Content area
Full Text
How Profitability Has Moved Networks Out of Hard News
...given the current economic climate, how best can journalists respond to these corporate, societal and technological changes and preserve the quality and integrity of news?
Twenty years ago, there was no network news "business." The Big Three broadcast television networks-ABC, CBS and NBC-all covered news, but none generally made money doing so. Nor did they expect to turn a profit from news programming. They presented news programming for the prestige it would bring to their network, to satisfy the public-service requirements of Congress and the Federal Communications Commission, and more broadly so that they would be seen as good corporate citizens.
Back then, the networks earned enough money from entertainment programming that they could afford to run their news operations at a loss. And so they did. Former CBS correspondent Marvin Kalb recalls Owner and Chairman William Paley instructing news reporters at a meeting in the early 1960's that they shouldn't be concerned about costs. "I have Jack Benny to make money," he told them.
It is no exaggeration to say that just about everything has changed since then. Today, ABC, CBS and NBC operate in a competitive environment in which most viewers have dozens of channels from which to choose. That has transformed not just TV news but the entire television industry. Those most severely threatened by the way the broadcast business operates are the Big Three. The ABC and CBS networks (now subsumed into larger corporate structures) are losing money, according to Wall Street analysts. NBC's network profits are also falling sharply. Those who own these networksDisney (ABC), CBS Inc. with its major stockholder, Mel Karmazin, and General Electric (NBC)-all demand that their news operations make money.
This demand for profit arises not because these owners are greedier than their predecessors were, but because the financial challenges they face are tougher. The TV entertainment business, in particular, has deteriorated because programming costs are rising while, due to more competition, ratings are falling and hit shows are harder to find. All of this leaves the TV entertainment business struggling to find its way. The networks' entertainment and sports operations are so troubled that news, particularly in prime time, is becoming one of...