The Gold Rush of All-News Cable : Television: NBC joins ABC's proposed challenge to CNN. The network is considering turning its America's Talking into a news competitor.


The field of potential challengers to CNN is getting crowded.

ABC said this week that it plans to jump into the all-news TV waters, and now NBC is in negotiations with Microsoft Corp. to create a 24-hour all-news TV network that would be connected to a computer on-line news service.

NBC is considering turning its America's Talking cable network into the all-news venture, according to executives familiar with the plan.

"America's Talking would give us a tremendous platform for distribution," one NBC executive said. The 17-month-old cable network reaches 20 million homes.

Distribution is considered the biggest hurdle facing ABC, which announced its plans for an all-news network Tuesday. ABC intends to launch its service in 1997. NBC would like to start its service in 1996, but several issues remain unresolved.

News Corp. chairman Rupert Murdoch also remarked recently that he intends to challenge CNN at some point, although his Fox network does not yet have a significant news division.

"I think the broadcast networks have looked at CNN's revenues and decided they'd like to cut up the pie if they can," said Ed Atorino, media analyst at the Dillon Read investment firm.

CNN, which reaches 67 million homes in the United States and nearly an additional 100 million internationally, made $241 million in profits last year.

"CNN is the brand name for news globally, and they have great distribution here and abroad," Atorino said. "But with new owners at some of the broadcast networks and the projected growth of DBS [direct broadcast satellite], broadcasters have decided to put their resources against CNN's."

ABC News President Roone Arledge said that an all-news channel will allow the network to make better use of both its on-air talent and its news-gathering operation.

"In addition to covering the news worldwide, we have terrific anchors and reporters who would like to be on the air more," Arledge said, noting that he expects Peter Jennings, Diane Sawyer and other prominent ABC news personnel to appear on the cable-news network, especially during a breaking story.

ABC is counting on its "star power" to help challenge the well-entrenched CNN, which has had 15 years to develop its around-the-clock news operation.

"CNN does a very good job at providing news 24 hours a day," Arledge said. "But I think what will make us different from everybody else is our on-air talent and our programming."

Microsoft and NBC, meanwhile, are discussing a 50/50 partnership, sources said, with a potential investment of up to $100 million over the next several years. NBC would retain editorial control over the channel and its on-line component.

Still to be determined within NBC is whether America's Talking would be reformatted or turned into an all-news operation. The channel, which is at break-even financially, currently includes hard-news segments and news programming along with a slate of talk shows.

The channel shares a production facility in Ft. Lee, N.J., with CNBC, NBC's financial news and talk network.

NBC also has an operation in Charlotte, N.C., NBC News Channel, which provides network news footage to its affiliated stations. News Channel is expected to play a role in the new news network, which also would include local news segments from NBC affiliates.

It is unclear how cable operators who have signed up for America's Talking would respond to having it replaced with an all-news channel. In theory, the channel could be reformatted to include more hard news along with talk programming. Another option, sources said, is to keep America's Talking as is and launch the news channel as a third, separate NBC cable network.

NBC News President Andrew Lack--who has wanted to challenge CNN for some time--would be in charge of the news channel. But if NBC executives scuttle America's Talking, sources said, there is fear that they might lose Roger Ailes, who is president of both CNBC and America's Talking.

Ailes, a former Republican strategist and TV producer, was hired by NBC President Robert Wright two years ago and is credited with building CNBC into a venture that has made more than $80 million in profit since then.

Both Lack and Ailes declined to comment on NBC's plans.

Microsoft confirmed that it was in talks with NBC. The proposed tie between the news operation and a computer online service--which would allow personal-computer users to access NBC news footage--would represent an extension of an agreement that NBC and the software giant already have in desktop publishing.

Before Time Warner moved to buy Turner Broadcasting System, the parent company of CNN and several other cable networks, Microsoft Chairman Bill Gates had discussed purchasing a $2 billion stake in TBS to secure its brand names on-line.

For its part, CNN acted unruffled this week by the prospect of encountering these big-name challengers.

"We have new competition," CNN President Tom Johnson said in an interview. "But I will put the quality of our correspondents and our news gathering against any other news organization."

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World