Those of us who were fortunate to work in TV used to have a pretty good business, way back when. You’d find a peach basket, open the window, and watch the basket fill up with money. OK, it was a little harder than that, but TV has always been a business that grows exponentially in good times and shrinks only a little in bad times. Growth was as reliable as the US Dollar. So when I read the piece I’m about to show you, a quote from “The In-Laws” (one of my all-time favorite movies) jumps to mind: 
What do you think will happen when they run off this dough… and there’s trillions of extra dollars, francs, and marks floating around? You’ve got a collapse of confidence in the currency. People are gonna panic. There’s gonna be gold riots, atonal music… political chaos, mass suicide. Right? It’s Germany before Hitler. You can see that. Jesus, I don’t know what people are gonna do… when a six-pack of Budweisers costs $1,200. That’ll be awful.
In other words, when the basic currency of a business has changed substantially, chaos ensues. It’s my belief that we’ve reached that point in media, as this report states:
For the first time outside of a recession, linear TV ad spend has stopped growing, according to global ad revenue updates by MAGNA Global and ZenithOptimedia, both released Monday. While national TV ad sales grew .3% to $42 billion in 2015, MAGNA predicted it will decrease by .3% in 2016. ZenithOptimedia’s Advertising Expenditures Forecast also found TV’s share of global ad spend will decrease from 38% in 2015 to 34.8% in 2018.
The basic currency – the TV CPM which is tied to the TV rating point – has lost its stability. There are trillions (OK, billions, anyway) of extra GRPs available. Pricing pressure has always been downward, but now there are options available that seem to be making that stick. I think we’re in a brief period where live events will hold pricing stable, but when only about a quarter of viewers are watching TV “live”, how long can that last?
This was the most ominous sentence in the piece: A shift in viewer attention and changing advertiser investments may therefore contribute to a decrease in both supply and demand for linear TV impressions. The shift has happened. The pretty good business is rethinking itself. There will be political money and Olympics revenue in 2016 to serve as a band-aid as it does so. But by 2017, the times could be, in the words of the Chinese curse, interesting.
Thoughts?
Consult Keith 