30 Jan 09 - The international news channel market is already extremely competitive and the proliferation of opportunities in the digital media space have added a new edge. Stewart Clarke assesses the state of play.

Compared with today, the TV news channels market at the start of the 1990s looked relatively simple. The likes of Al Jazeera, Euronews and France 24 had yet to launch, there were relatively few local-language services and new media was not a consideration, leaving a handful of players jostling for position with their linear broadcast services. Fast-forward to 2009 and what were new entrants are now established players and news channels are expected to exist on-screen, online, on mobile and on-demand.

And new offerings are being added to the mix. Reuters, for example is launching a financial news channel that will take on Bloomberg and Chinese authorities are providing funding for an international English-language news service. The competition is becoming fiercer.

In that environment, differentiation and brand-building are all-important and a presence outside of the linear channel is essential.

Euronews’ editorial policy of only transmitting presenter-free news – there are no debate shows, analysis pieces or lifestyle add-ons – serves it well in this environment, according to managing director Michael Peters.

“Having good content is not enough,” he says. “You need content and a brand. We were considered quite a strange channel ten or fifteen years ago, but today with the emergence of new media, people consume news in different ways and that has put us at the cutting edge.”

Distributing content across several media requires a coordinated approach and in the crowded international news-provider environment, several organisations have restructured internal operations and workflows.

“2008 was a huge year for BBC World News,” says Richard Porter, director of news content at BBC World News, previously known as BBC World. “We moved TV and online into one operation so our World News TV newsroom is shared with the online newsroom. We share newsgathering, and parts of the radio operation have moved over from Bush House [in West London]. It strengthens the message that we are a coherent operation. In the past, our US election coverage would have involved four or five different versions of the same story, this time it all had a common brand.”

Several of the major news organisations now have closely integrated digital media and TV departments. CNN International’s main online and TV newsgathering operations in London and Hong Kong are combined in open-plan newsrooms and UK-based Sky News has reorganised to better align its operations. “We’re gradually shifting resources to non-linear services and building a business in non-TV services. Then, when the business demand suggests we need more effort in one area we can do it,” says Chris Birkett, the executive editor of Sky News.

The BBC reorganisation is not about cost cutting, but making better use of resources, the organisation says. There is, however, a commercial benefit to having a more integrated approach, says Colin Lawrence, vice president of advertising sales at BBC World News. “The restructure means we have a stronger suite of products to pitch to clients that includes TV, online and video-on-demand.”

Between 2007-2008, BBC World News reported a weekly TV audience of 78 million, a year-on-year increase of two million per week. Advertising revenues increased 20% across the period and overall revenues were up double digit, the BBC says, without quoting specific figures.

Advertising revenues

But as the economic downturn continues to bite, can the growth be maintained? “Everyone is wary,” says BBC World News’ Lawrence. “We have had five years of terrific growth. News is vibrant, but it’s not recession-proof.”

The news channels maintain they won’t trim their spending on digital media – in some cases they can’t make cost savings: “We operate eight round-the-clock local-language channels on an annual budget of ?50m – there’s no room to make cuts,” says Euronews’ Peters.

Euronews’ Peters is hopeful that the news sector will avoid a crisis. “We operate in a niche market and the volumes are not large. The end of 2008 was very hard and I am not optimistic [for 2009], but I think the economic crisis will have a different impact on pan-European advertising than on individual markets. It’s hard to say I expect growth, but I expect, at least, us not to face a crisis.”

Kenneth Estenson, senior vice-president and general manager of CNN.com is cautiously optimistic about online advertising revenues at the site. “Certainly there’s downward pressure on marketing spend in every category, but strong brands win out in a challenged economy. We think advertisers will be less willing to put money with smaller sites that might not generate value,” he says.

The main CNN website had its busiest day ever on US Election Day, with 30 million unique users. Throughout 2008 it served almost 1.5bn video streams, an 86% increase year-on-year, according to Omniture SiteCatalyst data. CNN says that both the US and international digital media operations have turned a profit for several years. The digital business is the fastest-growing unit at the news organisation’s international operation, notes Nick Wrenn, the recently installed, Atlanta-based, vice-president of digital services at CNN International.

Syndication

Making rights-cleared video content from a TV channel and/or website available to third parties is a key growth area. But syndicating content achieves different ends for different organisations, with some looking at it as an incremental revenue stream and others a way of marketing their brand.

In December, France 24 agreed deals with several websites to carry its French and English-language news reports. The sites in question – Independent.co.uk, Fairfax.com.au, Yahoo.fr, Publico.pt, Letemps.ch and MSN.be – also carry live coverage of major news events. Content is uploaded to a partner’s FTP site or it can be accessed via France 24’s own FTP.

The French-based news channel, operated as a joint venture between public broadcaster France Televisions and its commercial counterpart TF1, launched in 2006 to provide an alternative to existing offerings – at launch it was dubbed ‘the French CNN’.

“From the beginning we were very keen on syndicating content to third parties. We need our content seen by as many people as possible,” says France 24 new media director Stanislas Leridon. “The web is totally different to TV and the universe is 1,000 times bigger; you have to go and get an audience.” He adds: “We’re doing it first to get more eyeballs, but all of these agreements are based on a revenue share with some minimum guarantees.”

Newspapers are keen to add video to their websites and are key customers for news channels that want to syndicate content.

With video added, doesn’t a newspaper website start to look increasingly like that of many of the news channels? “Papers have a lot of words and need video and we have masses of video, but not the same depth of coverage in words. There’s an assumption that news channel and newspaper websites will converge and both will have the same feel,” says Chris Birkett, the executive editor of Sky News. “But maybe each will look to its roots and one will be different to the other.”

Al Jazeera has done a deal with UK newspaper The Independent. From mid-January the newspaper started to embed Al Jazeera’s video player on its website in what Al Jazeera head of global distribution Phil Lawrie says is the first of several such deals. The video service was originally developed for mobile customers and has no ticker and large text suited for a small screen. Soft-launched late last year, it was licensed to The Independent before any mobile partners came on board. The plan now is to find newspaper website partners in English-speaking territories.

Lack of space on cable and satellite services is one reason that Al Jazeera wants to maximise distribution through other pipes. Al Jazeera’s English-language service has a footprint of 137.9 million homes globally and 70 million in Europe, but there are territories where it has struggled to get distribution.

“One of the main problems regarding distribution of the linear channel is capacity. Operators say ‘we’d like to launch your channel, but another entertainment channel might bring in a few more bucks,” says Lawrie. “And viewers that see us on YouTube or Livestation might not be aware of us as channel 541 on the Sky EPG. Also, with the likes of [former US Defence Secretary] Donald Rumsfeld attacking the channel, they might see us for the first time, see through some of the myths, and that we are a serious, quality news organisation.”

Being late to market means embracing smaller services and those just starting out, Lawrie adds. “You have to be sensible about the business model. Initially it’s about market share for us and then monetising that later, in the medium to long term.”

Syndicating content is predicated on owning the rights and, to that end, CNN has ended its relationship with Reuters and, on the online but not TV side, with AP. CNN also has deals to syndicate content from CNN.com, but the channel has global distribution already and as a commercial company, it wants to drive the bottom line.

“There’s a debate about context and making sure the brand is where we want it to be,” Estenson says. “Two or three years ago the debate would have been whether to put content [from the channel] on our site; the next debate was whether to give it to third parties. It was difficult to monetize then, but now we can embed video and track advertising.”

France 24’s Leridon adds that how many partners to recruit is another key question. “We don’t want to position ourselves as a press agency with numerous partners in each country,” he says.

Sky News, which celebrates its twentieth anniversary this year, is a few months into a joint venture deal with the website of UK broadsheet and News Corp stable mate The Times. The revenue-sharing deal, described by Sky as a ‘co-production’ agreement, cleared the way for branded Sky News to appear on The Times’ site. In return Sky uses The Times’ experts and commentators on the channel.

In the UK, Sky landed a deal to provide news content to Independent Radio News, which in turn provides news to a raft of the UK’s commercial radio stations. Sky wrestled the deal from another news content provider, ITN, and will provide syndicated, branded web-based news for the radio stations’ own websites.

News Channels’ websites

While selling content can be a profitable business, the news channel operators are keen to get their own web offerings right.

The early days of streaming news content often required a plug-in and ended up in a dedicated ‘video’ section, what one executive refers to as a ‘video ghetto’. The consensus now is that embedding video next to some related text is the way to go.

BBC World News’ video clips started to be embedded on the commercial BBC.com website last April. The site has one-minute world news summaries loaded alongside the standard text stories.

France 24 has had an online presence since launch, but it has learned some lessons and refined its video offering over time, explains Leridon. “You have to make sure you are offering content in the right format,” he says. “Initially, we made the same mistake as some others and offered the Windows Media format only. Then we realised that you need to offer Flash, Real Media and other media players because there are so many options. That became obvious very quickly.”

The internet is particularly important to France 24 given that its linear channel does not have a global footprint. The live streaming of its content also allows it to tap into office-based viewers who want news coverage while at work. France 24 claims that the average viewing time on the web is comparable to that on the TV at ten-to-twenty minutes.

“The cost of streaming a live feed has drastically reduced over time,” he adds. “It’s probably more cost-effective than distributing the channel via satellite because that requires many feeds to get wide coverage.”

Al Jazeera also embeds video on its website, but does so by using the embed tags from its YouTube channel, meaning that it appears with some YouTube branding.

Social Networking

Most news channels also now have a channel on YouTube. Two years ago Al Jazeera was the first of the news organisations to launch a service on the video-sharing website. The fact that Al Jazeera has struggled to get distribution in the US informed its thinking. About 60% of hits to its YouTube channel are from the US.

In mid-January it started offering selected video of its coverage of the Gaza conflict to professional users, free of charge. As one of the very few organisations to have circumvented the Israeli controls on reporters in Gaza, Al Jazeera has a stock of exclusive footage. Video is available to download under a license from Creative Commons, the not-for-profit organisation that licenses copyright-free content.

“We already have 6,000 videos on YouTube and some full programmes,” Mohamed Nanabhay, Al Jazeera’s new media chief says. “People could already watch on the internet, but Creative Commons is about experimenting with other ways of using content online. It’s a great way to get our footage out and users have to attribute it to Al Jazeera – it’s almost another form of syndication. The key difference from our YouTube channel is that that is more consumer-facing while this is aimed more at content creators and broadcasters.”

Al Jazeera has also set up breaking news alerts for its Gaza coverage on micro-blogging site Twitter and is beta testing a ‘news visualisation’ tool, developed with open-source software, that constantly updates a map of Gaza, showing where events are taking place.

Since October 2007 Euronews has operated the No Comment TV channel on YouTube and six million videos have been viewed to date. It started out as a brand-building exercise, but Euronews has just started experimenting and inserting advertising into the videos on the channel where appropriate.

Creating a community via an in-house website is desirable, but challenging. Many news channels are also establishing a presence on third-party social networks and have applications on Facebook and its counterparts. As well as having huge bases of registered users, they also tap into a younger demo that might not tune to a dedicated TV news channel.

CNN has attempted to harness the popularity of Facebook. Users of the CNN website and Facebook were able to engage with each other during CNN’s live coverage of US President Barack Obama’s inauguration on January 20. CNN users were able to update their status on Facebook via the CNN.com Live website for the period of the inauguration.

Unlike the generation X-ers who were largely disillusioned with politics, there are a growing number of younger viewers and web users that want to engage with the political process, says CNN.com boss Estenson. “We’re very open to quality partnerships with social networks,” he says. “Facebook was a good partner because it has a clean interface, good privacy controls and they don’t do news and information video.”

France 24 has launched a news quiz on Facebook, which by the end of 2008 had had over 300,000 plays and was one of the most popular applications. Sky News has also launched applications on social networks Facebook and Bebo.

Mobile

The BBC World Service has agreed a deal with mobile phone operator Nokia and the Arabic-language channels, and their English counterparts, are now part of Nokia’s mobile-phone-enabled internet radio application.

Many of the earlier, bullish, forecasts of mobile TV uptake and usage proved wrong. With a few exceptions, mobile has, arguably, failed to deliver on earlier promises when it comes to video. But news content is perhaps one of the areas in which broadcasters have delivered worthwhile services.

Earlier this year Al Jazeera teamed with mobile operator Sony Ericsson to offer an inbuilt headlines service across the Middle East and North Africa. Four of Sony Ericsson’s handsets now come with a built in Al Jazeera RSS feed, allowing the owners to receive regular news updates. Building services into handsets is a strategy being employed elsewhere. Sky News says it is aiming to double the number of users accessing video content on their handsets by end-2009 and pre-loading applications on to handsets is one way it will seek to achieve that. It will also, Sky’s Birkett says, develop applications for Apple’s iPhone and Google’s mobile device platform, Android.

While there are differences by organisation, many news channels target an upscale, wealthy demographic and the advertising revenues that viewing segment attracts.

But the rules are being rewritten in digital media, where users are younger and interact with information in wholly different ways. The influence of the internet generation has levelled the playing field and getting in front of consumers is no longer predicated on signing carriage deals with pay-TV or satellite operators. But traditional deals and revenue streams do provide the established players with the financial leverage to invest in digital media in all of its forms. At the same time the newer entrants have the tools to get on screens – albeit, possibly not TV screens – the world over.

If the news channel landscape looks very different today than in the early 1990s, the likelihood is that it will transform even more radically in the decades hence.

Sidebar: Local-language, global reach

News channels are increasingly launching local-language services to provide coverage to audiences in their native tongue.

The most recent local-language TV launch was the BBC World Service’s BBC Persian. A Persian-language service already existed, but the linear TV channel only launched in mid-January. Primarily targeting viewers in Iran, Afghanistan and Tajikistan, the free-to-air channel is beamed into homes via Hotbird and Telstar satellites. The channel is programmed from London – Iranian authorities refused the BBC permission to set up a BBC Persian bureau in the country – and transmits for eight hours a day from 17:00 to 01:00 Tehran time. As well as coverage of world events in Persian, there is some original factual programming focused on music, the arts, science, technology and sport.

The Persian launch follows the roll out of BBC Arabic in March 2008. As well as the linear channels, the World Service has launched local-language offerings on YouTube. It launched BBC Russian on the website last December and makes Arabic, Persian, Portuguese, Spanish and Urdu-language clips available on the site.

Arabic has become an increasingly important language for news channel operators. As well as the BBC, France 24 operates an Arabic-language channel, launched in 2007, alongside its French and English services. Arabic is also important for governments that wish to – depending upon your perspective – influence Arab speakers, or provide them with a service that is more editorially impartial than its peers.

The Alhurra (which translates as ‘freedom’ or ‘the free one’) Arabic-language channel, for example, is funded by the US government via the US Broadcasting Board of Governors. There is a dedicated Iraqi version of the channel.

Meanwhile, Al Jazeera, the Qatar-based Arabic news channel, launched its English-language service two years ago.

Euronews launched in Arabic last year. Despite the channel’s modest budget, director general Michael Peters confirmed there are concrete plans to launch at least one new local-language service this year.

CNN has local-language websites in Arabic, Spanish, Korean and Japanese and international digital boss Nick Wrenn would like to add more. “The biggest clip on our YouTube channel is a piece-to-camera in Polish, in Poland, which was promoting some of our Polish TV coverage. It showed the level of interest in local content.”