AP Vies for Larger Share of Sports, Celeb Biz

Posted on 3/24/2008 by Julia Dudnik Stern | Printable Version | Comments (0)

During the first quarter of 2008, the Associated Press announced several employee reassignments and new hires. Human resources were reallocated to usher in a fundamental change in the company's strategic emphasis. The core AP news market continues to dwindle as newspapers struggle. In addition to declining client revenues, the AP just lost Dow Jones, due to a failed pricing negotiation. Now the company is shifting focus, taking a primary role in covering sports and entertainment news worldwide and across all platforms.

In January, AP moved Daniel Becker and Jim Kathman to newly created director posts for entertainment content and sports products, respectively. Becker and Kathman have been with the company for several years and are responsible for driving the growth of the two vertical segments AP views as critical to its continued survival.

In an internal AP memo published by LA Weekly, Becker said the company plans to hire 21 new entertainment-beat employees in 2008. The new hires will work in Los Angeles, New York and London, providing entertainment coverage in video, photo, audio, text and multimedia formats.

Becker, who has held a number of AP entertainment-related photo-editing posts, will undoubtedly place a high emphasis on photography. An investment in images will be equally critical for AP's sports division, which intends to become the leading global multimedia sports-news agency.

The two segments are not only popular, but seem immune to economic downturns. The cyclical nature of sports and an unquenchable thirst for celebrity gossip are causing such press coverage to grow, while interest in other popular subjects stagnates. Hitwise data from March shows that celebrities top politicians in news and media Web visits, despite the proximity of the presidential election.

AP's new business focus may reflect the public mood, but to the consternation of journalists. An internal AP email, published by Jossip's Hollywood blog Mollygood, states: "Now and for the foreseeable future, virtually everything involving Britney is a big deal."

Though not all researchers agree on exact figures, most predict continued growth for outsourced entertainment news-content. PQ Media forecasts the segment growing by 77%, to $960 million, by 2011. Becker feels that "AP is uniquely positioned to become the definitive provider of entertainment news for all media formats largely because of our reputation for accurate, unbiased coverage." He adds that no other competitor can offer AP's reach or its unique global mix of daily video, photo and text coverage.

Currently, sports and entertainment images are dominated by Getty Images. However, since Getty is the official image provider for many sporting and red-carpet events, some news publishers view Getty's content as biased, more akin to public relations than news reporting. As such, a number of smaller news agencies continue to thrive alongside Getty. This may change if the AP succeeds in positioning itself as an unbiased source and offers a breadth of content that rivals the stock-licensing leader.

Thoughts of a Bohemian's Paul Melcher offers a parting thought: "The question now is not if, but when will Reuters and EPA follow?"

Copyright © 2008 Julia Dudnik Stern. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz


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