News Corp. chief Rupert Murdoch says the new Fox Business Channel will be “more business-friendly” than rival CNBC, making that point on the day he announced his network would launch at the end of the year.
It was the first hint that a classic political tactic used in starting Fox News Channel a decade ago — defining the opposition — was back in play.
Within a day of Mr. Murdoch’s statement on Feb. 8, Fox News business anchor Neil Cavuto told MarketWatch that “we’re going to be a channel for America — not for old white men with money.”
Roger Ailes, chairman and chief executive for Fox News, told the New York Times that he’d often seen things on CNBC where they aren’t as friendly to corporations and profits as they should be.
“We don’t get up every morning thinking business is bad,” Mr. Ailes said.
Substitute “America” for “business” in that quote and you’d swear it was 1996 again, and Mr. Ailes was needling CNN.
The tactic worked for Fox News Channel. Worked brilliantly. Many people doubted the network was even necessary, yet it charged past the industry pioneer within six years and hasn’t been caught since. Now many are questioning whether Fox Business Channel can compete against CNBC.
CNBC will be defined by what it delivers on the air every day, and not by Fox, says Jeff Zucker, chairman and CEO of NBC Universal, CNBC’s parent company.
“When you don’t have a product, it’s easy to throw darts,” Mr. Zucker says. “We’re not concerned at all.”
Rick Kaplan, who ran CNN from 1996 to 2000, wasn’t much concerned back then, either. Why worry about snide references to the Clinton News Network or a Fox slogan like “fair and balanced,” with the inference that CNN wasn’t? Fox’s ratings were so negligible it didn’t matter.
“I thought that people were not going to buy the argument,” Mr. Kaplan said.
CNN didn’t bother responding.
Yet Fox caught on with an audience that believed the slogans. Partly it was because there was a ring of truth, Mr. Kaplan says. Not that CNN was partisan, but mainstream news organizations may not have been sensitive enough to other points of view, he adds. President Clinton’s impeachment troubles galvanized what became Fox’s audience, Mr. Kaplan notes.
What should CNN have done?
“I’m not sure,” he says. “Maybe fight back harder and not just show disdain for Fox News Channel and the noise that was coming out of Fox and their advertising campaigns.”
CNN counterpunches now, as it did recently when Fox referred to Anderson Cooper as the Paris Hilton of TV news.
CNBC hasn’t sat back. Spokesman Kevin Goldman answered the criticism coming from Fox Business Channel: “It doesn’t surprise me that our alleged competition is already starting with its usual lies and propaganda.”
Like a boxer training before a fight, CNBC has also made several changes in the two years since Mark Hoffman became president. It has added a business newsmagazine, retooled “Squawk Box” and added the popular “Fast Money.”
What worked in politics is not likely to work in business, said Porter Bibb, of Wall Street’s Mediatech Partners and author of a biography on CNN founder Ted Turner released the year after Fox News Channel started.
Mr. Bibb believes CNBC’s advantage will be too much for Fox to overcome. CNBC, which started in 1989, is in more than 90 million of the nation’s 110 million homes; Fox will start this fall in 30 million homes. There’s usually room for only one TV on the desks of business leaders, and it will stay tuned to CNBC, he says.
In this case, Fox’s criticism of CNBC as anti-business doesn’t make much sense, Mr. Bibb says.
“You can ask anybody on Wall Street and they will tell you that’s the hollowest threat,” says Mr. Bibb. “CNBC is totally user-friendly in terms of business and finance.”
In fact, the most recent ethical issue for CNBC was about the network being too business-friendly. Questions were raised about whether star reporter Maria Bartiromo had too close a relationship with a former Citigroup executive who gave her rides on a corporate jet.
Calling a rival financial channel unfriendly to business could also paint Fox into a corner on its own coverage.
“Is it going to be a puffery channel?” Mr. Bibb asks.
Fox declined to speak to Associated Press about its startup strategy, but Mr. Ailes has been quoted as saying that its attitude of being business-friendly does not mean it will ignore corporate scandals or misdoings. Mr. Cavuto has talked about having a broader appeal than CNBC.
Mr. Murdoch’s comment could also be a signal to potential advertisers. Why wouldn’t a business want to see its commercials on a network that says it is business-friendly? The “old white men” that Mr. Cavuto referred to just happen to be the demographic group that advertisers consider least valuable.
A business audience might not be as easily swayed as the people who switched from CNN to Fox News, but Mr. Kaplan has this caution, learned from experience: “You don’t ever count Roger out, ever,” he says.
For Fox, whether CNBC is business-unfriendly may ultimately matter less than whether there’s an audience that believes it’s true and is willing to change the channel because of that.