CNN: The All News Network?
Bloomberg Businessweek ran an article last week by Alex Sherman, ” Has CNN‘s All-News Strategy Become Old News?”. It seems that the folks at CNN feel that there are times when commercials are not appropriate.
In Sherman’s article, Mark Whitaker, the CNN Worldwide Managing Editor, is quoted saying, “Our bread and butter is in-depth coverage of breaking news…We have faith that will help us with the ratings”.
The article goes on to discuss that CNN establishes high ratings when covering breaking news stories that have major national interest, like disasters, plane crashes and of late, the protests associated with the shooting of Trayvon Martin.
According to the article, networks sell roughly 70% of their available advertising space a year in advance and the rest is sold at a higher rate since advertisers know more people tune in when there is breaking news.
Lyle Scwhartz, a managing director for a media buying firm that is part of the largest advertising company in the United States, says that these ads still need to be placed in available time slots and by the time that happens, the breaking news might be over.
The article also adds that there is a problem between tragedy and commercial advertising. Many airline industries have an agreement that the networks will not air their commercials while covering things like plane crashes. Other breaking news is also uninterrupted.
Once the breaking news has subsided, according to Sherman, CNN’s ratings drop them back down to third place.
So this article begs the question: If advertisers buy these time slots at a higher rate because more viewers tune in during breaking news, but the network reduces and in some cases cease all commercial time during this same period, who benefits from this model?
I just don’t see this as being a sustainable business model for CNN. After a while, the advertisers are going to get pretty fed up with buying more expensive time slots for nothing. The comments associated with this article and a related article on Media Bistro, for the most part, have been pretty tough on CNN and it’s programming. Most people are critical of the bias they see on CNN as well as the notion that they are an all news network.
Since CNN is declining in ratings, and constantly lags behind other networks like Fox News Channel, and MSNBC not just in ratings but in advertising revenue as well, I can only guess that continuing this business model will ultimately lead to the end for CNN. Whitaker having “faith” that this will keep the network afloat seems like a stretch, at best.
As noted in Sherman’s article, there is so much competition out there as far as tuning in to the news, laptops, phones, tablets, other than its booming online website, I don’t think it’s out of the realm of possibilities to say that CNN is in the early stages of the death throes of a dying network.
You can read the Media Bistro post on the subject here.
- CNN Loses Half Its Viewers (the2012scenario.com)
- Why CNN’s Digital Strength May Cause Problems For Fox (worldmediatrend.wordpress.com)
Posted on April 21, 2012, in Uncategorized and tagged Advertising, Bloomberg Businessweek, business models, CNN, Fox News Channel, Mark Whitaker, MSNBC, Time Warner, United States. Bookmark the permalink. 1 Comment.