“Covering” news is generally a bad idea; news should be reported, there should perhaps be a little analysis from experts, but then that should be it. Unless new information or further developments arise, news programmes and channels shouldn't dwell on what we already know.
The terrorists want people to be afraid. Constant news coverage of a kidnapping they have accomplished registers them in the public's collective psyche. The incessant media speculation has inevitably arrived at the discussion “Well, should we negotiate with them?”.
People have criticised Tony Blair and George Bush for not responding to these terrorists sooner. That criticism has achieved the terrorists' goal, by planting the suggestion that the Coalition's leaders are ineffectual. Responding to the terrorists is the worst thing they could do - terrorism must not become a means of achieving a political goal.
Another thing: the BBC is perpetuating the damage to the perception of Islam here in the UK - An Islamic website has published a video showing...
. Islamic
. The terrorists' actions do not reflect the views of the vast majority of Muslims; describing a terrorist website as an “Islamic” website suggests they do. It's equivalent to describing an IRA website as a “Catholic” or a “Christian” website.