Network TV: Is It Dying or Not?

Whether you saw these headlines or not, they probably sound familiar:

“Why Television Is Dead” – Forbes, January 2014

“TV Is Dying, and Here Are the Stats That Prove It” – Business Insider, November 2013

“Television May (Or May Not) Be Dying…” – Forbes, November 2013

“Television Isn’t Really Dying…” – Business Insider, July 2014

As the agency’s head of national television negotiations, I pay attention to these headlines. Since cable came onto the scene in the 1980s, pundits have been predicting the death of network TV. Ironically, now the cable networks’ death is being lumped in with that of the broadcast networks. Yet every year, media planners put it on their plans, and I negotiate the buys.

Despite the sensational headlines, here are the facts I know to be true:

Ratings are declining. There are many more options for our viewing pleasure: YouTube, Netflix, Hulu, to name just a few.

Many young adults are opting not to subscribe to cable packages (nor do they have an antenna to pick up a broadcast network).

Live viewing is being usurped by the DVR.

All these things added up should equal the death of network TV, right?

Here’s a fact that the articles in the trades never seem to pick up on: Since deregulation in the late ’80s and early ’90s, the networks have been diversifying their income streams. No longer are they completely reliant on advertisers’ revenue. Reverse station compensation, investment in original programming production and the subsequent syndication fees, along with other financial strategies are keeping the networks profitable.

As long as they are making money, network TV will not die. It will change, but it will not die.

Categories: 1000 ft. POV, Industry

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