TV networks count cost of conflict
ROUND-the-clock reporting on the war with Iraq is taking its toll on the bottom line of US television networks with General Electric, parent of NBC, saying it has cost the company $50m (£32m).
Chief financial officer Keith Sherin told investors and analysts that the decision to forgo popular shows such as Law & Order in favour of more news had increased costs and reduced advertising revenues. Despite that, NBC still expects operating profit to be up by 10% this year.
Other networks were less forthcoming about the financial impact of the conflict. CBS, a unit of Viacom, declined to comment while Walt Disney, which owns ABC, said it was too early to say. NewsCorp's Fox, which has fewer news reports during prime time than the other networks, said 'the numbers were minimal' in terms of losses.
Financial analysts disagree on the potential financial impact of the war. Goldman Sachs estimates that, depending on the network, the war could cost up to $20m a day, Tom Wolzein, a Sanford Bernstein analyst and former NBC News executive, put the potential cost at between $40m and $60m for the year.
Those forecasts were based on expectations of a protracted air campaign involving round-the-clock coverage. When the campaign started more slowly, networks were forced to change their plans.
