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After a blockbuster election, CNN and Fox plot next moves

BC-TV-CABLENEWS:BLO - entertainment (1100 words),1151


By Gerry Smith and Anousha Sakoui

Bloomberg News (TNS)

NEW YORK - On Nov. 9, America’s cable news networks will wake up with an election-year hangover unlike any before. Having eaten into Fox News’ once-insurmountable lead with the most-watched year in its 36-year history, CNN is hoping Anthony Bourdain will serve up the ratings equivalent of a bloody Mary.

The celebrity chef’s show, “Parts Unknown,” is one of about a dozen original series that CNN has created to help cushion what’s expected to be a painful ratings decline after a blockbuster political season. Over at Fox News, which is recovering from a scandal that brought down its co-founder, a big task will be wooing stars like Megyn Kelly and Bill O’Reilly for contract extensions to help the network return to dominance.

Fueled by a raucous presidential election dominated by Republican Donald Trump, Time Warner Inc.-owned CNN says it has narrowed the gap with Fox among viewers 25 to 54 to its smallest in 15 years, based on the network’s interpretation of ratings data. Going into the final weeks of the election, CNN and Fox were neck and neck in that younger demographic favored by advertisers, though Fox still had a wide lead in total audience, trouncing CNN among older viewers.

Both networks, along with third-place MSNBC, are drawing hundreds of thousands more eyeballs each night than normal and are investing to keep that momentum going even as the fireworks of this year’s election start to fade.

“You’ve had an influx of new viewers,” said Steve Kalb, director of video investments for Interpublic Group’s MullenLowe Mediahub, who buys airtime on cable channels for clients including Miracle-Gro and Royal Caribbean Cruises Ltd. “Is there a potential for a little bit more of the audience to stick around?”

More than just advertising dollars are at stake. Fox News, owned by Rupert Murdoch’s 21st Century Fox Inc., is still recovering from Chief Executive Officer Roger Ailes’s departure this year following sexual harassment allegations. Ailes was the visionary who gave Fox its distinctive conservative tone. By quickly regaining ground on CNN, the network can prove the formula works without its creator.

Fox remains the most-watched news network by a wide margin - and was even the top cable channel of any kind this year. Year to date, among viewers of all ages, it has double the average audience of CNN. But Fox needs younger viewers to help maintain its grip in the long term.

CNN, meanwhile, lured audiences in the primary season with heavy coverage of Trump rallies. If election fever ultimately subsides into business as usual in Washington, the network will need to have a reason for people to keep tuning in.

“We’ve seen time after time that the networks are unable to retain much, if any, of the audience gains they achieve from the elections,” said Paul Sweeney, an analyst at Bloomberg Intelligence. “People tend to go back to their more typical viewing habits and that doesn’t mean watching minute-to-minute news.”

Of the two leading networks, Fox News has done better in retaining viewers in previous cycles. In the 2008 election - the last major battle between the networks - Fox News’ ratings among viewers 25 to 54 years old fell 38 percent from November to December, according to Nielsen data. CNN’s dropped 55 percent. Those trends continued to hold in the following year, with commentators like O’Reilly and Sean Hannity delivering their critiques of the Obama administration.

“Fox will be reinventing itself in some form post-election, but certainly they will retain many of the personalities,” said Brian Wieser, an analyst at Pivotal Research Group LLC. “CNN has already established it is going in a different direction.”

While Fox sticks to its popular opinion and talk shows, CNN is following much of the rest of the TV industry in producing more expensive shows designed to stand out for an audience that’s increasingly fickle, with options like Netflix and Amazon Prime offering more choices. The strategy has had some success. Bourdain’s travel show kicked off its eighth season with a dinner with President Barack Obama in Hanoi. It was the series’ second-highest-rated episode ever, drawing just under 1 million viewers.

“There was this concept that CNN was like the spare tire in the trunk - you only took it out when you needed it or you only turned it on when you needed it,” CNN President Jeff Zucker said at a conference in August. “We wanted to get away from that.”

CNN is also investing $20 million to expand its online operation, with plans to hire 200 more staffers to focus on web video, international coverage and mobile viewing. About a quarter of CNN’s advertising now comes from its digital properties like Great Big Story, which makes short-form videos for younger digital audiences.

Fox News isn’t changing direction. In an interview with the Wall Street Journal last week, Murdoch, now executive chairman of the news operation, said moving away from personalities like O’Reilly and Hannity would be “business suicide.”

But Fox is investing more in news. At a presentation to network staff on Oct. 7, Bill Shine and Jack Abernethy, named co-presidents of Fox News after Ailes’s ouster, showed off a new $30 million studio that will be used for election coverage. Abernethy told staff that a number of different projects are on the way, including upgrades to the newsroom, and other digital ventures.

Fox will also have to invest in people. O’Reilly, 67, regularly wins his time slot with viewers 25 to 54. Kelly, 45, whose profile soared after a public spat with Trump, has even outdrawn him on occasion. Both have contracts expiring in the coming months. Keeping them could be key to helping Fox convince advertisers it’s the better place to market to young audiences.

Much will depend on the outcome of the election. Trump could have a more-riveting-than-normal transition to power if he wins, sustaining viewership.

If Democrat Hillary Clinton wins, Fox News will still be positioned as the anti-establishment voice. “It’ll be fodder for Fox’s programming for four years,” Sweeney said.

On the other hand, Trump has been a ratings juggernaut. With his campaign trailing in the polls, the networks have to face the idea that their best year may be behind them - unless he can give them some new material.

“The party will be kind of over,” Kalb said. “What’s his next move? There will be that interest level there.”

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