TV news is starting to look like big business
There are enough meaningful developments from alternative news organisations to cement a profitable future – but challenges remain.
For years the dictum has been it’s really difficult to make money from television news. Sport, entertainment: Yes. News: No.
Many nights the excellent Channel 4 News has to make do with a single advertiser – an Irishman extolling the merits of Dubai as a place to go on holiday and do business. Channel 4 regards an hour-long nightly news programme as part of its public service remit.
News at Ten audiences are not a patch on what they used to be and Sky News would hardly exist today if Rupert Murdoch had not been prepared to subsidise the channel for years because he believed correctly that a news channel was an important part of the overall entertainment mix.
There are exceptions of course. CNN, which usually loses out in the mass audience race to Fox News in the US, pulls in the money in America because it gets to the audience advertisers want to reach, and CNBC flourishes because of its specialist business focus.
Other news services are strong financially because they are funded for political influence – the likes of RT, formally Russia Today, and CCTV, Central China Television.
In general though the maxim holds. It is a challenge to make money out of television news and the current financial difficulties of newspapers around the world are almost too obvious to mention.
Part of the answer is the endless quantities of news from professional and non-professional sources flashing round the globe in seconds.
The rise of Twitter and other new players have changed the nature of the breaking-news game forever and have increasingly turned news into a commodity and that of course can lead to commodity bulk prices unless you offer something very distinctive and special.
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A number of unrelated developments in recent days affecting both traditional media and the new players and increasing collaboration across the divide, suggests that a little revisionism may be in order although on one side we are mainly talking about consolidation and the other expansion.
The most recent is the most traditional of all, with the confirmation that David Montgomery’s Local World regional newspaper group is to become part of Trinity Mirror, publishers of the Daily Mirror, in a £220 million deal.
It will make Trinity Mirror the UK’s biggest regional newspaper publisher and shows that some serious people believe there is still money to be made in regional news even if consolidation is needed to tap into it. Such mergers usually lead to further rounds of cost-cutting and job losses.
The money involved in the deal is a drop in the ocean compared to multi-billion valuations of the new players such as Vice, even before Google and Apple are considered.
Vice, which already provides a daily news service for HBO in the US, is planning to launch no less than 12 television channels across Europe next year and a Vice network in the US across a wide range of genres.
And goodness, the Vice founder Shane Smith is talking about linear television – as in, the linear television that was supposed to be dead by now.
We’ll see how much news makes it into the Vice expansion but you can be sure that, at the very least, there will be Vice documentaries as the channels are expected to be produced and programmed by the Canadian company.
Collaborations are considered likely with a number of European broadcasters which could even include ITV and Channel 4.
Vice, whose investors include Sir Martin Sorrell’s WPP – a man with a well-tuned antenna for detecting money – could float before long with a $5 billion price tag.
The recent launch of the Apple News app in the UK for mobile and iPad users is another straw in the wind and again involves collaboration between old and new media.
The aggregation site for digital news brings together a host of publishers from The Times and the Financial Times to 27 of Trinity Mirror’s national and regional titles and also includes Sky News.
The app should certainly help to drive Apple iPhone and iPad sales. One hopes that enough of the money filters down to the publishers and broadcasters to justify their leap of faith in the new aggregation app which could eat into their more traditional audiences.
Another sign of improving relations between new media companies and the existing players came recently with the announcement that Google – which has been denounced by some traditional publishers in the past – actually plans to give them a digital leg-up.
Google, in a relatively cheap PR manoeuvre, has launched a European fund of more that £100 million over three years to help European publishers to develop new digital news projects.
Google will fund up to 70 per cent of large projects, defined as those up to €1 million, and promises there will be no strings attached.
Telegraph chief executive Murdoch MacLennan will be part of a 13-person council to approve the larger-scale grants.
Another small pile of cash in the greater scheme of things but another step in the right direction of improving relations between old and new and perhaps leading towards locating a little bit more money in the news.
The new mood is summed up perfectly by an invitation to the Reuters Institute Memorial Lecture next month in Oxford.
It will be given by Jimmy Maymann, former chief executive of the Huffington Post and now executive vice president and president of AOL Content and Consumer brands.
He will be joined by panellists Alan Rusbridger, former editor-in chief of the Guardian, and BuzzFeed UK editor-in-chief Janine Gibson, also ex-Guardian.
Perhaps they can discuss an NUJ survey just out which shows that one in five UK journalists earn less than £20,000 a year and that most journalists haven’t had a pay rise for the past two years.
Perhaps most worrying of all in the age of the new digital journalism is that publishers are busy creating new digital post for journalists at much lower wages than their print colleagues.
There could be collaboration to do something about that in future if new pots of money are found to fund the news.