The Group will invest $16.5 million in the launch of the first four publications in Texas in 2004
Madrid - In the second half of this year, Recoletos Grupo de Comunicación will launch Rumbo, a new Spanish-language daily newspaper for Spanish-speaking readers in the United States.
In a first phase, Rumbo will publish four editions in the Texas towns of San Antonio, Houston, Austin and the Lower Rio Grand Valley (Brownsville, McAllen and Harlingen). Later these will be extended to other states and cities which have Hispanic populations.
Recoletos today acquired Meximerica Media Inc., a company with extensive experience of the Hispanic media in the United States and which will be the publisher of the new daily. Investment for the launch this year is estimated at $16.5 million.
Meximerica representatives and Recoletos executives will manage the US company and the new newspaper. The group will be headed by Edward Schumacher Matos, José Antonio Ferrís, Jonathan Thompson and Jonathan Friedland, who have been appointed Chief Executive Officer, Chief Financial Officer, Chief Operating Officer and Editorial Vice President of Meximerica Media, respectively.
Rumbo will be a popular quality daily carrying mainly local service-oriented, sports, education and entertainment news. The various editions will publish different local interest contents and will share a common editorial standpoint with news about the United States, Mexico, as well as international news.
Initially, the newspaper will be published from Monday to Friday in tabloid format. At the San Antonio editorial headquarters news common to all the editions will be compiled, while small local editorial bureaus will process specific contents for each community.
Rumbo is aimed at men and women of mainly Mexican origin residing in the United States. The approximate 26 million Mexicans living in the United States represents two-thirds of the Hispanic population, which totals 38.6 million, according to the latest census. Hispanics are now the leading ethnic minority (13% of the US population). The number of Hispanics in the country is expected to triple between 2002 and 2050.
Mexican residents in the United States have maintained the social and cultural identities of their country of origin. Sixty-two percent were born in Mexico; 77% speak mainly Spanish or are bilingual, 74% read in Spanish, and 48% travel to Mexico every year.
Along with the population growth, Hispanics' purchasing power in the United States is growing at double the rate of that of the rest of the country as a whole. Advertising directed at Hispanics in recent years has experienced much larger growth than that for other advertising markets and the main US companies are increasing their advertising spend considerably to reach this community. Mexican residents in the United States have also become a major target audience for Mexican companies which are developing marketing campaigns on the other side of the border.
The four areas where Rumbo will be initially published have 3.2 million Mexican residents.
"Recoletos has made an important major move in its international growth strategy with the launch of Rumbo," said Recoletos Chairman Jaime Castellanos. "This project will give us entry to the most dynamic Hispanic market under the guidance of a group of local professionals with extensive and successful experience."
Edward Schumacher Matos said that "the launch of Rumbo in Texas is the first step in the construction of a network of daily newspapers specifically aimed at the Spanish-speaking population of the United States. The great experience of our team in this market will allow us to satisfy the editorial needs of this community with a great competitive advantage over any other daily currently published in Spanish or English."
Until he joined Meximerica, Edward Schumacher Matos was manager of The Wall Street Journal Americas, the Spanish and Portuguese version of the US daily which is published with the main daily newspapers of 18 Latin American countries. Previously, Schumacher was manager of The New York Times bureaus in Madrid and Buenos Aires. He won the Pulitzer prize as a member of The Philadelphia Inquirer's investigative team.
José Antonio Ferrís is a former daily Expansión and weekly Actualidad Economica's correspondent in New York. He was the first executive of Chile's El Diario Financiero from 1998 to 2002. Ferrís has a journalism degree from the University of Navarre and an MBA from the Massachusetts Institute of Technology (MIT).
Jonathan Thompson has 25 years experience in managing US publishing companies. As a Knight Ridder executive he took part in the launch and development of El Nuevo Herald, one of the most successful Spanish-language daily newspapers in the United States.
Jonathan Friedland set up The Wall Street Journal bureau in Buenos Aires and managed the office of the same newspaper in Mexico. He left the management of this newspaper in Los Angeles to join the Meximerica project. He was part of the team that won the Pulitzer prize for The Wall Street Journal's coverage of the Mexican peso devaluation and its impact on the rest of Latin America.
Recoletos's International Growth Strategy
Apart from Spain, Recoletos is also present in Portugal, Chile and Argentina.
It owns Económica SGPS, the publisher of Diario Económico and Semanario Económico in Portugal. Both publications are segment leaders in circulation, readership and advertising revenue. Diario Económico's circulation increased by 13% in 2003 despite the emergence of a new competitor. Semanario Económico was relaunched in September and increased its circulation by 6% in the last quarter of 2003.
Recoletos Argentina publishes El Cronista Comercial, a daily specialising in the economy and finances, and the monthlies Apertura (economic news) and Information Technology (specialising in the computer and technology sector). El Cronista increased its circulation by 9% in 2003 and is now a newspaper of reference among the quality media in Argentina. Apertura has increased its circulation by 40%, while Information Technology's has decreased by 2%.
In Chile, Recoletos and the Claro Group manage the Ediciones Financieras company, publishers of Diario Financiero. In the past few years, Diario Financiero has become the clear leader of the Chilean economic press. Its readership grew by 15% in 2003 to gain a market share of 54%.