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Reading Brian Stelter in The New York Times certainly indicates that numbers are falling and brands are seeking solace with Big Cable over Networks. Broadcast ratings in the key 18-49 demographic tumbled by 17% during the winter months when compared with a year earlier, according to Goldman Sachs, which called the decline: "the sharpest pace on record." NBC and ABC are lucky to get five million to tune in to anything.
"At ABC, the lowest-rated of the four broadcasters, first-quarter profit fell 40 percent compared with the same quarter last year, but the network still made $138 million," Stelter wrote. "NBC, on the other hand, lost $35 million in the quarter, because of lower advertising revenues. NBC's parent, Comcast, said the network would have fared better if its biggest hit, 'The Voice,' had been on in the quarter."
And Fox itself has also been hit ratings for the flagship "American Idol" is also falling. Stelter notes:
"Ad revenue slipped at Fox too, partly because 'Idol' has lost nearly a quarter of its viewers this season, on top of a 50 percent decline over the previous five years."
Dan M. from Chicago commented on the New York Times article:
Add equal parts mega-merger, a dearth of creativity / good writing, and a willingness to always stoop to the lowest common denominator in human nature, and you get 300+ channels of nothing.
Rednecks fishing with their bare hands in mud holes, spoiled, ignorant housewives stabbing each other in the back on competition shows, people that can cry on cue over the most ridiculously small of setbacks, news reporters that don't report news but instead celebrity nonsense and infotainment and political spin-doctoring. MTV has literally spawned an entire genre based on voyeurism and human dysfunction, while CNN single-handedly killed in-depth reporting on TV.
What's amazing to me is how so many other channels sacrificed their principles to jump onboard these sad trends. Television isn't about quality content anymore, it's about the almighty ratings dollar and playing on people's emotions, whether political or at the water cooler. And while ratings have always existed and pressure to get ratings dollars have always existed, it has never been this bad. It was nowhere CLOSE to being this bad back in the 80s.
Tim Goodman has a slew of snark at Hollywood Reporter.
Jim Edwards from Businessinsider.com evicerates even more:
But there are signs that this won't last, and that broadcast TV may be facing a crisis. The Times said:
"The networks are getting picked at from every direction," said Jessica Reif Cohen, the senior media analysts at Bank of America Merrill Lynch. "This year was the tipping point," she said, "when the television ratings really fell apart."
Put that together with competition from Aereo, which reroutes free, over-the-air broadcast signals onto computers and iPads where people can watch TV without paying for cable. News Corp. has already said it will stop broadcasting Fox TV, and go cable-only, if it cannot extract transmission fees from Aereo. (Most people watch "broadcast" TV on cable or satellite, where stations get fees from subscribers.) It's not just Aereo of course. It's Hulu and YouTube and Netflix and a hundred other alternatives to watching TV. Think about that: The model is so broken that a major broadcaster has threatened to stop broadcasting in order to save itself. It begs the question: With declining audiences, and dozens of new ways to watch shows without paying for cable, how long with these $10 billion meetings last?
It's so bad for Networks right now that Edwards also points out that Univision Routinely Gets More Viewers Than NBC:
It's not that Univision has suddenly piled on tens of millions of new viewers outside its Spanish language audience. (Its season-to-date audience was only up 1% through April.) Rather, it's that audiences for traditional TV offerings are collapsing. When the tide goes out, the rocks get exposed, and Univision is one of the rocks.
It's not a fluke. NBC isn't simply having a bad couple of weeks. Rather, NBC's audience has slowly vanishing since last fall - Univision finished the February sweeps period with 1.5% of all adults, aged 18-49. NBC had a 1.2% share, ABC had 1.7%, Fox had 2% and CBS had 4.9%. Univision is within striking distance of three of the four big networks, in other words.
...the fact that a channel that serves only 12% of Americans (those who speak Spanish) can now routinely compete with the "big" broadcast networks suggests that the broadcast pool is getting smaller and smaller.
More from Edwards at A Secret Cartel Keeps The Dying Broadcast TV Industry Afloat
The networks have actively resisted reform And they've been successful doing it:
...BelkinHarris Interactive surveyed US internet users on their willingness to replace cable TV with digital media subscriptions and found that 12% strongly agreed with the statement: "I would consider replacing my cable/satellite subscription with a streaming media subscription (e.g., Netflix, Hulu Plus) in 2013." Another 18% said they somewhat agreed, indicating that a total of 30% of respondents were inclined to at least consider cord-cutting.
Interestingly, no one is thinking to measure how much second screen or media stacking could be having an effect on the how much consumers are ad skipping. Nielsen themselves are giving the numbers. When do you think viewers actually use their mobile devices? During commercials of course.
• In US, 77% use TV & internet simultaneously (Nielsen)
• 86% of US smartphone and 88% of tablet owners use it while watching TV once a month (Nielsen)
• 45% use their tablet while watching TV daily (Nielsen)
• 44% of total tablet usage is while watching TV (Nielsen)
• 62% of TV viewers pick up the phone as soon as TV advertising break starts. (Nielsen)
As smartphones and tablets become more ubiquitous, this behaviour is only going increase. Not only are audiences shrinking, but those that are still there are, between PVR and media stacking, are apparently not watching or paying attention much to 30 second spots.
According to Socialnomics by Erik Qualman, 78 per cent of consumers trust peer recommendations. Only 14 percent trust advertisements. Only 18 per cent of traditional TV campaigns generate a positive ROI. The NYTs notes that hit TV shows have most-skipped ads on Tivo.
From Television Remixed: The Controversy over Commercial-Skipping by Ethan O. Notkin:
If there is one thing that viewers of network television would agree on, it is likely to be the annoying nature of commercial advertisements. One study found that 65 per cent of the consumers polled "feel constantly bombarded with too much marketing and advertising."
In addition, 69 per cent of those polled were interested in "products and services that would help them skip or block marketing." Part of the problem is the advertising industry's use of the widely accepted "saturation marketing" model, which calls for massive increases in the number of advertisements. The emergence of "spam" in the last decade has also contributed to the growing perception of advertising in general as untrustworthy and disrespectful to consumers.
The value chain and business model are broken. Clearly change is on the way. It's a matter of not if, but when.