How Cisco Got the Spotlight in CNBC News Segments

The Pressure Is on as Marketers Seek Ways Into News Shows

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NEW YORK (AdAge.com) -- Cisco Systems is enjoying prominent screen time within news programming on the business-news cable channel CNBC, which is using Cisco's TelePresence videoconferencing technology to snare a wider array of talking heads to discuss on the big stories of the day.

Cisco's on-screen appearances are likely worth at least thousands of dollars in promotional time.
Cisco's on-screen appearances are likely worth at least thousands of dollars in promotional time.
Cisco is not paying CNBC to use TelePresence screens on air, according to CNBC and NBC Universal executives; CNBC is actually leasing the equipment for its editorial and technology operations teams. The involvement doesn't affect CNBC's business coverage, news executives added. If Cisco becomes part of a story, CNBC will report on the company and suspend on-air use of its products.

In spite of those precautions, the deal suggests a blurring of the lines. Cisco's on-screen appearances are likely worth at least thousands of dollars in promotional time. And the pact shows the lengths to which marketers will go as they attempt to creep into what is perhaps the last TV genre to keep them at bay: news programming.

Cisco's technology and brand name are appearing in CNBC programming, for example, as part of a business deal under which CNBC uses the equipment at favorable terms in recognition of the exposure Cisco is getting. At the end of every news segment featuring a TelePresence interview, viewers see an on-screen "billboard" telling them that "promotional consideration has been provided by Cisco."

Cisco also has a deal in place with MSNBC for use of the TelePresence screens in coverage from that network's Washington bureau and on "The Rachel Maddow Show." MSNBC viewers also see a billboard notifying them about the Cisco presence afterward.

It's thanks to these pacts that the networks are spotlighting Cisco's logo and services in their programming. "You could have shot it where the shot doesn't include the logo, or you could take the logo off the equipment," said John Kelly, senior VP-sales and marketing, NBC News Networks. "We wanted to be very transparent about the fact that there is this arrangement between Cisco and MSNBC and CNBC."

Arrangements between Cisco and the editorial departments of both channels are "separate" from those between Cisco and the channels' ad-sales executives, said Mr. Kelly. "We have retained full editorial control in all of this," he said.

The deal to use the equipment was devised after Cisco and CNBC's ad-sales team started looking for new ideas that might secure additional ad dollars for CNBC from Cisco, Mr. Kelly said.

Cisco was originally prepared to sponsor a segment on CNBC's "Street Signs" program with popular host Erin Burnett. But the company was looking for a way to burnish its videoconferencing abilities, and talks were then extended to executives from CNBC's production and editorial departments, he said.

Such developments are likely to prompt cluck-clucking from traditionalists who have long believed the fast-developing practice of product placement, which laces marketers' wares into TV content, is bound to produce awkward situations -- particularly in the news media. McDonald's caused a stir in 2008 when its deal to put cups of its iced coffee on anchors' desks in local-news broadcasts from stations owned by Meredith Corp. came to light.

But one TV-news veteran believes this sort of stuff can work even in the news business -- under the right circumstances.

"What normally would be considered product placement -- putting a can of something on screen -- would be in very poor taste and bad form" on a TV newscast, said Lawrence Grossman, a former president of NBC News and PBS. But CNBC's method doesn't affect the content and gives viewers something in return, Mr. Grossman said.

For decades, TV news shows -- and for that matter, their print counterparts -- have held strong against marketers who wanted to insert their pitches into independently produced content. Long gone are the days when NBC's nightly newscast was known as "Camel News Caravan" and sponsored each night by the R.J. Reynolds company; news executives didn't want viewers to wonder whether a big sponsorship affected coverage of its industry or the sponsor itself.

With the economics of media in flux, however, more media outlets have allowed rules to bend.

Ads affixed to magazine covers, ads in the Los Angeles Times made to look like Los Angeles Times articles and ads for "celebrity" Pepsi beverages in the celebrity-pictures section of OK magazine all have made appearances in recent years. And TV entertainment, of course, has allowed increasingly intrusive references to advertisers in actors' dialogue on popular shows such as NBC's "Chuck," CBS's "The Good Wife" and CW's "90210."

With all that as a backdrop, it comes as little surprise that some TV-news outlets are more open to an idea that once might have been viewed as anathema. "We'll never compromise the editorial independence, if you will, as we strike these deals, but we are always having the conversations," said Mr. Kelly.

Indeed, MSNBC's popular "Morning Joe" often features prominent graphics during the broadcast telling viewers that the program is sponsored by Starbucks. "When we do these things, they are certainly very much vetted by our standards department and clearly noted," said MSNBC spokesman Jeremy Gaines.

Audiences may be more receptive to brand appearances in news programs if they feel it helps them get better information, suggested one media buyer. "It does take a lot of creativity to break into hard news, but communications technology is one way," said Frances Croke Page, VP-director at RJ Palmer Entertainment Media, because improving the programming flows suggests "a respect for the viewer."

One longtime TV-news executive believes TV networks are developing new rules out of necessity. "You must have editorial independence," said Andrew Heyward, a former CBS News president who works as a media-industry consultant, working for NBC News in the recent past. "You cannot have sponsors interfering with editorial content."

"On the other hand, these are businesses that need to get revenue and support growth," Mr. Heyward added. And advertisers are increasingly tempted by new kinds of competing media.

Other marketers, including Philips Electronics and Pfizer Inc., have tried a different tactic that doesn't require appearing in the broadcast itself. They bought all the ad inventory in broadcasts of CBS's "60 Minutes," NBC's "NBC Nightly News" or ABC's "World News," then gave back some of the time to the networks for longer program segments.

At CNBC, executives have found the technology is changing the culture of the newsroom. Producers and reporters now can tap a wider variety of news sources from around the world, said Steve Fastook, CNBC's VP-technical operations, and experience little of the audio delays so common when such interviews are conducted by satellite. Anchors and interviewees can also see each other when they talk; in the past, TV guests often spoke to a camera and used an earpiece to hear what on-air personnel were asking. "These tools are critical," said Mr. Fastook, and could even give CNBC an advantage over competitors.

Meanwhile, CNBC's editorial personnel won't let the deal crimp serious Cisco coverage, said Steve Lewis, CNBC's assistant managing editor. "If Cisco is going to be part of the news cycle in any way, shape or form, then we will cancel the segment that involves the usage of the technology or mention of the sponsorship," Mr. Lewis said. "It's pretty straightforward."

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