August 6, 2020

Comcast Ordered to Place Bloomberg With TV Peers

The ruling, released late Thursday, asserted that Comcast must include Bloomberg TV in so-called news neighborhoods, a term for locations on a channel lineup with four or more news channels.

It requires Comcast to bring Bloomberg into standard-definition versions of those neighborhoods within 60 days, at least in the biggest cities served by the company.

The F.C.C. decision is a long-sought triumph for Bloomberg, a somewhat obscure business news channel that is owned by Bloomberg L.P., and a setback for Comcast, which owns (through its NBCUniversal division) one of Bloomberg’s more popular competitors, the business news channel CNBC.

It is also a reminder of how much power cable companies have. In Washington, for example, Comcast carries CNBC in standard-definition on channel 39, relatively low on the dial, and Bloomberg on channel 103, where viewers are less likely to stumble upon it. This sort of placement, Bloomberg says, is inhibiting its growth — a common complaint among channel owners.

When Comcast took control of NBCUniversal in early 2011, the government imposed a condition — put forward by Bloomberg lobbyists — that strove to prohibit Comcast from favoring its own news channels over others. Ever since, Bloomberg has been prodding the F.C.C. to force its insertion into news neighborhoods.

Comcast has been pushing back, asserting, among other things, that such a move by the F.C.C. would infringe on its First Amendment rights.

The media bureau of the F.C.C. supported Bloomberg last year, but Comcast appealed to the full commission, prompting Thursday’s affirmation of the original ruling.

Greg Babyak, the head of government affairs for Bloomberg L.P., said the ruling promoted “the availability to the public of diverse sources of news.”

Comcast said it was evaluating its options. Sena Fitzmaurice, the company’s vice president for government communications, said the 2011 condition was being misinterpreted, and “very likely will lead to significant and unwarranted burdens on us, our customers and other programming networks.”

Analysts have said that the F.C.C.’s support of Bloomberg could embolden other news channel owners, like the new Al Jazeera America cable channel, to similarly challenge cable companies.

But it remains unclear how much Bloomberg will actually benefit: one F.C.C. commissioner, Ajit Pai, who dissented in part from the ruling, said “the cure may be worse than the disease” for Bloomberg, because “Comcast may create news neighborhoods consisting entirely of independent news channels,” like C-Span’s trio of channels, and still comply with the condition.

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A Befuddling Game Show Slides, Despite ‘Synergies’

But it turns out that something was out of tune. When the “Quiz” had its premiere last Monday, NBC scored a 1.7 Nielsen rating with viewers between the ages of 18 to 49, the demographic valued most by the network’s advertisers. Instead of growing from episode to episode, as NBC encouraged the show to do by scheduling it for 10 nearly consecutive nights, the show caved in; a 1.5 rating on Tuesday shrank to a 1.3 on Wednesday, a 1.1 on Thursday, a 0.8 on Friday, and a 0.7 on Saturday.

Total viewership fell to 3 million on Saturday from 6.5 million for Monday’s debut. NBC wanted a national event; what it got instead was a national shrug.

Were the ratings a repudiation of Comcast’s much-promoted “symphony” approach to creating new entertainment franchises? Untold numbers of people throughout the broadcaster’s parent company, NBCUniversal, which is wholly owned by Comcast, had spread the word about the game show through special segments on “Today” and other newscasts, elaborate graphics on the bottom of the screen of other shows, Twitter messages and other tactics. NBC and other media companies have been trying these sorts of synergies for decades, but since Stephen B. Burke became the chief executive of NBCUniversal in 2011, he has made it a special priority, calling it “Project Symphony.”

Questions about what went wrong with “Quiz” simmered as the prime-time show took a previously scheduled one-day break for football on Sunday, but the view among some observers was that the game play, not the promotional efforts that accompanied it, had missed the mark.

“It all comes down to content,” said Brad Adgate, who studies ratings patterns for Horizon Media.

Similarly, when asked if NBC’s synergies had failed, John Tinker, who tracks Comcast and other media conglomerates for the Maxim Group, said he’d suggest “a more traditional problem: it’s not a great show.”

“Who Wants to Be a Millionaire” this was not, despite NBC’s dreams that it would be. The show took a beating from television critics as soon as it started, mainly for having an overly complex format. Entertainment Weekly called the premise “a little horrifying.” The Hollywood Reporter called it “confusing and boring.”

In short, contestants were supposed to answer questions correctly so they could keep answering questions, beat other contestants and win more money — but asterisks and exceptions abounded, testing even the most patient viewers. Several people called it “the most confusing game show ever” in exasperated Twitter messages to Ryan Seacrest, the show’s host. Some critics pounced on Mr. Seacrest, whose omnipresence can easily be exploited for jokes. From NBC’s point of view, though, Mr. Seacrest was one of the show’s saviors.

For his part, Mr. Telegdy, the network’s president of alternative and late-night programming, said on Sunday, “We would absolutely do it all over again, in terms of the scale, ambition and the risk it represented.”

While he displayed disappointment about the ratings slump, he noted that “Quiz” had lifted NBC above its normal ratings levels for early September, which can only be a good thing for a beleaguered network that is about to introduce several new dramas and comedies for the fall.

The three million viewers on Saturday, on what is usually a dormant night for network television, represented NBC’s best performance in the time slot since a rerun of “It’s a Wonderful Life” last December. Still, given the high expectations, the New York magazine ratings buff Joe Adalian was moved in a Twitter post to rename the show “Million Dollar Mistake” after several consecutive days of declines.

NBC would not say just how costly “Quiz” really is, but consider this: More than 500 people have been employed by the production in New York City. Barring a stunning turnaround — the show will resume in prime time on Monday and wrap up on Thursday — the network is unlikely to start citing it as a successful application of synergy. But it’s unlikely to back away from the “symphony” idea either.

“When we get all parts of the company working together, we’ve been astounded by how successful we can be,” Mr. Burke said at a Merrill Lynch conference. He didn’t mention the “Quiz,” but he said the NBC singing competition “The Voice” and the company’s wide-reaching coverage of the Summer Olympics had both benefited from cross-promotional efforts.

“Million Second Quiz” received a boost, too, if NBC’s research into awareness about the show is any indication. Awareness levels were abnormally high beforehand but, like an anticipated Hollywood blockbuster that goes bust, most of the people who heard about the show did not actually tune in. Many who did were not compelled to stay. And the show suffered an irritating setback on Night 1: so many viewers followed Mr. Seacrest’s instructions to play the game online that NBC’s servers were overwhelmed.

“By the end of the week, we had found our footing,” said one of several executives who, when granted anonymity to speak self-critically, suggested that “Quiz” might have benefited from a test episode ahead of time (something known in the TV industry as a pilot). If there is a silver lining for NBC, it might be on viewers’ smartphones: the network says 1.3 million people have installed and played a total of 23 million rounds on its “Quiz” app.

Mr. Adgate of Horizon Media said he would be watching again this week, though he doubted that the low ratings were a setback for NBC as a whole. “Not everything Comcast puts on symphony is going to work,” he said. “There are going to be misses along the way, and one week in, this appears to be one of them.”

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The Media Equation: Telecom’s Big Players Hold Back the Future

Susan Crawford, a professor at the school, has written a book, “Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age,” that offers a calm but chilling state-of-play on the information age in the United States. She is on a permanent campaign, speaking at schools, conferences and companies — she was at Google last week — and in front of Congress, asserting that the status quo has been great for providers but an expensive mess for everyone else.

Ms. Crawford argues that the airwaves, the cable systems and even access to the Internet itself have been overtaken by monopolists who resist innovation and chronically overcharge consumers.

The 1996 Telecommunications Act, which was meant to lay down track to foster competition in a new age, allowed cable companies and telecoms to simply divide markets and merge their way to monopoly. If you are looking for the answer to why much of the developed world has cheap, reliable connections to the Internet while America seems just one step ahead of the dial-up era, her office — or her book — would be a good place to find out.

In a recent conversation, she explained that wired and wireless connections, building blocks of modern life, are now essentially controlled by four companies. Comcast and Time Warner have a complete lock on broadband in the markets they control, covering some 50 million American homes, while Verizon and ATT own 64 percent of cellphone service. Don’t get her started on the Comcast-NBCUniversal merger unless you have some time on your hands.

But don’t look for a jeremiad, either. A violist who plays in string quartets when she is not hammering telecom companies, Ms. Crawford is precise in her arguments and far from frantic in making them. The captains of industry who kidnapped telecoms and cable are not monsters, she says, merely shrewd capitalists who used leverage to maximize returns, no different or worse than the railroad or electricity barons of times past.

“They have acted in parallel to exclude competitors and used every lever they had to gain control over their markets. My whole book is essentially an argument to buy stock in cable companies,” she said with a laugh.

Her arguments don’t end there. High-capacity fiber connections to homes and businesses are not just a social good, but a business imperative, she says, and the lack of them will cripple American efforts to compete in a global economy.

Ms. Crawford said she believed that cities and states should take back control of their information infrastructure before it is too late. Already, 19 states have bent to the lobbying influence of established players and raised barriers to the public-private partnerships that would compete with legacy companies.

Verizon had been building out fiber optic cable networks — expensive to create but a dream to use — that were part of the competition envisioned by the telecommunications act. But in 2010, the company decided that it was a capital-intensive effort that offered less return than high-margin wireless, so it stopped expanding when just 14 percent of American homes have access to their fiber optic network.

Too bad, that. I have Verizon’s service, and even though it is expensive, it is fundamentally superior to Internet via cable because fiber can carry unlimited data, which means smooth downloading and streaming.

In 2012, Verizon entered into a joint marketing agreement with the cable companies, blessed by the Federal Communications Commission, so the former competitors are now firm allies.

“There has been a division of, ‘You take the wires, we’ll take wireless,’ which means that there is very little competition and investment, and very little access to high-speed connections,” Ms. Crawford said. It is worth pointing out that the billionaire Carlos Slim Helú controls 80 percent of the landlines in Mexico and 70 percent of the wireless market there. His recent appearance at the New York Public Library was accompanied by protests that his outsize presence was hurting consumers in Mexico. (Mr. Slim holds a minority stake in The New York Times Company.)

While consumers love to complain about their cable companies and Internet service, it’s sort of like the weather — no one does anything about it because no one can. And then there is Ms. Crawford. The New Republic recently called her “the next Elizabeth Warren,” suggesting that, just as Ms. Warren had been to the banking sector, Ms. Crawford “has become a dreaded figure to the industry she wants to reform.”


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USA Network Turns to Vignettes to Draw Viewers and Advertisers to Its Daytime Schedule

The USA Network cable channel, part of NBCUniversal, is adapting the show, “Talk Stoop With Cat Greenleaf,” for a series of vignettes that will appear on the channel during a daytime block of programming that runs from 11 a.m. through 3 p.m. on Mondays through Fridays.

There are to be three to four vignettes each hour, with each vignette lasting from 10 seconds to 60 seconds. The vignettes, which go by the jargon-y term “short-form content pods” at USA, are to run adjacent to regular commercials.

Executives of USA plan to describe the initiative at their upfronts presentation on Thursday afternoon at Pier 36 in downtown Manhattan. The presentation will conclude the upfronts week in New York, during which cable channels and broadcast networks are sharing with Madison Avenue their schedules for the 2013-14 season.

The host of “Talk Stoop,” Cat Greenleaf, will also serve as the host of the USA programming block, which offers viewers reruns of series like “CSI,” “Law Order” and “NCIS.” She will greet viewers by saying something like, “Welcome to USA daytime.”

Ms. Greenleaf will also continue as the host of “Talk Stoop,” which appears on properties that include WNBC-TV in New York and, which, like USA, are part of the NBCUniversal division of Comcast.

Just as she does on “Talk Stoop,” Ms. Greenleaf will interview celebrities during the vignettes, who will include stars of USA series, celebrities in the news, stars who have new movies or TV shows to promote and even brand characters.

USA is offering marketers sponsorships of the vignettes, along with acknowledgments like “Brought to you by …” There will also be opportunities to place products within the vignettes so that Ms. Greenleaf could be watched, say, drinking a cup of Dunkin’ Donuts coffee or driving a BMW.

Ms. Greenleaf “has the right personality and editorial credibility to make daytime feel topical, vibrant and culturally relevant for both fans and advertisers,” said Alexandra Shapiro, executive vice president for marketing and digital at USA.

The initiative is another example of an increasingly popular trend known on Madison Avenue as branded content, native advertising or branded entertainment. The goal is to weave brands and products into editorial or entertainment content in a fashion that will circumvent consumers’ growing abilities to avoid or skip conventional ads like commercials.

“Cat is going to be the MC of the day, anchoring the four-hour block,” said Laura Molen, executive vice president for cable advertising sales at NBCUniversal, who oversees USA and other channels like E! and Chiller.

Some vignettes “will be her traditional stoop interviews,” Ms. Molen said, and some will feature Ms. Greenleaf using a “portable” stoop that will enable her to visit locations like restaurants.

The vignettes are being sold to advertisers as part of packages, Ms. Molen said, that are composed of the segments along with “regular commercials before or after.” She said that pricing is being determined as the sales process gets under way.

The original programming that is to be discussed at the USA upfronts presentation will include drama series like “Graceland,” about undercover federal agents; comedy series like “Sirens,” about paramedics; and reality series like “Summer Camp.”

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Comcast Net Income Rises 17%

The solid results were partly the result of more expensive cable bills for 72 percent of Comcast’s subscribers. The company reported $3.07 billion in operating income and $15.3 billion in revenue, 11.2 percent and 2.9 percent increases from the same quarter last year.

Still, signs that the cable giant may have reached saturation in its core cable and Internet subscription business were apparent. The company lost 60,000 cable subscribers, 62 percent worse than the more modest losses it reported in the first quarter of 2012. New broadband subscriptions fell by 1 percent to 433,000 and Comcast gained 211,000 phone service customers, a 28 percent increase from last year.

Taken collectively, the country’s largest cable provider still had a 3.2 percent gain in new customers in the quarter, or 583,000 total subscribers, mostly because of the popularity of Comcast’s bundled offer that includes, Internet, phone and cable service at a reduced price.

In February, Comcast said it would pay $16.7 billion to acquire General Electric’s remaining 49 percent stake in NBCUniversal. The deal signaled Comcast’s confidence in the entertainment company. But at least in the first quarter of 2013, that investment did not show signs of paying off.

Revenue at NBCUniversal fell 2.4 percent to $5.34 billion, mostly because of a tough comparison to the same quarter in 2012. That quarter, NBC broadcast the Super Bowl and took in the advertising revenue that came along with the most-watched live sports event. Operating cash flow at NBCUniversal was up 17 percent to $953 million.

NBC had a particularly rough quarter without its hit singing competition, “The Voice” or the Super Bowl to prop up its prime time earnings. Overall revenue at the network fell by 18.5 percent and advertising revenue fell by 25 percent. In May, NBC will hold its annual upfront in New York to pitch advertisers on its new prime-time lineup for the fall television season.

Universal Studios theme parks were a bright spot for its parent company with a 12.2 percent increase in revenue largely tied to popular new attractions like “The Wizarding World of Harry Potter.” The holiday season hit “Les Misérables” helped the Universal movie division, which had a 2 percent increase in revenue and 10.3 percent increase in operating cash flow.

Cable networks including USA, MSNBC and Bravo continued to stand out, with $2.2 billion in total revenue and $859 million in operating cash flow, 4.6 percent and 6.2 percent increases.

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G.E. Posts 16% Rise in Quarterly Profit

G.E., the nation’s largest industrial corporation, reported net income of $3.5 billion, or 34 cents a share, a 16 percent increase from the year-earlier quarter, when earnings were $3 billion, or 29 cents a share.

On an operating basis, income was $4.1 billion, or 39 cents a share. Excluding gains from the sale of its remaining stake in the media company NBCUniversal to Comcast, G.E. posted a 13 percent increase in operating income, to $3.6 billion, or 35 cents a share. That figure matched the average estimate of securities analysts, as compiled by Thomson Reuters.

Revenue in the first quarter was $35 billion, flat compared with figures in the period a year earlier. Over all, G.E.’s revenue came in ahead of Wall Street’s forecast of $34.5 billion. But that total included proceeds from the NBCUniversal sale and slightly higher revenue this year from G.E.’s big finance division, GE Capital.

Revenue from the industrial business, whose products range from jet engines to medical imaging equipment, declined 6 percent, to $22.7 billion. The main shortfall came in its power and water unit, particularly from lower sales of generators for electrical power plants and wind turbines. As investment subsidies are phased out, wind turbine sales have fallen. With the weak economic conditions, especially in Europe, the demand for electrical power is down, meaning fewer power generators sold, upgraded and serviced.

The power and water unit’s revenue fell 26 percent from a year ago, to $4.8 billion, or $1.7 billion less than in the year-ago quarter. Without the power and water unit, G.E.’s industrial business would have grown slightly.

“This is a power and water story,” Keith S. Sherin, G.E.’s chief financial officer, said in a conference call with analysts.

Still, G.E. managed to pull out a steady financial performance, helped by higher profits in its aviation and transportation units and by GE Capital.

But weak industrial demand, analysts say, will be a challenge in the first half of this year for the big companies in the sector including Siemens, Honeywell and United Technologies.

“We’re in a decelerating global environment that will mean slow growth at best,” said Steven Winoker, an analyst for Sanford C. Bernstein Company.

In a morning conference call, Jeffrey R. Immelt, G.E.’s chief executive, called the quarterly performance “mixed.” The first half of 2013, Mr. Immelt said, was expected to be the most challenging, with demand likely to pick up in the second half.

Industrial orders were strong in some businesses, with orders for oil and gas equipment up 24 percent and commercial aviation orders rose 47 percent.

The rising industrial orders, Mr. Immelt said, should “position us well for the second half.”

But Europe, where industrial revenue fell 17 percent, may continue to be a drag on the industrial business. “Europe was tougher than we expected,” Mr. Immelt said, adding later, “We’re not counting on things getting better.”

To maintain profits in spite of the weakness in industrial sales, G.E. plans to cut costs by $1 billion this year. And the company, Mr. Immelt said, remained committed to spending $18 billion during the year on dividend payments and to buy back its own shares.

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Media Decoder Blog: CNN President Tries to Repeat Success in A.M. News

CNN has hired Chris Cuomo to co-anchor its new morning news program.Donna Svennevik/ABC CNN has hired Chris Cuomo to co-anchor its new morning news program.

Two decades ago, a young producer named Jeff Zucker helped a down-on-its-luck “Today” show regain its ratings mojo and start what became a 16-year winning streak. More recently, he was a sounding board for Ben Sherwood, the president of ABC News, as Mr. Sherwood’s “Good Morning America” finally ended the “Today” show’s streak.

Now, Mr. Zucker is assembling a new morning show for CNN, the first of several building blocks for the ailing cable news channel. On Tuesday, he hired Chris Cuomo, a former news anchor on “G.M.A.,” to be a co-anchor of the new unnamed show, and is expected to begin in the spring. Mr. Zucker wants to pair Mr. Cuomo with Erin Burnett, another veteran of the morning shift.

Mr. Zucker, who formally took over CNN Worldwide last week after his appointment as president last November, declined an interview request. But his decision to scrap “Starting Point,” CNN’s morning show, and start over turned heads in the television industry on Tuesday. Agents and anchors said it conveyed the message that “he’s not wasting any time.”

CNN is one of the most valuable brands in the world, but its ratings in the United States have collapsed in the face of competition from other cable channels and the Internet. “Starting Point,” for example, had just 234,000 viewers on a typical morning in 2012, the channel’s lowest total viewer number in that time slot in more than a decade. Of those, just 96,000 were between the ages of 25 and 54, the group that cable news advertisers try to reach.

Jeff Zucker, who took over as president of CNN Worldwide last week, is quickly making changes.Mario Anzuoni/Reuters Jeff Zucker, who took over as president of CNN Worldwide last week, is quickly making changes.

For Mr. Zucker, who rose from “Today” to run all of NBC Universal in the 2000s, before being replaced when Comcast took control of the company two years ago, the chance to turn around CNN’s morning ratings represents a test: long after leaving “Today,” can he revitalize another morning show for another network?

TMZ first reported Mr. Cuomo’s impending move on Monday night. He wrote on Twitter on Tuesday, “I have a great chance to be the first word on what matters to you every morning.”

His brother, Gov. Andrew M. Cuomo of New York, said in a radio interview that CNN was a better fit than ABC. “He’ll be on every day, so there will be a certain relevance to what he’s doing,” Governor Cuomo said.

Chris Cuomo has been a co-anchor of the weekly ABC newsmagazine “20/20” for the last three years. David Muir, the anchor of ABC’s weekend “World News,” will add “20/20” to his duties now. Mr. Cuomo, who previously spent three years as the news anchor on “G.M.A.,” was in the running for the co-host job on that show when Diane Sawyer left for the evening newscast “World News” in 2009. But the job went instead to George Stephanopoulos.

At CNN, a unit of Time Warner, Mr. Cuomo will have a new opportunity to lead a morning newscast. As it seeks a bigger audience in the mornings, however, CNN risks irritating the audience it already has by making sweeping changes. That happened 12 months ago when it gave up on a 10-year-old show, “American Morning,” and created “Starting Point.”

Soledad O’Brien, the anchor for the last 12 months, has been widely praised for her political interviews despite the program’s relatively low ratings. The show’s defenders say it never received the internal support and the external marketing it had been promised. They imply that it was not given a chance to succeed. Its detractors, however, say it was a bland copy of MSNBC’s “Morning Joe,” a show that, coincidentally, Mr. Zucker supported when he ran NBC Universal.

A CNN spokeswoman said in an e-mail Tuesday, “Soledad is very important to the network, and we’re discussing various options with her.”

Pairing Ms. Burnett with Mr. Cuomo would create another hole in CNN’s weekday schedule. Ms. Burnett is best known for her years at CNBC, where she and Mark Haines were at the helm of the midmorning markets newscast “Squawk on the Street” from 2005 to 2011. She is now the anchor of the 7 p.m. hour on CNN. But the hour has suffered like “Starting Point” and the rest of the channel’s schedule. CNN declined to comment on Ms. Burnett’s status on Tuesday.

Mr. Cuomo is the third prominent name from ABC to be hired by CNN in the last year. The first was John Berman, a longtime ABC correspondent, who now co-hosts “Early Start,” the predawn newscast that precedes “Starting Point.” The second was Jake Tapper, the chief White House correspondent for ABC.

Mr. Zucker had a role in signing Mr. Tapper, who will begin anchoring a daily program for CNN this year. Now Mr. Zucker is figuring out where Mr. Tapper and CNN’s other hosts belong on the schedule. Associates say Mr. Zucker wants both the daytime and prime time programs to be more entertaining and less dependent on the daily drip-drip-drip of stories about politics and overseas conflicts.

On Tuesday, Mark Whitaker, the managing editor of CNN Worldwide, stepped down, stating in an e-mail to staff members that Mr. Zucker “deserves his own team and management structure and the freedom to communicate one clear vision to the staff.” Mr. Whitaker was a top lieutenant of Jim Walton, Mr. Zucker’s predecessor.

The announcement last week of the hiring of the sports reporter Rachel Nichols from ESPN was a hint of what is to come under Mr. Zucker. He said in a statement then that Ms. Nichols would host a weekend sports program and called her hiring “an important step in expanding the range of programming and storytelling on CNN.”

Thomas Kaplan contributed reporting.

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Advertising: Ad Agency Goodby, Silverstein Opens a New York Office

AN advertising agency is rewriting a lyric of “New York, New York” to proclaim, “If I can make it anywhere, I’ll make it there.”

Goodby, Silverstein Partners, a leading agency with headquarters in San Francisco, is opening an office in New York. The office, temporarily located at 7 World Trade Center, gives Goodby, Silverstein, which was founded in 1983, a New York presence for the first time.

It is the agency’s second office outside of San Francisco, after one in Detroit that opened in 2010 as Goodby, Silverstein, which is owned by the Omnicom Group, began creating campaigns for the Chevrolet division of General Motors.

Two senior executives have relocated from San Francisco to lead the New York office, which will employ 15 to 25 people. They are Christian Haas, 39, who becomes partner and executive creative director, and Nancy Reyes, 37, who becomes associate partner and managing director.

The agency is occupying the temporary space while its permanent location, 200 Varick Street at Houston Street, is being remodeled. Plans call for an opening in April.

The office opens with work from current clients like Comcast, Elizabeth Arden, Google and YouTube. Goodby, Silverstein’s other clients include Adobe, the California Milk Processor Board, Cisco, Frito-Lay, the National Basketball Association, Nestlé and Sonic. Ms. Reyes and Mr. Haas say they are eager to look for new business in New York with the help of the agency’s co-chairmen and creative directors, Jeff Goodby and Rich Silverstein.

In the “Mad Men” era, only a handful of American ad agencies with heavyweight creative credentials were located outside New York, a city so widely regarded as the heart of advertising that the phrase “Madison Avenue” became shorthand for the industry.

That changed in the 1970s as the business began to decentralize, partly because the dire financial and quality-of-life problems in New York led many talented executives to pursue careers elsewhere. Agencies like Goodby, Silverstein became known almost as much for not being in New York — opting instead for cities like Austin, Tex.; Boston; Los Angeles; Miami; Minneapolis; Portland, Ore.; Richmond, Va.; and San Francisco — as for the ads they created.

Some of those agencies eventually added New York outposts. Some opened in New York but later retreated, and some still eschew New York. But declining to take a bite out of the Big Apple is becoming less appealing, primarily because New York has overcome the perception issues that once cost it so dearly.

“We just lose so many people to New York,” Mr. Goodby said in a phone interview last week from San Francisco. “It’s crazy not to access that.”

The executives who founded agencies outside New York did so to “kindle a ‘creative shop’ feeling,” Mr. Goodby said: a feeling they did not believe they could cultivate in a city dominated by giant, tradition-minded agencies. “I don’t think Rich and I felt we needed a New York office,” he said. “In fact, it was more unique to not have one.”

In his presentations to prospective East Coast clients, Mr. Goodby normally includes a slide that addresses why the agency has its headquarters on the West Coast. It reads: “You call it distance. We call it perspective.”

“I think I’m going to ask to have that slide retired,” he said, laughing.

Goodby, Silverstein was started as Goodby, Berlin Silverstein by three colleagues at Hal Riney Partners in San Francisco. The third founder, Andy Berlin, left for New York in 1992, three months after Omnicom acquired the 62.5 percent of the agency that it had not already owned, and he has spent the rest of his career there.

There was talk then that Omnicom would transform the agency into its third worldwide network, joining DDB and BBDO, in an expansion that would start with the opening of an office in New York. But a year later, Omnicom bought TBWA International, now TBWA Worldwide, and made that its third network instead.

“San Francisco is so livable, but there’s nothing like New York,” Mr. Silverstein said in an interview last week in Midtown Manhattan, at which he was joined by Mr. Haas and Ms. Reyes. “It’s a cliché, but it’s true. Go East, young man, go East.”

The executives acknowledge the risks of the move. They do not want other agencies to conclude that Goodby, Silverstein is trying to ride in like the cavalry to rescue Madison Avenue. “There’s nothing wrong with what’s going on in New York,” Mr. Silverstein said. “New York doesn’t ‘need’ another ad agency.”

Likewise, Ms. Reyes said, “there’s nothing wrong with what’s going on at Goodby, Silverstein in San Francisco.”

What became clear was that Goodby, Silverstein was losing prospective employees to New York. It was “less about them saying, ‘I’ve got to go to that agency in New York,’ than, ‘I want to be in New York,’ ” Mr. Silverstein said.

In fact, he said, a major reason he and Mr. Goodby finally decided to open an office in New York was that Ms. Reyes and Mr. Haas had confided that they wanted to move there.

Mr. Haas has worked in São Paulo, Brazil, in addition to San Francisco, but he has never worked in New York. “São Paulo is, in a weird way, kind of like New York,” he said, but “the energy, the buzz” of New York are difficult to duplicate.

Ms. Reyes worked at New York agencies like D’Arcy Masius Benton Bowles and Ogilvy Mather before leaving in 2003 to join Goodby, Silverstein.

In the last decade, “we lost lots of people in San Francisco to New York,” she said. “We’ll call on them.”

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Media Decoder Blog: Hulu’s Chief Is Leaving, Raising Questions About Its Future

8:39 p.m. | Updated
Jason Kilar, the Web wizard who turned Hulu from a punch line into a popular source of online video, said on Friday that he would step down as the site’s founding chief executive in the next three months.

The announcement is certain to turn up the volume on something that’s a constant hum in the media industry: speculation about the future of Hulu — and if it has one at all. Its owners, the Walt Disney Company, Comcast and the News Corporation, also run the ABC, Fox and NBC networks, and they do not agree about what to do with the Web site. Perversely, the more popular Hulu becomes, the more of a problem it is for the owners, since it may be taking viewers and advertising dollars away from their core television businesses.

Mr. Kilar never saw it that way, however. He was Hulu’s best advocate, sometimes clashing with the network executives on Hulu’s board and arguing that they had to keep investing in the site, since television’s future will surely involve Internet distribution.

For many Americans, that future is already here: Hulu’s streams of TV shows attract 30 million unique visitors a month via computers and untold millions more via tablets and Internet-connected television sets. Three million pay for Hulu Plus, its subscription arm — not bad for a start-up once ridiculed as “ClownCo.”

Mr. Kilar declined an interview request on Friday. In an e-mail message to employees, he gave no indication why he was moving on or what he might do next. “My decision to depart has been one of the toughest I’ve ever made,” he said.

He said his departure would take effect within the first quarter of the year. No successor was named.

Mr. Kilar, a former executive at Amazon, has in the past been mentioned for a number of prominent jobs in Silicon Valley. He was a top candidate last year for the chief executive position at Yahoo, but Hulu said he declined to be considered. The job later went to Marissa Mayer, a longtime Google employee.

His departure comes just several months after the only independent owner of Hulu, Providence Equity Partners, sold its 10 percent stake, originally bought for $100 million, for $200 million. Mr. Kilar and other employees also sold their stakes in the company at that time, netting Mr. Kilar about $40 million, according to an executive with knowledge of the transaction.

On Friday, there was widespread praise for Mr. Kilar for steering Hulu through sometimes turbulent seas. “He defied enormous odds, built from scratch one of the top five digital video brands, created two viable and growing businesses (free and pay) and got his well-deserved payday — not bad for five years’ work,” J. B. Perrette, who used to help oversee NBC’s investment in Hulu and now runs Discovery Communication’s digital operations, said in an e-mail.

That said, Mr. Kilar’s announcement did not entirely surprise many in the industry. During his tenure, he sometimes clashed with the owners on Hulu, exemplifying the divide between new, disruptive modes of distribution like the Internet and the more traditional operations at major media companies. As the parent companies pulled back on the amount of ABC, Fox and NBC programming provided to Hulu, the Web site invested in original content to fill the gaps and attract attention. That investment effort continues, led by one of Mr. Kilar’s deputies, Andy Forssell, but many in the industry say they believe that Hulu’s future remains fuzzy.

An internal memo obtained by Variety in August showed that the owners may want to change their agreements with Hulu so that it is no longer the exclusive distributor of repeats of television shows like “The Office” and “Family Guy.” That way, the owners could also sell repeat rights to online video services like YouTube, Netflix or Amazon.

Some of the owners also wanted more advertisements on the site, which had revenue of about $700 million last year but is not yet believed to be profitable. Much of the revenue came from Hulu Plus, and therein lies another fault line: the owners may concentrate on the paid part to the detriment of the free streaming part.

The owners had no comment about any of that on Friday, though. Robert Iger, Disney’s chief executive, called Mr. Kilar an integral part of the Hulu story and said in a statement, “We are proud of his achievements, we appreciate what he’s built, and we share his confidence in his team’s ability to drive Hulu forward from here.”

Rich Tom, the site’s chief technology officer, will also depart in the first quarter.

This month, Richard Greenfield, an analyst at BTIG Research, predicted that News Corporation would seek to acquire its competitors’ stakes in Hulu in 2013. Comcast, he said, has no managerial control of Hulu and Disney “appears increasingly less interested” in the site.

In August, News Corporation said that Jonathan Miller, the company’s chief digital officer since 2009 and a vocal champion of Hulu, would leave the company. Mr. Miller represented News Corporation on the Hulu board and had helped the media company broker a stake in Roku. News Corporation has had some high-stakes stumbles in technology with both Myspace and its tablet-only publication, The Daily, which has led some analysts to expect the company to tread cautiously with future digital investments like Hulu. And Chase Carey, the No. 2 to the chief executive of News Corporation, Rupert Murdoch, is said to be less enamored with the service.

Mr. Murdoch, however, praised Mr. Kilar for “building Hulu into one of the leading online video services available today.” He added, “It’s incredibly well positioned for the road ahead.”

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A Struggling CNN Casts Its Eyes on Jeffrey Zucker

Though CNN over all is on track to have its most profitable year ever, its flagship channel in the United States is seemingly rudderless, run by layers of producers and executives — many with competing visions. Its low prime-time ratings are the stuff of punch lines and a journalism school case study in the damage wrought by the digital age.

Then again, CNN also has tremendous potential, an enviably popular Web site and countless people rooting for it to succeed.

Throughout a four-month search for the person to succeed Jim Walton, the departing president, attention has centered on Jeffrey Zucker, the former chief executive of NBCUniversal, who was replaced when Comcast took over the company last year. Mr. Zucker produces Katie Couric’s syndicated daytime talk show.

Several news executives close to Mr. Zucker said this week that they believed he had been chosen to run CNN, and they expected the appointment to be announced soon. People close to the Time Warner chief executive, Jeffrey L. Bewkes, also identified Mr. Zucker. A Time Warner spokesman declined to comment.

In considering candidates to run one of the world’s best-known, but beleaguered, news organizations, Mr. Bewkes and his deputy Phil Kent have also been considering their own legacies. They are cautious about not undermining CNN’s journalistic heart and soul, even as they strive to resuscitate the channel’s prime-time lineup, according to people who have met with them about the search. That means the channel’s programming will remain nonpartisan in nature.

“They want someone who has programming and management and cable expertise; someone who can be credible to the staff and to the business community,” one person said. “They know that this is a pretty tall order.”

Mr. Zucker could check off all those boxes. As a young NBC News producer, he helped start what became a 16-year winning streak for the “Today” show. He had mixed results as he moved up the rungs of NBC, but he can point to cable programming successes even as the NBC broadcast network struggled. He did not respond to requests for comment, and people with knowledge of the search insisted on anonymity to preserve friendships and business relationships.

But many others in and around CNN spoke on the record about the challenges ahead. Getting the top-heavy 4,000-person company — spread among New York, Washington, Atlanta and bureaus around the world — to row in the same direction will be one of the toughest tasks, many said.

CNN’s many channels and sites net roughly $600 million in annual profits, through advertising revenue and subscriber fees. But the channel is leaving ad dollars on the table, as one executive put it, because its prime-time ratings are lagging, and it is putting future fee increases at risk by appearing irrelevant in the eyes of some cable subscribers.

One problem dates back to CNN’s creation in 1980: when there is a lack of news, there is a lack of viewers. Kiran Chetry, a CNN morning anchor from 2007 to 2011, said her time there was like being on a news treadmill: “We were running, sweating, doing the work, but never getting anywhere ratings-wise,” she said. This stemmed, she said, from uncertainty about “what we were, who our audience was and how we best served them.”

As Fox News and, later, MSNBC put on confrontational political programs with partisan points of view, CNN sold itself as proudly nonpartisan, but it fell from first to second to third place in the cable news wars along the way. This should have been an “up” year for the channel, thanks to the presidential election; but through mid-November the channel had drawn 412,000 viewers at any given time, down 16 percent from the previous 12 months.

Bill Carter contributed reporting.

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