Some Thoughts On Fox's New Business Channel

Last Friday, the idea for this post sort of popped into my head. While cycling, I think. While cranking out the miles on my faithful Giordana Columbus, it suddenly occurred to me how easy and natural the Fox Business News Channel's positions will probably be.

Then, yesterday, I read a Wall Street Journal interview with Roger Ailes, Rupert Murdoch's go-to guy and architect of the new Fox network debuting next Monday.

If my interpretation of the Ailes interview is correct, then I'm not far off with my view of how Fox Business News plans to compete in the cable business news product/market. All Fox has to do is repeat it's Fox News Channel approach- news with a balanced/optimistic outlook- and it should have CNBC running for cover in short order.

To start with, you need to realize that CNBC is very, very liberal, even as a (financial) business news channel. You'd think there isn't all that much wiggle room to inject politics into financial news, but you'd be wrong. After all, the parent is NBC, one of the most politicized networks, with left-leaning Tim Russert and now-retired lefty Tom Brokaw. Both the kind of up-from-the-people sort of anchors that instinctively distrust conservatism, with its message of self-reliance, even though they are examples of the latter.

You can count the non-liberal CNBC anchors/on-air staff on the fingers of one hand- Larry Kudlow, Joe Kernen, Becky Quick, and Erin Burnett. Possibly Michele Caruso-Cabrera.

Among guests, it's basically John Rutledge, Brian Wesbury, and Alan Murray, of the WSJ. After that, whichever guests and staff are not neutral, are heavily biased to the liberal side.

In this group are prominently counted on-air anchors Mark Haines and Carlos Quintanilla, with David Faber a close third, and Washington political correspondent John Harwood bringing up the rear. Long ago, prior to Squawkbox's, CNBC's morning news show, reshuffling, Haines, Joe Kernen and Faber used to comprise the anchor team, and Kernen was heavily out-weighed by his two liberal colleagues. When Becky Quick was added to the team, the balanced got a little better, but was offset by having Haines dominate the next two hours of air time after the morning show ended.

Friday morning, for example, the Friday Labor Dept. jobs number came out. It was 110,000. Much better than expected, especially following the prior month's dismal value. The result?

CNBC guest Robert Reich, former Clinton Secretary of Labor, found much wrong and engaged in massive, 'the economy is in the toilet....again...' hand-wringing. Rather than accept the topline number, he dug until he found one weak entry somewhere in the bowels of the jobs report, and pounded away on this one factoid.

Then resident economically-challenged 'chief economic reporter' Steve Liesman, who has no economics nor business degrees, by the way, weighed in with his worries. The camera cut to one guest who, at that point, solemnly intoned that the US is headed for recession, and this report is error-prone anyway.

After President Bush's speech noting the positive economic expansion evidenced by the job growth numbers, anchor Mark Haines promptly shook his jowly face in a worried frown, solemnly intoning something like,

"Well, I guess he has to try to sound upbeat when the news is good, eh?"

John Harwood, the liberal CNBC Washington political correspondent, then chimed in that, despite Bush's budgets including fighting a shooting war, he spent too much in the past, so he has no credibility now. And that he's simply taking cheap shots at the Democrats now running the Congress.

What I realized during this barrage of gloomy interpretation of upbeat job numbers was that, nearly uniformly, the anchors, reporters and guests on CNBC look for the cloud on the horizon. Forecast the rain squall. Hunt diligently for the worst spin and implication of any economic or business news.

Meanwhile, the equity markets took off like a rocket, with the S&P500 ending the day up nearly one percentage point. Our equity portfolio doubled that Friday.

On CNBC, the US is in a perpetual economic night of crushing debt, both public and private, near-recession, income-inequality of stupefying and near-revolution-inducing scale, and on the brink of economic peril.

Not to mention that with Larry Kudlow being dumped into the deadly 7-8PM time slot on CNBC, the network is sending the signal that he and his economic optimism must be shoved to a slot where it can wither and die in peace. Maybe Kudlow will be available to join a network that actually shares his values- Fox Business News?

All Rupert Murdoch will need to do is hire staff that is willing to look at positive implications of economic news. Not such a hard thing.

And, when you think about it, precisely for which the Wall Street Journal's editorial page is famous. Rather than affecting, or damaging, the great business paper's "objectivity," Murdoch's ace in the hole is, I think, to simply unleash economic realists and market-oriented people like Alan Murray to speak honestly, balanced and maybe even optimistically about the US economy and business affairs.

Which is what they've always done. Now, however, they'll have an entire global video business news channel on which to do it.

I don't know why it took me this long to realize how simple Murdoch's task will be. In a sense, he and his new channel's staff will be shooting fish in a barrel. CNBC is so liberal/negative in its political economic bias that I really think it cannot change. It is, after all, the child of a rather liberally-oriented network, NBC.

Even this summer's programmatic reshuffling on CNBC only resulted in busier, more frenetic information feeds and on-air shouting matches among multi-windowed talking heads. The overt negative, liberal economic biases remain prominent.

Then, I read yesterday's Ailes interview in the Journal. And all my thoughts seemed to coalesce in his responses to Rebecca Dana's questions. It's worth reading the entire piece, but some quotes are:

"...We compete with everybody who has a television on in the sense that we're trying to get more viewers. So I think the CNBC Fox Business Network so-called rivalry could be overblown. It certainly has been in their minds because they've spent an enormous amount of money putting on the screen what they think I'm gonna do. I just think we're gonna launch a very credible business network and I will call a lot of audibles at the line once the play starts. I will not stand around the sidelines with a gamebook and a set of plays that I'll stick to. I'll change many things in the first year I'm sure.

WSJ: What specific things has CNBC done in anticipation of Fox Business? Did they make any programming changes?

MR. AILES: They did that last week in anticipation of our schedule which we haven't put out yet.
They reached out to talent to give it a fresher look. They're still living on shows that in many cases I oversaw the development of 12 years ago when I was there. You know, Squawk Box and Power Lunch. I even built them their set before I left. Their newsroom. Now they've changed it because they went to the new building. They've embraced capitalism suddenly. They've put on shows: what? Capitalism's good! What a plan.

I've made them extremely uncomfortable because they used to just be uncomfortable with corporations and profits because they always only wanted to embrace capitalism on the day they negotiated their own contracts, and they've been forced now to see that it's probably a good idea over all and it creates a lot of charity and a lot of jobs for people and is a good thing. So, if nothing else, it's dragged some of them kicking and screaming toward reality.

WSJ: Has the perspective of the network changed?

MR. AILES: They are, let's be honest, there aren't a lot of. They probably don't reflect the business community in terms of their own economic and political views in many cases. Not that they should, but they should be able to report on it accurately and I think that they've you know, look, they got burned. They rode the bubble up. They flogged the bubble. They got burned. They got tied to a sort of day traders and good market information and it blew up on them and they didn't know quite how to scramble out of that. And rather than come up with a new way of covering it, they blamed the economy and the bubble and all of that for their woes.

I mean, there are some very good individual reporters, anchors and talent at CNBC. I found that when I went there. Everybody thought I would go in there and fire everybody and clean house. It turned out there were a lot of good people there. They lacked a mission and a focus and leadership. Oftentimes that's the case. I think they've improved. They're better. They've certainly had two years to figure out what we might do.

They've had The Wall Street Journal for seven, eight years. So I'm expecting them to come out of the gate the day we launch with some brilliant programming based on The Wall Street Journal. They've been holding it in reserve I think and they're gonna flood me with a tsunami of brilliant ideas and programming on Day One.

We're not particularly targeting CNBC. CNBC does a narrow kind of programming. Unless they do what they could do which is jump us with a whole lot of Wall Street Journal stuff, programming. If they do that, the good stuff will eventually become mine. Cause they're my R and D department.

WSJ: What will become of the WSJ-CNBC deal?

MR. AILES: Unclear. I think that's being sorted out right now. Clearly we're being blocked from using it, but they've enforced that so strongly in the last seven years that they haven't even used it. So, it must be a real tough enforcement.

WSJ: The Fox New Channel reported a 41% rise in operating income in the fourth quarter from higher affiliate fees and advertising growth. How did you accomplish that at a time when viewership is off and ratings are waning for cable news?

MR. AILES: Well, the ratings aren't off much. If you look at Bill O'Reilly the other night. He beat the other prime-time networks five and six to one. He had a one in the demo if you count his two shows. Our morning shows are starting to show growth after a dip last year. We accomplished it by getting our cable deals done, by having a good sales force, by blocking and tackling every day and by having more compelling television than our competitors. That's how it is. A lot of people like to come to Fox News. You'd be surprised. I get hundreds of emails a day from American people saying, "God, you're the only thing we watch." So, we feel a real responsibility to get the story straight and balance the story in some ways. If you watch some news -- I always say to my people, when I see something particularly horrible about America that I think is a little out of proportion to what is actually going on, I call up the desk and say, "Do you have any pictures of people lined up at the border trying to get out?" They say, "What do you mean?" I say, "I just watched that and hell, we've got to get out of here, America's a terrible place. We need to get out fast. There must be guys stacked up at the airport trying to get out of here." No. It turns out everybody's trying to get in, and nobody's trying to get out. We've got to keep that perspective in mind when you cover the news. It doesn't mean you don't cover the bad news about America. You do. It means you don't get up in the morning hating your country. And so, until somebody shows me lines at the border trying to get out, I think there's some good news.

...kids come out of journalism school, some nitwit professor who never had to earn a living and hates capitalism, and he's a jerk, and he grades papers according to his own personal philosophy. People get addicted to that crap, then they have to turn around someday and say, "Hey, it's not that bad. I like my paycheck. What a great country."

WSJ: What do you think of Alan Greenspan's recent criticisms of President Bush?

MR. AILES: You can't sell a book in America if you don't dump on Bush. That's the cheapest shot in the world. You cannot get an advance, and you can't sell a book because the publishers are all people who hate Bush and hate Republicans. The quickest way to get an advance and to get a lot of money. Once he did it -- I know Alan. Here's a guy who's worked for Republicans all his life, but he couldn't get a book deal, so he said, "Hey, Bush'll understand. I'm gonna make several million dollars here; I gotta get the dough." Alan understands money, and therefore, I don't, you know, look -- everybody's gotta do their thing. For the next 50 years, anybody who dumps on Bush will get a higher advance.

WSJ: What do you think about the state of the Democratic Party right now?

MR. AILES: I don't have a view of politics. The only thing I would say is that we've had the Whig Party and the Know-Nothing Party and a lot of different parties in America, and you've got to be very careful or you could turn into the moveon.org party. If you're going to take orders from them, that's who you will become.

WSJ: What do you think of the state of the Republican Party?

MR. AILES: I don't think they have any chance of losing their name or their compass. As you know, politics is split on both sides: economic, socials, that kind of stuff. Any time you come to the end of two terms of any party, there's a certain period of running out of gas and revival and so on, and those are cyclical changes that in my judgment are good for the country because they strengthen the two-party system. It gives everybody a chance to strengthen their ideas and move on themselves."

It's now apparent to me that the new Fox business channel, due on the air at the beginning of next week, is likely to simply share its sister News Channel's approach of fair, but positive and optimistic reporting.

What could be simpler than that? People like to hear the truth about good economic news. Despite what the heads of CNBC and NBC may believe.

And that is why I believe that Murdoch's/Ailes' new Fox Business News Network will, in time, eclipse CNBC, perhaps even raiding some of the better, more balanced/conservative talent, too.