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For Fox News, Ad-Sales Market Isn't Fair, Balanced
Despite Ratings Lead, Network Has Hard Time Winning Top Rates for Its Shows

NEW YORK -- Paul Rittenberg, head of advertising sales for the Fox News Channel, got on the phone recently to counter a lowball offer. Chrysler wanted to buy nearly $2 million of commercials -- but at a cut-rate price of $8 per thousand viewers.

Mr. Rittenberg pushed for $11.98, almost a dollar below his original asking price. Chrysler turned him down. As he hung up the phone, Mr. Rittenberg said nervously, "I hope CNN didn't get it."

The haggling illustrates a frustrating paradox for Fox News. No longer a struggling upstart, it is beating Time Warner Inc.'s Cable News Network handily in the ratings. But in the peculiar market for television advertising, where the usual rules of supply and demand don't always apply, it has trouble commanding the same rates as its rival.

Attracting a large audience can often let a TV show charge higher rates, because advertisers place a premium on the ability to reach a large number of people at one time. That's why giant events like the Super Bowl or the final episode of "Friends" command such high rates.

But a large audience is not a guarantee of garnering premium prices. Media buyers say they generally pay Fox News ad rates that are about 75% to 80% of what they pay CNN -- even though CNN has only about half the audience of Fox News. And for all the inroads Fox News has made as a news organization, Mr. Rittenberg has to contend with advertisers who use CNN as a yardstick of quality.