2005 Annual Report - Cable TV Ownership

There were no changes in the ownership picture of cable news in 2004. No new companies entered the field, and none of the three major cable news operations changed hands.

Cable news management came under attack on a variety of fronts, including allegations (notably in Robert Greenwald's movie "Outfoxed") that Rupert Murdoch had turned Fox News into a covert political operation, and Ted Turner's castigating Time Warner for managing CNN with too much attention to short-term results and the bottom line.¹ There are further signs of new competitors entering the field, including BBC, perhaps as soon as 2005.

The three cable news channels are all owned by media conglomerates, and all have corporate siblings heavily involved in other media sectors, from magazines (Time Warner), newspapers (News Corp.), local TV stations (News Corp. and NBC), and movie studios (all three).

Despite those similarities, the news channels play different roles within their respective companies that are useful to note in trying to imagine how they might evolve in the future. Fox News is one of the stars of News Corp.'s TV portfolio. CNN is a solid performer for Time Warner, but not an enormous factor. MSNBC, by contrast, contributes little financially to either of its parents, General Electric (the NBC of MSNBC) or Microsoft (the MS). On the one hand, that might suggest MSNBC is in a precarious position, which has led to speculation about its owners' commitment to the channel in the long term. On the other, having multiple platforms to deliver news and other content may be central to both companies' strategies.

In 2004, each company started a number of activities that attempt to create a "seamless" experience tying cable news to its online counterparts. Arguably, the cable channels are doing a much better job of online convergence than either network or local TV news. It could be that cable news is especially suited for online convergence because its 24-hour day matches well with the Internet's "always on" nature.

In most cases, the cable channels' attempts to boost their ties to their online counterparts have revolved around reporters and staff people discussing what their lives are like behind the scenes - posting about the techniques that got them a particular story, the day-to-day business of putting on a television show, or their personal lives. News is not the star - the "cast" is the star.

It is noteworthy, however, that the standing of the three cable networks in the TV ratings does not correspond to their online popularity. Among all news sites, in December 2004 CNN.com was the most popular, with 21.3 million unique visitors; MSNBC was in second place, with 19.5 million visitors, and FoxNews.com trailed in 15th place, with 5.0 million visitors.² (See also Online Audience.)

Let's look at the economics of the three news channels one at a time.