Slate columnist Daniel Gross was online at Washingtonpost.com on Thursday, Oct. 25, to discuss the new Fox Business Channel and what its launch signals about the economy. An unedited transcript of the chat follows.
Dan Gross: Hi -- Daniel Gross here. Moneybox columnist at (Washington Post Co. family member) Slate and columnist and senior editor at (Washington Post Co. family member) Newsweek.
Glad to take your questions and discuss the meaning of Fox Business Channel.
Appreciate CNBC even more: I have tuned into a few minutes of the Fox Business Channel but could not get its ludicrous commercial out of my head. (Really attractive people like Alexis Glick and Neil Cavuto telling me they will dumb down business news so that idiots like me can understand.) I've never been befuddled by CNBC's jargon, and the Internet can explain business terms quite efficiently. Fox News is a clear alternative to CNN and MSNBC, but what is the point of this business channel?
Dan Gross: Agree generally with your points, though I'd quibble with the inclusion of Neil Cavuto in the category of "really attractive people." Clearly, there's a two- or perhaps three-fold method to Murdoch's madness:
1. Make money. He's got an installed base of advertisers at Fox News Channel, and this should deliver more upscale viewers.
2. Annoy CNBC (high priority for ex-CNBC honcho turned Fox News head Roger Ailes).
3. Provide a new platform to extend the brand of his recent acquisition: the Wall Street Journal. The Journal currently has a partnership with CNBC, but Murdoch is in this for the long haul, and ultimately, if it survives, we'll see a lot more WSJ on FBC.
Anonymous: At a media summit hosted by BusinessWeek magazine, Rupert Murdoch was quoted as saying CNBC (Fox Business Network's main competitor) is too "negative towards business." They promise to make Fox Business more "business friendly." I read "business friendly" as Democrat nasty. Nasty to Democrats like New York Governor Elliot Spitzer, who has held dozens of corporations accountable to U.S. laws. With Fox Biz, do you see Murdoch bringing to business news what he did to national news with Fox News -- Republican-friendly/Democrat-nasty politicization?
Dan Gross: Hi. Yes, I do think that Fox Business Channel will Fox-ify news coverage. The irony, of course, is that CNBC -- even well before the advent of the Fox Business Channel -- already provided a Fox-ified version of business and economic coverage, generally friendly to Republicans as business friendly, and generally hostile to Democrats. What's more, as might be expected, the political spectrum represented on CNBC ranges from the center to the far right (economically speaking, at least). Anchors, guest hosts, guests, you name it -- the assumptions are all that free trade is an unabashed good, that the Republicans are always good for business, that Europe is a socialist haven, that tax cuts pay for themselves. Of course, most Americans don't agree with these ideas. But I'd also bet that most of CNBC's audience doesn't agree with them either.
Washington: So we all know that the leftist are the poor, bottom third of our country; can you help me understand why Fox wants a business channel to blame the Democrats for the stock market and other world economies?
Dan Gross: I'm sure that if things start to go poorly in the U.S. economy in particular, the Fox Business Channel will be filled with guests who will argue that it has something to do with the Democrats' control of Congress.
San:"Saying America needs Fox Business Channel because CNBC isn't sufficiently pro-capitalist is a little like saying Boston needs a new baseball team because the Red Sox aren't a sufficient object of local obsession."
Really? It seems like Gross doesn't understand economics. You don't enter into an area when no one actually cares about the market, but you do when people start to show interest. If the Boston area were demanding baseball, and the Red Sox were doing great because of it, then the sensible thing is to put another baseball team to strike for competition.
Ever hear of that term? It's one of the most important to businesses. Let's say I make sprockets. Sprockets become popular and in demand. Other companies are going to start making sprockets to in order to take some of my profits. It only makes sense. Why wouldn't Fox make a business channel, seeing as how a conservative business channel already is popular? The logic is like saying why is there an Los Angeles Times when the New York Times already is promoting socialistic garbage? It seems that Gross's reality only has monopolies of those who came in and somehow kept all competitors out.
Dan Gross: San -- I take your point about wanting to enter into a hot market where there's a proven audience. My point -- and the point of the analogy to the Red Sox -- is that when the market is basically dominated by a single, massive firm (business news on TV isn't a monopoly. There are plenty of other offerings, it's just that none of them really can take a bite out of CNBC) it's a tough haul.
One might indeed conclude that since Boston loves its Red Sox so much, that it would be welcoming to a new franchise. And if a minor league team were to open up across the river in Cambridge, I'm sure it would draw some fans. But it would take it a long time to dent the Sox' popularity.
Dobutsu: Mr. Gross fails to recognize what CNBC's agenda really is -- a shill for short-sellers. The talking heads on CNBC create fear among the viewers by consistently conveying doom-and-gloom scenarios no matter how upbeat a financial guest may be. The MSM are the major culprits in driving the market down. And Ben Stein agrees.
Dan Gross: I'm not very good on all the e-mail jargon, but really: LOL.
On days that I'm in my office in New York I tend to have CNBC on. And the relentless optimism is enough to make your head explode. Gloom-and-doom? Short-sellers? I must have a different cable system.
Finally, ending an argument with the statement "Ben Stein agrees" as a proof text, is quite dubious.
Where's the Ticker: On Fox Business Channel, they show the price of an individual stock for more than thirty seconds. I find this horribly annoying. On CNBC, the ticker rolls often to a stock I own or am following. Fox News has good graphics; why aren't they using the same philosophy? I watched for half an hour and couldn't find out how the Internet sector was doing today.
Dan Gross: Good question. I think Fox may be trying to select a smaller universe of widely held stocks rather than run the whole ticker. Although, you would think that the Internet sector might be one of the ones they highlight.
jordon: Comcast continues to add ridiculous channels that are irrelevant to my life, like Fox Business, while ignoring Al Jazeera English. How many times do I have to suggest this channel before they put it on the air? The cynic in me is not surprised, but my idealistic streak finds it regrettable.
Dan Gross: I'm not all that surprised you can't get Al Jazeera English on Comcast. the big systems look for channels that will pay them to carry, and ones that will have broad appeal. not sure Al Jazeera English is there yet.
lloyd667: What Roger Ailes realized long ago -- and what media critics and the mainstream media have yet to understand -- is that when it comes to TV no amount of pandering is too much pandering. (Blogs realize this, though.) So, Roger pandered to the hard-right with Fox News; the critics, with CNN and maybe BBC in mind, said that nobody would buy such an obviously biased news network; Fox was a hit, and CNN today looks a lot more like Fox than it looks like the CNN of yore.
Because Ailes is a right-winger, he naturally panders to the right -- but his success has been misunderstood (or deliberately misconstrued, not least by Ailes himself) as the result of meeting some unserved need for right-wing cant. I believe Ailes would have been just as successful if he had been a left-winger and pandered to left-wingers.
Dan Gross: lloyd667 -- you may be right re: the pandering. But when it comes to business/stock market coverage, the pandering stops working once the market goes south. It's highly cyclical, in other words. CNBC's financial results and viewership really plummeted after the dot-com/tech bubble of the 1990s crashed. Ultimately, the fortunes of CNBC and Fox Business Channel rest on how the Dow and Nasdaq do.
ovation: Is there any utility in business reporting? How many investors decide to buy or sell upon learning that the Dow is a few dollars higher or lower than it was yesterday? Only a bond trader would care if interest rates were up or down a couple of basis points, and traders need this information much faster than they can get it from TV; to the rest of us, this kind of "news" is just more meaningless information.
Dan Gross: Is there any utility in business reporting? A question I ask myself (but I hope my editors don't ask.)
Take it for what it's worth, but in my opinion, CNBC's utility--and the value it has for advertisers -- doesn't lie in people listening to its reporting and making decisions about what stocks to buy. Rather, it lies in the fact that CNBC is the sort of background music to the financial world. Go on a trading floor, or in a bar in midtown, or in the office of pretty much anybody involved in finance -- from entry level associates to CEOs -- and you'll frequently find CNBC on with the noise off. It's a form of wallpaper. The crawl at the bottom of the screen enables people to keep up with where the markets are, what the top news items of the day are, and generally who is saying what. Not the sort of info. that will make or break investments, but info. that professionals like to have at their disposal.
Overexpansion: Anyone who has studied Adam Smith knows that if a product has more demand than supply, additional people will make the product. With Bloomberg and CNBC, I don't see lack of product with business media. Is Murdoch hoping to produce something until his Wall Street Journal contract with CNBC expires and then go full-bore with business news? I'm afraid of what the WSJ could become.
Dan Gross: You're right. I think there is no lack of product. But, ultimately, from Murdoch's perspective, the money invested in the channel is a drop in the bucket (compared to the company's overall resources). What's more, he's just made a big business in financial media, buying Dow Jones, which owns, in addition to the Wall Street Journal, Barron's and MarketWatch. So one could see how it is a smart diversification move to build a television platform to supplement print and online business properties.
Dan Gross: OK. Well, thanks for all the excellent questions!