A New Dark Age?

Are you watching less TV than you used to? If the answer to that is “yes” then you’re not alone. Oh sure, you’re probably spending a lot more time in front of a screen, but when I ask that question I’m asking about cable network programming delivered live or watched via DVR within 3 days. That measurement, by the way, is known in the business as C3 ratings and there is not a lot of good news. Michael Nathanson, a senior analyst with MoffettNathanson LLC issued an analysis of recent data and this lede from the International Business Times sums it up nicely:

The biggest American horror story on cable last year, didn’t come from FX — it came from Nielsen. Ratings across national cable television networks tumbled 9 percent in 2014, triple the decline seen in 2013 and more than quadruple the 2 percent decline seen in 2012. To call it a crisis would be an understatement. If the trend continues, TV could be heading for a new dark ages.

Why the dark ages analogy?  You’re seeing it in the news.  Cable operators pay these networks a lot of money each month (OK, you’re right – WE pay…) but if no one is watching maybe losing those networks from their systems isn’t a big deal.  That sort of explains the stories you read about networks going dark on some systems (as I’m writing this Verizon just turned off the Weather Channel and Dish turned off Fox News for a few weeks)over what those fees might be.  Without a hue and cry from consumers who appear to be moving on to alternatives, the networks have no leverage.

While some in the industry are complaining yet again about faulty measurement methods, the reality is that people are shifting their viewing habits away from live, linear programing.  Even sports, which is supposed to be immune to this, suffered a 5% decline. You’re probably aware that HBO, NBC and CBS are launching their own streaming services. That sort of move might hasten the demise of business model that has fed TV networks with licensing fees as the cable and satellite distributors focus more on their broadband ISP businesses and less on TV.  After all, if they can distribute the programming services for free via their internet side, why pay?

Hopefully this is good news for those of us who pay for this stuff.  What do you think?

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Filed under Reality checks, What's Going On

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