Media Curmudgeon

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May 31, 2005

Media Greed

Eugene Robinson, in his May 27, Washington Post column titled "The Press of Business," wrote about Rupert Murdoch that: "He'll support politicians and push for legislation that furthers the interests of News Corp., his media empire, but that's about it. Murdoch simply practices capitalism in its most naked, elemental form. Instead of following an agenda, he's guided by greed, cunning and a razor-sharp instinct for what people want to watch, hear and read."

The occasion of Robinson's column was that last week Murdoch's Fox network won its first network season 18-49 ratings race (18-49 is the demo advertisers want, so it's the only demo that matters) and 20th Century Fox studio's "Star Wars III: Revenge of the Sith" was number-one at the box office, breaking the all-time weekend opening sales record. Of course, Murdoch's Fox News has been the top-rated cable news network for about a year. Therefore, Rupert Murdoch had a lot to crow about last week.

I have to agree with Robinson about Murdoch. Unfortunately, the drive for profit, regardless of its consequences has led all of the publicly owned media to put business ahead of news credibility or public service. What used to be a public trust in journalism has become a private trust for investors—-primarily rich investors and media moguls who make outrageous money. They are getting rich by feeding Christians to the lions to please a blood-thirsty, sensation-seeking mob.

Television is getting worse, more banal, and more stupid every day. Television and cable news is morphing into entertainment. CNN head Jonathan Klein has apparently decided to out-Fox Fox News by becoming more controversial, more sensational, and by appealing to the baser nature of viewers. He won't be fired for abandoning good journalistic practices, he'll get praise and a raise from media conglomerate owner Time Warner for catering to and pleasing the mob.

Right-wing conservatives are licking their chops because their attack on the media for being too liberal is paying off. The corporate-owned news media have become more timid and afraid to upset anyone, especially conservatives and the current administration. Conservatives have also attacked the media for using un-named sources ever since the most famous un-named source of all time, Deep Throat, brought down the Nixon administration, which conservatives genuflected to.

The right-wing didn’t mind when an un-named source outed Clinton’s Oval Office indiscretion, but conservatives screamed foul when Newsweek magazine mentioned what is apparently a not uncommon torture technique as told to it by an un-named source in the Pentagon. So it really does depend on whose ox is being gored. Outing Clinton for a stupid, personal indiscretion is OK, because the right-wing hated him. Outing torture techniques is not OK—-in fact it’s disgustingly disloyal—-because the right-wing supports Bush, the war, and, we must assume, torture.

Furthermore, un-named sources can be controlled and made to retract statements. I like what David Gergen, who as in the Nixon White House, said about protecting un-named sources. Gergen said the best way to deal with un-named sources is to reveal who they are if they don’t tell the truth. If un-named Deep Throats tell the truth and give journalists good information, then protect them even if reporters have to go to jail. If un-named sources lie and steer reporters in the wrong direction on purpose, then out them. Can you imagine what would happen if Robert Novak wrote, “Karl Rove, told me that Bush doesn’t support torture, but he lied and was trying to cover up a note Bush wrote on a CIA report to stop at nothing. I have an authenticated copy of the note in my files. Rove lied and I’ll never believe him again.”

That sort of thing will never happen of course. Why? Because columnists such as the conservative Novak and other journalists who are in the thrall of corporate for-profit media are afraid of being attacked by the current administration and their numerous right-wing press assassins—attacks hurt profits. Big corporate advertisers don’t mind blatantly sexuality, tasteless entertainment, and public gross-outs on television, but they do mind and won’t support with ad dollars anything that smacks of controversy, of negativity, or that the evangelical right doesn’t like.

General Motors pulled its advertising from the Los Angeles Times last month because the Times automobile columnist wasn’t nice to GM. Morgan Stanley recently told the print media it would pull ads from any publication that ran negative stories about Morgan Stanley. Big business has learned from the right-wing and the Bush administration that the press can be controlled through accusations of being liberal and by threats to profitability (ad dollars). That’s why Murdoch bends right—-it’s less trouble and, thus, more profitable. It’s about greed, not ideology. What a shame.

Posted by Charles Warner at 5:39 PM | Comments (4) | Print |

Charles Warner at June 1, 2005 3:04 PM writes:

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Charles Warner at June 1, 2005 2:11 AM writes:

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Bill Grimes at June 1, 2005 1:24 AM writes:

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Neil Derrough at May 31, 2005 9:58 PM writes:

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May 27, 2005

More Than Pain For NBC

A May 26, story in the Arts section of the New York Times by Bill Carter titled "Triumph For Fox, But Pain For NBC" noted that Fox had won the 18-49 ratings battle for the network TV season and that NBC had come in fourth, a big comedown from being first last year.

In same issue, in the Business Day section, a story by Jacques Steinberg was titled “NBC News May Get New Chief” and noted that NBC News president Neal Shapiro “Has told his superiors at the network in recent days that he would like to leave his post, two senior executives at NBC Universal said yesterday.” Mmmm. Interesting coincidence.

It’s not really a coincidence if you remember that NBC Universal is owned by GE, that GE’s CEO, Jeff Immelt, was Jack Welsh’s hand-picked successor, and that Immelt has kept in place many of Welsh’s hard-nosed management principles, as detailed in Welsh’s excellent management book, Winning. One of Welsh’s principles was to be number one or number two “in every market—fixing, selling, or closing every underperforming business that couldn’t get there.” Another one of Welsh’s principles was the 20/70/10 rule about people. Promote and pay well the top 20 percent, try to keep the 70 percent in the middle happy and motivated, and move out the bottom ten percent.

Several weeks ago Jeff Zucker, president of the NBC Universal television group, moved out the producer of the ratings-challenged “Today” show and installed a new producer. Zucker, who used to be the producer of “Today,” even went back to the producer’s chair (actually looked over the shoulder of the new producer) for a week to let everyone know that he was still involved and interested. Zucker was credited in accounts in the press for making the change in producers even though “Today” was the responsibility of NBC News’s Neal Shapiro. That probably gave Shapiro the not-too-subtle hint that he was considered one of the dreaded lower ten percent group.

So, in line with GE’s philosophy of being number one or number two in every market and fixing, selling, or closing businesses that under perform, we can expect GE to “fix” NBC (GE won’t sell it and certainly won't close it). In the GE system, someone has to be held accountable for the disastrous slide from number one to number four in the ratings, the worst drop in modern TV network ratings and one that will probably cost NBC close to half a billion dollars in the upfront market that is currently in full swing.

So why has GE allowed NBC to keep MSNBC alive when it isn't even close to being number one or number two? Also, expect more people than Neal Shapiro to be moved out, especially after NBC got blasted in the trade press for a terrible performance in the upfront presentations of next year's prime time programming. Could Jeff Zucker feel the pain, too?

Posted by Charles Warner at 2:17 PM | Comments (0) | Print |

May 26, 2005

AOL Is Googled

It used to mean when you "googled" people that you typed their name into Google's search engine and then checked out the information about those you googled. Now, another meaning has developed because Google has become one the most innovative companies doing business on the Internet and it is leaving other Internet companies in the dust--it googles them by doing some function first and marginalizing or preempting moves of other companies on the Internet. In fact, Google and Yahoo are locked in an innovation battle that is making consumers and both companies winners, as innovation battles between two companies typically do.

Google's newest move to allow users to customize the Google home page and add news, stock quotes, and e-mail will make it a powerful portal. In a May 19 story in the New York Times, Katie Hafner writes, "Moving more directly into competition with portals like Yahoo, MSN and AOL, the search company unveiled a feature that allows users to personalize the Google home page."

The story goes on to quote Danny Sullivan, the editor of searchenginewatch.com, a Web log devoted to the industry, as saying that "It's Google formally declaring that they are a portal." I'm sure he meant to say that "it is a portal"--a company is a singular noun and, thus, isn't a plural "they"--a common mistake people make when talking about companies.

This announcement came the same week that Time Warner's CEO, Dick Parsons commented in a Fortune magazine article (see my May 19 blog) that if AOL fails in its latest effort to get more online advertising through its free portal, he would consider “spinning off the division as a separate stock.”

AOL's new, reconstituted, free portal is scheduled to re-launch in July apparently, so Google announced its portal strategy two months before AOL's new portal is supposed to launch in order to effectively preempt and torpedo AOL's strategy. It googled AOL, effectively blunting AOL's portal strategy. Because Google is already the default home page on millions of people's browsers, now people will have even more reasons to have Google as their portal and, more important, fewer reasons to use the new AOL portal.

The newly designed AOL portal may be terrific and may include cool functionality and great content, but it's doing it too late--five years too late, which in Internet time in which things change at light speed, makes it eons too late. Google's move makes it even more unlikely that AOL's portal strategy will work (and don't you think Google knows that) and, therefore, more likely that Parsons will make good on his threat to spin off or sell AOL.

The next question is obvious, who will buy the stock of a shrinking company with a failed portal strategy? It's more likely that Parsons will have to sell AOL outright. But to whom? I've said all along that Microsoft is the most logical buyer, but now could the most logical buyer be Google? Are the strategists at Google smart enough (I think they might be) to realize that Google's move to become a portal will hurt AOL, thus lowering its value, thus making Parsons lower his asking price so Google can buy AOL?

Google's stock is at an all-time high of $260 a share, which means it's got lots of wampum (paper money/equity)--the same kind of wampum AOL used to buy Time Warner in the biggest and most disastrous corporate merger is history. Wouldn't it be a marvellous irony if Google did to AOL what AOL did to Time Warner, buy it with inflated stock?

Such a purchase would make sense for Google because it doesn't have an ISP component like MSN and Yahoo (DSL with SBC) have, and it would be better to buy an ISP than try to set one up from scratch. And it would also make sense for Google to try to lower the value of an ISP it wanted to acquire. I think in baseball the maneuver is called a double steal.

Posted by Charles Warner at 2:50 AM | Comments (3) | Print |

Charles Warner at June 1, 2005 3:22 PM writes:

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ThePef at June 1, 2005 1:29 AM writes:

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Jesse Kornbluth at May 26, 2005 7:38 AM writes:

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May 19, 2005

Big Media De-Conglomeration

If a reliable publication like Newsweek magazine can admit it was wrong on the Koran-flushing story, then I guess I can admit that I have been incorrect on several occasions. Unlike Newsweek, I haven't been pressured by anyone to admit I'm wrong and my errors won't cause any riots.

Last year in several blogs I predicted that CBS would shut down its news division after the embarrassing Rathergate episode. But instead CBS forced Rather to retire a year earlier than he planned (but still five years too late and after he had dragged the "Evening News" down to last place). CBS also fired Mary Mapes for producing the Rather piece on "60 Minutes II" about Bush's National Guard service--yes the same Mary Mapes who won a prestigious Peabody Award (the Oscars of broadcasting) for producing the "60 Minutes II" story on the torture at Abu Ghraib. What was CBS's reaction to winning a Peabody for "60 Minutes II”? It cancelled the program today--another triumph for the right wing and for junk entertainment programming.

Another thing I was wrong about in a blog and in my textbook, Media Selling, was the emerging importance of cross-platform selling by big media conglomerates. I thought Time Warner, Viacom, Disney, and News Corp. would develop successful cross-platform sales units that would sell packages to advertisers that included multiple platforms and assets. CBS Plus sold a $300 million dollar deal to P&G several years ago and the promise for multi-platform sales seemed quite sanguine.

Right after the AOL-Time Warner merger, the new company formed Global Marketing Solutions, a unit that was supposed to sell deals that took advantage of all of the many Time Warner assets, including AOL, a strong online component that none of the other media conglomerates had. The potential seemed huge for cross platform deals.

But internecine warfare between the various Time Warner silos made it virtually impossible for them to cooperate and allow their assets to be part of a deal. CBS Plus's philosophy was to aggregate Viacom's assets and then sell them at a discount in order to get a higher share of business. When the CBS Television network's ratings took off and shot to number one, it probably wasn't interested in selling at a discount and Karmazin was no longer there to force the network do so, so CBS's cross-platform deals dwindled. (I’m also pretty sure that MTV’s Tom Freston wasn’t nuts about selling high-demand MTV at a discount as part of a cross-platform deal either.) Disney and News Corp. made some deals, but none of them significant. In the big media conglomerates there was too much infighting and, generally, an unwillingness to cooperate in giving discounts or putting packages together.

Big advertising agency conglomerates and their buying units that have seen their income decline because of pressure from major advertisers are looking for ways to increase their business, so big media buying organizations such as the Starcom MediaVest group, Carat, Zenith, and Mind Share have realized that they can create cross-platform ideas, sell them to clients, and then negotiate with the media conglomerates (after all, negotiating is one of the things they do best). Therefore, agencies will more and more drive big cross-platform deals in the future—because they want to and the media conglomerates don’t.

It’s ironic that this is happening because one of the major reasons the big media companies gave for getting bigger was so they could aggregate a lot of media assets, increase their clout in the marketplace, and do cross-platform deals across all of their media properties. They wanted to provide one-stop shopping for agencies and advertisers, or so they said. In reality, many of the conglomerates (including the then named AOL Time Warner) believed they could get a premium by controlling multiple outlets, and whispered the prospect of higher prices to Wall Street that would believe anything that might lift stock prices. But from the get-go agencies let the media conglomerates know that they expected discounts, not premiums, on cross-platform deals. Therefore, the refusal to pay premiums and strong individual brands refusing to give discounts led to cross-platform deals slowing to a trickle and agencies stepping into the void.

Also, the media conglomerates seem to have realized that the get-big strategy didn’t work—didn’t help their stock price. They seem to have come to the conclusion that it is more profitable to let strong brands compete in the marketplace to maximize revenue rather than trying to sell discounted deals across several platforms, as Mel Karmazin tried to do when he was at CBS and then CEO of Viacom. Redstone forced Karmazin out of Viacom and then soon after announced the plan to split Viacom into two separate companies—one comprised of older, no-growth brands such as CBS and the other with high-growth brands such as MTV.

Furthermore, Time Warner CEO Dick Parsons made headlines this week because of a comment he made in a Fortune magazine article. He said that if AOL fails in its latest effort to get more online advertising through its free portal, which will offer online search and content that previously had been available only to AOL subscribers, Parsons said he would consider “spinning off the division as a separate stock”—another example that the conglomeration strategy isn’t working.

I’ve predicted before that Parsons would sell no-growth AOL, and his comments this week seem to confirm that he’s thinking about it. Who would have thought it four years ago—the de-conglomeration of big media and agencies taking over cross-platform deals? I would have been just as accurate if I’d predicted that we’d find WMD in Iraq.

Posted by Charles Warner at 12:29 AM | Comments (1) | Print |

Jesse Kornbluth at May 19, 2005 6:41 AM writes:

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May 17, 2005

More on CPB and NPR

The New York Times ran an article by Stephen Labaton on Monday, May 16, with the headline "NPR Conflict With Overseer Is Growing." Labaton's story detailed the escalating battle between the Corporation for Public Broadcasting's (CPB) conservative chairman, Ken Tomlinson and NPR Radio, but it left out one important element that other stories about the battle, including ones in the Wall Street Journal and in "On the Media" on WNYC, have also ignored.

It’s clear that Tomlinson is a puppet for the White House and the conservative movement, all of whom feel emboldened because of the Bush victory and want to turn PBS and NPR to the right. But there is also pressure to neuter PBS and NPR from another area, commercial broadcasters and their powerful lobbying organization, the National Association of Broadcasters (NAB).

PBS and NPR are overall considered to be fair, balanced, and objective – right down the middle is the best way to put the general public’s perception of NPR, according to several research studies. But if NPR and PBS are actually fair and balanced, then, naturally, the conservatives think that’s bad—that’s liberal to them. As Bush says, “You’re either with us or against us.” You either promote the conservative agenda or you’re the enemy—part of the hated liberal media.

If conservatives were able to turn NPR to the right, it would make NPR less balanced and less listenable, which is what local commercial broadcasters want because they have been furious for years that NPR is stealing audience and money from them (their view). Local radio station owners have been whining for years that local NPR stations, which are typically owned by state universities or other non-profit organizations, are unfair competition. As NPR-affiliated stations started gaining audience, businesses more and more discovered that the brief underwriting announcements allowed by NPR affiliates were an excellent form of advertising.

Commercial radio’s audience has declined in the past several years because of music being downloaded from the Internet; iPod listening; satellite radio; increased Internet usage; the self-inflicted wounds of me-too programming, reduced news programming, and over-commercialization; and, especially, the rising popularity of NPR-affiliated stations. NPR stations are punishing commercial radio stations where it really hurts, by attracting upscale, well-educated, adult listeners.

Fewer listeners mean less money. Therefore, the anger against public radio turns into rage because it’s always all about money to commercial radio owners, who have reduced news and public-service programming and increased right-wing talk programs and rap music, thus chasing away upscale listeners.

Commercial broadcasters are cheerleading Tomlinson on to neuter NPR programming and to cut funding, thus making it harder for NPR to produce excellent, upscale programming. However, as Labaton points out in his NY Times article, NPR gets only about one percent of its total operating funds from CPB, so Tomlinson’s threat has little leverage.

The best thing NPR could do is to refuse any money from CPB or the government and for local stations to do the same. Then the local stations could tell their listeners what they have done and ask for a bigger pledge during their on-air begathons. In anticipation of this option, or maybe just in an attempt to stick it up Tomlinson's and the conservatives' butt, I gave a $100 to WNYC in its current pledge drive—my third contribution this year. Why don't you do the same.

Posted by Charles Warner at 1:06 AM | Comments (1) | Print |

Neil Derrough at May 17, 2005 5:54 AM writes:

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May 6, 2005

The CPB Flap

The recent flap over the politicization of the Corporation for Public Broadcasting (CPB) has received high-level coverage in the main-stream media, but as usual no one has figured out how to solve the problem—except, perhaps, Slate’s Jack Shafer.

The first I became aware of the CPB politicization on the April 15 edition of the WYNC program “On the Media,” which I listen to via its podcast. “On the Media” won a Peabody Award—the Oscars of broadcasting—for its reporting on the media and how it handles news of the media, and hosts Brooke Gladstone and Bob Garfield did an excellent job of reporting on the how the CPB’s new board chairman, Ken Tomlinson, is trying to turn PBS and NPR to the right. However, Garfield and Gladstone had no solutions to the problem.

On Monday, May 2, the New York Times ran a page-one story with the headline “Chairman Exerts Pressure on PBS, Alleging Biases,” and the sub-heads, “Cites a Need for Balance” and “Longtime Executives See Republican’s Action as Threat to Autonomy.” The headlines tell the essence of the story, so no need to read it unless you want to endure the Time’s typical numbing detail. Then, on Wednesday, May 4, the Times ran an editorial titled “Politicizing Public Broadcasting” which read, in part:

“Although he has insisted that he does not want to politicize PBS or cut any programs, Mr. Tomlinson has managed to spread the word throughout the PBS community that he does not like anything that he considers too anti-corporate, anti-White House or anti-Republican. For journalists whose basic code is to ‘speak truth to power,’ this is not good news: those are the main powers in the country.

Their real fear, an understandable one at this stage, is that Mr. Tomlinson and his supporters have a larger agenda - to ‘hollow out’ public broadcasting and fill it with programming that suits their political agenda. And if public broadcasting becomes too political to suit all but the most loyal Republicans or too boring in the name of balance, that could mean the slow death of such broadcasting, which could have been the goal all along.”

Not bad thoughts, but typical of the Times’s limp hand-wringing style—the ediorial points out problems but doesn’t offer any solutions.

Jack Shafer, of Slate wrote the best article theat I read on the subject titled “PBS Unplugged." Shafer not only gave a better historical context to the topic than the Times did but he also offered an intelligent solution. I urge you to read the article, but, in essence, he pointed out that:

“The best remedy for this week's public broadcasting crisis isn't the dismantling of the ‘objectivity and balance’ firewall but the abolishment of the CPB itself. Bureaucracies inevitably conform to the wishes of the ruling party, and as much as CPB would like to rise above politics, every federal appropriation comes laden with political baggage. No government—Republican, Democrat, or Socialist—will ever surrender control over media money it disburses.”

Shafer then suggests that the solution to depending on government funding is for the public stations to sell off part of their valuable spectrum:

“Although the nation's 1,000-plus public broadcasters are cash poor, they are resource rich, controlling as they do a honking chunk of valuable radio spectrum. If Congress allowed individual public broadcasters to ‘privatize and dezone’ their slices of the spectrum, as Peter Huber puts it in his book Law and Disorder in Cyberspace, they could raise billions for permanent endowments by selling those frequencies to other communications companies (including cell-phone firms or other data services).”

Bingo! As long as PBS and NPR take a nickel from the government, the government will want any spin to turn its way. If Americans want to keep public broadcasting independent, we must “wean public television and radio from the federal government teat,” as Shafer writes. Thus, privatize public broadcasting and it can be as biased as commercial media can be (Fox News, Sinclair television stations, The Nation, or the New York Post, e.g.).

But Tomlinson is right about one thing, that PBS and NPR do have a perception problem—they are perceived my many people, especially conservatives, to be liberal. However, if PBS and NPR were to get weaned and become privately owned, they would still have a perception problem. They couldn’t change their image overnight; it would take years for people to realize that PBS and NPR are journalistically balanced.

So the problem is not one of reality but of perception—a problem that change in funding or ownership cannot change, only marketing can. Therefore, what NPR and PBS need (PBS needs it more than NPR), in addition to funding that is independent of the government, is better marketing and promotion. PBS and NPR should start a massive promotion campaign based on the theme “PBS--balanced and objective” and then follow up with a slogan like “We give you the facts, you make the judgments.”

Of course it sounds just like Fox News—that’s the point. Fox News has been enormously successful with its brilliant campaign of “fair and balanced” and “we report, you decide,” and have gotten away with it. Anyone with any brains knows the slogans are bullshit, but the point is that Fox has created a perception of balance. It has imbedded an image into the public’s subconscious with constant repetition of this message and all Fox spokespeople have stayed on message with great discipline (and with the help of Vice President Cheney and other conservative mothpieces and think tanks).

Unfortunately, PBS and NPR aren’t into marketing or sloganeering, they think they are above it. Murdoch and Fox News aren’t so elitist; they know how to sell and image and appeal to the masses by feeding liberals to the lions, but PBS and NPR need to consider something to change Americas perceptions or they will be in trouble.

Posted by Charles Warner at 10:37 PM | Comments (1) | Print |

Julia Bradford at May 7, 2005 12:12 PM writes:

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