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CNN RELIABLE SOURCES

Amazon CEO Purchases WashPost; RNC Chairman Threatens NBC, CNN

Aired August 11, 2013 - 11:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


BRIAN STELTER, HOST: It's the end of an era at "The Washington Post." and no one knows what's in store next.

Jeff Bezos, the mastermind behind Amazon, pays $250 million and takes over the news operation that took down a president. But can the guy who gave us the Kindle give the news business a much-needed boost?

(BEGIN VIDEO CLIP)

ANNOUNCER: A new sports network is here. Fox Sports 1, with live sports like Major League Baseball.

UNIDENTIFIED MALE: Unbelievable!

ANNOUNCER: College football, UFC, college basketball, NASCAR and more.

(END VIDEO CLIP)

STELTER: Yes, ESPN has a new archrival -- thanks to Rupert Murdoch. We'll talk to the head of ESPN about how he plans to keep FOX from scoring.

(BEGIN VIDEO CLIP)

JOHN OLIVER, THE DAILY SHOW: It's John Oliver. Jon Stewart is still not here. In a huge deal, he's actually being taken over by Amazon CEO Jeff Bezos.

(LAUGHTER)

(END VIDEO CLIP)

STELTER: And it's the biggest battle for late-night since Leno and Letterman, or Leno and Conan. Maybe Jimmy and Jimmy. Now, it's Jon versus John.

Just a few weeks left in Jon Stewart's summer hiatus, I wonder if John Oliver is going to find it difficult to hand back "The Daily Show."

I'm Brian Stelter, and this is RELIABLE SOURCES.

(MUSIC)

STELTER: Welcome to Washington.

What a head-spinning week it's been to the reporters in this town. For 80 years, "The Washington Post" was synonymous with names like the Graham family and names like Woodward and Bernstein. This week, Bezos became the name to take the post to a new generation.

What began with this Twitter message, "Stand by for news, very big news," ended with this monumental front page on Tuesday.

So, will "The Post" of the future look anything like this? For that matter, will any newspaper?

Joining me to make sense of this week's news: in New York, Jenna Wortham, a technology reporter and my colleague at "The New York Times"; and here in Washington, Jane Hall, a journalism professor at American University; and Paul Farhi, the man who broke the news, a media reporter for "The Washington Post".

Paul, you knew about this sale a whole day before the rest of the world. What was it like walking around the newsroom holding that information in, keeping that secret?

PAUL FARHI, THE WASHINGTON POST: Well, there was a kind of tension there because I wanted to tell everybody what I knew. We're reporters. Our job is to wave our hands and say we know something.

STELTER: Yes.

FARHI: On the other hand, I didn't want guys like you to get the story before "The Washington Post" could break its own news. So, those two things sort of kept my mouth shut.

STELTER: And you talked to Jeff Bezos beforehand. You're the only reporter who's talked to him. What was your takeaway from that conversation?

FARHI: Kind of a mystery, to tell you the truth. Seemed like a guy who had some interest in newspaper but couldn't exactly articulate what the plan was going to be, because I sense that he hasn't quite developed the plan in detail yet. Of course, pressed for answers, wanted him to lay it all out for us, but it's not there yet or at least he's not saying what it's going to be.

STELTER: Right, right.

Jane, let's zoom out and talk about why this matters to "Post" readers or readers of any newspaper. This newspaper has such a storied legacy.

JANE HALL, AMERICAN UNIVERSITY: It has a wonderful legacy. I went back and looked up about Katharine Graham during the Pentagon Papers and Watergate. Her company was going public when they joined "The New York Times" in the Pentagon Papers case. They were up against the government. They were up against threatening license challenges under Nixon. They stood up at times and the publisher, the business side stood up for journalism. And that is what I think has made a lot of people sad to see this also is one of the last family-held newspapers, except for your "New York Times", and there's been a lot of tumult. The questions are, will there be the support for journalism, as well as what kind of new ideas can Bezos bring to this?

STELTER: He did send a memo to the staff and let's put up a part of it on the screen. I was really struck by what he said. He said, "There's no map and charting a path ahead will not be easy. We will need to invent, which means we will need to experiment."

Jenna, what experiments might he try at "The Washington Post."

JENNA WORTHAM, THE NEW YORK TIMES: Well, the thing to remember about Jeff Bezos is he is obsessively consumer oriented and focused. So I think we can expect him to start with the reader and work backwards, whether that means finding ways to make "The Post" much more relevant and interesting on mobile devices. You know, he showed (ph) them with the line of Kindles, that he's obsessed with now people are consuming and reading content on the devices and smartphones and tablets.

So, you know, he could include anything from personalized payments to, you know, e-commerce integration, recommendation engines -- any of the things we've seen make Amazon the web e-commerce giant that it is. We could see him apply some of those techniques or principles to "The Post."

STELTER: And as you pointed out in the history earlier this week in the paper, he's some made some strange big investments before.

WORTHAM: Yes. I mean most people don't know but he was an early investor in Google. He's an investor in Twitter. He's building a 10,000 year clock. He's working on a space company in Texas.

So, he's a very eclectic guy, a very quirky entrepreneur with a range of interests.

STELTER: Jane, I wonder what's going to be harder, a space project or making "The Washington Post" profitable.

WORTHAM: Yes.

HALL: Well, I don't know. I think "The Washington Post" needs to move much more quickly than once in the millennium, which is what that clock is doing.

STELTER: Right, right.

HALL: You know, I talked to a number of reporters and, you know, I have friends who took the buyout at "The Washington Post" and students that are there and people like Paul Farhi.

People are general excited by the idea of Bezos. But we don't really know and I doubt if he knows. He must figure this is not a philanthropic enterprise, you know, but how do you make customer service work and do the investigation into the Walter Reed Hospital that took months to do?

STELTER: Right, right.

HALL: How do you combine those two? We don't really know what he's going to do.

STELTER: Customer service are the keywords perhaps.

Jenna, you have written about this as well. That customer service is the guiding philosophy of Amazon, making it wonderful for users.

WORTHAM: Right. I mean, Jeff Bezos has proved over and over again he's not someone who listens to Wall Street. He doesn't listen to analysts. He's not so consumed with short-term profits and short- term losses for that matter.

So, you know, a big part of this will be him giving "The Post" the room to experiment and kind of figure out what it means to be a newspaper in 2013, 2014 and 2024. I mean, he's giving them a lot of space to figure it out.

STELTER: "The Boston Globe" sold this week as well. We've go to mention that. John Henry, the new owner. I wonder if he's going to take what he's learned about sabermetrics in baseball and apply it to "The Globe."

FARHI: Well, I think both of these purchases suggest that the newspaper industry needs new approaches. I think the Grahams essentially said that by saying we cannot take this newspaper into the future, we need to hand it off to somebody who does have another plan, another way of going about it.

And, you know, Jeff Bezos may be the guy to do that. We hope so at "The Washington Post."

HALL: Healthy invests in reporters. What an idea. There have been a real loss of newsroom jobs at "The Post" and in other publications. And, you know, the brand of "The Post" covering Washington could use some reinvigorating and use more reporting on federal agencies. That's what the paper has always had attention about.

I mean, I assume you agree with me.

FARHI: Well, we also need to cover our local city and our region. "The Washington Post" has always from the get-go within a local newspaper.

And, you know, what's interesting here is we will have a publisher who is an absentee publisher. He's not moving here. He won't be here. How that affects our metro coverage, something we've been very strong on for decades, remains to be seen.

STELTER: The story you wrote about "The Post" sale was about "The New York Times." I know why, you know why, but let's explain to the viewers at home why "The New York Times" ownership came up immediately once this happened.

FARHI: Well, because "The New York Times" is essentially the last man standing. A family own, family controlled newspaper that is still independent.

Can they make a go of it? Can they remain a public company without the kind of, you know, wealthy backer that "The Washington Post" is now getting. So far, so good for "The New York Times," but can they remain independent is the question.

STELTER: In fact, the family met -- at least talked afterwards and put out a statement saying they don't intend to have any change. What do you make of that?

FARHI: Well, they say that and if someone shows up like Jeff Bezos and says I'm going to give you a whole lot of money for this enterprise, maybe they would be for sale. The family seems adamant. We have to take them at their word, obviously. They think they have a plan to go in the future, but "The Washington Post" wasn't for sale necessarily until a few months ago too.

HALL: "The New York Times" is profitable and it moves in the digital world. And it moves -- they have doubled down on being a national newspaper.

STELTER: Right.

HALL: And I agree with Paul. "The Washington Post" has to do both. "The New York Times" has to do both too but they are sold all over the country and that's a source of revenue. And they've had subscriptions.

I mean, everybody has to develop ways to get the content paid for. Advertising is coming up. You know, there are a lot of different ways to try this. They have doubled down on we're going to be the brand and the newspaper and that's going to be our core business.

FARHI: And there's something that they have to be dependent on into the future, which is those paid -- those paid subscriptions going up and up and up.

STELTER: Right.

FARHI: If it levels out, if it declines, there's a problem. So they have staked their future on a strategy which says people will pay for the paper and advertising will be a lesser part of the revenue stream of the paper.

STELTER: Right. Paul Farhi, Jane Hall, and in New York, Jenna Wortham -- thanks.

When we come back, what can "The Post" learn from someone like Jeff Bezos. We'll talk to someone who knows personally -- Henry Blodget, next.

(COMMERCIAL BREAK)

STELTER: He's one of the 20 richest people in the world. With an estimated net worth of more than $25 billion, he's a busy guy. So, Monday's announcement left many people wondering, why would Jeff Bezos want to buy "The Washington Post"? Well, his past investments might help answer that question.

A few months ago he helped this Web site, "Business Insider," raise $5 million to hire more reporters and more salesmen. In retrospect, maybe Bezos was dipping his toe in these waters. Well, now, that he's dived all the way in with "The Post".

I spoke with "Business Insider" Henry Blodget about where he thinks the paper is headed.

(BEGIN VIDEOTAPE)

STELTER: Henry, thanks for joining us.

HENRY BLODGET, BUSINESS INSIDER: Thank you for having me.

STELTER: So, when you heard about the sale of "The Washington Post" here in this newsroom, how did you react?

BLODGET: I was very startled. When I thought about it, I wasn't surprised. Jeff Bezos has made big, bold bets that people think are insane for his entire life as a professional and most of them worked out very well. And when I thought about it, this made a lot of sense.

STELTER: You guys go way back. You bet heavily on Amazon in the '90s and believe the stock was going to rise and it did. And more recently you talked about an investment here. When did that start?

BLODGET: Well, I knew him in the '90s and a year and a half ago he asked me to dinner, which was great. We had a long dinner. We talked about a lot of things, Amazon over the years, it's been an incredible progression, his philosophy toward the business, investing in the long term. We talked about this business.

And six months later, he said, "Hey, I'd like to invest." We said, "Great. Send the money."

STELTER: Did you get the sense that he was interested in the journalism business more broadly?

BLODGET: He's an incredibly curious, smart person. Every time I've ever seen him and talked to him, he always has great ideas about things. He's thought about everything very deeply.

So the idea that he would be into great journalism seems absolutely apparent. I think he's interested in this business too, though. There are a lot of similarities between the digital journalism business and Amazon. And the difference between Amazon and a traditional retailer is very similar to the difference between a digital journalism business and a traditional journalism business.

STELTER: Right.

BLODGET: I think all of that was actually very interesting to him.

STELTER: What is out there he's trying to build here? And what do you think appealed to him about this?

BLODGET: I think he thinks it's cool and interesting and he has invested in lots of things for seemingly only that reason. He's invested in rockets, atomic clocks. He thinks it's cool and he wants to be close to it and talk about it. And if there's a financial return there, great. I don't think he's trying to throw money away. But I actually just think he wants to be involved in a lot of very colonel things and that was definitely an appeal here, I hope.

STELTER: You wrote a blog post earlier in the week about what you think he might do at "The Post", though. And you said that, "If you ever have a question about how to do something, you just look at Amazon."

What do you mean by that?

BLODGET: Lots of different ways. But the main way that Amazon is so different from the rest of corporate America and the reason the company is one of the big success stories out of the 1990s is that Jeff has a philosophy of making bets that are going to pay off over decades.

He is not worried about this quarter's earnings, this year's earnings. He's not worried about making a profit to impress Wall Street this year. And the company is also mocked and criticized for that, but only by short-term people who don't understand the value of taking those profits and reinvesting them. And that's why Amazon has been so successful.

So, looking at "The Post," "The Post" is losing money now. My guess is he will be patient about that, as long as he thinks "The Post" is making very intelligent investments for the future.

What happens to the newspaper? Is he going to combine newspaper delivery with some of Amazon's physical delivery that they're moving into now? Maybe so. Will he eliminate the paper? Eventually, I would imagine so.

Will he work on the Web site and the distribution and building out the newsroom so "The Washington Post" is much deeper and broader? Certainly possible.

STELTER: You mentioned similarities between digital news and e- commerce and distribution is one of them. What are some of the other similarities you see here?

BLODGET: The biggest similarity is if you look at a traditional store versus Amazon. Any traditional store has to be either a specialized store or a generalist store. There's Walmart, which has two versions of every product. Then, there's a specialty store which has all of them.

STELTER: Right.

BLODGET: A web business can be both of those things at the same time. That's why Amazon can basically hook you up with any product, anywhere. They don't have to be a specialist, they can be broad.

The news business is exactly the same way digitally. Historically, we've had networks that are focused on a particular thing. We've had magazines focused on a particular thing. Or we've had generalist newspapers like "The Washington Post" that try to do a little bit of everything.

STELTER: Right.

BLODGET: A good digital news organization can do both. They can go very deeply into certain topics and they can be incredibly broad. And I think that's a huge opportunity.

STELTER: What's the biggest takeaway that someone like Jeff can take from here and apply to "The Washington Post"?

BLODGET: Hopefully, to the extent that he's looking at some of the things we do. Some of them are very applicable to what "The Post" does. I think there is the fundamental challenge that he will have to confront relatively quickly, which is transforming an organization that has just been trying to survive and now focusing on it -- OK, here's the innovation engine we'll go forward.

But I would expect there are a lot of things we do here he would want to do at "The Post" that would help the innovation engine get better and more profitable going forward.

STELTER: What are two (ph) of those?

BLODGET: The way a digital newsroom is constructed is very different than a paper that's organized to deliver the product the next morning. The best journalists at "The New York Times" or "The Washington Post" are working on the next day's story. Maybe they'll hit the Web site, but there's that deadline of we're going to set it up for tomorrow morning and then it's going to be delivered.

Digital is much more real time. You have much more flexibility in terms of the type of story you can do. Sometimes it's just a link is all you want. Sometimes, it's a very short story, sometimes it's longer, sometimes it's video, sometimes it's very image heavy photographs. You can do a lot more of that than you can do in the paper.

So, there are just different ways of story telling that work very well online and there are different ways that people consume the information. They don't want it in a dump in the morning that they get and flip through. They want it throughout the day.

STELTER: This all makes me think "The Washington Post" of the world will become more like "The Business Insiders" of the world, and vice versa, that there will be more blending between them.

BLODGET: I think that's right. In our case, the bigger we get, the more resources we have, the more we can do investigative reporting enterprise stories.

STELTER: The more show up on the same bits as "The Washington Post."

BLODGET: Exactly. You're typically used to seeing "The New York Times" or "Washington Post." Similarly, on the digital side, for "The Washington Post", I think the way to make that business work very well is to build a real time newsroom and to have the best talent at the paper focused on digital rather than the print product, and orienting the entire business that way. That will make "The Washington Post" viable forever.

There's a huge opportunity here. People talk about the death of journalism. This is a golden age for journalism -- and "The Washington Post" now has a chance to be part of that.

STELTER: Henry Blodget, optimistic, thanks for joining us.

BLODGET: Thank you for having me.

(END VIDEOTAPE)

BLODGET: So what would you like to see Bezos do with "The Washington Post"? Tweet me your ideas @brianstelter. Just use the #reliable. I'll be chatting on Twitter right after the show.

Coming up next, the new head of NBC News probably deserves hazard pay. Can Deborah Turness turn around the network's morning and evening news ratings slide?

(COMMERCIAL BREAK)

STELTER: Back in May, NBC shattered one of the media's remaining glass ceilings, by hiring the first female president of a network television news division. Her name is Deborah Turness. And she started her career across the pond working with Britain's ITN.

Let me tell you what the conventional wisdom was in the TV industry back when she was hired. People said her first, second, third, fourth priorities would be fixing the "Today" show, which is stuck in second place in the mornings and it does need fixing. But other shows need fixing too.

Just two weeks ago, in the evening, ABC's Diane Sawyer beat NBC's Brian Williams for the first time in nearly five years. Maybe that's just a fluke, but it's probably not. The newsmagazine "Rock Center" was recently cancelled. And NBC's Sunday morning show "Meet the Press" has lost a lot of ground to its competitors as well.

NBC used to be the dominant brand in network news. Now -- well, that's debatable. Returning to the roundtable to talk about NBC's challenges and more, Paul Farhi, the media reporter for "The Washington Post"; and Jane Hall, a journalism professor at American University.

Jane, I want to put up the graphic from "TV Newser" this week. Deborah Turness' first week on the job showed how challenging this is going to be. It says "Good Morning America" has extended its winning streak among total viewers to 50 weeks. It's longest run at number one in more than 21 years. Once you fall to second place, it's really hard to get back up, right?

HALL: Well, these changes in morning television are glacial. And once they turn, they sometimes stay turned for a long time. That's got to be her first job.

Multimillion dollars, as you've written, are on the line between being first and being second. These are a huge profit center, they are largely female audiences and they misjudged, as you wrote so well, how the largely female audience would react to Ann Curry seeming to be pushed aside. They did the same thing 20 years earlier with Jane Pauley seemingly pushed aside, and this is a really big issue that she's going to have to deal with right away.

STELTER: Right, right.

Paul, it's worth pointing out these network news shows still command a big audience versus cable news, and that's why we care about them, right?

FARHI: That's right. It's the tallest building in Wichita phenomenon these days. Everybody is losing audience. The audience is going to hundred different channels, 1,000 different channels, maybe 5,000 different channels with the Internet.

And yet, the network is still, because of their historical advantage, still command the biggest share.

STELTER: Right.

FARHI: You know, that's a very valuable position, even in this world that's flying apart in many, many different ways.

STELTER: Flying apart, I like that.

FARHI: Yes.

STELTER: Jane, what's the significance of having a woman in charge of a network news division for the first time?

HALL: Well, I think -- I think it's important. I think it's another shift in moving women into the executive suites that's going on around the country. I think the symbolism probably at the anchors was more important because that's what the viewers know.

STELTER: Right. HALL: When Diane Sawyer and Katie Couric came into these jobs, it used to be a woman wouldn't be seen, I was told, as the voice of authority in a time of crisis. I think it's less important. I don't think she'll be any more sensitive to the women viewers than to the men, but it's a good -- it's a good symbol.

FARHI: We should also point out that she, I believe, is also the first British national to run an American network news division. And we don't know how that plays out either.

STELTER: That could be very interesting, though.

HALL: You know, one another thing I wanted to mention, the nightly newscasts, among everybody else, have maintained their audience. There is still an audience for a summary of the day's news --

STELTER: Right.

HALL: -- on all three of those broadcasts -- the one place that's amazingly stable.

STELTER: Is nightly news.

HALL: Yes.

STELTER: Another topic affecting NBC News this week is the Hillary miniseries over at NBC Entertainment. We've seen the RNC come out and say they're not having any debates with NBC if this miniseries goes forward. They say the same thing about CNN because CNN is working on a documentary about Hillary Clinton.

And earlier today on "STATE OF THE UNION", Reince Priebus, the chairman of the RNC, was asked about it so let's roll that tape and see what he said.

(BEGIN VIDEO CLIP)

REINCE PRIEBUS, RCH CHAIRMAN: Totally ridiculous and stupid. The fact is what channel am I going to tune into to see the documentary and mini series that is all about promoting Hillary Clinton? At this point it sounds like it's going to be CNN and NBC. And if that's the case, they're not going to be involved in our debates, period.

(END VIDEO CLIP)

STELTER: Paul, let me play devil's advocate here. Isn't this all a smoke screen designed to distract from the fact the Republicans want fewer debates overall? They want to have their candidates less exposed in 2016 and that's why they're making a big fuss of this?

FARHI: Well, I won't touch that part, but I do think -- I do think they want equal time and that's what Reince Priebus is going for here. You know, I don't remember the RNC being all that upset when CBS did a miniseries about the Reagans. They did have a few problems once the facts started leaking out about that miniseries.

But, nevertheless, you know, this is the entertainment division of NBC, not the news division. And we don't know what the content is. There's plenty of warts to bring up about Hillary Clinton, it's not going to be all glory for her.

HALL: You know, Chuck Todd and Andrea Mitchell have already talked about how this is, as Todd said, a nightmare for them. Viewers, I don't think, are going to make a difference.

The thing that's funny to me, who's to say if this talks about Monica Lewinsky, which it will, who's to say this is going to be great for Hillary Clinton to bring all of that bad news up again? I think Priebus -- I'll go out on a limb. I saw Priebus' interview with Sean Hannity about this. He basically said we want a base we can control. These guys are not going to promote us.

So, I think -- I think it's a ploy. I'm sure it's a sincere ploy, but I think it is a ploy about the debates, to say we're going to take our ball and bat and go home.

Except on the other hand from the RNC's perspective you're going to have four-plus hours -- or I'm not sure how long it's going to be -- of primetime coverage, of primetime story about Hillary Clinton. They'd probably like that for Marco Rubio and Jeb Bush, et cetera.

STELTER: One more NBC story this week, Alec Baldwin in talks for a show on MSNBC. This is not a joke. I think it may be announced as early as this week.

Will you all be watching an Alec Baldwin talk show?

FARHI: I'd watch that. I think he's an interesting personality. Look, the cable networks do not have hosts who are from a news background necessarily.

Why not Alec Baldwin? He's a guy who mixes it up. It could be exciting and energetic.

HALL: I think it could be good. I've interviewed him. He's very interested in politics. How he would be on a regular show -- you have to book people, you have to be a host, how the rest of the lineup feels about this, I'd be curious to know how some of the other hosts feel about him. He certainly would get a lot of tune-in in the beginning.

(CROSSTALK)

HALL: He's got a great podcast. So if it's anything like the podcast he does online, it could be great.

STELTER: Well, Jane Hall, Paul Farhi, thanks for joining us.

And next, a turn from the latest media news of the week to maybe the heaviest of all, terror threats, embassy closings and secret drone strikes. There was no shortage of news from Yemen this week, but where was the press?

(MUSIC PLAYING)

(COMMERCIAL BREAK)

STELTER: Welcome back to RELIABLE SOURCES. I'm Brian Stelter.

Today 18 of the embassies that were closed because of terror threats last week reopened. One is still closed, and it's the one in Yemen, which underscores how that country is now a central front in the largely secret war against Al Qaeda.

So why are there so few Western reporters living and working there?

And how does that journalistic vacuum affect the way we understand what's going on?

Joining us now live via Skype from the Yemeni capital, Sanaa, are two of those Western journalists, freelance reporter Adam Baron and Iona Craig, the Yemen correspondent for "The Times" of London.

Also joining us from Atlanta, Jeb Boone, a former managing editor of the "Yemen Times" and now a global "Post" correspondent.

Thank you all for being here and thank you all for coming in from Skype from Yemen. Sometimes this can be tricky which really shows how hard it is to cover the news there.

I wanted to start with Iona and talk about what a typical day in the life for a reporter in Yemen is.

Iona, is it relatively safe for you? Are you able to move around pretty freely?

IONA CRAIG, "THE TIMES": Yes, I'm able to move around pretty freely. I head out in the mornings. I normally pick up some bread from the bakers that's just outside my front door for breakfast. I live right on a busy market and head out for meetings.

Most of the interviews I do here when you're talking to Yemenis, I don't think I've ever done one that's lasted less than an hour. People will sit down and spend a lot of time talking to foreign journalists here.

But the only thing I do, I do need to take precautions. I do wear an abaya now and a hijab just to blend in a bit more because of the recent issues over foreigners being kidnapped.

STELTER: Adam, do you find interest from editors back home and from bosses back home in the stories that are happening there?

ADAM BARON, FREELANCE JOURNALIST: I think I'm lucky that the two main outlets that I write for in the U.S., CSM and McClatchy Newspapers, tend to take a pretty nuanced view, so they're always interested in stuff. But it's very clear that there are certain things, like anything AQAP related, obviously, as the past week has shown, they get disproportionate attention compared to the political things or more humanitarian related stuff.

STELTER: So in other words, the war coverage is taken much more seriously than the human stories there?

BARON: Yes, I'd say so.

STELTER: And, Jeb, how does that affect how Americans perceive what's going on there?

If we don't see it on television every day, if we don't see live shots from there and foreign correspondents parachuting in, how does that affect how Americans perceive it?

JEB BOONE, FORMER MANAGING EDITOR, "YEMEN TIMES": Americans don't realize how -- just how deeply involved we are in Yemen and how many drone strikes have happened just this past week. There have been so many.

It's important to realize that while no one is -- no one is in these areas, these rural areas where the drone strikes are happening. It may seem sort of a distant occurrence, hard to keep in touch with. Also keep that in mind when the media reports on these types of drone strikes, they're relying on reports from elsewhere and they might not quite be sure what's going on, either.

STELTER: Iona, when we talked earlier, you made a point about how this reminds you in some ways of Iraq and WMD from many, many years ago because you say Western journalists are fed, spoon-fed information.

Can you give us an example of that?

CRAIG: Yes, I mean that's really come out this week. Most of the coverage that's come from Yemen has not just been misleading, it's been complete and utter codswallop. You'd probably believe -- or the people in America would believe that we're on lockdown here, that we're under a siege.

And the reality is here in Sanaa this week, nothing has changed. It's absolutely normal, the amount of soldiers on the streets. There has been no heightened security. And the only difference has been this U.S. surveillance plane that was buzzing over the city for several days.

So, yes, and the spoon feeding aspect is that all of this was instigated by unnamed officials in the White House and in Washington without any verification of that. And people -- you know, the media organizations have completely swallowed that information without questioning it or actually using their own brains, you know, to think whether that may or may not be correct.

And that's similar to what happened with the Iraq story. So this has all been sort of hugely hyped up as a pretext then, as Jeb mentioned, this soaring number of drone strikes this week.

STELTER: Adam, I suppose if there's any optimistic take on this, it's that you all are there and that, thanks to Skype and Twitter, you're able to get the word out in a way people couldn't do 10 and definitely not 20 years ago.

BARON: Yes. I can't imagine what it would be like to do this prior to -- prior to the Internet and stuff.

And I think when it comes down to it, I think when you look at me and Iona and our other colleague, Casey Crooms' (ph) coverage, it's very clear the difference between someone who's writing about Yemen from Washington, D.C., or Cairo versus writing from Yemen from Yemen.

And I think when it comes down to it, one of the reasons why there's such an issue with a lot of coverage at Yemen is that it's being covered from elsewhere, when this is a country that you really need to be deeply enmeshed in to really understand.

STELTER: That's a great reminder for all journalism for that matter, the value of being on the ground.

Adam, Iona, Jeb, thank you for joining us.

UNIDENTIFIED MALE: Thank you.

STELTER: After the break, ESPN calls itself the worldwide leader in sports. Well, it's about to get a fearsome new competitor.

What's the game plan for fending off FOX Sports 1? My conversation with ESPN boss John Skipper is next.

(MUSIC PLAYING)

(COMMERCIAL BREAK)

STELTER: Welcome back to RELIABLE SOURCES. Redskins, Cowboys; Alabama, LSU; Yankees, Red Sox; now there's another sports rivalry forming. This Saturday FOX launched its new 24-hour sports channel, FOX Sports 1. The lineup will feature football, soccer, college sports, NASCAR and even ultimate fighting. But really this is the ultimate fight.

FOX is hot on the heels of NBC and CBS, who also have their own dedicated sports channels. They're all attempting to challenge the dominance of ESPN.

So maybe it's not a coincidence that Keith Olbermann, the combustible former "SportsCenter" anchor returns to ESPN this month, or that Nate Silver, "The New York Times" stat stud, is about to bring his FiveThirtyEight blog to the network.

Earlier I spoke with ESPN president John Skipper about FOX's new network and the state of sports journalism.

(BEGIN VIDEOTAPE) STELTER: John Skipper, thanks for joining us.

JOHN SKIPPER, PRESIDENT, ESPN: Thank you, Brian. Thanks for having me.

STELTER: We see the earnings from Disney come out a few days ago and as always, ESPN drives the company's profits.

It must be a great time to be in sports media, huh?

SKIPPER: Look, right now is an ascendant time for sports. We were very pleased with the earnings. Many divisions of the Walt Disney Company have contributed this year. The films have had a great year, the parks are having a great year and we're really pleased to be able to do our part in the overall company.

STELTER: Now because of those profits, the competition is getting more and more fierce. We have FOX Sports 1 launching in a matter of days.

What's ESPN's take on this giant new rival?

SKIPPER: Look, we have a great deal of respect for the News Corporation and for FOX. They have got some excellent rights. They make smart plays. The News Corp will make big bets, so we respect what they do, we're cognizant.

But we, on the other hand, we feel very confident in our strengths, in the aggregation of rights we have and our people, in our relationships with advertisers, our distribution deals. We're in a strong position.

STELTER: Your hiring of Nate Silver was one of the great media surprises of the summer.

When will he start and what will we see initially from Nate Silver and FiveThirtyEight being a part of ESPN?

SKIPPER: Nate will officially work for us as of September 1. It will take us a few months to get FiveThirtyEight retooled and repositioned and relaunched, but you'll begin to see Nate Silver across some of the platforms of ESPN.

He brings a unique mind to this. He really is at the forefront of the analytics movement and we'll look to use him where he can make a difference, help us understand big events better, and then, of course, the priority is for him to get FiveThirtyEight relaunched in the next several months.

STELTER: Is there an analogy there to Bill Simmons? The two did a podcast this week talking; they're clearly getting to know each other.

Do you want to bring in more franchises like them?

SKIPPER: Well, it certainly was helpful that we had launched Grantland, that we had allowed Bill Simmons to have the freedom to do the kind of site he's doing so that when we went to Nate and said we're going to let you range across things other than sports, we're going to give you support and freedom to have opinions and to look at things, it gave us a real credibility.

And, yes, it's like, of course, asking if you want to have a hit record. We like having a Bill Simmons and Grantland. We like having a Nate Silver and FiveThirtyEight.com. If you or anybody else can point me in the direction of other singular talents around whom we can create businesses and opportunities, we're ready for a go.

STELTER: And speaking of talent, Keith Olbermann starts in a couple of weeks. We're going to see him on ESPN2.

Will we see Nate Silver on that program as well?

SKIPPER: You know, we're right now in the process of doing the formats for the Keith Olbermann show, of doing rehearsals. Eventually you'll see Nate Silver on Keith Olbermann, I suspect, but we haven't made all those decisions.

Given the fact that the show is smart and that we're looking for smart guests and points of view, I suspect you'll see Nate Silver on Keith Olbermann; I'm not prepared to say when yet.

STELTER: How are the rehearsals going for Olbermann's show? How's it going so far?

SKIPPER: So far it's going great. There's always some scary moments as you think about getting a show up and launched this quickly, but we've done this a lot. We've got some excellent producers on the show.

Keith is up for it. It's been astonishing to watch the rehearsals and see what he can do in a room with a pen and a piece of paper in an hour. So we're very excited about how smart this show is going to be, how energized Keith is. We think we're going to have a very informative entertaining show here.

STELTER: Is there a strategy here for ESPN overall to seem more intellectual, especially at a time when FOX Sports 1 is about to come on?

SKIPPER: Look, we have long looked for smart talent and unique points of view. It was 2000 when we put David Halberstam and Ralph Wiley and Hunter Thompson on Page 2 of ESPN.com. So we've been at that.

Just by the very nature of the definition of unique talents and singular talents, there aren't many who qualify under that. So yes, we're on the lookout for people who can make us smarter. And we have a lot of networks and a lot of time to fill. And we want to have many different ways to do that, different kinds of shows, different formats, different talents.

And the strategy has been to create as much of our own competition as possible. We want to be programming ESPN1, ESPN2, ESPNU, ESPN News, ESPN Deportes as with great shows and compete, most importantly, with ourselves.

(END VIDEOTAPE)

STELTER: At the end of the interview, I wanted to ask Skipper about the controversy that's engulfed next winter's Olympics. Russia's anti-gay laws have generated tremendous outrage as well as some questions about NBC Universal, which will broadcast the games, might handle the issue.

(BEGIN VIDEO CLIP)

SKIPPER: Look, I think the guys at NBC have an extraordinary commitment to the Olympics and what it stands for. I know those guys personally and I know that personally they are not supportive of the kind of legislation that has been passed in Russia or those kind of actions. And what they're trying to figure out is how to navigate that.

They have a responsibility to our athletes, to the U.S. Olympic Committee, to the IOC. They want to do great television, and I have a high level of confidence that they have the moral compass and the smarts to navigate this.

It does represent an ethical issue for us all. It will represent it to us in covering this. We, of course, are appalled at what has gone down here. But again, we -- I think my peers and friends over at NBC will do well here.

STELTER: John Skipper, one of the most powerful men in media, thanks for joining us.

SKIPPER: Thank you, Brian. Nice to be here.

(END VIDEO CLIP)

SKIPPER: Last but not least, Jon Stewart returns to his "Daily Show" from a summer break soon.

But I wonder might viewers be rooting for John Oliver to stay put?

(MUSIC PLAYING)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JOHN OLIVER, "THE DAILY SHOW": All the speculation launched our new segment, "Can't You At Least Wait until Jon Stewart Comes Back?"

(LAUGHTER)

OLIVER: Because as you know, 2016 is three years away. And I'm only here for two more weeks. (END VIDEO CLIP)

STELTER: Some fans don't want him to ever leave. Many it's his youthful exuberance; maybe it's his slightly less cynical approach; maybe it's just that British accent. I'm not even going to try to impersonate it.

Whatever the reason may be, some people seem to prefer John Oliver to the man he's filling in for. My "New York Times" colleague David Carr got me thinking about this. Here's what he had to say.

(BEGIN VIDEO CLIP)

DAVID CARR, "THE NEW YORK TIMES": Let's stipulate that Jon Stewart changed television and journalism and is really great at hosting "The Daily Show." Still enjoying the John Oliver.

Maybe it's the presence of the British accent. Maybe it's the fact that he's super excited every single day to be doing it. Maybe it's because he acts like he's about to get the hook in any random second, but there is an urgency to the broadcast right now that I'm enjoying very much.

(END VIDEO CLIP)

STELTER: David Carr with the video selfie there. This debate, it divides households, families, even morning show teams.

Here's what the cast of "NEW DAY" told me on Friday.

(BEGIN VIDEO CLIP)

MICHAELA PEREIRA, CNN HOST: I'll have him booked. John Oliver is really funny. And that British charm, come on.

CHRIS CUOMO, CNN ANCHOR: It's hard to look at it because Jon Stewart attacks CNN all the time, but Oliver has attacked "NEW DAY" directly. So I don't know who I like better.

KATE BOLDUAN, CNN ANCHOR: I'm going to be Switzerland on this because I think...

(LAUGHTER)

CUOMO: You (inaudible).

BOLDUAN: You know, you win them over with sugar. I'm going to -- I love you both.

(END VIDEO CLIP)

STELTER: Next I went to a primary source, the comedian, Lizz Winstead, who co-created "The Daily Show" back in the 1990s.

(BEGIN VIDEO CLIP) LIZZ WINSTEAD, CO-CREATOR, "THE DAILY SHOW": It's not really about whether or not John Oliver or Jon Stewart's better. It's just another case of one of those crappy cable TV jobs that no American wants to do. Isn't John Oliver just really an immigrant doing a job that no American has really signed on for?

(END VIDEO CLIP)

STELTER: You know whose votes matter the most, the viewers.

So we stood in line at "The Daily Show" this week and we polled the audience.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I prefer Jon Stewart. Yes. Just because he's familiar and he's been doing this for so long.

UNIDENTIFIED FEMALE: I prefer John Oliver because he's British. Sexy accent, you know.

UNIDENTIFIED MALE: I do prefer Jon Stewart.

UNIDENTIFIED FEMALE: In life, John Oliver.

UNIDENTIFIED MALE: Jon Stewart. I honestly don't know why. He's just got charisma. But I love John Oliver.

UNIDENTIFIED FEMALE: But hosting "The Daily Show," I don't know. I mean, Jon Stewart made it what it is and it's awesome.

UNIDENTIFIED MALE: John Oliver because I'm English.

UNIDENTIFIED FEMALE: I prefer Jon Stewart because I don't know who John Oliver is.

UNIDENTIFIED FEMALE: But John Oliver is like my favorite comedian hands down and has been.

UNIDENTIFIED MALE: Oh, man, now that is a tough question. I'm going to have to say John Oliver, just because he's young, relatively and, I don't know, a big fan of his work. So it's been fun to see him break out into his own. Hoping he gets a spinoff, right?

(END VIDEO CLIP)

STELTER: Me, I'd still vote for Jon Stewart. I'm loyal.

But there is more than enough room for two Johns. So Comedy Central, we're counting on you. And that is your moment of zen.

Thanks for watching this edition of RELIABLE SOURCES. I'll be chatting after the show on Twitter, so tweet me @BrianStelter or just use the hashtag #reliable.

By the way, if you missed anything, you can catch all of today's conversations on CNN.com or go to iTunes and check out our podcast. Join us again next Sunday at 11:00 am Eastern. "STATE OF THE UNION" with Candy Crowley begins right now.