Jessell | Broadcast Nets Still Power Ad Marketplace

As cable and streaming options continue to win a greater share of advertiser budgets, the broadcast networks are far from done. They showed last week that they are still major players, still the favorite of the big mass advertisers, the people who throw around billions. It won’t always be that way.

Harry Jessell

There are many measures of how broadcasting’s grasp of the television audience has loosened over the past 40 years.

Here’s one:

On Feb, 28, 1983, around 106 million people tuned into their local CBS stations to watch the last episode of the most popular sitcom of the time, M*A*S*H.

Last Thursday, nearly 18 million showed up at the appointed hour, again on CBS, to catch the finale of the most popular sitcom of the time, The Big Bang Theory.

That’s just one-sixth of the final MASH audience and it tells the story of broadcasting’s long slide. With many people straying to cable or cherry picking shows on OTT streamers, broadcast audiences are fractions of what they were when the only way to get TV was with an antenna.


Yet, as we saw last week in the upfront presentations, the broadcast networks are far from done. They showed they are still major players, still the favorite of the big mass advertisers, the people who throw around billions.

The presentations of the fall schedules lacked bold ideas, but it was reassuring that the networks continue to invest heavily in scripted programs. During the 2019-20 season, they will introduce three dozen new dramas and sitcoms. Maybe the next M*A*S*H or Big Bang is among them.

Even Fox, which is supposed to be all about sports and news, stepped up. It canceled eight shows, but ordered 10 news ones, twice as many as last year, including six dramas and four comedies.

Watching the trailers for the new shows puts a lie to the notion that broadcasting is devolving into a medium of reality and live events — awards ceremonies, games, talent shows and such.

This is not to say live sports is not an important part of network broadcasting, perhaps the most important part. I can’t imagine Fox without the World Series, CBS without the Masters and March Madness, NBC without the Olympics and none of them without the NFL.

But scripted shows will again fill most of the slots on the grids just as they always have from the beginning of TV time.

Last week’s presentations are prelude to the real show — the upfront selling that will commence in earnest in a few weeks, and the expectation is that the networks will have little trouble selling the bulk of their time with at least modest rate increases.

The total take will approach $10 billion.

To see why prices are going up you only have to check the network scatter market. Advertisers who didn’t buy in advance last summer are having to pay steep premiums to buy their way in now.

The great paradox is while the proliferation of TV on cable and on various digital media has severely eroded broadcast viewership, it has at the same time made it extremely difficult for media buyers to cobble together the frequency and reach their advertisers are demanding.

And as the supply of broadcast ratings points goes down, their price goes up. That’s Economics 101.

“These upfront buys become even more important because they constitute a sure thing in an advertising environment that is otherwise very fragmented and very uncertain,” said Paul Verna of the digital ad research firm eMarketer.

It irritated me when NBCU turned its upfront presentation into a showcase for all of its second-rate cable outlets in 2016. And I see now that others network owners are doing the same thing. Disney pushed ESPN, Freedom, FX and Nat Geo for the better part of two hours before it finally got around to ABC.

But I guess it makes sense. The multimedia companies sell advertising across all their platforms and they are licensing and producing broadcast shows with an eye toward their eventual downstream non-broadcast distribution.

I can see where the trend lines are leading. Network viewership will continue to decline to a point where they are no more enticing to ad buyers than cable or OTT. With advanced ad tech, buyers will be able to efficiently pull together the audiences they need from non-broadcast media.

I can’t tell you when that day will come, but, judging from programming investments the networks celebrated last week, it’s not coming soon. Broadcasters can look forward to a few more seasons in the sun.

P.S. News broke last week that Phil Lombardo sold his last two full-power TV stations for $83 million to Deb McDermott, formerly of Young Broadcasting, formerly of Media General. Both WLNE Providence, R.I., and KLKN Lincoln, Neb., are ABC affiliates.

It’s quite a deal for Lombardo, the well-known former chairman of the NAB and the charitable Broadcasters Foundation of America. He bought WLNE out of bankruptcy in 2011 for just $5.8 million.

He sold his three other small-market affils in Iowa to Nexstar for $88 million in 2013.

Lombardo is 83, soon to be 84. But it wasn’t age that led him to sell, he told me. Rather, it was the recognition that station groups have to have some size to hold their own in dealing with MVPDs and the networks. A group with five small-market affiliates simply wasn’t big enough. “You need a lot of heft.”

But Lombardo is not retiring or putting a cap on his six decades in broadcasting. In addition to leasing a couple of broadcast towers, he says he, Ray Cole and the rest of his core Citadel Communications team will continue to operate an all-news low-power in Sarasota, Fla., and look for other opportunities, possibly additional LPTVs modeled on Sarasota. “But as for Big Four affiliates, I’m done now.”

Harry A. Jessell is editor of TVNewsCheck. He can be contacted at 973-701-1067 or here.

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