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News, profits & corporate takeovers

Tom Bettag

Former executive producer, Nightline, CBS Evening News

Tom Bettag

In the mid-80s, basically news divisions that were left to run by themselves, sometimes by fairly enlightened owners. Suddenly you're owned by bigger corporations -- Disney, GE [General Electric], Loews. Tell me a little bit about that experience. As you said before, there's always a tension between making money and delivering a public service: news. It seems that that got ratcheted up in the mid-80s.

This really comes back to [60 Minutes creator] Don [Hewitt's] part of this, and the turning point was when 60 Minutes started making money. ... There's an old Fred Friendly line that I think is the critical one: "Television can make so much money doing its worst that it can't afford to do its best."

Once it was realized that you could make a lot of money with news -- mostly in the form of news magazines and not necessarily hard news -- that turned the business completely. ... The news divisions were turned into people who really produced what some people have called "entertainment posing as news" -- good storytelling about murders, about mysteries, about lurid sort[s] of things that make great television. We started doing what I think is entertainment posing as news very successfully, and making a lot of money and filling that entertainment gap in prime time. ...

The biggest detrimental change [I've seen in the industry] is that people have realized they can make a lot of money with news and asked the news division, "Do what you can to maximize profits." ... It is now a profit center, and in the conflict between public service and making a profit, profit is winning out. That's the biggest change.

... We talked a lot about profits, but [what about] the corporate ownership? [Dan] Rather has said, ... "I don't know who owns me anymore."

That is a real problem. We are such a small part of the overall corporate picture that if you're trying to get their attention [and] saying there's a real problem, that is very, very tough. That's just something we have to deal with, but then you just have to yell louder. ... Yes, that's a problem, but it is also the corporation has more money to be able to absorb the ebb and flow of the whole thing, and there are probably trade-offs. ...

 
Jeff Fager

Executive producer, 60 Minutes

Jeff Fager

We interviewed Dan Rather. ... He complains that one of the things that has changed is that he can't find a boss to talk to. When he was here, he could go down the hall and talk to somebody who was running CBS, but that now ... the owners and the news people are so far apart that you're just employees now and part of a production company that has to produce profit.

I think that's incredibly untrue and unfair in his case. He worked here; he knows that the president of CBS News is where the buck stops at CBS News. It doesn't go higher than that. Nobody's dictating how stories should be told. We have total freedom in terms of what stories we will tell and do tell.

But it does happen. We lived through one.

But you're asking about the present. The tobacco case was horrific, really, if you look back on it -- one of the lowest points in CBS history since the company was founded. To tell 60 Minutes that you can't broadcast a story that you put together, Lowell, based on the fears of litigation when the public health was at stake is incredible to think about today. That would not happen in this environment, I don't think. I'd hate to think it could.

We did a story equally as tough and difficult with, I think, incredible fallout for the administration and the Department of Defense and the prosecution of the war in Iraq, when we broadcast the Abu Ghraib story. They were very upset about that in the administration, but we weren't told, "Don't do that," and Dan was there for that. ...

Twenty years ago, network television went through new technology: cable. New rules loosened things up, and people started taking it over who were cost cutters, and you lost a lot of your newsgathering ability. Is that similar to what's going on now, let's say with newspapers?

It probably is. I can't speak to that as well. I feel fortunate in that we still have the support of CBS at 60 Minutes to cover the world the way we always did, which is expensive. ... As I look back on when CBS News was in the [Larry] Tisch era and we were all lamenting the cuts, the cuts were nothing compared to what happened between then and now. It really has been hard to cover the news and cover the world.

They're tough times. I used to run the Evening News, and I know that the budget that I had to cover the news was more significant than the Evening News has today. It makes it much more difficult. ... You have to remember also that in the years before Larry Tisch came to CBS News, there was no budget, and nobody cared about any budget. We just covered whatever we wanted. I don't ever remember submitting a budget before 1988 or whatever it was on any broadcast that I worked on. ...

The fact is that it is a business. We don't expect that it's going to be subsidized somehow. I don't expect [that] 60 Minutes is going to be thriving if we're not attracting a big audience. ... We've been around for 39 years, but if we're not careful and if we're not diligent, it could end.

 
Ted Koppel

Former anchor, Nightline

Ted Koppel

... [There's] always been the profit side, making money, so there's always tension there?

Well, let me correct your predicate. There hasn't always been that divide. In the very early days of television news, when I first joined ABC in the early 1960s, basically the network didn't care what the hell the news division did. They gave the news division a few million dollars a year, said, "Here it is; go do whatever it is you people do, and do not come back for any more money." They didn't expect news divisions to make money.

Then one day, along came this new program on CBS, and it wasn't an immediate success, but after two or three years, 60 Minutes started to do something that no news program had ever done before: It began to turn a profit. Now, all of a sudden, the presidents of networks were going to the presidents of their news divisions and saying: "CBS is making money off that -- what are they calling it, a magazine program? Why don't you do that? You do a magazine program."

And so 60 Minutes begat 20/20, and then 20/20 begat Dateline, and Dateline begat Primetime Live, and there was a biblical epic of begatting that went on in the television industry. And now, all of a sudden, making money became part of what we did. Originally news divisions were there to act as a fig leaf so that when the president of a network was called before a congressional committee to justify his license, he could say, ... "We have Edward R. Murrow. We have David Brinkley and Chet Huntley and people like that, and they are doing very serious news programs." So in a way, the news divisions were not about money. These days they are. ...

How did news divisions and people like [former ABC president] Roone Arledge deal with corporate takeovers, in the '80s, of network news divisions?

It didn't matter as long as he was making money, as long as we were all making money. That was the big change that came about with 60 Minutes. They realized we could make money, and once we could, the imperative was: Do it. You're just an operating center like any other operating center, like the Frigidaire division of General Electric. We expect them to make money; General Electric expects [its subsidiary] NBC News to make money.

 
Newton Minow

Former chair, Federal Communications Commission

Newton Minow

One critic says that back when you were FCC commissioner, there were two and a half networks, but there were also thousands of newspapers in the United States. Now, today, you may have thousands of outlets -- Internet, cable and so on -- but it's a handful of companies now that control most of those outlets.

That's a valid criticism. ... There has ... sadly been too much concentration, and the government has permitted that to happen. ... The ... economics pushed toward concentration, but the opportunity for more people to be in the business gets eliminated.

Also, the number of opinions become dominated by, let's say, one source. There was a classic case in a small community in one of the Western states where one company owned all the outlets. They didn't even have people on duty at night. It was all mechanical. And there was some form of a national disaster -- an earthquake or a storm -- and nobody could get in any news because this one company had turned off all the lights. That's wrong. ...

 
Dan Rather

Former anchor, CBS Evening News

Dan Rather

So you're now in the anchor chair. It's the early '80s. ... Mr. Paley's still alive. The news organization is just moving along, and Larry Tisch buys the company. He was the white knight, the savior from Ted Turner. [Tell me about that period.]

Well, what an interesting period. And for anybody who cares about the history of American journalism, I think it is a good period to study. ...

By 1977, 60 Minutes was the talk of the television industry, not just the news industry, because here was a news program that was becoming a tremendous profit center. Before the development of 60 Minutes, even the very top of the network news division never thought of [the news] in terms of a profit center. ... People in the corporate entity began to say: "Wow, you know what? News can make money, and not only can it make money; it can make big money. And it can help us make even more money because by getting a ratings toehold early on Sunday night, the flow of that helps our entertainment programs later on." …

60 Minutes continued to be a big and growing proverbial cash cow, so much so that it was quickly decided, once 60 Minutes began to make this big money, that the entertainment division would get part of the money that 60 Minutes made. ... Instead of [putting] the money back into more correspondents, more viewers, better coverage, a large part of that is going to be put on the entertainment side, something I think a lot of people don't know. ...

Running parallel with this was a diminution of the power of the regulatory agencies -- that the power of the FCC, the Federal Communications Commission, over licenses and being able to hold networks and individual stations responsible for public service was quickly fading away.

So on the one [hand] you have, "Hey, news can make big money." On the other hand, any motivation we have to use some time just for public service, give it up for public service, is beginning to diminish. …

Then you get to the mid-80s, when Larry Tisch first came to CBS. And there are many people at CBS, including some of the best-known correspondents, who said: "This is what we need. This is the white knight. Here's a man with a lot of money, great personal wealth, who cares about the news, and this will be our platinum era." I didn't know what to believe, but I was very glad to hear this.

When Larry Tisch first came to CBS, he came for a lot of the right reasons. He told me that one of the reasons he came -- and I believed him -- was that there was an effort by Sen. Jesse Helms of North Carolina and others who didn't like CBS News because we had taken on [Sen. Joe] McCarthy, because we'd been out front in the civil rights coverage. ... CBS News had been born out of a desire to do independent and, yes, fiercely independent news when necessary, as a public service. But Sen. Helms and some other people had made public announcements that they wanted to buy CBS, and they wanted to buy CBS because they wanted to change the culture of CBS News. Larry Tisch took that talk seriously, and he thought that was not a good thing. ...

I think the biggest difficulty was -- and [Larry Tisch] said this in my presence once, when I was gently, maybe too gently, but trying to make the point that we need more bureaus not fewer bureaus, more reporters not fewer reporters -- he said, "Dan, your problem is you don't understand business. You're a good reporter, I'm glad you are with us, but you don't understand business." Well, the difficulty was Larry Tisch did understand business but he didn't understand this business, which is to say he certainly didn't understand the news business. ...

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posted feb. 13, 2007; last updated feb. 27, 2007

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