Breaking News

Cable news programmers and operators fight to keep viewers satisfied and loyal—without breaking the bank. By Shirley Brady Cable news networks seem to be at the apex of their influence. More people watch cable news daily than tune in to broadcasters’ nightly news reports. And the most-watched cable news network, Fox News Channel, feels its cachet is strong enough to demand $1 per sub in affiliate fees once its 10-year contracts expire in September. In reality, cable news networks and their cable operator affiliates are facing difficult decisions. Carnegie Corporation research shows all traditional news providers, including cable news networks, are under siege. Viewers in the 18-34 demo are abandoning mainstream news sources for the Internet (blogs, MySpace.com and social networking sites), cell phones, pagers and pretty much any platform that isn’t TV news, radio or print. "Mobility is a big part of" the younger demo opting out of traditional news vehicles, says Merrill Brown, a former editor of MSNBC.com and co-author of a study on young people and news for Carnegie. "The notion of on demand is critical to news usage patterns…What’s more, they want to engage with the news source, to comment and talk about the issues they’re reading about or viewing stories about." While it’s clear that some younger, tech-savvy consumers are abandoning traditional newscasts, it seems overall broadband users are doing so, too.* Fortunately, one of the few areas cable operators and programmers agree on is the need to act aggressively to keep this multiplatform-hungry audience loyal. And merely repurposing content or streaming live video will not suffice. Programmers must create unique multiplatform works to enhance their brand. Young-skewing CNN anchor Anderson Cooper could provide footage exclusive to CNN’s off-television products, for example. Cable operators need to tap such multiplatform content to increase customer loyalty among this growing sector of the population. Still, there are major issues. Patrick Knorr, general manager of Lawrence, Kan.-based Sunflower Broadband, predicts that cable news products will converge across his product lines, although he has some questions. "How do news organizations see bringing VOD, Web and linear together into one experience?" he asks. "Is that a goal? When will it happen? Will IP video have an advantage?" Even less sanguine about convergence is 20-year-old Brian Stelter, editor of tvnewser.com, a blog that reports on the news business. "When it comes to anytime, anywhere news, I think the cable news nets have some catching up to do," he says. "NBC and CBS offer their evening newscasts online, but the cablers don’t offer any full shows online." Stelter’s suggestions for cable news programmers keen to capture tech-savvy fans? "I’d like to see every segment and every package on cable news archived on the Web somewhere," he says. "A lot of the content is worth archiving—if they could find a way to do it without upsetting cable operators." In fact, the balancing act is even more complicated. While cable news networks’ timely short-form content is perfectly suited for off-television distribution, free news on the Web and other platforms poses a challenge to linear TV networks. OPERATORS CAUGHT IN THE MIDDLE While operators are con-cerned about Fox News Channel’s proposed rate hikes, most appreciate the importance of combining linear news networks with off-television products to improve customer loyalty. A former TV news anchor and reporter, Cynthia Boles, VP of marketing for small operator Buford Media, wants the urgency and stickiness of news programming to sweeten her bundled offering. "There is a real opportunity for cross-platform synergy," she notes. "As the news channel websites get closer and closer to `news on demand’ I see an opportunity to magnify the value of both the cable product and the Web product by promoting the use of both on our systems." Similarly looking for "fair and balanced" rate cards and cutting-edge cross-platform products, Patty McCaskill, SVP of programming for Suddenlink Communications (formerly Cebridge Connections), wants news programmers to come up with cross-platform solutions that keep her bosses happy while satisfying her subscribers. "The challenge for every news organization is to continue serving their current consumers while finding compelling ways to engage new/younger consumers, many of whom rely on Jon Stewart and/or the Internet as their sole sources of information," she says. CABLE MUST REACT TO CHANGE That sea change in behavior is why McCaskill urges news programmers to brainstorm on cutting-edge news-based products. "I would encourage any news network to partner with distributors like Suddenlink so that their news content and brands remain available across all the products we offer or might offer in the not-too-distant future—linear, broadband, VOD, mobile," says McCaskill. "And to do so with economics that don’t force the consumer to pay incrementally for the news brand-plus content experience as they look to access it on different screens." Cable news programmers appreciate forward-thinking distributors who see creating a synchronous experience around their TV brands as not just a goal, but also a necessity to keep their audience. Like many things in the cable business, the timing depends on cutting deals that bake in multiplatform elements. This likely means that the one-experience goal for news content will not happen on a mass scale soon. FOX COULD GO MOBILE ON CABLE Even with his cable news network in the hot seat over the rate hike, Fox News SVP of affiliate sales Tim Carry says he could see launching Fox News mobile video on cable systems as part of operators’ quadruple-play bundles with wireless. "We’ve had VOD conversations [with cable operators] and we’ve had new-media conversations with everybody," he says. "If we want to get into new media together, I think we have to figure out what works in new media and not just say, `I’ll take Fox News and just clone it on every one of these portable devices.’ If we all agree that we have to create unique product, then I think it comes to a new level of economics on those particular platforms." So far, FNC has been a holdout on VOD. CNN, the most-distributed U.S. cable news channel with more than 90 million homes, sends its video news programming to affiliates’ VOD and broadband platforms. With no cable operator yet taking FNC’s off-network product, Carry has been striking deals with wireless providers, including Cingular and Amp’d for The Blast, Fox News’ mobile video news service. CNN also is reaching out to tech-savvy and younger audiences with online products like Pipeline, its commercial-free subscription broadband service that launched in December. Costing $2.95 per month or $24.95 per year, Pipeline offers unfettered access to CNN’s deep library of news video for those who can’t get enough on the linear network or CNN.com. So far, none of CNN’s cable affiliates—including corporate sibling Time Warner Cable—have started marketing Pipeline to their high-speed Internet subscribers, although that could change by year-end. TESTING QUICK CLIPS That said, operators and news programmers are helping to move the needle by participating in technical tests this year. That includes Time Warner Cable’s Quick Clips trial and Comcast’s searchable interactive program guide, which will blend the on-demand and the linear video content in one interface to the customer. Comcast is launching that in its Scientific-Atlanta platform markets. Time Warner’s Quick Clips technology will bring content from news and other programmers’ websites onto Time Warner subscribers’ TV screens. "We want to ensure that we never give our customers a reason to leave," president and CEO Glenn Britt said about Quick Clips in his keynote address at the TelecomNEXT conference in March. CNBC and MSNBC may not have the broad appeal of a Fox News Channel or CNN, but that makes the co-NBC Universal-owned news nets keen to test new platforms, like Quick Clips. "The primary thing that interests us about Quick Clips is the broadband platform generally has big advantages: It’s very timely and has ubiquitous distribution," says NBC Universal Cable CFO and SVP, new media, J.B. Perrette. "VOD is terrific, but today you still have to do a lot of advance planning to get content available on the platform." For his part, Knorr is making news video portable across Sunflower’s product lines this year. With a fraction of Time Warner Cable’s financial resources, he is working on a customized test with technology vendor ICTV to port content from the websites of Sunflower’s parent company onto his subscribers’ TV screens. "The real trick is to tie it all together seamlessly on the set-top box," Knorr says of his convergence dreams. "It’s up to companies like TV Guide, ICTV and SeaChange as well as content providers, but we are doing our part to push them in the right direction." *At least 71% of home broadband consumers use the Web for their daily news fix, according to a March study by the Pew Internet and American Life Project. Online news is a more regular part of these broadband users’ daily diet than the local paper, which attracted 43% of broadband subscribers; local TV newscasts, 59%; national TV newscasts, 52%; and radio, 53%. All News, All the Time The six U.S.-based cable news networks range in size from CNN’s 90 million-plus U.S. households to more than 38 million homes for Bloomberg Television. CNN
Launched: June 1980
Ownership: A division of Time Warner-owned Turner Broadcasting System Inc.
Management: Jim Walton, president, CNN Worldwide; Jonathan Klein, president, CNN U.S.; Greg D’Alba, EVP and COO, ad sales and marketing.
Subscribers: 90 million+ U.S. households
Key Programs: Anderson Cooper 360, Paula Zahn Now, The Situation Room
Spin-offs: CNN Pipeline, a subscription-based broadband video news service, and CNN.com for online; CNN on Demand for VOD; wireless content; nine TV networks including CNN Headline News; two radio networks; CNN Newsource for syndicated news. Globally, CNN’s 22 branded networks and services are available to more than 2 billion people in more than 200 countries and territories. CNN HEADLINE NEWS
Launched: January 1982
Ownership: A division of Time Warner-owned Turner Broadcasting System Inc.
Management: Ken Jautz, EVP, CNN Worldwide; Rolando Santos, EVP and GM, Headline News.
Subscribers: 89 million+ U.S. households
Key Programs: Nancy Grace, Showbiz Tonight
Spin-offs: CNN Student News, a 10-minute news program for schools. Channel is also seen in Canada, Latin America and the Caribbean. CNBC
Launched: April 1989
Ownership: NBC Universal
Management: Mark Hoffman, president; Robert Foothorap, SVP, ad sales; David Friend, SVP, business news.
Subscribers: 86 million+ U.S. households
Key Programs: Squawk Box, Closing Bell with Maria Bartiromo, Mad Money with Jim Cramer
Spin-offs: CNBC.com; including CNBC Europe and CNBC Asia channels, the CNBC TV brand is available in 231 million households worldwide. FOX NEWS CHANNEL
Launched: October 1996
Ownership: News Corp.
Management: Roger Ailes, chairman and CEO; Paul Rittenberg, SVP, ad sales; Tim Carry, SVP, affiliate sales.
Subscribers: More than 85 million U.S. households
Key Programs: The O’Reilly Factor and Hannity & Colmes, the top-rated shows in cable news.
Spin-offs: The Blast, a wireless video news service; FoxNews.com; radio. A U.S. business/financial TV network is said to be under consideration. Other FNC markets include Asia, Europe and Australia. MSNBC
Launched: July 1996
Ownership: A joint venture between NBC Universal and Microsoft
Management: Rick Kaplan, president; Bill Wolff, VP, prime-time programming; Mark Effron, VP, daytime programming.
Subscribers: 82 million+ U.S. households
Key Programs: Hardball with Chris Matthews, Countdown with Keith Olbermann, Scarborough Country
Spin-offs: MSNBC.com; radio BLOOMBERG TELEVISION
Launched: February 1994
Ownership: Bloomberg LP
Management: Kenneth Kohn, executive editor, broadcast
Subscribers: 38 million+ full-time U.S. households and 88 million part-time homes
Key Programs: Business and financial news updates and stock tickers
Spin-offs: More than 200 million viewers worldwide for its 10 networks in seven languages; radio; podcasts; customizable content and interactive television.