2005 Annual Report - Cable TV Audience

So what is the future for cable audiences? Most likely it will not be based on drawing dramatically new numbers of people freshly wired to cable boxes. Rather, it will have to be built around establishing viewer loyalty -- by building its own dedicated audience, cannibalizing from the news competition, and winning more of the 'information' audience that drifts to channels like Discovery, History, or TLC.

That outlook has a number of implications.

One is that to grow further, cable will have to do more than the things Fox has done so far -- attract an audience with talk radio-style programming and steal conservatives away from CNN. It will have to attract new viewers with new kinds of programming.

Another is that cable executives will increasingly focus not just on numbers of viewers but on something called "time viewed" -- the length of time those viewers hang around -- as well as demographics.

When it comes to time viewed, the implications for the future may not be good for news, or at least what traditionalists would consider news. The "traditional newscast" at best would attract viewers to a single program, not over time. Yet to date, the signature newscast (MSNBC originally had high hopes for "The News with Brian Williams") has been a ratings loser in cable compared with the talk formats (like Larry King, O'Reilly, or Matthews). If that continues to be true, there will be even more emphasis on personality. That's what's working, that's what's winning and that's what viewer loyalty seems to be built on. Here, Fox seems to have had the upper hand so far. It has more programs built around personalities, and it apparently has viewers sticking around longer. If personality is the path, then the Fox approach would seem to be the model others will copy.

Another question is how you define success. Any discussion of the future "growth" of the cable audience will likely break audience growth down into demographics. All ratings points are not created equal; viewers with higher incomes are more desirable to advertisers. That, industry insiders explain, is how Lou Dobbs's Moneyline program was sold for so many years. It had relatively low ratings, but charged high ad rates because of the presumed desirability of the audience. If cable cannot increase the sheer numbers, can it increase its appeal to specific demographics? It would like to do so, but it has shown little boldness to date in going upscale, for fear of losing the overall ratings wars. Here, potentially, CNN and MSNBC may have an opening to do something Fox has not.

Indeed, the small percentage increases and declines in audience growth CNN and MSNBC have experienced illustrate the problem facing both channels as they compete against Fox News. Neither appears to have leadership willing to take a risk on an approach to the news that might prove either a breakout success or a ratings disaster. Instead, by attempting variations of what Fox has shown is successful, both channels in their own distinct ways have failed to create their own distinct formulas.

CNN has moved in the direction of talk shows, à la Fox, but has never gone for the ideological edge. MSNBC has also moved in that direction, but the political stances have varied -- sometimes to the left ("Donahue"), sometimes to the right ("Scarborough Country"), and sometimes both. During the daytime, MSNBC has shifted toward a BBC or radio style "newswheel," with regular previews of what is coming in the next 15 minutes, and regular news summaries.

If CNN and MSNBC do not change their content substantially, there would seem to be little reason to believe their ratings will change in any dramatic way. Yet if Fox News's growth continues to slow, or even stop, it is possible that its formula of talk programs may no longer be the model the others try to emulate.