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Fox Viewers May Be Graying, but Their Passion Still Pays

July 22, 2013 by Leave a Comment

For most of the television business — the segment that relies on advertising — that would be serious cause for concern because ad sales are almost always based on a target age of 25 to 54, and Fox News, for the last two years, has had a median age of 65-plus in its ratings both for the full day and for prime time.

But up until now at least, Fox News has been more able than any other television entity to defy the tyranny of the demos, as they are known in the business. And the network, which has upturned traditions and expectations throughout its history, has earned consistently enormous profits, relying on the commitment and loyalty of its audience.

“I don’t think you can fully capture the value Fox News brings by looking at the Nielsen ratings alone,” said Craig Moffett, the longtime financial analyst who specializes in cable. Mr. Moffett, who heads his own firm, said that the key to Fox News’s continued financial strength has been “the level of passion and engagement” it inspires in its viewers.

That translates into big money because cable systems now pay Fox News one of the highest per-subscriber fees in television, 94 cents a month, topped in cable television only by a few networks, most of which have expensive sports rights to pay. (By comparison, CNN gets 57 cents a subscriber, according to SNL Kagan Research.) As Mr. Moffett put it, “There are a handful of networks consumers are deeply passionate about out of all proportion to Nielsen ratings, and distributors know if you don’t have those networks, then woe be to you.”

With close to 100 million subscribers in total, Fox News will take in $1.11 billion this year from subscription fees before it ever sells a single commercial, Kagan estimated. Still, the network faces some significant questions as it goes forward: How old is too old? And when does the issue have to be addressed?

Fox News declined to make executives available for comment, but several recent signs — including changing personalities for some of its weekday programs — suggest the network may have decided the time has come to confront the issue of age.

Just how old is its audience? It is impossible to be precise because Nielsen stops giving an exact figure for median age once it passes 65. But for six of the last eight years, Fox News has had a median age of 65-plus and the number of viewers in the 25-54 year old group has been falling consistently, down five years in a row in prime time, from an average of 557,000 viewers five years ago to 379,000 this year. That has occurred even though Fox’s overall audience in prime time is up this year, to 2.02 million from 1.89 million three years ago.

The network also has been faced with a recent string of nightly wins in that 25-54 audience by CNN, which had been hopelessly behind in recent years.

“The numbers indicate they haven’t been replacing the younger viewers,” Mr. Moffett said of Fox News. Many of the loyal viewers the network has always had are simply aging up beyond the 54-year cutoff for many ad buyers. The result is an audience edging consistently above that 65-plus number.

News audiences always trend old, and the viewers of Fox’s competitors are hardly in the full flower of youth. MSNBC’s median age for its prime-time shows this year is 60.6; CNN’s is 59.8.

In terms of the rest of television, Fox News also is quite a bit older than networks considered to have a base of older viewers. CBS has frequently been needled for having older viewers, but at 56.8, its median viewer is far younger than Fox News’s. (Viewers at Fox News’s sister network, Fox Broadcasting, have a median age of 50.2; at ABC, the median is 54.4; at NBC, it’s 47.7.)

Article source: http://www.nytimes.com/2013/07/23/business/its-viewers-are-graying-but-their-passion-pays-for-fox-news.html?partner=rss&emc=rss

Filed Under: Media Business Tagged With: , ,

Asian Markets Take Heart From U.S. Retail Sales

November 28, 2011 by Leave a Comment

Although many analysts cautioned that neither development was an immediate cure-all for the problems facing the European and U.S. economies, the news helped stock markets in Asia to solid gains on Monday. European and U.S. stock futures also rose.

The Hang Seng index in Hong Kong and the Straits Times index in Singapore were up 2.1 percent and 1.5 percent by midafternoon.

The S.P./ASX 200 in Australia closed 1.9 percent higher, the Kospi in South Korea rose 2.2 percent and the benchmark index in Taiwan closed up 1.7 percent.

In Japan, the Nikkei 225 index managed a rise of 1.6 percent, finishing the day at 8,287.49 points, despite comments from the central bank governor, Masaaki Shirakawa, that the prospects for the Japanese economy remained poor.

The euro was hovering just under $1.33, up from $1.3233 late on Friday. The European currency has slipped sharply since late October, when one euro was worth $1.42.

Global stock markets have also slumped in recent weeks, as the European debt crisis began to move from small, peripheral economies like Greece and undermined confidence in larger euro zone members, like Italy and even France.

The ratings agency Moody’s on Monday warned that the increasing severity of the euro zone debt crisis was putting the ratings of all E.U. nations under threat.

“While the euro area as a whole possesses tremendous economic and financial strength, institutional weaknesses continue to hinder the resolution of the crisis and weigh on ratings,” Moody’s said in a report
on Monday. “In terms of the policy framework, the euro area is approaching a junction, leading either to closer integration or greater fragmentation.”

Still, despite this grim environment, markets staged a muted rally on Monday, reversing some of the slides seen during the previous weeks.

Encouraging news from both Europe and the United States helped prop up investor sentiment.

In the United States, the Thanksgiving weekend — a key shopping period ahead of the all-important Christmas holiday season — saw unexpectedly strong spending across the nation, fanning hopes that U.S. consumers are once again daring to open their wallets.

The National Retail Federation said Sunday that spending per shopper surged 9.1 percent over last year — the biggest increase since 2006 — to an average of almost $400 a customer. In all, 6.6 percent more shoppers visited stores on the Thanksgiving weekend than last year.

And in Europe, there were reports saying that France, Germany and Italy were prepared to move ahead more quickly to establish firm rules on fiscal issues, including debt limits, and to encourage more coordination of economic and fiscal policy.

Still, the differences on how to approach a larger bailout for euro zone countries remain profound, with Germany firmly opposing both an expanded role for the European Central Bank and bonds issued jointly by the euro zone countries — commonly known as euro bonds — as answers to the sovereign debt crisis.

And analysts cautioned that it was by no means clear that even an agreement on tighter budget rules would convince markets that the European Union, the E.C.B. and euro zone governments stand behind bigger indebted nations like Italy and Spain.

“Calls on the E.C.B. to adopt Fed style pre-emptive and aggressive QE continue to intensify, now also from within the core countries,” said Michala Marcussen, an economist at Société Générale in London, in a research note on Sunday, referring to quantitative easing. “The political hurdle thus seems to be easing.”

Yet a potential legal obstacle remains, she cautioned, in that the E.C.B. is not allowed to finance governments directly. “We have long held that the E.C.B. would, when looking into the abyss, turn more aggressive. However, such action is likely to be reactive rather than pre-emptive.”

Moody’s echoed this cautious sentiment on Monday.

“The political impetus to implement an effective resolution plan may only emerge after a series of shocks, which may lead to more countries losing access to market funding for a sustained period and requiring a support program,” it wrote.

“This would very likely cause those countries’ ratings to be moved into speculative grade in view of the solvency tests that would likely be required and the burden-sharing that might be imposed if (as is likely) support were to be needed for a sustained period.”

Stephanie Clifford contributed from New York.

Article source: http://www.nytimes.com/2011/11/29/business/global/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Ford Strategy Will Call for Stepping Up Expansion, Especially in Asia

June 7, 2011 by Leave a Comment

Ford’s chief executive, Alan R. Mulally, is expected on Tuesday to unveil an aggressive strategy to increase the company’s worldwide sales to 8 million vehicles a year from 5.3 million by middecade. That would put the Detroit automaker at the top echelon of world production. Last year, Toyota, the leader, sold about 8.42 million vehicles.

But Ford will be playing catch-up in Asia, where competitors like Toyota, General Motors and Volkswagen have larger shares and better brand recognition.

“Ford is trying to make up for lost time in Asia,” said Michael Robinet, director of global forecasting at the research firm IHS Automotive. “They have to do a lot of heavy lifting in the next decade to become a major player.”

Mr. Mulally plans to share Ford’s growth goals with investors and analysts at a meeting in New York, representing another step in the revitalization of the nation’s second-biggest auto company.

“We’re clearly transitioning into a growth mode after going through a horrific recession and industry collapse,” Mr. Mulally said in an interview on Monday. “We are now positioned to serve customers where the market is growing.”

After revamping its core North American business and posting eight straight profitable quarters, Ford is pushing hard to build up operations in Asia. The company has already exceeded expectations for its turnaround in its home market, and now has the financial strength and product lineup to try to repeat that success in what has been its weakest region.

The company expects to expand sales of its Asia-Pacific-Africa division to one-third of its global sales by 2020, from 15 percent of its overall volume currently.

Its steepest challenge appears to be in China, where other automakers have more established brands and deeper ties to consumers. G.M., for example, is the market leader in China with a 14 percent share, while Ford has less than 4 percent, according to IHS Automotive.

But Ford has drastically transformed its product portfolio since Mr. Mulally took over as chief executive five years ago, from an overreliance on trucks and S.U.V.’s to smaller cars. Mr. Mulally said that by 2020, small cars would make up about 55 percent of all Ford sales.

New cars like the Fiesta subcompact and Focus sedan are made on global platforms and sold in various markets around the world. That is a huge change from how Ford operated in the past, when it made different cars and trucks for specific regions of the world. Now the company can sell the same models in China, for example, that it offers in the United States. The change has cut costs and allowed Ford to shorten the time it takes to develop new products and refresh older ones.

Mr. Mulally said that transformation was the main reason that the company could now concentrate on gaining new customers in fast-growing markets like China and India.

“Up until now we haven’t had the products,” he said. “And now we have a company that’s operating profitably in all the regions of the world.”

Ford’s two hometown competitors, G.M. and Chrysler, both required considerable financial assistance from the United States government to survive and restructure in bankruptcy court.

Ford, by contrast, was able to weather the recession without federal aid. The company mortgaged most of its assets in 2006 to borrow $23 billion, then sold off noncore brands like Volvo and Jaguar and reorganized operations to produce a new lineup of smaller, more fuel-efficient models.

The strategy paid off. Last year, Ford earned a $6.6 billion profit and increased its United States market share for the second consecutive year — the first time it had done that since 1993.

The company continued its surge in the first quarter of this year when it posted a $2.6 billion profit that beat analysts’ projections. Meanwhile, Ford has paid back $17 billion of its debt, while maintaining cash reserves of $21 billion.

Ford has already started its product blitz overseas. By middecade, it will increase the number of models it offers in India to eight vehicles, from three, and in China to 15, from five. It is also building several new plants in Asia and adding dealers.

In the past, Ford’s Asia strategy relied heavily on its Japanese partner, Mazda. But it has substantially reduced its stake in Mazda, and is building up its own regional staff of executives and other people.

“Asia is clearly the next frontier for Ford,” said Mr. Robinet of IHS Automotive. “It’s definitely possible for them to grow significantly because they’re working from such a low base.”

Mr. Mulally said he was undaunted by Ford’s underdog position. He said that Chinese consumers were well aware of Ford’s products from the Internet, and appreciated its growing reputation for quality and fuel-efficiency around the world.

“The entire industry in China is growing, so it’s not like you’re taking share away from another competitor,” he said. “You have all these new customers that are now entering the marketplace and looking for world-class products.”

Article source: http://feeds.nytimes.com/click.phdo?i=5a13a7219f51c761bb57897858687c8a

Filed Under: Business News Tagged With: , ,