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CNN Transcript

Sunday, June 11, 2000

Some News Web Sites Are Fighting For Survival

ANDRIA HALL, CNN ANCHOR: A new poll finds more and more Americans are turning to the Internet for news. But doesn't mean all is well in the world of online journalism. In the past week, two news Web sites, and --, were hit hard by layoffs. CNN's Deborah Feyerick takes a look now at the landscape of news Web sites and what it takes to succeed in cyberspace.
(BEGIN VIDEOTAPE) DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): What ESPN is to sports, set out to be to crime and justice. And in 18 months, they had built a solid reputation, even winning several journalism awards. But now, the 140 staff writers, editors, and business people are looking for work.

JOE KRAKOVIAK, APBNEWS.COM: The simple answer is we ran out of money. We have no money to pay our employees or to pay any severance.

FEYERICK: A number of journalism Web sites are in the same boat. recently laid off workers, as did the CBS Internet Group. And though initially raised $27 million -- now spent -- the money needed to keep going has dried up.

BERNHARD WARNER, "INDUSTRY STANDARD" MAGAZINE: They're going back to the same group of institutional investors and some of them are turning their backs, because their portfolio is already hurting.

FEYERICK: Internet analysts say part of the problem is that investors look at journalism the same way they look at e-commerce, or Web shopping, that is a way to earn some fast money.

SREENATH SREENIVASAN, PROFESSOR, COLUMBIA UNIVERSITY: Journalism requires a kind of commitment that most investors, most venture capitalists don't have. It takes a long time to produce a quality product.

SYDNEY SCHANBERG, JOURNALIST, APBNEWS.COM: They are bottom line people and you -- you know, you can't blame them, it's what they do and this is what I do, and maybe it's not a fit.

FEYERICK: Web sites make money either through subscriptions or through advertisers, who tend to favor companies like CNN, or ABC News, with a built-in audience.

MICHAEL O'DONNELL, SALON.COM: Clearly, they are competition, because they have such a big brand presence, they leverage their TV assets or their radio assets. But I think on the Web, people are looking for fresh, original content, and that's what we have.

FEYERICK (on camera): Media insiders say Internet journalism is here to stay, but they say news sites need to be realistic: start small, build carefully, and develop a loyal audience. (voice-over): Proving they can one day turn a profit, so investors will commit for the long run. Deborah Feyerick, CNN, New York. (END VIDEOTAPE) | stuff | quotes: cnn