So just what is the point of Sky News?

point of Sky News? It’s a question no-one at Osterley, in their
Colgate-striped news studio, would even bother to ask. But don’t mind
them, they’re still getting used to the space and comfort of life
outside Sky 6, the corrugated hangar that was so recently home. And
while they luxuriate in Macleans-style minty-freshness, we the punters
can ask – what’s it all about?

Cast your minds back 16 years – no
legislation obliged Rupert Murdoch to set up a rolling news channel as
part of his Sky Television satellite network. He just did it.

would a businessman want to spend money on a TV news channel? As part
of a suite of channels it might make some sense, but a quick glance at
the numbers will demonstrate that there are no viewers in news. Ask the
1,000 people who tuned in to watch Jamie Rubin the other night.

it Citizen Kane-style hubris? Well, owning CNN allowed Ted Turner to
act out his fantasies of Learjet diplomacy. But Murdoch doesn’t need a
television channel as a vanity-publishing outlet for his politics, he
has newspapers for that, and Sky News remains a model of careful

There is an explanation – but you might not like it.

comes from a generation who couldn’t imagine a world without news.
Remember the movie Independence Day from his Hollywood studio? When the
aliens arrive and the White House gets blasted it’s plucky Sky News
that tells the world. Yes, Sky News was an example of Murdoch’s

“When it comes to news, Rupert’s an
investor,” Kelvin Mackenzie once told me. Murdoch believes in it. Back
then I didn’t want to believe him. But now I think I do.

what’s to worry about? A generous owner, a new studio, more money –
could life get any better for the news team on the grey Sky campus?
That’s where the reality check comes in. Without the belief, Sky News
is just a £50m a year bucket that has just had a further £8m-worth of
capital spend poured into it.

But don’t worry, say the Osterley
optimists. Sky News may trail News 24 slightly in the overall ratings
figures, but it remains the channel of choice for decision-makers. Tony
Blair gifted us an interview on launch. The party to celebrate was
beneath the Banqueting House in Whitehall. Sky News is what the
establishment has on in the background.

For rubbing shoulders
with the great and good, they say, Sky can hardly grudge us the cash.
It turned over £3.6bn last year. Our millions barely show up on the
balance sheet: blink and you’d miss us. But turnover is not profit, and
Sky has a boss with ambitious plans and an unblinking view of the
bottom line.

To meet James Murdoch’s growth targets his company will be spending around £37.5m a month on marketing alone.

if you were sitting in his office wondering how to convince City
analysts that your plans weren’t just empty promises, you wouldn’t be
betting your share price on a tri-coloured news studio.

building the news budget up, Murdoch fils also has the perfect
rationale to chop it down if the glossy surroundings and star signings
don’t deliver. And right now, although Nick Pollard’s team have done
nothing wrong and a lot right, the omens are not good.

It’s not
studios and content that were dragging Sky News below News 24, it was –
and is – promotion. BBC1’s relentless evening call, post-bulletin, for
viewers to switch over and catch its rolling news service delivers a
tiny percentage of share, but in digital terms it’s enough to make all
the difference between winning and losing.

If Sky bosses had
really wanted to help their news service counter BBC promotion, the
answer was not to make-over the set and the schedule; the answer was
marketing. We may know that Eamonn Holmes has gone to Sky News, but
where are the billboards and buses telling the public where to find
him? Only 40,000 of them found him on day one.

But then we return whence we began. Marketing gold is not going to be spent redeeming 40,000 leaden souls.

it’ll go where the subscribers and the revenue streams are. And the
customers may like the news, but they seem to base their subscriptions
more on the movies and the sport.

So you wouldn’t necessarily
have needed to go to Harvard for your MBA to be sitting in James
Murdoch’s office thinking, where do I find the money for January’s
marketing spend in year three of my plan?

And then finding
yourself thinking that maybe, just maybe, you could make Sky News a
talk-news channel and find some poor sap to run it on £10m a year. And
bingo, a whole month’s worth of campaigning urging you to buy a fourth
Sky+ box for the guest bedroom! It’s business, not rocket science.

those of us who like what Sky News has done and what it stands for, and
that must be a pretty sizeable chunk of the industry judging from the
awards cabinet, this would be a great shame. Right now Sky News is a
public service with no protection. The Westminster decision-makers who
took the channel’s champagne and are flattered by the attention might
want to think about that.

Adrian Monck is head of journalism and publishing at City University

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