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CNN sheds image of 'Chicken Noodle Network'

By NENA BAKER UPI Business Writer

NEW YORK -- When the bootstrapping Ted Turner bet his fortune to launch Cable News Network on June 1, 1980, conventional wisdom said a 24-hour all-news channel operating on a shoestring budget wouldn't last six months.

So much for conventional wisdom.

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As CNN marks its 10th anniversary, the clout of the Atlanta-based network is such that world leaders consider it indispensable.

Regular viewers include President Bush, who holed up last summer with a TV set tuned to CNN during the critical hours when his administration was considering its response to threats to American hostages in Lebanon.

British Prime Minister Margaret Thatcher, Jordan's King Hussein and Cuba's Fidel Castro all are CNN devotees.

Through a complex satellite system, CNN -- now hooked into some 55 million U.S. households -- can be seen in 95 countries.

The signal is available everywhere in the world except the North Pole, South Pole and Siberia, said Ed Turner, executive vice president of news, who is not related to the network's founder.

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'We know the PLO sits in Tunis and watches us,' Turner said.

Military types acknowledge that CNN, because of its ability to move freely and take viewers front-row and center to breaking news events, has become an important intelligence tool.

While it was once derided in the television industry as the 'Chicken Noodle Network' for its conspicuous lack of resources and on-air gaffes, today the top brass of the three broadcast networks guardedly discuss what Turner boldly calls the 'fourth network' -- if they'll talk about it at all.

At the time of CNN's launch, then CBS News President Bill Leonard asked, 'Why would anybody choose to watch a patched-together news operation that's just starting against an organization like ours that's been going for 50 years and spends $100 million to $150 million a year?' according to 'CNN: The Inside Story,' a flattering new book written by Hank Whittemore with the cooperation of Cable News Network.

Leonard, like most of the industry, misjudged the public's appetite for live coverage of breaking news events, something the entertainment-driven broadcast networks shun.

Breaking news is, however, where CNN shines.

'I think that CNN is the industry's benchmark right now,' said Fred Friendly, a former president of CBS News and a professor emeritus of journalism at Columbia University. 'It's not because they have a better news department than the other networks, but because they have unlimited airtime. That's what you need to make news work.'

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So ubiquitous is CNN's live coverage of breaking news events that both broadcast and print newsrooms all over the country continuously monitor the network.

Although it has 1,700 employees and 27 bureaus around the world, CNN will use footage from other broadcasters with which it has reciprocal agreements.

'We are a general news vehicle, like a wire service,' said Turner.

For CNN credibility -- and profitability -- did not come easily, however.

Launched with a meager 1.7 million subcribers, an annual budget of $30 million and a few hundred mostly young and inexperienced staffers earning wages well south of the industry average, CNN lost a total of $77 million in its first five years before turning an operating profit of $13 million in 1985.

It still has something of a skinflint reputation, usually preferring to let star-quality talent move on rather than pay them what the competition offers.

Ted Turner, a business maverick who was able to transform his father's billboard company into a vast media empire when he recognized the potential of cable television while the industry was in its infancy, had to invest $250 million before he ever saw CNN earn a nickel.

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Challenged in 1982 by the launch of Satellite News Channel, a cable network developed jointly by ABC and Westinghouse Corp. that concentrated on short, snappy headline-style news, Turner made a pre-emptive move that proved too much for SNC but nearly bankrupted CNN.

The introduction of Turner's Headline News Service siphoned precious advertising revenues from CNN, leaving it near collapse.

But it's no longer touch-and-go.

Last year, CNN and Headline News had operating profits of $134 million. The combined operations were the top revenue generator within Turner Broadcasting System Inc., which includes cable superstation WTBS, Turner Network Television and the MGM film library.

CNN's annual budget today is about $130 million, still a fraction of what the other networks spend on their news divisions.

When the bootstrapping Ted Turner bet his fortune to launch Cable News Network on June 1, 1980, conventional wisdom said a 24-hour all-news channel operating on a shoestring budget wouldn't last six months.

So much for conventional wisdom.

As CNN marks its 10th anniversary, the clout of the Atlanta-based network is such that world leaders consider it indispensable.

Regular viewers include President Bush, who holed up last summer with a TV set tuned to CNN during the critical hours when his administration was considering its response to threats to American hostages in Lebanon.

Advertisement

British Prime Minister Margaret Thatcher, Jordan's King Hussein and Cuba's Fidel Castro all are CNN devotees.

Through a complex satellite system, CNN -- now hooked into some 55 million U.S. households -- can be seen in 95 countries.

The signal is available everywhere in the world except the North Pole, South Pole and Siberia, said Ed Turner, executive vice president of news, who is not related to the network's founder.)

'We know the PLO sits in Tunis and watches us,' Turner said.

Military types acknowledge that CNN, because of its ability to move freely and take viewers front-row and center to breaking news events, has become an important intelligence tool.

While it was once derided in the television industry as the 'Chicken Noodle Network' for its conspicuous lack of resources and on-air gaffes, today the top brass of the three broadcast networks guardedly discuss what Ted Turner boldly calls the 'fourth network' -- if they'll talk about it at all.

At the time of CNN's launch, then CBS News President Bill Leonard asked, 'Why would anybody choose to watch a patched-together news operation that's just starting against an organization like ours that's been going for 50 years and spends $100 million to $150 million a year?' according to 'CNN: The Inside Story,' a flattering new book written by Hank Whittemore with the cooperation of Cable News Network.

Advertisement

Leonard, like most of the industry, misjudged the public's appetite for live coverage of breaking news events, something the entertainment-driven broadcast networks shun.

Breaking news is, however, where CNN shines.

'I think that CNN is the industry's benchmark right now,' said Fred Friendly, a former president of CBS News and a professor emeritus of journalism at Columbia University. 'It's not because they have a better news department than the other networks, but because they have unlimited airtime. That's what you need to make news work.'

So ubiquitous is CNN's live coverage of breaking news events that both broadcast and print newsrooms all over the country continuously monitor the network.

Although it has 1,700 employees and 27 bureaus around the world, CNN will use footage from other broadcasters with which it has reciprocal agreements.

'We are a general news vehicle, like a wire service,' said Turner.

For CNN credibility -- and profitability -- did not come easily, however.

Launched with a meager 1.7 million subcribers, an annual budget of $30 million and a few hundred mostly young and inexperienced staffers earning wages well south of the industry average, CNN lost a total of $77 million in its first five years before turning an operating profit of $13 million in 1985.

Advertisement

It still has something of a skinflint reputation, usually prefering to let star-quality talent move on rather than pay them what the competition offers.

Ted Turner, a business maverick who was able to transform his father's billboard company into a vast media empire when he recognized the potential of cable television while the industry was in its infancy, had to invest $250 million before he ever saw CNN earn a nickel.

Challenged in 1982 by the launch of Satellite News Channel, a cable network developed jointly by ABC and Westinghouse Corp. that concentrated on short, snappy headline-style news, Turner made a pre-emptive move that proved too much for SNC but nearly bankrupted CNN.

The introduction of Turner's Headline News Service siphoned precious advertising revenues from CNN, leaving it near collapse.

But it's no longer touch-and-go.

Last year, CNN and Headline News had operating profits of $134 million. The combined operations were the top revenue generator within Turner Broadcasting System Inc., which includes cable superstation WTBS, Turner Network Television and the MGM film library.

CNN's annual budget today is about $130 million, still a fraction of what the other networks spend on their news divisions.

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