AP Acknowledges Threat From CNN’s Wire Service; But Challenger Still ‘Needs Improvement’

As CNN prepares to go head-to-head with the Associated Press when it launches its new wire service, the cable news outfit will have to prove to newspaper editors that it can transfer its cable TV credibility to breaking print news. A long piece in the NYT takes a look at the challenges the upstart CNN Wire faces, as well as how its established rival is reacting. CNN Wire has been in limited trial at a handful of newspapers the past month. Editors from about 30 papers have been invited to CNN’s Atlanta headquarters for a presentation called the CNN Newspaper Summit this week. Acknowledging that it lacks ties with newspapers, CNN hopes it can dazzle editors enough to get them to give its services a try.

Playing one off the other: CNN’s challenge — which is largely based on offering similar breaking news to what the AP offers, but at a lower cost — wouldn’t mean much at any other time, except that the showdown comes as the AP has been struggling with its members over pricing for the past year. Meanwhile, newspapers have been attempting to slash costs and lay off staffers for the past year. The high-profile competition offers newspapers a chance to play one off the other. Still, given the existing competition from Thomson Reuters (NASDAQ: TRIN) — whose services were dropped by CNN in August 2007 — as well as Bloomberg, it remains to be seen how CNN will position itself against those two.

“Still needs work”: NYT obtained a tape of AP President and CEO Tom Curley speaking to staffers last week about the growing pressures on the non-profit organization’s business. In addition to the dismal economy and the poor business prospects of newspapers, Curley identified CNN as major threat. CNN, flush with revenues from the recent election cycle, is in an excellent position to take on AP. Plus, it can offer brand names like Anderson Cooper to produce columns that might be attractive to newspaper readers and advertisers. Still, Curley had a fairly negative take on the actual reporting that CNN Wire has produced in its trial. “The current CNN wire, if you look at it truly is, still, and remarkably, abysmally written,” Curley was quoted as saying. But he noted that CNN is in hiring mode and in addition to targeting the waves of professional newspaper reporters who have been laid off this year, the company is actively recruiting AP staffers as well. That should allow CNN to improve the quality of its wire service fairly quickly.