Turner Broadcasting and NBC are going to war over CNN’s plans to launch a business news network.
TBS president Ted Turner received approval last week for his proposed business news web at a meeting of the company’s board of directors.
Given that the four largest cable systems – Tele-Communications Inc., Time Warner, Comcast and Continental – are on the Turner board, the new CNN biz channel has a powerful list of backers.
Now that Turner has the greenlight for its new web, dubbed CNN Financial Network, NBC, looking to protect its own cable business web CNBC, has promised to launch an all-news channel. In a tersely worded statement, NBC threatened to launch “a new general-news service to compete with CNN.”
Tough sell for Ted
Meanwhile, Turner will have a tough early go to launch CNN Financial Network, with an estimated startup cost of more than $10 million and a five-year wait to see a profit.
The key hurdle in launching the network is the limited channel capacity of the cable operators, including those on the Turner board, most of whom have multi-year contracts with existing cable business web CNBC.
“It’s up to each of our systems operators to decide if they have the channel capacity or its the kind of service their subscribers would be interested in,” said a Time Warner spokesman, echoing the comments of his colleagues, who plan to take a wait and see attitude with the new channel.
The new CNN channel will be based in New York and is targeted for a January launch. The venture will come under the domain of CNN exec veep Lou Dobbs, drawing on the resources of his business unit, which programs about 15% of CNN.
In challenging the proposal with the threat of launching a competitor to CNN, NBC has thrown down the gauntlet in what could turn into a messy domestic war.
CNBC president Roger Ailes said that with the resources of his operation and NBC News, NBC could have a competitor up and running in less than six months. CNBC and sister cable channel America’s Talking, launched last year, already have encroached on CNN’s turf by putting together skeds chock-a-block with news and information programming.
Turner and NBC, which a scant six months ago were close to a merger agreement, already are fierce competitors on the international scene with CNN Intl. facing off against NBC’s Super Channel in Europe and the Peacock web’s upcoming news channel in Asia.
– John Dempsey contributed to this story.