By Edward Attwood
CNBC chief Mark Hoffman on making and breaking the news
It’s any TV network’s dream. Out of the blue comes a call from the sitting president of the US, requesting a town-hall-style chat with one of your lead anchors on an hour-long prime time special. Mark Hoffman, president and CEO of CNBC, isn’t about to hand out tips to enquiring hacks about how to get that all-important interview with Barack Obama, but the truth is that Obama’s decision to plump for CNBC over the host of other US networks may well have been an obvious one.
“There’s a standing request from almost every US domestic news organisation to interview the president, and I think we offered a unique proposition,” Hoffman smiles. “An hour of time, commercial-free, for an audience that is very hard to reach in the populist media. I think the time was right for the White House to do that and I think it was very effective for them and very effective for us as well.”
So how did the network emerge as the medium of choice for the world’s most powerful men and women? Well, original content has certainly been a big draw. On all its platforms, CNBC is now interviewing just under a thousand people a week. That mass of original content - both opinion and fact - has fast become must-see material for that small percentage of the planet’s population that moves the levers of international industry.
“There is a fundamental concept in business - buyers and sellers, fear and greed, and at the cross-section of that is truth,” Hoffman points out. “The market figures it out and it’s our job to try and help the business community and investors rationalise some of that information - certainly not all of it, but a good chunk of it.”
But the firm also seems to be one of the few that is emerging from the global recession with its credit intact. The reason? During Wall Street’s toughest times - including the Lehman Brothers collapse - millions tuned in to watch CNBC’s anchors and reporters provide blanket coverage of the action. In the period since then, TV numbers may have subsided to an extent, but Hoffman is certain that the network’s target audience has grown.
“I would say that we have a core audience around the world. What happens is that in times of crisis is that that audience tends to spend more time with us,” he explains. “So at least in places where the audience is measured, it looks like the audience grew. Although there is a populist phenomenon, this is a relatively niche brand of content and in crises, I think you see a more populist participation with the content, and then as crises settle, or ameliorate, audiences tend to do the same.”
However, on the digital side, Hoffman is far more confident that new users that flocked to the CNBC.com website during the more dramatic points of the credit crisis have opted to stay.
He estimates that traffic to the website doubled or tripled in the heart of the crisis, and has “more than doubled” in comparison to the previous period, even when the big stories had somewhat settled down.
The CEO puts this down to the power of the television brand pushing views to sample new media extensions and then staying with them.
Part of the reason behind CNBC’s enduring financial success - Hoffman says it is on track to post a fifth year of record-breaking profits - is the make-up of its viewers. He describes them as “literally the most educated and affluent viewers in the world”, a formidable and tough-to-reach grouping that advertisers are happy to pay big bucks to target.
“We’re not focused on being all things to all audiences. We’re really focused on being a particular brand of content, which yields an affluent, highly educated slice of the media pie and that’s been a strategy that has been highly monetisable,” the CEO says. “It’s an audience that’s very tricky for advertisers to find - and we’ve found that living in that space has made us absolutely appropriate and necessary when advertisers are looking for that audience.”
Back in the Middle East, however, and Hoffman is visiting Bahrain to mark the opening of CNBC’s latest bureau, which complements the existing CNBC Arabiya (Arabic language) office in Dubai. It’s all part of a worldwide strategy that attempts to position CNBC in as many business markets as possible.
Alongside English-language channels, the company is working on local language franchises, of which there are now twelve.
“We want to be in countries, cities and regions that have a financial impact and this fits in with what we’ve done in the last few months,” says Hoffman.
“From the beginning of the year, we’ve opened up a Korean-language channel in Seoul and we’ve also added a regular report on China that accesses 400 million homes. It’s all part of a global strategy to be where the news is.”
The network’s recent moves suggest a focus on emerging economies, and the CEO says the strategy has already produced strong editorial dividends.
With regards to the Bahrain bureau, the seven-strong team will produce a monthly programme about the region, as well as filing daily, on a tri-anchored programme based in Singapore, London and Manama. Hoffman will not be drawn on how the bureau will grow over time, or indeed the amount of capital CNBC has invested in its latest venture, but he does say the firm “has committed in a substantial way”.
For Middle Eastern businesses, the new bureau could provide a great window on the region for the rest of the world. Hoffman is keen that local firms should take advantage of local programming to broadcast the Gulf’s story outside the Middle East.
“It’s what’s happening here regionally, with companies, investors, with the puts and takes of finances - and the region is getting exposure globally on a daily basis,” he says. “We welcome business participation from the region in the concept we’re creating. We’re looking to tell the Middle East business story to the rest of the world - that’s why
From the outside perspective, Hoffman says that external interest in the Middle East is growing considerably, with key players keen to know the major investment plays taking place inside the region.
The Bahrain office simply ensures a complementary offering for the region. While CNBC Arabiya tells the Middle East’s story to the Middle East, English-language CNBC International will tell the world’s story to the Middle East, and vice versa.
“There will be a tremendous amount of travel out of here, using it as a hub or a base of operation. The concept we look at everywhere is content that is critical to business and investors,” the CEO says. “That’s a general view, and you’ll find that everywhere we go. That’s a very nice thing about CNBC as a brand - it is consistent editorially around the world, and it’s consistent with who watches it and uses it.”
Elsewhere in the world, CNBC has also leveraged strong relationships with other content providers, such as Dow Jones, Yahoo! and the New York Times in the US, as well as with other firms in the US and Asia. Hoffman doesn’t say whether the company is planning a similar sort of partnership with providers in the region, but if the opportunity arises, it’s surely something that CNBC will consider.
“In many cases it’s an exchange of content - which is really the way of the world now - it’s how digital operates,” the CEO says.
“We place some content with New York Times - they place some with us, and it brings people from the New York Times to CNBC and there’s an extensive video section on the New York Times website which brings consumers back to us. Just the syndication of content, especially on the digital side, is a big piece of the puzzle.”
Hoffman is also considering newer technologies, such as mobile streaming, that have thus far failed to really get off the ground in the Middle East.
CNBC may have a subscription mobile product elsewhere in the world, as well as facility that allows viewers to stream English-language content via the website.
Plans are not definite as yet, but the CEO says that the firm is making sure it is resourced appropriately to ensure it will be in a position to implement those technologies should the need arise.
Talking of subscriptions, Hoffman also points out that the issue of paid-for digital content is one that CNBC is looking at closely. Both in the US and the UK, major papers such as the Wall Street Journal and The Times have both put up subscription firewalls over most or all of their online content.
It’s caused a certain amount of consternation on both sides of the Atlantic, but is largely being seen as a referendum on whether all news providers will adopt the same method in the future.
The Times recently announced that around 105,000 users had handed over card details to secure access to its site since July, in comparison to a pre-paywall average of 3.1 million unique UK individuals every month.
“Yes, we’ve looked at it, but we have decided not to turn over big pieces of the digital puzzle - specifically CNBC.com - into more of a paid environment,” says Hoffman.
“But we will have products that we think are appropriate that will be ad-free but subscription driven. In the main, we’re more of an advertising-focused business on the digital side.”
Again, clearly, CNBC’s healthy advertising revenues are paying off. But when questioned as to how he sees the paid-for digital debate resolving itself in the future, Hoffman is disarmingly honest.
“I think there are a lot of people who would try to tell you what the landscape will look like in five years time, but I’m not one of them, I really don’t have any idea,” he adds.
“Look back five years - in the Middle East, you are working in an environment with a fairly robust print - elsewhere is the antithesis of that.
“On the TV side, a two revenue-stream model has been very effective for us. If we find the right way to do that digitally, we will attempt to do it there as well.”
For the future, CNBC will continue to commit to the emerging regions, and the CEO says that there are “a number of spots on our target list”.
As we head into 2011, it’s likely that the firm will try and add another two or three locations during the course of the next twelve months or so. Certainly Hoffman recognises that even CNBC can’t afford to rest on its laurels. At any news organisation, coverage and original content - the more the better - are key mantras.
“We need to be focused on content that is beyond enterprise; it needs to be essential and it needs to be new,” he says.
“I think there is a danger in the world of quickly finding content to reach a level of commoditisation and I think the ability to break news, which is an important element of CNBC, to instantly react to and get the appropriate divergence of opinion around things as they break, is essential.
“The driving concept behind our editorial is fast, accurate, actionable and unbiased. If we can achieve those four things, I think we’ll be in good shape.”