Waiting for VOD: Is time running out on 24-hour news channels?

For years, I’ve thought that 24-hour news channels were actually just a technical kludge. Most of the time, there just isn’t enough news to fill 24-hours so many of the channels are little more than a very expensive tape loop, with the stories running on repeat every 15-minutes on some channels. Sure, 24-hour news channels really shine during big events, during wars, elections, disasters or historic events like the Arab Spring. CNN really broke through during the first Gulf War. That being said, I remember watching the same cruise missile fired from the same frigate over and over and over. Well, to be fair, the cruise missile launches were punctuated by the similarly repetitive footage of a carrier-based aircraft taking off (I believe it was an F-14, but it’s really beside the point).

After the Gulf War, CNN’s ratings dropped, and now CNN is suffering a precipitous drop-off on ratings. Brian Stetler of the New York Times has this observation from an CNN insider. “Maybe CNN is just like an emergency room,” and Stelter adds:

When elections and explosions happen, people tune in to CNN, the same way they hurry to a hospital when they think they are having a heart attack. But people tend not to linger in either place — a reality that was reaffirmed for CNN this week when Nielsen ratings showed that April was the channel’s lowest-rated month in 10 years.

Domestically in the US, CNN is being outflanked by the partisan noise machines of Fox and MSNBC, which like the tabloids in the UK know their constituency and serve it well. I wonder how long it will take for a cable TV version of the Daily Mail, Mail 24, heavy on celebrity, skin and manufactured outrage. I’m sure someone is already cooking it up somewhere. It would certainly be a money spinner. I digress, and poynter has a good round-up of CNN’s ratings woes and various suggestions on how to solve them

Personally, I don’t really care about the political angle. Globally, CNN seems to be performing much better. It’s brand of more level-headed news playing well to international audiences who don’t know and don’t care about the partisan battles of the US. While CNN’s prime time US ratings might be suffering, financially it’s doing well. It’s set to make $600m in operating profit, a record, Brian Stelter reports. Will CNN reach a tipping point where the ratings start to undermine its ability to generate this kind of income? Is CNN where US newspapers were in say 2004, right before they started to fall off a cliff financially? Possibly.

In the longer term, I simply wonder about the cost of running a 24-hour news channel versus running a news website with video-on-demand and the ability to go live digitally on multiple platforms when big events happen. This especially gets interesting when you think of smart TVs and the blurring of the internet and TV that’s now possible (although not being used by consumers as much as they can yet). 

CNN’s financial success might come from its success on multiple platforms rather than its failing on TV. Greg D’Alba, CNN’s president of news and Turner digital ad sales told BusinessWeek:

CNN’s primary differentiation is the ability to connect multiple screens. More than 80 percent of our advertisers buy both TV and digital. That’s unlike virtually any other service out there.

For now, having a 24-hour news channel works, and it works in part because CNN is paid by cable and satellite companies to carry the channel. However, as TVs get smarter and consumers move to video-on-demand with greater tools for video discovery, I wonder if having a rolling channel will make economic in the future. I don’t think so. We’re not there yet, but the future looks less like a tape loop and more like an app.