From Jim Metrock:
Product ads on Channel One have all but disappeared.
Public service announcements (PSAs) have taken the place of regular commercials. This is not what Channel One wanted.
The marketplace has rejected Channel One’s business model – the model that Christopher Whittle unleashed on the country in 1990. Channel One made money only when it was advertising candy, soft drinks, and raunchy movies. Those advertisers decided individually to remove their ads from C1N. Channel One was left with PSAs, and they don’t produce much revenue.
Can Channel One News survive on PSA money? I don’t think so and I base that on what happened to YNN and on the extraordinary equipment replacement costs C1N must deal with soon.
We can tell the future of Channel One by looking back a few years to the Youth News Network (YNN) in Canada. In the mid-90’s a Canadian company called Athena Educational Partners created YNN to copy the then-successful Channel One News.
Canadian teacher organizations actively opposed YNN. Other groups did too. After many years of struggling to get schools to sign up, YNN eliminated all product ads and ran only public service announcements. They thought they would stem the controversy and allow them to survive. The year after deciding to go to an all-PSA format, YNN went out of business.
That is the future of the Channel One Network.
The company is running on vapors and they face a massive challenge: what to do with their ancient, deteriorating inventory of television equipment? Hundreds of thousands of 19" TV sets hang pathetically on classrooms walls across the country. Some of these TVs date back to the early 90’s. How do you replace this equipment with more modern technology? It was easy when Channel One was making tons of money pushing Snickers and Pepsi on an overweight student population. Today, Channel One has a few organizations that are paying to run PSAs. These companies don’t pay the "full-fare" rates that McDonald’s used to pay.
Channel One News is a ghost of what it once was, and the Channel One Network doesn’t stand a ghost of a chance of continuing as a viable business.
