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Sunday, December 7, 2008

The Business Side Of The News

Journalism may be a noble profession, but running a media conglomerate is a different story. Over the last week, I've been reminded that the business of reporting the news is just as much about profit and the bottom line as it is creating the first draft of our collective history.

The first example of this actually started over a year ago when CNN ended a 27 year relationship with the Reuters news service. CNN has been building its news gathering sources since then and if CNN Wire is successful, you may see CNN material in your newspaper. This week CNN met with several newspapers at a Summit in Atlanta.

For nearly a month, a trial version of CNN's wire service has been on display in some newspapers. But this week editors from about 30 papers will visit Atlanta to hear CNN's plans to broaden a service to provide coverage of big national and international events — and maybe local ones — on a smaller scale and at a lower cost than The AP.

"The reality is we don't have a lot of relationships with newspapers," said Jim Walton, president of CNN Worldwide. "We have relationships with TV stations around the world." Walton said the meeting this week, which CNN has billed the "CNN Newspaper Summit," is "kind of a get-to-know-you."

With its CNN Wire, the company is going up against the largest news-gathering operation in the world in The AP, and it must convince editors that it can offer something that is well outside its broadcast expertise — which may not be a tough task given the dire circumstances newspapers face. In addition, a number of newspapers are unhappy with the cost of The AP, a nonprofit corporation that is owned by the 1,400 papers that are its members. Some newspapers have even given notice that they intend to leave The AP.

Walton, of CNN, says that the network already runs an internal wire service for its bureaus and, and that taking it outside is a logical step. The breadth of the service that CNN will ultimately offer is unclear, and partly depends on the demands of newspapers. CNN Wire could offer columns written by some of its high-profile personalities, like Anderson Cooper. It also plans to offer text versions of its major investigative pieces for television.

"The CNN system is set up so we use content across all our networks and platforms," Walton said. "It's not unusual for Anderson Cooper to appear online or on CNN International."

And local coverage could be in the offing. In August, CNN said it was dispatching journalists to 10 cities in the United States, but in a bare-bones fashion: the correspondents will be laptop- and camera-toting one-person bands, rather than workers in expensive bureaus.

The Associated Press is more than 150 years old and is the world's largest news-gathering operation, with more than 3,000 journalists in over 100 countries.

"I think the crucial question is whether CNN is going to try to really go head-to-head with The AP, or offer something that's a lot more selective," said Jack Driscoll, the former editor of The Boston Globe and editor in residence at the MIT Media Laboratory. "Newspapers are hurting so much that they could be willing to get less for less."

In that case, Driscoll said, there is probably room for a new competitor.

"But if CNN is going to try to do something close to the range and quality of The Associated Press, that's awfully hard to do, and it's a huge financial undertaking."

Some newspapers that have long relied on The AP have said they would drop the service because of its cost, which varies — The Columbus Dispatch, for example, paid more than $800,000 a year. Others, including The Star Tribune of Minneapolis and the Tribune Company, one of the largest newspaper chains, have also given notice that they plan to drop out of the service. The AP, in response, announced in October that it would reduce prices, which will result in a cumulative savings of $30 million annually for its member newspapers.

This stands in contrast to the current financial fortunes of CNN.

In October, CNN said it was hiring nearly 30 people to staff a news hub in Abu Dhabi, and has made other international expansion moves. And Walton said the network was on track for its fifth consecutive year of double-digit profit growth, a first for CNN.

"One of the good things is that when you are profitable, you can reinvest," Walton said.

Source: International Herald Tribune

CNN's multi-day pitch to newspapers this week for its new wire service appears to be a success, according to several editors and publishers who attended.

They said few specifics were presented, but welcomed that approach as CNN executives spent more time asking them what they wanted before presenting a formal newspaper package.

No pricing plans were put forth, according to those who attended the three-day summit in Atlanta from Monday to Wednesday. CNN officials said more formal proposals and packages would likely not be presented until after the new year.

Some attendees to the all-expenses-paid gathering said they would like to see more extensive photo options and more specifics on national, international and breaking news.

Still, most welcomed the opportunity and believe CNN could play a future role in their outside news source plans.

"They showed us the inner workings of the operation, how careful they are with accuracy and the things that are important to us," said Ben Marrison, editor of The Columbus Dispatch, one of about 30 newspapers with representatives at the event. "We have not been able to look at the active wire process. They were mainly looking for feedback from us on what they needed, they were open to questions from us and they were somewhat amenable to adjusting to what we needed."

Marrison, one of several editors who have complained about Associated Press's new rates and ongoing service, said for CNN to succeed with newspapers it would have to offer national and regional reporting, photo services, and breaking news.

"They have the full complement of video, which is already available," he added.

Jean Dubail, assistant managing editor/online for The Plain Dealer in Cleveland, said his paper has been using some CNN wire service on a trial basis. He said the presentation was positive.

"They had pretty much all of their big guns there." he said, citing on-air personalities such as John King and Gloria Borger. "They rolled out how the wire has worked internationally, with some written by on-air staff. Most of the day was spent talking about what it would take to turn it into something we could use."

But, he added, "they said several times they had no wish to replace AP."

As the summit took place, AP sent a strong message to its members on Monday promoting its services.

That notice, from Tom Brettingen, Senior Vice President, Sales and Marketing and Chief Revenue Officer, said in part: "The Associated Press is the gold standard in global journalism. AP has 243 bureaus in 97 countries, and is the largest global news network in the world. AP’s video newsgathering agency, APTN, is the world’s leading provider of news video. AP state and regional news coverage is unparalleled in the United States in size and scope."

Roger Plothow, editor and publisher of The Post Register in Idaho Falls, called the Atlanta gathering, "quite encouraging."

"They really didn’t have a completely developed proposal; in fact, they had no proposal at all," he said. "Two-thirds of the day was spent asking -- what do you think of this? What do you think of that? Given the history of AP, which has not done that, this was the right thing to do."

Source: Editor and Publisher

At the same time that CNN expands its resources to support a wire service, it will eliminate their science and technology unit including their chief technology and environment correspondent, Miles O'Brien. What will the viewers of CNN be missing as a result of this decision? Well, here is a sampling of some of Miles O'Brien's reports:

November 29, 2008: CNN's Miles O'Brien talks to the crew of the space shuttle Endeavour as they get ready to return to Earth.

December 1, 2008: Miles O'Brien talks to SETI scientists and planet hunters about life beyond Earth.

November 25, 2008: CNN's Miles O'Brien follows a small airplane making an emergency landing in Van Nuys, California.

November 22, 2008: Pond scum could be a great alternative to oil, says one entrepreneur. CNN's Miles O'Brien reports.

November 4, 2008: Miles O'Brien takes a look at just how much hot air was created from all that hot air.

October 17, 2008: CNN's Miles O'Brien takes a look at metaphors used by business reporters and their effect on the markets.

September 8, 2008: A pilot figures out a way to fly without being fuelish. CNN's Miles O'Brien reports.

August 12, 2008: Scientists are genetically engineering bacteria to produce an oil alternative. Miles O'Brien explains how it all works.

July 31, 2008: CNN's Miles O'Brien tries out a futuristic personal jet pack -- which may soon sell for $100,000.

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