The Wall Street Journal takes stock of the three TV business networks and sees that their fortunes are sagging.
In the third quarter, CNBC, the dominant business-news channel, hit a 20-year low in its target demographic of adults 25 to 54 years old. (CNBC’s gross advertising revenue is down 4% to $251.6 million since last year, according to SNL Kagan.) Six-year-old Fox Business Network remains on a long-term growth trajectory, but its average total daytime audience has declined from last year — to 58,000 from 71,000 — and has fallen short of some media buyers’ expectations. Bloomberg LP, meanwhile, is rethinking the business model of its TV channel, having failed to turn a profit or draw more than 10% of the audience for TV business news despite being on the air for nearly two decades.
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Why is this happening? Reporters Keach Hagey and William Launder write that, beyond online and streaming competition, “business television has faced the added challenge that individual investors are fleeing the stock market as an increasing amount of trading is done by institutional investors and algorithms.”
“I think there are all sorts of places you can get stock prices,” said Kevin Magee, the executive vice president of Fox Business Network. “Aside from that, there is general unhappiness with the economy these days, and it isn’t always fun to watch news that’s bad.”
Other highlights from the article…
- So far the impact on CNBC’s financial performance has been minimal. Ratings typically don’t affect a cable channel’s profits in the short term, thanks to fees from pay-TV operators that are set in long-term agreements. Media buyers say that even with the ratings declines, CNBC remains attractive for advertisers because it continues to reach what one buyer calls “the correct people,” especially during regular stock-trading hours.
- The audience for Fox Business has grown over the years to about 25% of total business news viewership but those market-share gains have stalled since last year, an election year. “When the network was launched, everyone was making a comparison that it was going to do to CNBC what Fox News did to CNN,” said Brad Adgate, director of research at media buyer Horizon Media, referring to Fox News’s surpassing CNN’s ratings in five years. “There were a lot of overgrown expectations that didn’t really come to fruition.”
- Bloomberg has cut its TV losses in half in recent years, to about $100 million, according to people familiar with the matter, such as by eliminating costs like its foreign-language TV channels. The channel has also grown its ad revenue steadily, and is on track for its best performance ever this year, company executives said. Hurting its financial performance is that Bloomberg is paying cable and satellite companies for distribution, say people familiar with the situation, the reverse of the usual situation for cable channels and an arrangement normally reserved for startup networks. The channel is in about 75 million U.S. homes.