MSNBC Turns Into a Freak Show

Roughly eight years ago, there was a nasty fight at 30 Rockefeller Plaza in New York. On one side was Roger Ailes, then - president and CEO of CNBC and its sister cable network, America's Talking. On the other side were NBC strategist Tom Rogers, NBC News president Andrew Lack, and NBC president Robert Wright. The fight was over a joint venture with Microsoft. (I know -- I was there, making the pitch with Ailes.)

Ailes argued that CNBC should combine with Microsoft to form MSCNBC, a financial-news and business-information network that could own the category on cable and on every Windows OS computer. Rogers and Lack argued that NBC News should take away the America's Talking channel from Ailes and reinvent it as MSNBC, a 24-hour news network that could compete with CNN.

The outcome was never in doubt. Wright disliked Ailes. Rogers and Lack (at the time) had Wright's confidence. To no one's surprise, Ailes was sent packing, and MSNBC was launched. Seven years later, MSNBC is on the verge of collapse, groaning under the weight of bad management and even worse execution.

How does something like this happen? How does it come to pass that two of America's greatest corporations, GE and Microsoft, end up hiring a former professional wrestler, XFL color analyst, and third-tier former governor as the linchpin of their prime-time schedule for a news channel? Imagine for a moment that someone came into your office and said, "I've found the answer to our problem, boss: Jesse Ventura." What would you say?

We're not talking stupid here. We're talking brain-dead. But if you spend some time researching this disaster, the first thing you realize is that MSNBC was never about being a news channel. MSNBC was a financial play. Its aim was to repurpose content and, in so doing, to amortize the cost of news gathering and talent across 24 hours of cable television as well as the existing 20 hours (roughly speaking) of broadcast time.

What was missing from this "strategy" was a strategy. The television-news business breaks down into four basic elements: news, analysis, commentary, and opinion. CNN owned the news space and sometimes excelled at analysis and commentary. Fox News Channel occupied the opinion space and crafted talk shows that resonated with conservatives. MSNBC, in the beginning, threw out the categories and proclaimed itself the news source for slackers. It was younger, hipper, and self-consciously cutting edge. It wasn't about the news; it was about attitude, about how you related to the news. It was a disaster.

Following the collapse of "slacker news," MSNBC sought to distinguish itself by devoting its attention to the 2000 presidential campaign. In the post-election Florida drama, MSNBC provided the best ongoing coverage of the legal wrangle. But the network was unable to capitalize on its performance, and nine months later, September 11 changed the world. CNN was there with global coverage. Fox News Channel was there with strong opinions about what it all meant. MSNBC was caught in the middle.

With ratings in free fall, MSNBC has at last turned to Ventura, the human intersection of second-rate celebrity and reality TV. Unable to compete in the known categories of news, analysis, commentary, and opinion, MSNBC created a freak show as its signature offering.

Most people will tell you that MSNBC's pathetic state is a one-off, an aberration of complicated circumstances and a market suffering from overcapacity. I think that the opposite is true. MSNBC isn't unusual; it's emblematic of what's happening in television. The major networks are now competing against one an-other with freak shows. Fox has Joe Millionaire. ABC will soon have its own version of the British show Wife Swap. And there's a ton more of these kinds of shows in the works.

Sitcoms and dramas have become so expensive that the networks are at a tipping point. It costs $11 million per episode to keep Friends on the air. That's unsustainable. The networks lose hundreds of millions of dollars on their NFL broadcasts. That's also unsustainable. Their news divisions are mature businesses with declining ratings. Over the long term, that isn't going to work. The only ray of hope is freak shows. And that amounts to a form of cannibalization -- for the business itself and for the brand equity that has been built up over 50 years.

MSNBC's slow death is a nonevent. But as metaphor, it's a harbinger of bad news for the broadcast networks.

John Ellis (jellis@fastcompany.com), a writer and consultant, works in media, politics, and technology. Read his weekday musings on the Web (www.johnellis.blogspot.com).

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