There's Something About CNN...

by Dave Zornow

Here are excerpts from my January 1998 column for Cable Avails magazine. For the complete story and lots more on the business of buying and selling Cable Television locally and nationally, call Cable Avails at 303 837-0900. 

CNN, the perennial leader of cable network news, is still the perennial leader of cable network news. The expected showdown between CNN and its challengers, MSNBC and the FOX News Channel has been mostly a blowout. Despite the competitors' promises of shaking up the news business and dethroning CNN, the original 24-hour news network remains the leader. At least, so far.

In the third quarter, CNN scored a total day coverage rating of .5 -- more than twice as high as its closest news competitor. And despite the new competition, this summer's .5 matches CNN's third quarter of one year ago. FNC and MSNBC are drawing viewers from somewhere, but apparently not from CNN.

MSNBC can now be seen in 35.9 million homes. Since its launch in October, 1996, FOX News Channel has grown to 24.2 million homes. Smaller, startup networks can blame their low ratings on small, unstable Nielsen samples, but MSNBC's total day rating of a .2 and .3 prime and FNC's .1 rating in both dayparts are fair representations of their average ratings.

"There is too much news on TV today for FOX and MSNBC to appreciably grow their ratings," says Whitey Chapin, vice president of broadcast research at True North media. "There are a finite number of people who are looking for these types of programs." Chapin says neither MSNBC nor FNC has been around long enough to garner significant "share of mind" among cable viewers. "CNN ratings have been going down, but when people need news, CNN is where they still go first," he says.

"Ratings can be very telling -- but they can also be misleading," says Janet Alshouse, News Director at FOX News Channel. "The key to ratings is to capture an event and bring it to viewer's lives. That's how we are trying to differentiate ourselves." Alshouse says FNC's credo of presenting news that is "fair and balanced" combined with FOX's brand recognition and its appeal to younger audiences will create opportunities for FOX that aren't available to CNN and MSNBC. FNC points to spikes where they have beaten the competition during events such as the coverage following the death of Princess Diana. "Our product is very admirable, but we are still tweaking it," she says. "If you are riskier, sometimes you pay for that. But as the smallest kid on the block we need to be fearless and scrappy."

If Alshouse doesn't have ratings to show for her FNC efforts, she does have VPVHs on her side. Nielsen's third Quarter 1997 audience composition report shows that FOX News Channel drawing younger audiences in higher proportions than the category leader. From 6am to 6am, FNC's composition of Adults 18-34 is 60 percent larger than CNN's (16 percent of adults who watch FNC are 18-34, compared to only 10 percent of CNN's audience). By comparison, almost seven of ten CNN viewers (68 percent) are 50 or older compared to 59 percent of FOX's total day audience.

It's the brand, stupid. 
Cable's success in building powerful, recognizable brands has long been the envy of other media. Not that other media don't build successful brands. It's just that cable's brands seem to have greater legs than their competitors.

CNN's continued success against its news rivals underscores its branding power. MSNBC is backed by NBC and it's all star lineup including Tom Brokaw, Jane Pauley, Brian Williams and Keith Olbermann. The other partner is no slouch either: Microsoft's Bill Gates is one of the world's smartest and most successful marketers. But despite these significant assets, CNN's position has not eroded to any measurable degree.

CNN's brand equity is better demonstrated online than on-air. Internet measurement company ReleventKnowledge ranks CNN as 13th among all web sites in its November 1997 compilation of visits by persons 12 years or older. Despite Microsoft's powerful brand name on the desktop and on the web, MSNBC doesn't crack the top 25 list of most trafficked sites.

Branding and brand extensions will become even more important as cable enters the digital future. Will the news paradigm hold true for newcomers to other existing niches? Which sports brand will hold the upper hand as ESPNews and CNN/SI square off? Will the Cartoon Network's Chicken and Cow hold its own against the emerging digital Toon Disney? Will Cnn/fn give the business to category leader CNBC?

The early years of the new news rivals may or may not hold lessons for these other programming niches. Despite their slow starts, the news networks may eventually grow into significant ratings players in time. "I don't necessarily think the pie is sliced too thin. I think there is room for three national news networks," says Steve Seidmon, president of research consulting firm Seidmon Associates and former vice president of research and programming at MTV. "These news nets are not like headline news. They are programmed with half hour or hour unique content and discrete programs." Ratings and brand recognition come from programs like Larry King and Burden of Proof on CNN and Time and Again and The Big Show on MSNBC. "That's what lets CNN compete so effectively with other news channels: not only do you have brand equity in the parent brand of CNN, but you also have franchise equity in the programming that comprises the network."

Seidmon predicts that CNN's competitor's will, in time, build their own successful brands. "MSNBC and FOX don't have a lot of brand equity yet, but they are beginning to build those franchises. They've invested in personalities like Keith Olbermann and Geraldo Rivera because they are names which can help define these franchises. " Despite their early frustrations, Seidmon thinks that both competitors will grow and enlarge the news ratings pie. "News is a very big donut," he says. "There are alot of things you can fill it with."

Back to Articles page

© 2003 TNG Research. All Rights Reserved.