In ATT's Deal for Time Warner, CNN Could Be Conundrum
October 24 2016 - 5:32PM
Dow Jones News
By Joe Flint
AT&T Chairman and Chief Executive Randall Stephenson is
saying all the right things with regards to CNN, the global news
operation that the telecommunications giant will own if its $85.4
billion deal to acquire Time Warner Inc. is successful.
"CNN is an American symbol of independent journalism and First
Amendment free speech. My board and I are clear -- CNN will remain
completely independent from an editorial perspective," Mr.
Stephenson said in a statement. He even went on CNN Monday and
reiterated the company's commitment to keep CNN free from corporate
overlords. "The last thing we want to do, as AT&T, is in any
way taint that in the slightest bit."
But saying it and doing it are two different things, and some
believe AT&T will be in for a learning curve when it comes to
CNN.
"An editorial company is just a different beast than most
industrial firms," said Jay Rosen, an associate professor at New
York University's Arthur L. Carter Journalism Institute. "If your
customers are mad, for a normal company that's bad and you have to
fix it. For an editorial company, not only is that not a problem,
it is kind of expected," he said, adding, "editorial companies are
built to expect and resist pressure from advertisers."
There are also potential land mines in how CNN will cover its
corporate parent when it makes news.
"AT&T is much more likely a company to make news and be in
the news and be controversial than Time Warner ever was," said
former CNN President Jon Klein. "Self-censorship is a concern."
Corporate ownership isn't new in television journalism, and the
same issues CNN will face have been challenges for others. General
Electric Co. owned NBC for decades, and NBC was often criticized
for its lack of hard-hitting coverage of its corporate parent. When
CBS was trying to sell itself to Westinghouse Electric Corporation
in the 1990s, it didn't have the stomach for a hard-hitting "60
Minutes" story about the tobacco industry that likely would have
resulted in lawsuits. While the story eventually aired, it was
watered down and correspondent Mike Wallace told Charlie Rose, "we
were caving in."
One way to keep the owners out of the newsroom is make money,
said Mr. Klein. "There is nothing like profitability to shield a
journalistic organization from pressure," he said. On that score,
CNN is in good shape, as it is approaching $1 billion in
profitability, according to people familiar with the matter.
CNN isn't the only Time Warner unit that potentially could cause
consternation for AT&T. At HBO, every week John Oliver takes
apart political issues or big business such as Sunday's episode on
opioid addiction that was critical of pharmaceutical companies.
Bill Maher's show "Real Time" is known for its blunt take on
politics and Wall Street, and HBO's latest addition to its
editorial business is Vice News, which prides itself on rogue
journalism.
But media watchdogs think CNN, in particular, should be part of
the conversation when lawmakers and regulators scrutinize this
deal.
"The news media serve the public trust and inform the
electorate," said Todd O'Boyle, program director of Common Cause.
"It's an industry that's critical to our experiment in self
governance. We need a policy regime that treats journalistic
institutions as more than more assets on a balance sheet."
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
October 24, 2016 17:17 ET (21:17 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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