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Why proposals for US-style TV news channel could be 'lucrative' despite 'stagnating' TV ad market

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Plans for a Fox News style TV channel in the UK could find a tougher market than its US counterpart but still be lucrative enough to succeed for several years, according to a top media expert.

Two rival proposals for a similarly opinionated station are reportedly being pursued: one from within Fox News owner Rupert Murdoch’s News UK and a second channel, already granted a licence by Ofcom, named GB News.

News UK hired former CBS News president and Fox News vice president David Rhodes earlier this year as its head of broadcasting. His Linkedin profile says: “See what we’ll do on the screen in the coming months.”

Which group will win the race to launch a new right-leaning opinionated channel in the UK remains to be seen, but the market is very different to the US.

Rasmus Kleis Nielsen, director of the Reuters Institute for the Study of Journalism, told Press Gazette Fox News had become “fantastically important and powerful and profitable” in the US because there was a largely uncontested market for right-leaning media.

By contrast, the UK press is traditionally more politically diverse and partisan: “In that sense any new entrant, whether online as we saw with Breitbart some years ago or in this case television… [will find] a much more competitive space where they would be going up directly against the Mail, the Sun, the Express as well as upmarket titles like the Telegraph for an audience that already has their habits and their preferences so that seems to be much tougher and arguably much less lucrative even in television, let alone in digital.”

Nielsen added: “Can this be done in a way that will serve some people in a way that they can find satisfying and appealing and that will make the owners some money for a period of time? I think that largely depends on how effectively this is marketed and how cheap it is to produce.

“In that sense of course original news reporting is expensive as Sky News and everybody else knows. Original entertainment programming, scripted entertainment and the like, is expensive.

“So I would expect that an outfit like this will probably focus on things that are very cheap and in bountiful supply, mainly anger and opinion, and how lucrative the market for anger and opinion is in the UK beyond the supply that already exists – well, I suppose we’re about to find out.”

Due impartiality

Broadcast TV channels in the UK face stricter regulation than the US, with Ofcom’s Broadcasting Code stating they must adhere to “due impartiality” across their programming. It has not yet been confirmed whether any launch from Rhodes’ team at News UK would be a traditional channel or online-only.

But due impartiality is less restrictive than viewers may think. Ofcom’s rules state it “does not mean an equal division of time has to be given to every view, or that every argument and every facet of every argument has to be represented.

“The approach to due impartiality may vary according to the nature of the subject, the type of programme and channel, the likely expectation of the audience as to content, and the extent to which the content and approach is signalled to the audience.”

This means it can be applied across different programmes on the same channel – as has previously been the case for Talkradio – or fulfilled by a guest or audience members offering opposing views.

Ofcom says it is not necessary “to include every argument on a particular subject or to provide, in each case, a directly opposing argument to the one presented in the programme” in order to preserve due impartiality.

Other factors that can influence whether or not the standard is met include the nature of the programme, its presentation of the argument, the transparency of its agenda, and the audience it is aimed at and their expectations. Broadcasters are entitled to interpret news events as they see fit, as long as they do so within the remit of the code.

Nielsen told Press Gazette: “It’s worth keeping in mind that a number of broadcasters are licensed in the UK, including RT and CGTN, that I don’t think the editorial standards director at the BBC would consider to be duly impartial in the sense the BBC would employ that phrase.

“In that sense the space of what has so far been accepted as due impartiality is much wider than simply what we see from by far the most trusted and most popular news providers in the UK like the BBC and ITV in their television offerings.”

TV still biggest news source by far

TV is worth the gamble because it is both the UK’s most-used platform for news and has a still lucrative advertising market, worth £4.9bn in 2019 according to Statista.

Nielsen said: “Fundamentally the television advertising market is still significant, even if it’s stagnating… if you could capture even a very small share of that provided it’s cheap enough to produce the content, that could be lucrative for at least some years.

“It’s true of course that the digital advertising market is far, far larger than television is right now but at the end of the day news publishers compete only for a small share of that with the dominance of companies such as Google and Facebook so in that sense I think we can see this is something that might be lucrative for a period of time even if, of course, television is in structural decline.”

According to Ofcom’s latest news consumption survey TV remains by far the most popular source for news, used by 75% of people. It is followed by the internet on 65% and radio on 42%.

Julian Aquilina, a TV analyst at Enders Analysis, told Press Gazette: “Although the trend is obviously shifting more and more online and particularly through social media channels, TV is still the most important source for people to consume their news.

“So from that perspective I suppose it makes sense that if you are looking to launch some sort of news provision you’re going to look at potentially using some sort of TV channel.”

But he pointed to figures showing that in 2019 about 7% of news consumption across the UK’s public broadcasters and Sky News came from 16 to 34 year olds, while two-thirds came from those over the age of 55.

Despite this it could be an astute choice because TV news is generally regarded as a high-quality, trusted and accurate environment.

“It’s regulated very carefully so that’s why people who still continue to watch news on TV – because they believe they are able to get an independent view,” Aquilina said. “That isn’t to say different sources don’t have certain leanings…”

Other things to consider, he added, would be the prominence of any new channel on TV channel guides – “for a news channel how are people going to hear about it, are you going to be visible enough?” – and the fact that news isn’t a profitable genre in the UK.

Below figures from the Broadcasters Audience Research Board show the scale of some of the UK’s news-focused channels, with BBC News and Sky News reaching 12.7m and 9m people in the four weeks to 23 August respectively.

Channel Four-week reach (BARB figures for August 2020)
BBC News 12,692,000
Sky News 8,980,000
Sky Sports News 6,317,000
That’s TV Network 1,224,000
CGTN 631,000
Geo News 609,000
Vice 367,000
Hum News 344,000

Recent plans for Sky and NBC News to team up and create a new international news service under their joint owner Comcast have been dropped because of the coronavirus pandemic.

Timeline of the UK’s news-focused channels:
  • February 1989: Rupert Murdoch launches Sky News.
  • November 1997: BBC News Channel launches as BBC News 24.
  • August 2000: ITN launches ITV News Channel.
  • December 2005: ITV News Channel closes after its Freeview hours are slashed to give lads’ channel Men and Motors evening airtime and following complaints it was too low down Sky’s electronic programme guide.
  • November 2006: Al Jazeera launches English-language service with bases in London and several other cities worldwide.
  • April 2010: The Chinese state’s China Global Television Network turns its English-language channel CCTV into a 24-hour news operation. Later renamed CGTN in 2016.
  • February 2012: France 24 signed a distribution deal to go live in the UK.
  • February 2013: Nigerian broadcaster Arise Networks launches London-based channel aimed at European audience.
  • October 2014: Russia launches RT UK channel.
  • July 2018: Pakistani channel Hum News launches on Sky.
  • July 2019: Ofcom fines RT £200,000 for “serious and repeated” failures to report with due impartiality. The broadcaster later fails with a High Court challenge against the fine.
  • September 2019: CGTN doubles down on European service by launching production headquarters in London.
  • August 2020: Instead of celebrating a summer launch, Comcast cancels its plan for a new international news channel combining the might of NBC and Sky to challenge CNN.
  • September 2020: Fox News to launch in the UK and several other countries as a digital international streaming service priced at $6.99 per month.

The post Why proposals for US-style TV news channel could be 'lucrative' despite 'stagnating' TV ad market appeared first on Press Gazette.


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