Television news networks count the high cost of war

As coalition forces run into stiffer opposition from die-hard supporters of Saddam Hussein's regime, the escalating cost of reporting from Qatar and Kuwait to across the Iraqi desert is mounting.

The BBC has around 200 staff in the Gulf region and has earmarked around $15m (£9.5m) to cover the conflict, but that $15m will only stretch so far when 200 people need not only to be able to broadcast and have satellite costs paid, but to be fed and put up.

CNN, which has around 250 staff in the region, has earmarked around $25m to cover the war, but with costs running at $1m a day and the war already into day 13, that money will not even take it until the end of April.

Sky News has around 80 staff in the region and its US sister channel Fox News has around 100 and says its budget for covering the war runs into 'tens of millions of dollars'.

Analysts are estimating that additional costs of covering the war could run to between $40m and $60m, hitting profits at their media group parents hard in the worst advertising downturn the industry has ever faced.

Coupled with the cost of satellite news feeds, equipment, training, insurance and accommodation, some networks are also facing the considerable loss of advertising revenue.

Sky News has run no ads since the war began 13 days ago and Fox ran no ads for the first two-and-a-half days of the conflict.

The industry is expecting to see the news networks gradually scale back the number of people they have in the field and see an increased amount of content being pooled, as is happening to a greater degree with newspapers.

Last year, merger talks took place between ABC, part of the Walt Disney media empire, and AOL Time Warner's CNN about merging the news operations of the two broadcasters, but talks broke down between the two over operational and structural issues. If the deal had gone through, it would have led to massive cost cuts.

The BBC, which already has an existing news-gathering agreement with ABC, was understood to have approached the US television network with plans for an alliance that could see jointly branded news services and distribution of BBC news on the ABC network.

Earlier this year, the BBC signed a deal with the increasingly controversial Arabic news network Al Jazeera, which is licensing 1,000 hours of BBC programming for a new documentary channel it is planning to launch. The deal built on an existing deal to share news and on-the-ground facilities.

Sky News and Fox already work together, with each sharing content and reporters, while ITN and ITV News have a long-standing news deal with CNN.

Such deals could be widened as news organisations face up to the cost of covering the war.

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