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War coverage costing millions extra

CNN and other media outlets have spent extra money on coverage in the aftermath of September 11  

By CNN's Becky Anderson

LONDON, England (CNN) -- In terms of war coverage, it seems media companies are damned if they do, damned if they don't -- financially speaking, that is.

That's the reality for most organisations as they struggle to marry coverage with costs.

"We've been overspending our budget by a very considerable amount every day, and we have to go and get it topped-up by our parent company, BSkyB, which so far they have done," says Nick Pollard, head of Sky News.

"And we have calculated what it's likely to cost, but we could be wrong. It could go on at a more intensive rate for a longer period, so there will be a very substantial overspend."

Covering the conflict is putting financial strain on media groups. CNN's Becky Anderson reports (October 29).

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Wall Street analysts estimate that U.S. news networks alone already may have overspent their budgets by as much as $100 million during the current conflict.

CNN itself spent an extra $150,000 a day on its coverage in the days following the terror attacks of September 11.

As for British media, the BBC estimates it is spending between $750,000 and $900,000 a week on additional costs.

And ITN, which supplies the news to Britain's three commercial terrestrial channels, is laying out an additional $200,000 a week.

Extra staff, increased travel costs, new communications equipment and additional newsprint -- all put an increasing drain on already strained financial resources.

The consolation: a huge increase in the appetite for hard news across all delivery platforms.

"Of course it's costing us a lot more, but the justification for that is an increased interest in news programmes," says Richard Sambrook, director of BBC News.

"I mean in Britain, the average late-night TV audience has increased by 20 percent since September 11. So we're fully committed to this story and will go on covering it at this level."

But for commercial broadcasters, this commitment comes at a time when advertising revenue has all but dried up.

Even before September 11, ad spending in the U.S. and UK was down significantly.

In the week after the atrocities in the U.S., half a billion dollars in advertising was lost as major networks pulled all commercials for rolling news.

But many media groups remain positive.

"Basically the business people at The New York Times also believe that the prestige of the paper and its performance on a story of this size is what makes it a newspaper they feel they can sell to readers and to advertisers and therefore make revenue eventually," says Warren Hoge, London Bureau Chief of The New York Times.

With the war against terror likely to last years rather than months, the questions now are: How long can media companies maintain the current levels of coverage? And will increased audience figures continue to justify the funds needed to finance it?


• BBC News
• Sky News
• The New York Times

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