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Remote Control

Obama Saturation Strategy

I gave my opinion about this several months ago, but the past few days require another look from all of us in the Shoptalk community. President Obama–after a prime time speech before Congress and a star turn (again) on “60 Minutes”–made the rounds of the Sunday talkers last weekend and made history by appearing on every single one of them!

And then last night, he spent virtually the entire hour on “The Late Show with David Letterman.” He’s out there selling Healthcare Reform and singing the praises of economic stimulus, both priorities for his administration. His supporters tell me this is a smart strategy. By owning the airwaves–including comedy shows from which many Americans get their “news”– the President can control the message and drive public opinion, which will help him on Capitol Hill.

Conversely, his detractors say that Obama Saturation will water down the impact of his messaging–or worse, turn off citizens who may become annoyed at his omnipresence. Last spring, I was in this latter camp but I’m starting to wonder if his supporters have something with regard to managing a splintering media. Please, send me your thoughts and I’ll follow up later this week.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

Late Night, Earlier

Jay Leno debuted at 10pm (daylight savings time, reminded one of our precise readers) last night, 9 central (reminded another), but regardless of the time, it was pretty much the same old Tonight Show, just 90 minutes earlier. Sure, Jay booked it to the max with Jerry and Oprah, plus Kanye, Jay-Z and Rihanna (hey, does anyone have a last name anymore?) But the stunts (Dan Band at the car wash and Leno faking an Obama interview with CBS video) and Sweater Jay in a reality show with Sweater Friends were pretty much stock Tonight Show routines.

From time to time, I will DVR Letterman or Leno to see a guest I didn’t want to stay up for. The experience of watching that show time-shifted is how I felt during the whole hour Monday night. (My other feeling was that I felt awfully alert considering it was midnight — except, it was only 10:30!)

Look, the set was big and glamorous, the band is talented, the jokes were fine and the guests were appropriately stellar for a “debut” — but Seinfeld had it right when he suggested that the whole thing was kind of ho-hum. Wisely — or perhaps defensively, knowing how affiliates might be feeling about a show even NBC brass think can do only a 1.5 in the demo — NBC and Leno left a nice hole for a local station news promo before the last segment, and then went seamlessly from Leno’s final segment to the local news (at least in New York where I saw the feed.)

The bottom line is that while the show was perfectly professional and well-produced, it didn’t contribute anything different, much less breakthrough, which would suggest viewers– especially young ones — will come flocking (regularly) to this new offering. In fact, the scariest thing for NBC might be the continuing transfer of “older viewers” (55+) from 11:30 to 10pm. What do you think?

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

The First Day of the Rest of the Peacock’s Life

I know NBC-Universal is a cable TV company, not a network television company anymore, however, two big events loom for the Peacock that may well decide its 21st Century Fate. The first is the much-ballyhooed curtain-opener from Burbank at 10pm EST tonight: the launch of the “Jay Leno Show.”

NBC execs are cleverly predicting only a 1.5 rating in the key demo (A18-49) which is an extremely low bar. How do they get away with setting the bar so near the ground–at a rating that would lose to several dramas that were cancelled last season? By promising the world that such a rating would drive enough revenue to more than cover the significantly lower costs required for a nightly comedy show (versus a pricey drama.) As I’ve posted before, that may work fine for GE shareholders and upper management and certainly does creatively address the network business model conundrum, but a 1.5 rating is not going to delight NBC’s affiliates who have relied heavily on revenues from late night newscasts that follow Leno beginning tonight.

(*Also–while that bar is exceptionally low, there is a nightmare scenario for NBC if Leno–who will start quite north of 1.5 due to hype and curiosity this week–dives down toward 1.0 or below in the weeks ahead. After all, it’s a long race with steep competition not just from the other Big Four nets, but also increasingly from cable–e.g. HBO, TNT, FX, A&E, not to mention NBCU’s own stable-mates USA & Bravo.)

Secondly–as if that isn’t enough to keep the 52nd floor on pins & needles–there is the less publicized Vivendi Drama. In case you don’t know, Vivendi has the right in November to sell its 20% stake in NBCU, either in the open market or to NBCU’s parent, GE. If Vivendi exercises that option–and it’s likely they might here in 2009–an awkward test of the company’s real value would be unleashed during a very uncertain time for the industry at large. This instability could trigger any number of cataclysmic events, up to and including a decision by GE to finally sell off the entire $30B asset. (Time Warner NBC Universal, anyone?)

Bottom line: looks like a bumpy ride this season for the three Jeff’s–Gaspin, Zucker and Immelt and it could turn out to be the hottest show of the season.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

Now You’ve Done It!

Glenn Beck called President Obama “a racist.” Viewers objected, including an advocacy group called Color of Change. Color of Change took its objections directly to advertisers, calling on them to withdraw their ads from the “Glenn Beck Program” on Fox News. Reportedly, 33 companies capitulated, including Clorox, UPS and CVS. (Clorox not only pulled ads from Beck’s show, but announced it is pulling out of all opinion programming.) This is the second time this summer that riled-up viewers have used social media and the internet to make Corporate America quake (the first was the apparent Fox-MSNBC truce, allegedly brokered after shareholders and other viewer constituents lit up the digital switchboards at News Corp. and GE).

Now this could break one of two ways. It could just blow over with all parties being–perhaps–just a bit more careful about “crossing the line” with their commentary. (That’s what Shine and Griffin along with O’Reilly and Olbermann are hoping.) Or it could portend things to come for Cable News, which I suspect is the likelier scenario. And by that I mean that social media and the blogosphere move with speed and power never seen before by traditional media mavens. At the same time, Corporate America is watching and listening to that cacophony more efficiently and attentively than ever before. This thing has the real possibility of snowballing into a movement with both digital armies (conservative and liberal) attacking their opposite Cable News number. That would be, at least, inconvenient–and at most, it could be downright painful to the bottom line.

It might just blow over with the passage of time, but if it doesn’t, CNN could be sitting pretty with their high-road, middle-ground approach to hosting and commentary (with the exception of Lou Dobbs.) I’d be interested to hear your opinion–so fire away!

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

Why An Imus-FBN Union Could Work

There are reports this week that controversial New York radio host Don Imus may return to national television in a serious way. The New York Times is reporting that Fox Business Network is in “advanced negotiations” to land a simulcast of the “Imus in the Morning” radio show (WABC in New York is the flagship station)–airing from 6am-9am. One observer noted that the move would be vintage Roger Ailes, as the loyal Imus audience would provide some ratings traction for the fledgling network, some built-in promotion for the business day, and some buzz.

Don Imus When yours truly was running MSNBC (’98-2004) Imus was our morning show for those same hours and performed a similar function. He brought sampling and buzz, especially during election years. Of course, eventually (2007) the whole thing crashed and burned in the media frenzy that followed his inappropriate remarks about the Rutgers women’s basketball team. (Like Michael Vick, Don has done his penance which included an off-the-air exile, repeated on-air mea culpas, the hiring of African-American cast members, and a running dialogue on his new WABC program about race relations in the US.) Don’s efforts, plus time–and his hiring by Citadel Radio and WABC– have helped pave the way, first for RFD-TV to simulcast a television version–and now, for Fox Business Network.

But would it work? In a word–yes. While not as large as before, Imus still has a tremendous following which prefers television at home (and at the gym, and at the office.) Though FBN is only distributed so far in 50 million homes (compared to 97 million for CNBC, and almost that many when he was kicked off MSNBC)–he wouldl quickly get a rating that Nielsen can actually measure (currently, Nielsen says the audience isn’t large enough to reliably measure during those hours on FBN.) Secondly, the political cycle earlier this decade didn’t work in Imus’ favor because the Bush Administration (other than the war, and that got old) didn’t give media much to chew on. That’s not the case with Obama, who has a big agenda and talks about it constantly. Thirdly, the economy is actually interesting right now, which would be good for Imus and Fox.

Finally, there is the Ailes Factor. Roger and his capable lieutenant Kevin Magee (EVP of the network) would get the maximum value of out Imus, his all-star guest list, and the potential increase in appearances by Fox stars. On the other hand, this would do little to aid the alleged truce between Fox and MSNBC. There is no love lost between Don and his ex-employer, NBC, and Don has never been easy to “muzzle.” His “charm”–and much of his success in recent years–is due to his candor, which could on full display on Fox in time for the 2010 off-year election.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.com.

Getting Paid For Content

Rupert Murdoch and this blog mentioned it last week–again. Contrary to conventional wisdom, Rupert says that while information may want to be free, quality content should be paid for. I’ll take it a step further–and say, consumers will pay for quality content. This is not a new concept. Consumers have been paying for newspapers and magazines for more than a century now and continue to do so (though admittedly in smaller numbers.) Ad-supported, broadcast radio and television spoiled the users (and even, for a time, broadcasters) and the media industry has tried to apply that model to the internet.

However, as with cable TV distribution, some producers of content have broken from modern tradition and asked users to pay toll. Notably, The Wall Street Journal and The New York Times have charged toll on line–and less notably, so have smaller sites like Zagat.com and vault.com (the parent company of Shoptalk.)

On a local level, there have been fewer examples of the pay-for-content, pay-for-access business model as newspapers and TV stations have tried primarily to replace shrinking ad revenue with on-line revenue–in the form of advertising dollars. But digital ad revenue has turned out to be nickels and dimes, not dollars, and as Mr. Murdoch has pointed out, quality content ain’t cheap to produce.

So as national entities like ESPN and msnbc.com try to move in on local markets–and as newspapers experiment with web efforts (see Ann Arbor and San Diego, among others)–local television stations are going to have re-double efforts to examine new twists to the old business model. Or die trying.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

War of the Cablers

Call in the National Guard. Give me Security. It’s back to DEFCON 2 in the war across 6th Avenue. I’m talking about the feud between Fox News and MSNBC–two entities within spitting distance of each other in midtown Manhattan. Late last week, it was reported in numerous publications that a truce had broken out in the war of words between the two–particularly the network cleanup hitters Keith Olbermann and Bill O’Reilly. It was further reported that said truce was brokered at the highest corporate level (e.g. Jeff Immelt, GE Chairman and Rupert Murdoch, the News Corp Chairman) with assists from one level down (e.g. Jeff Zucker and Roger Ailes.) What drama! What a cast!

In any case, both sides seemed to confirm the truce anonymously last week, but Olbermann came out firing Monday night on MSNBC, labeling Murdoch “the worst person in the world” with O’Reilly having to settle for runner-up (“worser”). Fox News seemed to be holding its fire until Wednesday night at 8pm EST (that’s 48 hours of patience–nice!) when O’Reilly opened his program with a broadside attack on GE, Immelt and NBC News–effectively accusing GE of taking government money and “conceivably” using it to pay an $50 million SEC fine incurred for misreporting profits earlier this decade. O’Reilly also credited NBC with getting Barack Obama elected and tied in the fact that Immelt serves on an Obama economic advisory council. Phew!

Rupert MurdochLook, obviously there is no truce–at least not one that is enforceable. How can Keith Olbermann possibly serve his loyal viewers without criticizing Fox News (not to mention GE, which despite it’s marketing efforts and green initiatives, is not exactly a Liberal Cause.) And how in the world can Bill O’Reilly serve his audience (e.g. maintain his monster ratings) without launching missiles against GE and NBC, two pet targets? I’m sure it’s uncomfortable when shareholders, board members and the press obsess about America’s most prominent and representative on-air culture war, but Immelt and Murdoch need to have thicker skin and forget about any “truces.”

As if Murdoch needs any evidence for this, he need look no further than his own company earnings call on Wednesday in which it was acknowledged that Fox News Channel was far and away the most successful entity in the News Corp galaxy last quarter. Importantly, he acknowledged the brutal economy and that this “was a most difficult year”–the worst in News Corp’s history–and there is no clear sign of a fast recovery.” The big headline, however, is that Murdoch plans to charge for all the company’s news websites. He said, “The digital revolution has opened many new models of distribution, but it has not made content free. Quality journalism is not cheap, and an industry that gives away its content is simply cannibalizing its ability to produce good reporting.” Murdoch was not just talking about print, because he also referenced video content and various distribution models from on-line and cable operators.

Rupert: forget about MSNBC and focus on the important business of reinventing business models for the content industry! It’s a much better use of your time.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

All News Is Local

What is the future of local news? Newspapers are cratering left and right and nobody knows better than our audience how much pressure is being brought to bear on local radio and television. This reality stands in stark contrast to the fact that with news, as with real estate, location is everything. People are curious about national news, but their burning interest is LOCAL.

There is an interesting piece this week in Business Week on the fragmentation of audience underway due to new technologies and shifting consumer behavior. It suggests the need for new advertising platforms–just what traditional media folks don’t want to hear. And here on Shoptalk, we’ve reported on other efforts to undermine, supplant or replace traditional outlets with competitors like the San Diego News Network.

All this hand-wringing suggests to me a still-great opportunity for local TV operations which still control the largest (albeit shrinking) access to audience in most markets. Almost all the focus lately has been on cutting costs (and I’m sure that will continue) but there has to be equal energy given to the revenue model and finding effective ways to compete with or partner with new entities that will go after local interest audiences on line or elsewhere. As always, your ideas and suggestions are welcomed!

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

Tension Between Networks and Obama Administration Could Get Uglier

The latest White House request for an hour of prime-time fell on less receptive network ears, with top news execs from CBS and NBC openly questioning the newsworthiness of said request. President Obama has done “big” interviews with all manner of broadcast and cable network anchors in the past month and has been setting a blistering pace for prime-time press conferences. According to Howard Kurtz of the Washington Post, the White House went to GE Chairman Jeff Immelt and Disney CEO Bob Iger to clear time for the most recent appearance on the economy and health care reform.

This is another classic case of Be Careful What You Wish For. From 2003 through 2008, the media lamented a President who rarely held press conferences and almost never granted interviews. Now, we are seeing the opposite extreme in Barack Obama, who is available in the extreme. While the print press chafes on the sidelines, cable news people are delighted with the new openness. However, broadcasters are beginning to show signs of annoyance. And it could get even uglier come fall.

Let’s face it, it’s one thing to preempt “Wipeout” or repeats of “CSI” and “30 Rock”. However, it is quite another matter to upend new episodes of hits like “Criminal Minds” or “House,” not to mention big new investments like “Mercy” or “Flash Forward.” Broadcasters have enough problems going into this television season with falling ratings and CPM’s. They don’t need hijackings of airtime by a White House trying to “control the message.”

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

Broadcast Needs a Second Revenue Stream

A number of items in the news recently are leading me to the same conclusion. Those items, In no particular order: ESPN expands local internet offerings in major markets–a clear and present threat to one of local broadcast news remaining differentiators; NBC and their private equity partners latch onto an internet veteran (the respected Mike Kelly) to run The Weather Channel (and inevitably, ironically, continue to disintermediate the local weather market, once controlled by broadcast TV and radio; Jeff Zucker hands the network TV reins to cable exec Jeff Gaspin, saying “the Cable Model is superior;” the broadcast upfront is finally closing some ad deals as August encroaches, but with lower CPMs, lower ratings, and therefore lower revenues; and finally, across the country, local news departments are continuing to lay off key personnel and merge operations with competitors to save money and return profits.

Here’s the conclusion: it’s high time for the federal government to further de-regulate the broadcast industry. Regulation made sense back in the middle of the 20th century, as broadcast license holders were given the precious commodity of broadcasting bandwidth, with its limited and valuable distribution access to millions of Americans. Initially, even as technology stretched the playing field, cable operators were protected by the theory that Americans were entitled to over-the-air broadcast channels and cable operators shouldn’t have to pay the broadcasters, even as they were profiting from their programming. (Eventually broadcasters got some measure of revenge through must-carry rules and ownership leverage but arguably, that came a day later and a dollar shorter.)

Broadcast television desperately needs a second revenue stream or local stations (and their over-the-air viewers) will suffer even more. That revenue stream, to augment ad dollars, is subscription fees. There is a precedent. Cable distributors get fees from viewers but only pass along that revenue to broadcasters indirectly via must-carry leverage. And so far, broadcasters have had only limited success selling their programming to viewers via digital distribution (iTunes) and analog distribution (Netflix, Blockbuster, Walmart.) In the case of digital internet distribution, not only are distributor “partners” are threat–so too, unfortunately, is piracy. Once upon a time, broadcasters had all the leverage. But the balance of power has shifted and it’s time the government realized it. Otherwise, the American public will be deprived a great platform for entertainment and information.

Erik Sorenson is chief executive officer of Vault.com, Inc. He oversees the strategic direction of the global, New York-based media company, including ShopTalk & TVSPY. If you would like to comment on Remote Control, or want to reach Erik, email remotecontrol@tvspy.

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