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MSNBC.COM SOARS WHILE MSNBC TV SLUMPS

Web Operation Boosted by MSN Network Synergy and On-Air Promotion

By Published on .

NEW YORK (AdAge.com) -- In the hyperkinetic world of cable and Internet news, the case of MSNBC illustrates a brand largely succeeding
News site MSNBC.com gets 17 million unique visitors a month.
in one medium while stumbling in another.

The TV version of the joint venture between Microsoft and NBC remains in a protracted ratings slump behind Fox News Channel and CNN, yet MSNBC.com is a strong performer.

TV operations
Things got so bad for the TV network that in August and September MSNBC's total-day viewer totals in the advertiser-coveted 18- to 49-year-old demographic slipped to fourth place -- below even Headline News, which has been known as a quick tune-in option.

"We've had a difficult year," said Erik Sorenson, MSNBC president and general manager. "I think the nadir was in August, no question about it."

In October, perhaps due to heightened interest in the Washington D.C.-area sniper attacks, MSNBC recovered to move back into third place, though it still trailed leader Fox in the 18 to 49 segment by 50% and CNN by 47%, according to Nielsen. (Mr. Sorenson said about 70% of MSNBC's advertisers use the network to reach the news-viewing demo of 25- to 54-year-olds. There

Some 60% of the traffic on MSNBC.com comes in from somewhere within the MSN network.
it barely beat Headline News for third place in August and by a slightly higher margin in September.)

It's no secret that MSNBC can't seem to find a programming mix to lure viewers away from the fast-paced, conservative-leaning Fox News, or the more staid, hard-news driven CNN. One paradoxical sign of the turmoil is that MSNBC, conceived in 1996 as a cable news channel for a younger audience, this summer resurrected Phil Donahue in prime-time.

Web operations soar
Contrast MSNBC to its online sibling MSNBC.com, which for seven of the first eight months of 2001 drew more unique visitors than CNN.com to lead the online news category. When the Sept. 11 attacks occurred, CNN's identity as a trusted news source likely helped it overtake MSNBC.com. And CNN.com continues to lead, but MSNBC.com is in a strong second position. Figures from Nielsen/NetRatings show that in September 2002, CNN.com had 21.5 million unique visitors, while MSNBC.com posted 17 million.

As MSNBC cable grapples with programming issues, MSNBC.com's solid showing can be traced to traffic being driven from multiple sources. There's the site's relationship with Microsoft and its MSN portal. And offline, the NBC network has the top-rated evening newscast and morning news show, as well as

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newsmagazine Dateline -- all of which direct viewers to MSNBC.com.

"MSN is incredibly important to MSNBC.com. It's a huge distribution platform. ... About 60% of our traffic comes from somewhere on MSN," said Scott Moore, general manager of MSN news and information.

"You can't overlook the power of the portal," said Tim Spengler, executive vice president and director of national broadcast at Initiative Media.

TV's MSNBC, meanwhile, doesn't benefit as much from NBC News' popularity since NBC's affiliates chafe at the network directing viewers to a competing channel.

TV programming tangle
Much of MSNBC's recent tumult, Mr. Sorenson said, was precipitated by Sept. 11. The network experimented with longer-form programming generated from the NBC News archives. But the attacks forced the news channel to be just that -- constantly.

"We did not have the programming resources post 9/11," Mr. Sorenson said. "We didn't have the personalities, we didn't have the analysts on staff the way that CNN and Fox did, and we were just wildly out of position and we've been scrambling ever since."

Financially, MSN's Mr. Moore said MSNBC.com slightly exceeded its first-quarter revenue targets and is expected to post a 35% jump over the first quarter for the second quarter. Microsoft does not break out MSNBC revenue.

Slow-growing revenue
Meanwhile, MSNBC is growing at a much slower pace in revenue. As the ad market recovers, MSNBC has seen its ad revenue for January through September of this year increase only 5.2% (to $137.1 million) compared to the same period in 2001, according to Taylor Nelson Sofres' CMR. Fox News grew at a rate of 23.9%, followed by CNN at 20.4%, while Headline News jumped 10.8%. In terms of total revenue intake, CNN is the leader, according to CMR, followed by MSNBC, CNN's Headline News and Fox.

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