I was in the Capitol South Metro station in DC recently and noticed that NAB had bought all the advertising space in the station, used by many Congressional staffers as it is located adjacent to the House office buildings. The various NAB ads in the station talked about the pending advent of DTV, its wonders, and then had the surprising statement that the 100 most popular programs on TV are on "free TV". No proof or references were given for this claim. A senior NAB staffer I met at an FCBA meeting assured me it was correct. So, NAB could you please reply to this post with a reference or explanation why this claim is correct.
Today's NYT had a less optimistic article on the prospects for "free TV" in today's world.
"For decades, the big three, now big four, networks all had the same game plan: spend many millions to develop and produce scripted shows aimed at a mass audience and national advertisers, with a shelf life of years or decades as reruns in syndication.
The future for the networks, it seems, is more low-cost reality shows, more news and talk, and a greater effort to find new revenue streams, whether they be from receiving subscriber fees as cable channels do, or becoming cable networks themselves, an idea that has gained currency."
So how are the NAB members with the top 100 TV programs doing financially?
"Financially, the networks are on shaky ground, partly because they rely almost solely on advertising. CBS reported that for the fourth quarter of last year, as the recession deepened, operating income in its television segment declined 40 percent, even though it was by far the most-watched network. In the second week of February, CBS had 12 of the top 20 shows, according to Nielsen Media Research.
News Corporation, which owns Fox, reported operating income of $18 million in broadcast television, compared with $245 million a year ago. And Disney’s broadcasting business had a 60 percent drop in operating income.
Jeff Zucker, the chief of NBC Universal, has been more pessimistic, saying, “broadcast television is in a time of tremendous transition, and if we don’t attempt to change the model now, we could be in danger of becoming the automobile industry or the newspaper industry.
Recently, Robert A. Iger, the chief of the Walt Disney Company, surprised Wall Street when he acknowledged in a conference call with analysts and reporters that some of the company’s businesses were experiencing profound change as competition for people’s time increased and consumers were confronted with an abundance of choices. “This clearly has had an impact on broadcast television,” he said.
In the last three months of 2008, broadcast networks lost nearly three million viewers, or about 7 percent of their total audience. Overall television viewing is up, however, and some big cable networks, like USA and TNT, are attracting new viewers.”
Meanwhile FCC continues to protect broadcasters with their ever declining audiences. A big question not mentioned in the article is what will happen to over-the-air TV reception when the dust from the DTV transition settles in June. Many think CATV, DBS, and FiOS-like service will be the big gainer from the switch to DTV but it may be a year before we see hard data.
It is ironic that, as the book Defining Vision describes in detail, DTV results from an NAB initiative in the mid-1980s to derail increased land mobile sharing of UHF TV spectrum and preserve the spectrum hegemony of NAB members. (It was also supposed to save the US consumer electronics industry - something it clearly failed to do.)
A graphic from the article