Gateway Aims for Latino Appeal with Investment

Hoping to woo the U.S. Latino market, Gateway Inc. Friday took a stake in portal

In the deal, Gateway (GTW)
will put $10 million into (PASA)
for a 7.6 percent stake in the Spanish-language portal. The two companies
will launch joint marketing campaigns and promote computer and Internet
adaptation in U.S. Hispanic communities. said that the new funds will go towards its education and
communities programs, including a project to distribute Gateway PCs with
Spanish-language tech support and Net access. Gateway will also be the
exclusive PC seller on the network, with revenue sharing of the
joint sales, and will sponsor parts of the site.

“Gateway made a very public commitment to our community when it announced
its Spanish-language initiative in September 1999 and now the company is
further expanding that commitment by investing in the only publicly traded
online community that solely serves the US Latino community and the only
online community to do so in both English and Spanish,” said Gary L.
Trujillo,’s chairman and chief executive officer.

Gateway, which claims to be the top U.S. consumer PC seller, began
operations of its Spanish-language PC ordering, customer service and tech
support last October.

Gateway pointed to research indicating that there are 13 million Hispanic
households in the U.S., with Hispanics projected to become the
second-largest minority group in the U.S. by the year 2010.

The PC-portal pair is not the first to take aim at the Spanish-language
market, though its focus on the U.S. section is more specific than other
partnerships. StarMedia, which focuses on both the U.S. Hispanic and Latin
American markets, has similar deals with Compaq for Latin America and a
general e-commerce partnership with Dell.

Earlier this year, Spanish-language etailer Españ and Latino-focused
research firm Research & Research released a controversial survey that found
high levels of language “indifference” or bilingualism among Hispanics.
According to the survey results, most of the 2,000 survey respondents chose
English over Spanish. Forty-one percent said they prefer English Web sites;
only 8 percent of those surveyed said they prefer Spanish. However, 51
percent also indicated they are “indifferent” or bilingual, with no clear
language preference when buying products or surfing the Internet.

However, the survey did find that 51 percent of users were more likely to
patronize a Spanish e-commerce
alternative. The survey also found that 61 percent of U.S. Hispanics online
have made a purchase in the last year, and 74 percent of those purchasers
connect to the Internet daily.

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