By Kate Conger
By Brian Rinker
By Rachel Swan
By Anna Pulley
By Erin Sherbert
By Chris Roberts
By Erin Sherbert
By Rachel Swan
Sleek yet casual in a sport coat and slacks, Ron Reagan Jr. stands on a riser in a chilly television studio. It is the morning of his 41st birthday. As the crew tweaks the lighting, a producer comes out of the control room. There's a slight problem involving Sofie Formica (her real name), Reagan's perky co-host of the TV.COM program. This morning, she's a bit too perky.
The control room says her nipples are visible through her blouse. An obvious silence from the cameramen and floor crew indicates they hadn't really seen the need to mention this.
When informed, Formica quickly folds her arms across her chest, and shoots the control room a look. An assistant brings her a steaming cup of tea.
Reagan glances around, with a head-bobbing smirk straight from his father, and gestures dramatically to the ceiling. "Can't we get some heat in here?"
Why is the son of a former U.S. president spending his birthday standing in a converted gymnasium at the foot of Coit Tower, fiddling with a paddle ball toy, waiting for his co-host's nipples to recede?
Well. To tape a television program on high-tech with virtually no substance, that will air on cable or a backwater TV channel, probably in some weekend time slot when virtually no one will watch it.
That wasn't the idea back in 1992, when CNET founder Halsey Minor set out to establish a mighty media empire of cable television programming devoted to computers and technology. CNET's concept was to marry television and high-tech, and spawn profits.
The first program, CNET Central, appeared in 1995, followed by the cnet.com Web site, the two new ventures snuggling together in a bed of happy cross-promotion.
Other shows followed: Reagan's TV.COM, Cool Tech (consumer-oriented technology products), The Web (Internet and online services), The New Edge (future technologies), and Tech Reports (90-second tech inserts for local news programs). All programs are taped in the same studio.
Since the launch, CNET's efforts have flourished, making it one of the few Internet companies to turn a profit. CNET's main cash cow is its Web site, which reviews and praises products, directs Web surfers to manufacturers, and apprises readers of the most convenient method to purchase the goods. CNET's common stock is quoted on the NASDAQ market. Last month the company reported a doubling of revenue, and announced a 2-for-1 stock split.
But the television part of the operation has proven downright embarrassing.
Most of the programs air on the Sci-Fi Channel and the USA Network, Saturday and Sunday mornings from 6 to 8 a.m. One airs in the Bay Area on Saturday afternoons. CNET claims a weekly audience of more than 1 million for all the shows combined. Company literature proudly boasts that the shows are available in 7 million U.S. homes, in 40 countries, or to 8 million viewers in 23 countries, depending on which company report you choose to believe.
According to CNET TV publicist Maureen Pelisson, the company has never crunched numbers for viewer demographics. It guesses that the audience -- what there is of one -- consists of males in their 20s and 30s who don't know much about technology but watch television early on Sunday mornings.
CNET has hired toothy hosts to shake the pompons -- veteran Bay Area TV host Richard Hart, local actress Daphne Brogdon, Los Angeles DJ Ryan Seacrest, India-born Hari Sreenivasan, and blue-haired "cyberpunk" Desmond Crisis.
But the cheerleading doesn't seem to be helping.
According to CNET's financial records for the first quarter of 1999, the company's online division had generated about $18 million in total revenues, doubled from the same time last year. The television programming mustered only $1.7 million in total revenues during that quarter, a slight drop from 1998.
Inquiring minds would certainly want to know why CNET keeps producing and distributing programs that make no money.
The answer lies in the company's shareholders' reports. Amid the effervescent bubbling about additions to the online division, and great new profitable deals struck with America Online and PC manufacturers, the company makes a small admission:
"Our television programming may not be successful, which could adversely affect our profitability. ... We may be unable to increase or sustain our revenues if we fail to develop television programming that allows us to attract, retain, and expand a loyal television audience, or if we fail to retain or develop distribution channels for our television programming."
In other words, the television programs do not exist to allow Reagan to visit his favorite San Francisco restaurants. They do not exist to add some professional heft to the resume of Desmond Crisis. They exist to promote and maintain the brand name of CNET. Basically, a CNET show is produced because CNET can then brag that it is the "global leader in tech TV."
According to publicist Pelisson, the television division is funded entirely by the USA Network, which pays CNET a licensing fee for the programming, and then graciously covers all production costs. In return, the USA Network receives shares of CNET stock.