War of the Cablers

By Erik Sorenson 

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!

Look, 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.