By Howard Kurtz
Washington Post Staff Writer
Monday, October 15, 2007
NEW YORK -- It is the first rehearsal for the Fox Business Network, in a gleaming studio converted from a loading dock area, and two things are clear: These folks are determined to have fun, and they have an elastic definition of business news.
"More trouble for the falling pop star," anchor Dagen McDowell says, kicking off a segment on Britney Spears losing custody of her kids. She asks co-anchor Cody Willard: "How will it affect her earnings? . . . There's nothing cynical about protecting your assets. . . . When does the woman's money run out?"
Rupert Murdoch's new cable venture, which launches today, is determined to be different. It aims to put a Foxified sheen on even eye-glazing financial matters as it takes on the established CNBC and Bloomberg News.
"You don't have to reinforce the notion that business news is dull by being dull," says Neil Cavuto, the Fox anchor and senior vice president for business news. "I have no problem with entertaining folks. I have two boys, 5 and 6, who hate vegetables. If I put them in pudding, they'll eat the vegetables."
Few are betting their mutual funds against the venture, and the reason is Roger Ailes. The Fox News chairman, who is overseeing the launch, built his news channel from scratch, and in a half-dozen years outdistanced CNN and MSNBC in the ratings. Perhaps more important, it was Ailes who invented the modern CNBC when he ran that network in the early 1990s, creating such signature shows as "Squawk Box" and hiring Maria Bartiromo as his stock exchange reporter. Cavuto and several other Fox executives and anchors are also CNBC veterans.
The fledgling operation got a boost with Murdoch's $5 billion deal to buy the Wall Street Journal. While the paper is contractually obligated to provide business news to CNBC until 2012, Fox's lawyers are examining whether Journal reporters can appear to discuss other subjects.
The Fox team faces an uphill climb, and initially won't pay for the new network to be rated by Nielsen. CNBC is an established brand with identifiable personalities, from Jim Cramer to Erin Burnett and Bartiromo. Fox Business will debut in 30 million homes, one-third of those reached by CNBC. (The channel will be available in the Washington area on digital cable via Comcast, RCN and on DirecTV satellite.) Fox Business has a staff of 300, about half that of CNBC.
"It's a pretty well oiled machine," Kevin Magee, Fox's executive vice president and a CNBC alumnus, says of his old network. But he calls CNBC's coverage hard to decipher: "We'll try to de-jargonize it and speak in terms that people understand. I think they've gotten precious and they're very pleased with how smart they are, and their first mission is to tell you how smart they are."
CNBC President Mark Hoffman, for his part, rejects Murdoch's contention that "they're Wall Street and we're Main Street."
"We're for people who have a lot of money or aspire to make a lot of money," Hoffman says. "That can be any street in America, Europe or Asia where CNBC is delivered. . . . We don't try to be all things business. I wouldn't call us a general business network. We're an investor network."
CNBC has tried to broaden its appeal in recent years, adding shows such as "Mad Money" and "Fast Money." But it's wary of broadening too far. After he took over in 2005, Hoffman once saw anchor Mark Haines standing next to a kayak, promoting an upcoming segment on weekend fun. He concluded that the network had strayed too far from its market roots. "Narrower is better in cable," Hoffman says.
Indeed, his network, with its parade of banking analysts and fund managers, remains largely aimed at substantial investors. And that, of course, is where the money is. While business audiences are relatively small -- CNBC is averaging 210,000 viewers this year, up from 163,000 last year but way down from the Internet boom days -- their median household income is $160,000. That translates into the kind of advertising revenue that has generated $325 million in annual profits for parent company General Electric.
But there are signs that CNBC is nervous about its new rival. After word leaked that Fox Business would have a 5 p.m. show called "Happy Hour" -- based in a bar -- CNBC added a happy-hour segment, from a bar, to its program "Fast Money." CNBC spokesman Kevin Goldman says "the concept" has been around since "Fast Money" "was first created" and was adopted when the program moved to 5 p.m.
Fox News Channel already has the five top-rated business shows on cable, led by Cavuto's "Your World." He will do double duty on the new channel, and Fox News correspondents will contribute as well.
Television industry analyst Andrew Tyndall is skeptical of Fox's chances. "There is no evidence that the potential financial news audience is underserved," he says. "CNBC is a quality brand. Bloomberg has its niche. . . .
"It would be a mistake to think the Fox Business Network can take advantage of Fox News's coattails. Of all genres of news, business news is the one where accuracy and objectivity are valued most highly," especially when "people are putting their money at risk."
CNN's coattails didn't help its business channel, CNNfn, which folded in 2004 after nine years.
Fox Business is short on stars, although last week it signed former Hewlett-Packard chief executive Carly Fiorina as a contributor. Perhaps the channel is relying on what New York magazine called a bevy of "foxy young broads," including a former model and onetime flight attendant.
But one certified celebrity is Alexis Glick, a Fox Business vice president who was a substitute host on the "Today" show.
"It was a rocket ship," Glick says of her NBC gig. "People said, 'Oh my God, she's going to be the next Katie Couric.' I was a kid. I'd only been in TV for three years. . . . It was a dream job, but the thing I missed most is running a business."
And Glick knows the business, having worked at Goldman Sachs and then managed floor trading at the New York Stock Exchange for Morgan Stanley. "I feel very comfortable bringing an inside-baseball perspective because I sat and talked to hedge-fund managers every day," she says.
Glick, who describes herself as a player-coach -- she will anchor and help run things -- has a weakness for sports metaphors. A former high school basketball star, she speaks of the "pre-game show" and "post-game show" and "zone defense." She says she is drawn by "the thrill of the win" -- that is, when she's not taking care of her three young children.
"I multi-task," Glick explains. "I do a lot of e-mails at 5 a.m. in the middle of a breast-feeding session."
The notion that Fox Business will strike a hipper tone than CNBC permeates the organization. In online promos, anchor Rebecca Gomez says: "It's more casual, it's warmer." McDowell boasts that "we're going to bring the same passion we've delivered at the Fox News Channel."
Willard, an anchor who sports shoulder-length hair, says on the Web site that he feels like throwing his television out the window "when you hear the garbled 'The Dow futures are down 28 because oil is up 32 cents to $78 this morning.' . . . Does the reporter even believe it himself when he spews that nonsense?"
During the rehearsal, McDowell says things like "Tracy, whatcha got?," while graphics refer to the "Breaking Biz Desk."
Cavuto harks back to the 1996 launch of Fox News, when he would tell his staff not to lead off his show with whatever CNBC's big story was. But while few took Fox seriously at the time, he says, "there's a bit more pressure now because we're a far better-known organization."
Who is the target audience? "My wife is not a business news junkie at all," Cavuto says. "She's good at shopping for bargains, but she's not riveted by this stuff. I always think, how can I reach out to her, or to her mom?"
Perhaps the key intangible is whether the start-up channel can find the niche that Fox News did a decade ago, one that few thought existed at the time. By positioning his network as an alternative to the media establishment and dubbing it "fair and balanced," Ailes, a former Republican strategist, appealed to a largely conservative audience. His future stars, such as Bill O'Reilly and Sean Hannity, were little known at the time.
But is there an audience that sees a political imbalance in financial coverage? Murdoch told a conference in February that the new channel would be "more business-friendly than CNBC," and Ailes told the New York Times that "many times I've seen things on CNBC where they are not as friendly to corporations and profits as they should be."
Fox executives say they cannot survive by simply stealing a slice of CNBC's audience. Instead, they say, they must attract viewers who haven't been drawn to business coverage.
"We'll make mistakes," Magee says. "We'll make lots of mistakes. We're starting a lot of shows from scratch. Some of them I hope will work, some of them I know won't."
But, he adds, "we don't want to be CNBC's little brother. We want our own look and feel."