Managing for margins: The end of broadcast TV?
David Johnson July 23rd, 2008
Shelly Palmer has this blast on HuffPost to counter remarks made by Ben Silverman, co-head of programming for the NBC Television Network. Sliverman said: “We’re managing for margin and not for ratings.” Palmer writes: “There is nothing technology can do to help or hurt this strategy. It is truly the end of broadcast television.” And continues with:
If you want to see TV ratings improve, the business improve and the ROI improve, try investing in programming, not margins. It will be a refreshing twist for the 21st century. And, it is really the only thing that will turn the business around. The recipe for profitable broadcast television is pretty simple: Develop large audiences that you can accurately measure and sell them to advertisers who need to reach them. The shows that do this even have a name: “hits.” If, on the other-hand, you want to sunset an organization and squeeze every last dime out of it before it gives up the ghost, manage for margins.
Hmm, maybe the print folk should read this too? Your thoughts?
2 Comments Add your own
1. Cory Bergman | July 23rd, 2008 at 8:58 am
It’s not the end of broadcast TV, but it’s a very bumpy transition from a linear approach to a non-linear one.
Presently, you need to “program” the network, with shows of varying strength on various nights, “counter-programming” what the competition is doing. The strength and promise of these shows is commensurate with investment and the overall mix of programming on the network. So time and volume are big influencers on how you spend your money.
In a non-linear world, when or even where something airs is not important. (Frequency, however, is still important.) And there’s no minimum volume: you don’t need to fill every night. So investment decisions are fundamentally different.
The problem is, the vast majority of revenue is still originating from the old model (”analog dollars”), so there’s a clash of strategies. Once the money shifts to a non-linear environment — which it will, since most TV programming will still be viewed on TV, just in an on-demand fashion — then the networks will do a better job producing stuff we’ll watch.
The question is, what will happen in the transition. Which networks will capitalize? Which will fail?
2. David Johnson | July 23rd, 2008 at 10:22 am
Hey, shouldn’t you be going goo or sleeping or something? Great points.
makes me wonder about the syndication deals of old, e.g. baywatch gets dumped by the network and goes on to be a worldwide sensation as an indie syndie.
if the value of the network as a distribution channel for studio products diminishes, will studios start going it alone with their strongest material. but then, how do you get exposure and eyeballs to that material? and how do you recoup costs of production if you don’t get “picked up.”
maybe it dovetails with the ala carte channel/cable operator issue, too. doesn’t jeff jarvis love weeds, but only watches via itunes because he doesn’t subscribe to showtime?
so do networks become something like movie studios for strong series content in non-linear and distributed platforms or do they grind it down to cheapo reality and contest shows.
Leave a Comment
(Please keep URLs out of the comment body or the spam filter will block you.)Subscribe to the comments via RSS Feed