With Latin pop singers dominating the U.S. charts and the huge success of the Buena Vista Social Club album and documentary, it's no surprise that online entertainment and e-commerce companies are emerging to cash in on the growing interest in music rooted in Spanish-speaking countries.
Worldwide recording artist Julio Iglesias and Latin American TV star Don Francisco are investing in one of the new firms, Aplauso.com, which will go live this summer. The company's two other founders are Larry Rosen and Sergio Rosenblat. Rosen was CEO of online music seller N2K/MusicBlvd, which merged with CDNow, and Rosenblat, head of the Latin Grammy organization, was a Warner Music International and CBS Records International executive, where he worked with artists such as Gloria Estefan.
"People are really excited about this music now," said Rosen, who will serve as chair of Aplauso's board. "Now they can learn about the music and then purchase (it)."
Aplauso will be available in Spanish, English and Portuguese, featuring music by artists throughout the Latin world and targeting both U.S. and Latin American consumers. The site also will provide music news from bureaus in Brazil, Argentina, Mexico and Spain, as well as local entertainment guides. On the retail side, Aplauso will sell custom compilations, digital downloads, CDs and DVDs.
Iglesias, who has collected 2,600 platinum and gold records and sold more than 250 million albums throughout his career, signed on to Aplauso because he sees the Net as a key platform for exposing music lovers and people to new cultures and ideas.
"Aplauso.com was a perfect opportunity to celebrate this wonderful form of communication and the one thing that is closest to my heart--Latin entertainment," Iglesias said in an email interview.
Iglesias' son, Enrique Iglesias, also is using the Net to promote his music. The 24-year-old singer, who has gained huge popularity in his own right, was one of the first artists to program a Net radio station for Viacom's SonicNet.com, for example.
"The Net is a wonderful platform (for music distribution) that knows no boundaries," the senior Iglesias said. "For example, some of my early albums are not available in the shops anymore, and people are always asking me where they can buy them. The Internet will give them that opportunity wherever they are in the world."
Posing potential competition to Aplauso is another Latin online music network announced this week, dubbed AKAMusica. The creators of online hip-hop network AKA.com, which has 3 million monthly users, have partnered with Spanish-language broadcasting company Mega Communications. AKAMusica will be promoted on Mega's 17 Spanish-language radio stations.
"(Mega's) knowledge of the Latin market and the quality of their executives will provide us with a significant competitive advantage," Stuart Hersch, chairman of AKA, said in a statement.
Aplauso and AKAMusica are banking their futures on another factor: predictions that Net use in Latin countries will continue to surge, based partially on wireless and cable Net access technologies and community access centers, such as Net cafes. Jupiter Communications estimates that there were more than 9 million online users in Latin America at the end of 1999, and that the figure will increase to 38 million in 2003.
Companies such as Latin American portal StarMedia spotted this trend early on and are focusing their energies on getting people in the region online to build the audience for content and commerce.
Just yesterday, StarMedia and CMGI's 1stUp.com teamed with several blue chip venture capitalists to provide free dial-up Net access through a company dubbed Gratis1; the venture will launch operations in Brazil and Argentina before moving to Mexico and the rest of the continent. Compaq also announced a free Net access service for the region in November.
America Online and Yahoo have their sights set on Latin America, too. AOL plans to take its Latin American unit public and to launch subscription-based online services and Internet portals throughout the region.