Fox News vs CNN | Cheerleader in Chief | 3

0:07September 11, 2001, Atlanta. CNN managing editor Kevin McAllister presses two phone receivers to his ears while checking the incoming footage from Manhattan. It's been 32 minutes since the first plane hit the World Trade Center, and CNN's newsroom is racing to keep pace as the tragedy unfolds. McAllister barks into one of his phones at CNN's bureau chief in Detroit. Look, I get it. Having no one in Detroit's a risk I'm willing to take. You gotta get everyone in their cars and headed to New York City right now. McAllister's focus switches to the monitors in front of him. One screen shows the latest raw footage from a CNN crew in Manhattan, images of casualties outside the Twin Towers.

0:50He stands up and yells across the newsroom. Hey, do not take 28 on the air. No 28. It's too graphic. 28 not to air. Got it? CNN boss Walter Isaacson rushes over. Isaacson took charge two months ago to help fend off Fox News, which is now just a few thousand viewers behind CNN. He peers over McAllister's shoulder at the footage. This is the world's biggest disaster. Let's not be too squeamish. And what about that footage? Isaacson peers at the image McAllister's pointing to, a close-up of people leaping out of the towers. Too much. Zoom that shot out. Isaacson looks up to see Ted Turner approaching.

1:33Turner no longer oversees CNN. Tech giant AOL put him out to pasture after buying Time Warner in January. Ted, come on, no time for this. Yeah, see headline news? Isaacson glances at a screen showing CNN headline news, the sister channel to CNN that runs nonstop headlines. It's showing sports. Walt, you need to switch that over to CNN's feed. Yes, yes, thanks, Ted. Someone make that happen. An assistant runs off to carry out the order. Holy s***, guys, the plane just hit the Pentagon. are you guys seeing this? The newsroom pauses for a millisecond, then presses on. There's no time to reflect, no time to pause, no time to mourn.

2:13There's only news to get on the air. But the rush of news is overwhelming. A CNN executive pushes past Turner to reach Isaacson. Hey guys, we got too much going on. Let's use the news crawl, the bottom of the screen. Isaacson's eyes widen. The crawl is a ticker tape of headlines that runs along the bottom of the screen. CNN was going to add it in November to attract younger viewers and take advantage of the trend in people buying bigger TVs. But it's also a way to keep up with the news avalanche of 9-11. Yes, let's get this done. But Fox News has already had the same idea. At 10.49, it becomes the first network to deploy a news crawl that day.

2:55CNN follows 22 minutes later. Even so, today is CNN's day. That night, it draws 7.7 million viewers, far ahead of Fox's 4.4 million. By then, President George W. Bush is promising America that those behind this crime will face retribution. And CNN seems set to win the ratings race as the war on terror begins. CNN has more foreign news bureaus than the competition, and exclusive rights to run footage from Middle Eastern news network Al Jazeera. But it's about to discover that all that news-gathering muscle can't keep Fox in check.

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5:21From Wondery, I'm David Brown and this is Business Wars.

5:49On the last episode, Rupert Murdoch wrestled with Time Warner to get Fox News to New York cable subscribers, and Fox News leveraged the Clinton-Lewinsky scandal and the Y2K presidential election to become CNN's closest competitor. Now, the horror of 9-11 has plunged the U.S. into a war on terror, and both Fox News and CNN are vying to be the news network Americans turn to in wartime. This is Episode 3, Cheerleader-in-Chief.

6:27September 28, 2001. A remote hilltop in northern Afghanistan. Steve Harrigan extends the antenna of his satellite phone and slowly moves the handset through the air in search of a signal. Harrigan is a 39-year-old CNN correspondent. He usually works out of CNN's Moscow bureau. But with America about to invade Afghanistan, CNN's sent him here. Harrigan's Afghan translator stands nearby, his cell-ware kameez flapping around his legs in the wind, and a bemused look on his face. And that's because Harrigan's considering quitting CNN for Fox. Harrigan isn't surprised his translator feels this way. He hasn't heard of Fox News.

7:11CNN is world-famous, available in 160 million homes worldwide, while Fox News has almost no reach outside the United States. Harrigan's phone finally connects with a satellite. Ah, got a connection. Sorry, I need to call in. I'm late already. Harrigan dials in the conference call. His agent comes on the line. Steve? Yes, sorry I'm late. Don't worry. I'm here with John Moody, executive vice president of newsgathering at Fox News. Hey there, Steve. Excited to talk? Very glad you're considering our offer to join Fox News. It astounds us that CNN let your contract lapse and dropped you in Afghanistan exposed.

7:54Basic rule in life, don't put your people in danger if you're not going to take care of them. Harrigan nods along. He's been with CNN 10 years, but feels unloved. Many of his colleagues got laid off in the past year due to a global slump in ad spending. And his contract expired four months ago, leaving him employed on a month-to-month basis. Well, John, I'm impressed at how fast Fox News has grown and how fast you've been with making this offer. Ah, well, we think having you with us will make a big difference in our international coverage. And it's not just more money in a four-year contract we're offering.

8:29We'll give you the exposure you deserve. You will be our A player in Afghanistan. Well, that sounds great, but what support will I have in the field? CNN's global. I mean, can you even get a video phone to me? I'd have to return my current one to CNN if I come over to you, of course. Yeah, we've got all News Corp behind us. We've got contacts in Uzbekistan. They can smuggle a video phone to you. You could be filing your first reports for us within 48 hours. If you're in, that is. Well, in that case, yes, I'm in. Harrigan's defection gives Fox News its first on-the-ground correspondent in Afghanistan.

9:10And while it catches CNN off guard, it's only a minor setback. CNN's got more than 70 people in the Middle East, and Harrigan was one of three in Afghanistan, and just one of its 40 international correspondents. Fox News has just four foreign correspondents. CNN knows it's got the upper hand. It's betting that when news breaks, viewers will flock to them. But Fox News chief Roger Ailes isn't out to match CNN's global reach. Hiring Harrigan isn't the start of a push to catch up with the competition. Ailes' real focus is not on building foreign bureaus, but winning viewers by making Fox News into America's cheerleader-in-chief.

9:58So while CNN leans towards dispassionate reporting for audiences at home and abroad, Fox News reassures the nation that America is in the right. CNN anchors describe al-Qaeda members as terrorists, but their counterparts at Fox call them dirtbags and terror goons while wearing American flag pins. Fox News' opinion programming goes even further. On The O 'Reilly Factor, its top primetime show, host Bill O 'Reilly boots off guests he disagrees with. Among them is Sam Husseini, the former media director of the American Arab Anti-Discrimination Committee. This is war. exactly and then war you don't kill civilians you don't kill women and children those are your words bill dollars let's not get to those who are going to go to the best of oil because this is ridiculous uh...

10:47now and this is how i went so it is that is a bit of a business that this is that this is that you are you going to be the most absurd statement in the world that means we would have on the nazis or the japanese we would have done any of that because you don't want somebody's declared war on us to be punished for the war that terrorist States have declared war, Mr. Usaini. Cut his mic. By the time the invasion gets underway, CNN and Fox are offering two rival visions of how to cover the conflict. At first, it seems CNN made the right call. As the troops move in and the bombs fall, CNN makes the biggest rating gains.

11:27But as the war grinds on, the tables turn. CNN's uptick in viewers fizzles as people revert to their normal TV habits. But at Fox News, the numbers are rising as audiences keep coming back for its roster of in-your-face personalities, patriotic anchors, and greater airtime for conservatives.

11:55January 2002, Midtown Manhattan. In a glass-walled conference room inside Fox News headquarters, Roger Ailes sits at the head of the table, grinning. He and his senior executives are being walked through the latest TV ratings from market researcher Nielsen. The senior executive explaining the figures flicks to another slide. All right, here's the detailed breakdown. In January, we averaged 656 ,000 viewers over a 24-hour period. CNN managed 596 ,000. This is the first time we've done that. So now we are the number one cable news network in America. A vice president sitting at the table fist pumps the air.

12:37All right, we're annihilating those guys. Also, now that we're the number one news network, we can demand higher fees from cable providers. We project our cable subscription revenue will rise from around$7.7 million a month to around$17 million next year as we start renegotiating the deals. The executive brings up another slide. We also investigated who our new viewers are. Turns out our growth isn't from taking viewers away from CNN. Most of our growth is from people who didn't watch cable news. Ailes' grin grows even bigger. Ah, when Fox News started, Rupert said there was room in the market.

13:17Nobody in the TV industry in New York believed him. But he saw there was an audience it wasn't being catered to. Ayles leans forward in his chair, his stomach pressed against the table. First they spun it that we were too conservative. Then that we weren't doing news, just opinion. Now that they're getting their a** kicked in all those areas, I guess they'll have to say we have some bad disease because that's about all they have left. Yeah, tell them, Roger. Come on, baby. But then Ayles turns serious. But we can't get complacent. And we might have beaten CNN, but we're only the 12th most watched cable network.

13:57I'm here to tell you we can go higher. We can be the number one cable network. That. Now that is our goal. But while Fox News ups its ambition, CNN's soul-searching.

14:17March, 2002, Atlanta. In his stark white, two-level loft apartment, CNN boss Walter Isaacson is hosting an offsite. He and CNN's management team are spending the day exploring ways to get CNN back on top. But it's not just Fox that's got CNN worried. MSNBC's about to adopt a Fox News-style format with more opinion, a shift from straight coverage to news with a right-wing lean and big-name conservatives like Pat Buchanan. Isaacson drops in on a table that's debating MSNBC's pivot. One of the managers there is struggling to understand what MSNBC's doing. You know, I don't get it. Why try to out-Fox Fox?

15:00What's the point? Well, maybe they're trying to beat Fox by booking bigger right-wing names. I don't know. Better hope they're wrong. If MSNBC gets even half of what Fox News has, we're in deep trouble. Isaacson rises from his chair. His boss, Jamie Kellner, head of Turner Broadcasting, has just arrived. Jamie, thanks for coming. Yeah, my pleasure. So what's the emerging plan? Isaacson gulps. He knows Kellner wants him to bring some spark back to CNN. Well, I don't think you're going to like the answer, but we want to stick with straight news. There's no point in chasing Fox News, especially if MSNBC's headed that direction, too.

15:42We feel the way to go is to be newsier. You know, be the authoritative news network. The final word. Isaacson waits for a dressing down. Instead, Kellner smiles. Okay, I get it. It's a good way to go. News is what CNN's all about. It's your brand, and it's hard to go against brand. And with MSNBC going in the other direction, CNN will be more distinctive. Oh, yeah, we want to be more competitive in primetime. We think our decision to hire Connie Chung from ABC News, that'll really help. We want her facing off against Bill O 'Reilly over at Fox. Ah, I like it. But unknown to Isakson, Kellner's also got an eye on ABC's entire news division.

16:35December 2002. AOL Time Warner Headquarters, Manhattan. In a conference room, Kellner stands before the board. He's here to present a new plan for CNN. In the nine months since CNN's offsite, Fox News has cemented itself as the leading news network. But Kellner's got a plan to reset the status quo. Today, I want your backing to explore a merger of CNN and ABC News. The board isn't surprised. CNN and ABC have flirted with the idea before. A board member raises his hand. Now, what makes you think Disney will actually go for it this time? Well, ABC's ratings are collapsing. Its parent company, Disney, wants to reduce costs at ABC News, which is barely profitable.

17:22If we share newsgathering costs, there will be less pressure on ABC. Kellner brings up a slide listing the benefits of the merger. You see, CNN would save$500 million in operational costs, some of which would pay for more promotions and on-air talent. Kellner smiles as the board members nod in approval. Then he catches the eye of Ted Turner. Turner's slouched back in his chair, arms crossed and frowning. The CNN founder leans forward. Well, you know, ABC News is hardly worth anything. Broadcast news is going to go the way of the dinosaurs. Why hook up with a dying brand? What good is ABC News to CNN?

18:06Kellner is stunned. He talked to Turner about his plan multiple times. He thought Turner was on his side. Well, Ted, like I said, it lowers costs, expands our news gathering. Hey, listen, I thought you were into this. Well, I was, but then I thought about it some more. I think it's a pile of junk, actually. This company doesn't need another merger. Wall Street already thinks the AOL-Time Warner merger was a mistake. This company can't afford to make any more mistakes. Kellner realizes it's over, with Turner against CNN merging with ABC News. The plan is toast. But CNN's not lost hope of reclaiming its crown.

18:54The U.S. is about to invade Iraq, and that could deliver the viewer boost it needs. The first Gulf War was a ratings blockbuster that launched CNN into the big time. It just hopes the sequel can also transform its fortunes.

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21:56It's March 2003, and after months of buildup, the Iraq war has begun in a blaze of shock and awe. Back home, millions are turning to cable news networks to watch the action from their sofas and armchairs. And both CNN and Fox News are jostling for their attention. We are at Fox News headquarters in New York and Washington bringing you the very latest developments in this attack on Iraq. We can tell you that several areas in Iraq have been hit. The Mosul area in the north, several areas in and around Baghdad. And there has been some mortar fire heard and seen on the Iraqi-Kuwaiti border. A U.S.

22:38Army source has told CNN that the U.S. Army 7th Cavalry has had its first hostile contact with the Iraqi forces on the other side of the border. They are describing it as relatively low-key according to reports which we're receiving now, and these reports are somewhat conflicting. A number of Iraqi vehicles were taken out, including perhaps a number of tanks. That has slowed the U.S. Army 7th Cavalry's progress across the border into Iraq. We just heard an inco—what the hell? No, no, I don't know what it is. Can you hear me? Atlanta, we just heard something shooting. As troops pour into Iraq, the news rivals play to their respective strengths.

23:26CNN adopts a solemn, serious tone as its army of correspondents delivers live reports close to the front lines. On Fox News, the coverage is more emotional, with swells of patriotic music, a computer-generated stars and stripes fluttering in the top left corner of the screen, and an ever-present reminder that the terror threat remains high. The Iraq War sends ratings at both networks soaring, but it's Fox's more vibrant presentation that wins out. In the first week of the conflict, Fox News averages 5.6 million viewers in prime time. CNN trails with 4.4 million. CNN's hoax of a war-fueled comeback are dashed.

24:17April 9th, 2003, New York City. It's 8.30 a.m., and Fox News Executive Vice President John Moody is holding the morning editorial meeting. Everyone in the room is focused on a live camera feed from central Baghdad. The camera's positioned on top of the Palestine Hotel, the base camp for the world's media. And it's pointed at Firdos Square, a vast open space dominated by a massive 39-foot-tall statue of Iraqi dictator Saddam Hussein. Around the statue is a convoy of U.S. Marine vehicles, some journalists, and a few Iraqi civilians. Moody and his team watch as some of the civilians approach the statue's huge marble plinth.

25:00One whacks it with his shoe for a nearby photographer. Then someone appears with a sledgehammer and slams it into the plinth. The sledgehammer doesn't do much damage, but Moody's eyes widen. He sees what this could be. The Iraq War's equivalent of the fall of the Berlin Wall, an image for the H's. He checks what's on CNN. It's already running the statue footage. Moody turns to his producers. Hey, get that statue on the air, rolling thunder. No one takes a break. No one leaves that f***ing shot. One producer challenges the call. John, there's firefights and looting all over Baghdad. This feed's going nowhere.

25:41We can always come back if anything happens. Hell no, this is the shot. This is the story. We stick with this like glue. And get me someone on the ground. Now! A few minutes later, Firdos Square, Baghdad. David Chater shields his eyes from the sun and stares at the looming statue of Saddam Hussein rising above him. He's a correspondent for Rupert Murdoch's British news channel Sky News, and he too senses that an epic-making story is within reach. But then he looks back at the Iraqis trying unsuccessfully to dent the statue and realizes at this rate, this story will come to nothing. But then he spots the Marine's M88 Hercules.

26:24It's a 70-ton armored vehicle with a large crane mounted on its roof and an anchored chain. He realizes the crane could reach the top of the statue and then notices the Marines have a U.S. flag. He rushes over to them and points at the statue. Hey, get that flag up there! The Marines exchange glances and then grin. Soon, the M88 Hercules is moving into position and extending its crane towards the statue's head so a Marine can scramble up and wrap the toe chain around its neck. By then, CNN and Fox News are going big on the story and ordering their correspondents in Baghdad to get to Firdos Square.