CNN has become a prime-time ratings afterthought in the cable news business it started three decades ago, as Fox (NSDQ: NWS) News continues to dominate a traditional television realm mostly supported by older viewers. But online and on mobile, the tables are turned.
Driven by a flurry of big breaking-news events in 2011 – everything from the Japanese tsunami to the Egyptian uprising – Time (NYSE: TWX) Warner-owned CNN Digital averaged 73 million unique viewers a month last year across its various platforms, according to comScore (NSDQ: SCOR). Fox News Channel, far and away the leading cable news outlet in prime time, averaged less than 30 million unique users across its channels, while No. 2 network MSNBC (NSDQ: CMCSA) averaged just over 50 million.
Given that other Time Warner sites including Time.com and People.com are folded into the CNN Networks metric, just comparing unique users overstates CNN’s advantage. But in the social networking universe, the 1 million fans on CNN’s Facebook page dwarf those for Fox News by a factor of eight. And with a combined total of 9.4 million followers, @CNN and the rest of the news brand’s Twitter handles have 1.8 million more followers than the closest news competitor, the New York Times.
CNN.com served up 135.9 million page views last March when the earthquake and tsunami ravaged the Japanese coastline, and it averaged 101.3 million video starts a month, a 19 percent uptick over 2010. Sections including Belief (up 64 percent to 7.8 million page views), World (up 23 percent) and This Just In (up 29 percent) also posted big gains.
CNN Digital also remained No. 1 in mobile news for a fourth straight year, averaging 19.4 million unique users, a 60 percent edge over Fox News Digital. (For its part, Fox News is quick to note that it has an engagement metric advantage – according to comScore, the average user spent 10.7 minutes on Fox News sites compared to just 2.2 minutes for CNN.)
These digital rankings, of course, are a complete reversal from what has been happening on cable news television over the last decade.
The Atlanta-based CNN ranked No. 3 in prime-time cable news ratings last year — despite its 16 percent uptick in average nightly prime-time viewers and Fox News Channel’s 9 percent decline. For the year, Fox averaged 2.2 million watchers in prime time, MSNBC came in second averaging 902,000, followed by CNN with 735,000. This, according to TV ratings tracker Nielsen.
Perhaps most key, CNN trailed Fox in the all-important adults 25-54 viewer demographic, averaging less than half of Fox’s 522,000 in the category in which advertising sales are based on. So what’s with the discrepancy between digital and cable performances?
According to Brad Adgate, senior VP and director of research for ad-buying firm Horizon Media, the very programming attributes that seem to give Fox News an advantage over CNN on cable television also seem to have a converse effect online. Focused on what Adgate calls “infotainment” and leveraging the opinions of strong, ideologically minded personalities like Sean Hannity and Bill O’Reilly, Fox News’ programming is thematically different from that of CNN, which is rooted in breaking news. In short, CNN has more pure news product that can be easily converted into text and optimized for search.
“If news breaks, and you’re searching for something specific, you go to CNN,” Adgate said. (For their part, CNN officials contend their digital numbers are not all based on breaking news search, noting its Opinion section posted 54 percent traffic growth over 2010.)
Larry Kramer, founder and former CEO of CBS (NYSE: CBS) Marketwatch.com, agrees: “When you first hear about news now, you’re generally not in front of a TV. Your first inclination to go to a site, and for a lot of people, that’s CNN. When news breaks, you’re going to see them get the biggest burst.” Kramer said that Fox’s opinionated personalities have resonated and stood out amid a cluttered cable news spectrum. “But that kind of voice is not unique at all on the web,” he added.
In 2010, when Time Warner actually broke out financial data for its cable news division, revenue from digital platforms matched sales of advertising from U.S. prime-time programming — both accounted for about 10 percent of the company’s bottom line. (Time Warner listed operating income as $500 million that year.)
Despite its growing strength in online and mobile platforms, CNN is unlikely to try to transition into a pure-play digital company anytime soon. Here’s why: While the No. 3 prime-time audience share for the CNN flagship channel may harm the news company’s domestic advertising sales revenue, its cable carriage fees remain among the highest in the TV industry, according to Kramer. Indeed, in 2010, CNN and its related brands grossed nearly half of their revenue from U.S. and international carriage fees. “That’s a far more significant revenue stream than anything they’ll get on the web,” Kramer said.
Looking forward, the real opportunity for CNN, Kramer added, is to be a true global, multi-platform news provider, in which a centralized news-gathering force services all distribution points. Kramer specifically cited CNN.com’s user-generated-content initiative iReport, which added 250,000 registered users last year. Just like the early days of CNN, when viewer-supplied camcorder video helped transform the cable channel into a must-see destination, iReport could be equally transformative for the brand in an age of camera-equipped smart phones. “There’s no other brand, save for Reuters (NYSE: TRI), that’s so solely associated with news,” Kramer said. “This is one of the only pure-play news brands that really exists internationally.”