By David Poland poland@moviecitynews.com
How To Think: Chase Carey Edition
Doing what I do, I guess I spend a lot of time writing about what I think others should think.
But I realize more and more that I am more frustrated these days by the process of thinking than I do about the conclusions that emerge from the process. I don’t really give a crap what people think, so long as their notions emerge from a way of thinking that allows them to consider a reasonably wide perspective.
The discussion this week in many media circles is about Fox’s Chase Carey “threatening” to take the Fox Television Network off of over-the-air broadcast TV in order to avoid being rights-raped by Barry Diller and Aereo.
Now… you can make an argument that this is ridiculous and bad business and makes no sense. But if you are making this argument primarily based on the idea that change is unlikely and that networks have been operating a certain way for decades and this just isn’t going to happen than you are absolutely failing as a critical thinker.
In the last 20 or so years, it seems that virtually everything about television has changed… and that is aside from streaming, a phenom of the last few years.
20 years ago, fin-syn – the rule that kept networks from owning the shows they aired – was abolished. The entire industry changed.
When cable television was making the push into cities, they were required to put all local broadcast stations on their systems. Now, they are paying for the right to retransmit the network broadcasters. The entire notion of how networks are paid for the content package that they have created is changing.
Less than 2 years ago, Netflix started making 9-figure annual deals with studios and producers for post-theatrical streaming rights. Before that, it was low 7-figures and 6-figures. The funding of the industry changed massively, virtually overnight.
Back in the day, the networks paid affliated stations to run their programs. Now, affiliates pay the networks for the right to transit their line-ups.
In the week ending March 31, 2 of the Top 9 shows in America were cable shows. “The Walking Dead” was #6 and “The Bible” was #9, each with over 11 million viewers. But traditionalists will tell you that that’s just because of the great traditions of those two powerhouse drama networks, AMC and The History Channel. (That was sarcasm, folks.)
Have 6 seasons of Monday Night Football on ESPN caused everyone to forget that this was the #1 property on broadcast TV for decades? And do we remember what Sunday night was before NBC started doing Sunday Night Football… a previous ESPN property? Did you watch any NCAA Tournament games on tru-tv? Would you have expected to do so before the summer olympics were spread out over 8 channels – mostly cable – last summer?
Forget about sitcoms or hour-longs leading network ratings… do we remember movies of the week and how huge they were? Do we remember when reality television was not allowed in prime time? Things change… a lot… quickly… and often. Does media resist this notion because it’s impossible to get ahead of every curve… that media will be surprised most of the time too? Is that thinking smartly or being self-protective?
The NFL averaged 17.4 million viewers per game last season. How much of that audience was watching over-the-air? The estimated 15% (2.6 million) that don’t have cable or satellite? 1.4 million? Most likely, about a million. How many of those are cord cutters? Not sure. But the cutters could easily be serviced, as MLB already does and DirecTV offers as an extra, by a streaming package.
The NFL sells its rights to broadcast, cable, satellite, etc, for what will be just under $7 billion in 2014.
If 10% of the viewers are “at risk” and if the Aereo concept puts, say, $500m in retransmission fees at risk… well, it’s math, isn’t it? Also part of the equation, the value of network owned & operated stations and revenues from network affiliates. If it weren’t for those last two things, the math would already swing towards making these non-broadcast nets. (I object to the flinging of “just another cable station” at such a shift. It overstates the argument wildly.)
Anyway…
The argument over the future of networks or Aereo or over-the-air broadcasting can be had by reasonable people. But so much of the thought process I see in print, online, Twitter, and elsewhere embraces wither the status quo or the underdog “disrupters,” which could be anything from legitimate game changers to con artists.
I am passionately against Aereo because I believe it undermines the foundations of the content creators and aggregators (networks) that seem completely reasonable in this day and age. Moreover, as a consumer, I want more access, just like everyone. But I know – having watched it scores of times – that if the players can’t get paid, it ultimately results in less content and access, not more.
What separates the “broadcast” networks from the cable networks isn’t (primarily) the over-the-air broadcasting… not in 2013. It is the 30+ hours of “original” programming delivered each week. Good, bad or indifferent, that programming just doesn’t exist on any all-cable network. It’s not because there aren’t enough people available only on cable and satellite, but because the model is, simply, different.
No one has The Answer… or everyone would air only winners. No matter how good any choice, there are things given up, whether demographically or the cost of the show or a given show’s ability to support other shows. Sunday Night Football has great ratings, but it’s expensive and not as female friendly as some programming and is off the air for 2/3 of the year. Good and bad.
But I hate the rush to deny change.. and of course, the shockshock when the change comes and the effort to own the very change that was being poo-pooed just months before. Everyone on… everyone off… everyone on. I’m not saying that everyone has to be an iconoclast or even a serious researcher. But just answering the basic questions of journalism more seriously would help so much. What? Who? Where? WHY?
Each story is NOT in its own little bubble, disconnected from the rest of the world. That is publicity, not journalism… not serious thought.
I think the issue of increasing costs of high speed internet and whether or not Internet service providers will want to go in that direction, since many Internet service providers also service as cable providers. Sure, put everything online, but unless the speed of streaming is not addressed, I don’t think the cordless revolution will take over. If anything, people may go back to their cable and satellite providers due to frustrating loading time to watch a show.
And cost, brack. Capping home wi-fi is the next horror show to come.
As soon as AT7T blithely capped their “unlimited ” plans and there was barely a peep, bad things started falling in line.
at the NAB this week, the phrase they keep using is “Zero TV”. This will become an oft used expression soon. It’s used to describe people who dont have cable or an hd antenna and view all their television through an internet connection.
Zero TV households are currently estimated at “around 5 million”, but that number is difficult to pin down.
Haven’t heard too much about this so just trying to get my head around it.
So is this just about retransmission fees or does the service allow people to skip through commercials as well? Is the streaming live or can they pull down things from a day or week ago? Are all these tiny antennas in the same media market so that if I apply in South Dakota I am actually watching a New York Station?
Because if this is just about availability through the internet, and is not skipping over the commercials, I don’t see the reason for Fox and Univision to go to the mattresses over this. Nobody is going to drop cable because they can get broadcast television over their tablet, they are going to drop cable because they feel it is not worth the cost.
As for the legal arguements, does the service have tiny servers devoted to each individual antenna and customer, recording the same material a 100,000 times simultainuously? Because even if you are renting your own little antenna, if all the content is coming from one recording in a database I don’t see how this is a private use broadcast.
IF Chase Carey could pick a show, ANY SHOW, that met expectation, much less be a hit, I’d consider this guy as being one step ahead of the curve but I don’t see him as having done anything new. Glee and Master Chef he inherited. Some of his higher priced failures include Chicago Code, The Good Guys, Terra Nova, ca-fricking-ching, and the DOA, we clearly are out of touch w/the American public, Lone Star. The show that looked like it had a shot of breaking out, New Girl, can’t anchor a night. I’m sure they’ll throw more money to X-Factor this fall because they don’t have anything else.
I find it hard to believe he’s really considering any long term implications with this proposed move, just what can immediately show up on the balance sheet. Fox will overspend for college hoops and football, maybe the NBA, so they can load up on premium content for their new espn-killer, 24 hr sports channel and then sock it to America w/like $6 a head carriage fee. And the boy wonder would be considered a hero to the board.
Ridiculousness!