right shows with the right anchors with the right original series, touching the right topics and issues in the documentaries is the way that we are going to be reaching them. And if you look at what millennials want, and what's important to them, you will find out that they are very socially conscious. It's more important to them to graduate and maybe do a year at Teach for America than go to Wall Street. Those are fundamental changes. They are family oriented. They care about society. They want an active role in solving things. But there are certain key filters that they will adapt to decide if they want to watch you or not. You need to be authentic, you need to be transparent, you need to be funny and that's what came back, a digital approach to what you can see now.
That sound similar to what new cable network Pivot is saying about their plans to appeal to millennials.
I think that what they're doing is a good product. I like Participant Media, amazing films. I loved Lincoln. I think our project is very different from theirs. We are non-scripted. We are going to talk about pop culture and current events. Satire will play a big role. We are not going to get into fiction. And we also start from a point where understanding the Hispanic audience that is completely under-served and growing in a dramatic way gives us a huge advantage in doing what we have to do. But all the projects that are focusing now on millennials are doing the right thing, because if you understand that Hispanics and millennials are the two most important demographic waves since the baby boom, you will see that the bet is right on.
How much are you spending to launch this channel?
I don't know if I am supposed to disclose that. But I can tell you that if you come and visit our building you'll see that we actually do have the most technologically advanced and coolest news port in America. That it's 160,000 square feet. Our parent companies are being incredibly generous. The Disney Co. knows that this is a bet on the future, that this is how they're going to engage the diversity that is changing the face of this country. And for Univision from a position of strength, it is an extension of the brand to reach an audience we were not doing before. I can only tell you that I am very grateful for their generosity and that they're not being stingy at all.
How much of what you're going to be doing is going to be traditional news?
I think that the key part is not going to be traditional news. We are going to be covering current events, but we are going to be doing it through the filters that I mentioned. Things do not have to be boring to be well done. You can be funny and relevant. You need to be consistent and you need to be outstanding and perceived to be authentic as well. So we are going to have a morning show. The morning show has an anchor, a beautiful female anchor [Mariana Atencio] from Venezuela. We have an anchor from Brazil [Pedro Andrade] who does a show out of New York for Globo. It has a guy from Brooklyn [Yannis Pappas] descended from a Greek family who has millions of followers on YouTube. And they are going to be doing a very different morning show that is going to be fun. That is going to be entertaining, that is going to be self-deprecating, they're not going to take themselves seriously and they don't pretend. They can actually be having a conversation with an audience that likes to see things plain and simple. They don't need to be reading a Teleprompter. It can all be more casual and more real.
And aside from that, we have an amazing show with Alicia Menendez. I'm sure you maybe heard of her. She was at Huff Post Live. It's going to be talking about sex, money and politics. Everybody talks about sex, money and politics but she is straight about it, she doesn't pretend to be talking about other things to end up talking about that. And she is what I think everyone would want as a role model for a millennial woman. She is sure of herself, she went to Harvard, she studied hard and she knows the only way to lead is by example and that's what she's going to do with her show.
We're going to have a show as well with Derrick Ashong. Derrick was born in Ghana, raised in Riyadh. He came to the U.S., went to a really good college. Started a band, he's a musician. He's an activist. He cares about Internet freedom. He has issues that are very deep to his heart. He has lived the immigrant experience in a different way but he knows what that is. And he can relate to people in an amazing way. He has been on Oprah radio. He won an Emmy for an Al Jazeera show called The Stream and we're incredibly lucky to have him here.
We are also going to have Jorge Ramos live. As you know Jorge is the most respected anchor in American today. He's been doing it longer than Walter Cronkite did. He's a real journalist. He doesn't pull any punches. And he's going to bring the best of Jorge to his show, live. It's going to be called America with Jorge Ramos. His team is a United Nations mini-sample and it's very interesting.
I'm going to have [former Daily Show executive producer] David Javerbaum's show with the animated anchors and his wit and his satire. We're going to have a sports show. We're going to have [Leon Krauze], the anchor of KMEX, the most watched television station in this country.
And we're going to be producing very interesting original series that we've been working on for the last couple of years and some very interesting documentaries. We have our parent companies contributing with an investigative unit that is led by Mariana Van Zeller and we have our parent companies contributing with investigative units with Brian Ross, with Keith Suma, to make sure that we represent the excellence of Univision News and ABC News.
And we are very excited to start covering the World Cup. That is a huge event for us in 2014. We're already producing 48 short stories in Brazil now and we are very happy that we have the opportunity to have the World Cup next year.
What kind of shape are you in in terms of distribution?
I know we are in the best possible hands. We are represented by the Disney distribution team. They are as good as it gets. I trust that they are going to do incredibly well for us. This is an important project for them, and for Univision. They have already closed deals before launching with Verizon, with Cablevision, with Charter, with AT&T U-Verse, with Google Fiber and with Cox. I'm sure in the near future they'll have deals for the rest of them.
How many subs do you expect at launch?
Our plan is to get to 40 million subscribers in the second year and 60 million subscribers in the third year.
How are you doing with advertising? Do you have any special sponsorship deals for the network or its shows?
I've spoken with our ad sales person Catherine Sullivan [of ABC]. She will tell you how much excitement there is in the market for this. We are doing better than expected in ad sales and getting brands to join us. What I'm getting from them is the concept we have presented has been identified as unique and indispensible programming for their clients.
Are you integrating products into programming and doing sponsorships deals? Are you comfortable with having brands in your shows?
I'm sure we will be open for that. I'm aware of certain interesting discussions that are taking place now. As long as the journalism is respected we are happy to explore options. And we will evaluate opportunities depending on who the client is, what the brand is and how and what is it that they want. We're very mindful of taking care of our brand and will not make any short-term sacrifices.
You're launching the digital aspect of this enterprise first. Is there an advantage to that?
Yes. We have been active in digital for more than a year. We had an amazing testing lab that started like a year and a half ago. We started posting content on our YouTube channel. We had a Twitter handle. We had a Tumblr page. And that is what allowed us to test different concepts, to see how many minutes people wanted to watch, which type of stories. And we have a team that is not joining at the last minute and trying to figure out what to do with everything that has been in place for a long time doing the content. We know that the digital real estate is the best possible lab to incubate, create and tweak content. We tried short-form documentaries. We wanted to see if the target group wanted that type of content, if they were interested or not and we learned a lot. It was a great experiment to be watching the metrics and the numbers of what we were testing every day.
What did you learn?
We learned that humor is the currency for this psychographic. That everyone wants to be funny and wants to see things that are presented to them in a non- taking-themselves-too-seriously way. That they value good content. That authenticity is key. They don't expect you to be perfect. They don't want you to be in the perfect location and overproduced with tons of makeup. They just want you to have a conversation and to be part of a different generation that does not appreciate the monologue that television used to have, and wants to connect, wants to interact and wants to be having a dialogue with us. And if you listen carefully and you understand that they really know what they want, you will be able to provide them with excellent content.
Will viewers know Fusion is the product of Univision and ABC News?
I don't think it matters to the audience really. We are going to be transparent. If we're asked, we're going to be telling the truth and if we are going to be using an ABC resource, we are going to be giving them the right credit, and we're going to be proud of having their help. And the same with Univision News. We don't expect people to believe that Jorge Ramos is a part of Fusion only and that George Stephanopoulos is just doing Fusion. We are going to be grateful to our partner. [Viewers] don't care who is behind what. They care if it's good and if it appeals to them or not.
How are you going to make sure people know this channel is up and running when it's up and running?
We are going to be very active digitally. We are going to trust our content. We are not going to be focusing on an advertising campaign. We think that if our content is good, pushing that content and making it relevant will be the best way to be noticed. And we're not in a hurry. I hear the Disney company leadership talking about Fusion as what they saw when ESPN started some 30 years ago and it was not easy at first. I'm sure that when some people left ABC Sports and NBC Sports to join ESPN, they were being mocked. It's not happening to us right now. We have it easier. We are given the right resources and talent. But this is not going to be built in one day and we are patient. This is a long-term bet that neither of our parent companies can miss. It's too important.