TELEVISION
Region by Region, Murdoch's Fox Networks Now Rule (NYT)
TV Networks' Tough Talk Leaves Local Stations Fuming (NYT)
INTERNET
Online Merchants Grow Uneasy as Web Portals Sell More Goods
Themselves (CyberTimes)
China Sets Up Its Own Web Site To Lure U.S Concerns' (NYT)
Potential Profits Seen in Fan-Oriented Web Sites (NYT)
IBM, RealNetworks in Online Music Venture (WP)
Putting the Internet in Orbit (WP)
Internet Execs to Field Questions (WP)
Potential Profits Seen in Fan-Oriented Web Sites (NYT)
ADVERTISING
Advertising Group Has Its Mind in the Clutter (WP)
Magazines Seek To Demonstrate Efficacy Of Ads (WSJ)
TELEVISION
TV NETWORKS' TOUGH TALK LEAVES LOCAL STATIONS FUMING
Issue: TV
For most of this century broadcasting in America has centered around the
relationship between networks and their local affiliate stations. Two of the
big four networks, Fox and ABC, have recently announced plans that could
seriously threaten these already delicate relationships. Last week, ABC said
that it is starting a soap opera channel that will run the same shows on the
same days as ABC's affiliates. At the same time, Fox told its affiliates
that it is reclaiming 20% of the commercial time that the stations have been
selling to advertisers. One affiliate executive, Alan J. Bell, explained the
rational behind Fox's aggressive move this way: "Fox is saying to its
affiliates: 'I found you in the gutter, drunk with vomit on your clothes,
and a bottle of Thunderbird in your back pocket. Then I cleaned you up, gave
you a haircut and shave and a job in the mail room. Now you're doing well,
so you should do whatever I tell you to do." Local stations are left with
little power to retaliate against the networks. Pre-emption of network shows
is one of the only options for affiliates, many of which are locked into 3
to 5 year contract with a network, as they try to fight network attempts to
redefine the business relationship with stations.
[SOURCE: New York Times (C1), AUTHOR: Bill Carter]
(http://www.nytimes.com/yr/mo/day/news/financial/network-affiliates.html)
REGION BY REGION, MURDOCH'S FOX NETWORKS NOW RULE
Issue: Cable
Although he rarely watches any games himself, Rupert Murdoch now owns stake
in all but four of the nation's 23 regional cable sports networks. Last
week, in a deal worth billions of dollars, Murdoch's Fox Entertainment
network took control of the 2 of the top 5 regional networks. While Fox may
now own all or part of the regional cable rights to most professional US
teams, Disney's ESPN still dominates the world of cable sports. "Now all the
sports are controlled by two companies, neither of which owns any cable
systems," said one bitter cable operator, who noted that ESPN has recently
announced a 20 percent rate increase. Another issue arises from the fact
that Rupert Murdoch, who owns stake in several professional treams as well,
"has the reason to spend more for contracts, creating the issue of salary
imbalance," said Andy Zimbalist, a sports economist at Smith College.
[SOURCE: New York Times (C1), AUTHOR: Geraldine Fabrinkant]
(http://www.nytimes.com/library/sports/other/041299fox-tv-sports.html)
INTERNET
CHINA SETS UP ITS OWN WEB SITE TO LURE U.S. CONCERNS' BUSINESS
Issue: E-commerce/International
The Chinese Government has launched an Internet site intended to help
Chinese companies market goods to foreign companies. A San Francisco based
company, U.S. Business Networks, will operate the site, www.meetchina.com,
for China. Chinese companies will be able to post information about their
products and services with contact information. Only in recent months has
China begun to allow companies to make direct contact with foreign
businesses. "From China's perspective, it fits perfectly," said Patrick
Meehan research director for the Gartner Group, a technology consulting
firm. "It's kind of open, but not all the way. It's part of the 'great
firewall of China' strategy, where they have a way to funnel information in
and out of the country." Analysts also say that the Web site will
facilitate China's process of privatizing state owned businesses by opening
up avenues for greater contact with the West.
[SOURCE: New York Times (C9), AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/04/biztech/articles/12site.html)
ONLINE MERCHANTS GROW UNEASY AS WEB PORTALS SELL MORE GOODS THEMSELVES
Issue: E-Commerce
Web retailers, some of whom pay up $5 million a year to be featured on a
portal site, are concerned that they will soon face competition from the
very same sites that bring them much of thier traffic. Some portals, like
Lycos and Yahoo, have discovered that much money is to be made from selling
goods directly to consumers, bypassing merchants altogether. Retailers are
beginning to reconsider they million dollar agreements with portals as they
examine weather the relationships might be hurting, not helping business.
Some annalists say that it the customer who will benefit from this new
tension between portals and merchants. "I think it's a healthy tension, and
I think that's natural, and there's room for both sides to succeed," said
Tim Brady, Yahoo's vice president for production. Some, however, are more
unsure of the portals' ability to succeed if they do not become better at
appeasing their e-commerce partners. Jonathan Morris, executive vice
president of Bluefly.com, a discount apparel merchant, predicts that "the
ones that are closed-minded about [the best way to structure e-commerce] are
going to fail because they'll lose their merchants."
[SOURCE: CyberTimes, AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/04/cyber/commerce/12commerce.html)
POTENTIAL PROFITS SEEN IN FAN-ORIENTED WEB SITES
Issue: Internet
Rather than original programming, the Internet's biggest successes have been
its most derivative: online extensions of music, television shows and movies
that fans already know. With the increasingly interactive Web, big
entertainment producers are looking to build direct relationships with their
customers and turn the fan-oriented sites into potentially profitable
services in their own right. For example, Walt Disney has an elaborate site
at ABC.com with advertising material pegged to its television shows. Now
Warner Brothers is going a step further with an elaborate offering called
Acme City. The new service lets fans build their own home pages devoted to
Warner properties. It gives users sounds and images for Warner characters,
something other companies frown on because of copyright concerns. Jim
Moloshok, the head of Warner Brothers Online, said, "The people who create
home pages devoted to your products are the ones who will buy your albums
the day they are released and see your movies five times." It doesn't hurt
that the pages are also producing premium revenue. In Acme City's first 10
weeks, some 200,000 people have registered to build home pages. [For ABC
info go to (http://www.abc.go.com). For Acme City, its
(http://www.acme-city.com)].
[SOURCE: New York Times (C8), AUTHOR: Saul Hansell]
(http://www.nytimes.com/library/tech/99/04/biztech/articles/12site.html)
IBM, REALNETWORKS IN ONLINE MUSIC VENTURE
Issue: Intellectual Property
International Business Machines has enlisted the support of Real Networks in
its bid to create a universal standard for sending music over the Internet.
The joining of the computer company and the online multimedia company is
another step in the industry's effort to find a way to distribute music
online while guarding against piracy. RealNetworks will develop consumer
software based on IBM's Electronic Music Management System (EMMS), one of
several competing music delivery formats. IBM's effort already has the
support of several major record labels. The currently popular format for
Internet downloading is MP3, but that format is opposed by recording
companies because it allows unauthorized copying of songs for which no
royalties are paid. Microsoft, participating separately in the online music
battle, is expected to unveil the latest version of its own music
downloading format, MS Audio 4.0, this week.
[SOURCE: Washington Post (Online), AUTHOR: Scott Hillis (Reuters)]
(http://www.washingtonpost.com/wp-srv/business/daily/april99/ibm12.htm)
See also:
REAL NETWORKS, IBM TO DELIVER MUSIC ON THE WEB
[SOURCE: Wall Street Journal (A3), AUTHOR: Eben Shapiro]
(http://wsj.com/)
PUTTING THE INTERNET IN ORBIT
Issue: Information Technology
Spaceway is coming from Hughes Network Systems to provide high-speed
Internet access using satellites. Last month HNS-parent Hughes Electronics
Corp. promised to fully fund the $1.4 billion required for the project's
first phase. Several companies share similar goals: to provide customers
two-way, high-speed Internet access using small dish antennas. In March
Hughes unveiled a plan that is less expensive, less ambitious and easier to
carry out than many of its rivals. The trade-off: The company's Internet
service would be 20 to 30 percent slower than its competitor's offerings.
The plan, which would provide service to mostly business customers, includes
a 2002 launch of three satellites (two active and a spare) to operate over
the US, followed by satellite placements over Europe, Latin America and Asia
Pacific. Hughes has a thriving industry in VSAT satellite communications
and has been flirting with consumer satellite service for Internet access.
Teledesic is an ambitious challenger, a $10 billion effort by Microsoft's
Bill Gates and cellular pioneer Craig McCaw to lace the skies with 280
low-orbiting satellites. Other sky-based communications efforts are being
planned by Alexander Haig (balloons over major cities), Angel Technologies
(high altitude airplanes over major cities), and Lockheed Martin Corp. (a
four-satellite network called Astrolink).
[SOURCE: Washington Post (F5), AUTHOR: Mike Mills]
(http://www.washingtonpost.com/wp-srv/business/feed/biztop923915253852.htm)
INTERNET EXECS TO FIELD QUESTIONS
Issue: Internet
Are you ready to join with 45,000 of your closest friends to chat online
with top Internet executives all day on Wednesday? Chief executive officers
and chief financial officers from Internet companies like Excite and Yahoo!
are taking part in the effort promoted by Vcall Corp., an Internet
conference call provider. The executives taking part in the virtual
conference call will make speeches or hold discussions with their
counterparts over real-time audio and video feeds. Listeners may send
questions via e-mail. Vcall hopes to use the conference call as a marketing
tool to attract future paying listeners, advertisers and clients. [The 8:00
AM to 8:00 PM EDT Wednesday event will be available at (http://www.vcall.com).]
[SOURCE: Washington Post (Online), AUTHOR: Eileen Glanton (Associated Press)]
(http://www.washingtonpost.com/wp-srv/WAPO/19990409/V000709-040999-idx.html)
ADVERTISING
MAGAZINES SEEK TO DEMNSTRATE EFFICACY OF ADS
Issue: Advertising/Magazines
Advertisers are pressuring magazines to test the efficacy of the ads that are
placed there. Magazine advertisers want the same assurance they get on the
Internet with the ability to measure effectiveness of the ads by tracking
customer's movements. In addition, as television is converted to digital,
viewers/customers will be able to purchase with their remote control as they
can now with their keyboard. For decades, magazines have been selling ads
without much thought about their ability to actually sell. "Rightly or wrongly,
there's no question that every advertiser now wants every magazine to be
accountable," says Catherine Viscardi Johnston, executive vice president of
Conde Nast Publications, that publishes Vogue, GQ, and Vanity Fair. Working
towards accountability, magazine publishers are doing a number of things. For
example, Nast publications is creating a magazine branded credit card to help
track consumer purchases. The industry trade group, Magazine Publishers of
America spent half a million dollars on research last year and found that
increased advertising leads to a short term sales increase. Other companies are
adding web components to which they lure readers as a buying mechanism.
Magazines are also forging closer ties with advertising companies. For example,
last week, Wenner Media hired an ad executive with no publishing experience to
oversee three magazines: Rolling Stone, Men's Journal and Us. American
Express publishing makes use of its database of credit card holders to track
how a specific product they have advertised is selling. Other publishers,
like Conde
Nast, have opened its subscriber database to advertisers. It has teamed up with
the trade group "Beauty Lab" and targeted a marketing survey to
"beauty-conscious subscribers." "Products don't have a close connection with
readers, magazines do" says Ms. Johnston of publisher Conde Nast.
[SOURCE: Wall Street Journal (B1), AUTHOR: Wendy Bounds]
(http://wsj.com/)
ADVERTISING GROUP HAS ITS MIND IN THE CLUTTER
Issue: Advertising
The award for the most cluttered TV show in broadcast prime time television
in 1998 is ABC's "Sports Night" with 19 minutes 13 seconds per hour of crass
commercialism. The American Association of Advertising Agencies defines
clutter as all "non-programming content" -- ads, promotions, public service
announcements, program credits not run over continuing program action, and
other miscellaneous gaps. Prime-time clutter among the broadcast networks
hit a record high of 15 minutes 44 seconds per average hour in 1998, but
prime-time still has less clutter than other dayparts. The most cluttered
broadcast morning news show in '98 was ABC's "Good Morning America" with 17
minutes 36 seconds per hour. Broadcast late-night shows collectively
dropped about 35 seconds from '97's all-time high of nearly 19 minutes of
clutter per hour. Daytime is the clutter motherlode. "All My Children" had
nearly 21 minutes of pitches. Cable TV is no better than broadcast; the
leading networks were E! and TBS with 18 minutes per hour, a cable record.
[SOURCE: Washington Post (C7), AUTHOR: Lisa de Moraes]
(http://www.washingtonpost.com/wp-srv/WPcap/1999-04/12/013r-041299-idx.html)
--------------------------------------------------------------
No Chicago Tribune coverage -- we're returning to
our East Coast-centric roots.