Streaming’s Rise Further Squeezes Stations’ Content Pipeline, Execs Say
Streaming is squeezing TV stations’ content supply chain and bigger studios need to jump in to create more options to reduce the pressure, a panel of executives from local station groups and syndication suppliers said at TVNewsCheck’s TV2025 conference last week.
After a small resurgence of energy around first-run syndication in January with new entrants like The Drew Barrymore Show coming into the mix and Tamron Hall seeing renewal for a sophomore season, the pandemic has had a cooling effect on programming, Debmar-Mercury Co-President Mort Marcus said. He noted syndies’ ratings are down upwards of 25% with cable news networks benefitting from a COVID news-related jump in daytime ratings.
“We are getting some offset by an increase in the CPM, maybe 20%, but not enough to offset the 25%-30% decline in ratings,” Marcus said.
Angelica Rosas McDaniel, EVP of strategy and creative development at Litton Entertainment, said viewers’ habits have changed in the pandemic. While it’s not realistic to think ratings will return to their pre-COVID numbers, she thinks there will be a slow reversal of the downward trend in time.
But Scott Ehrlich, SVP of growth platforms and content at Sinclair Broadcasting Group, noted these declines predated the pandemic and the supply quality, too, had already been flagging. He said stations need to work from that understanding.
“We can’t sit back and hope that the audience and the supply chains turn around,” Ehrlich said. “Hope is not a scalable strategy.”
Further complicating the dynamic is streaming’s ascendancy in the marketplace as another destination for programming including original shows and off-nets, he added.
“If you’ve got a really good show, and you’ve got a paid subscription business that it could be used as acquisition content for, trading that off versus its value in the marketplace as a syndicated show is going to be a harder and harder call for people to make,” Ehrlich said.
With streamers’ rise, Marcus said he no longer sees a traditional off-net play in the future but rather a sharper turn to first-run programming in daytime and prime access. “There won’t be very many off-net things available,” Marcus said, noting that in nabbing one of the few current offerings, Schitt’s Creek, Debmar-Mercury had to put up an advance to get the rights.
“It’s a stretch to think that anybody running one of these streamers is going to walk to work one day and say, ‘Let’s not do this for the streamer, let’s do it for first-run syndication,’” said Frank Cicha, SVP of programming for Fox Television Stations. “That’s an impossibility right now, but that doesn’t mean we’re not going to get product.”
But Cicha also noted that streamers don’t have a lock on all potential content categories and streaming content is consumed differently than what’s featured on linear TV, with different expectations from viewers. He said his station group has placed some of its shows on Tubi, the ad-supported streaming service owned by Fox, to see how they resonate with audiences on the platform.
“The idea of developing a single show for one or the other in some ways just doesn’t make a lot of sense,” Cicha said. “It has to be targeted for one or the other as opposed to: Here’s this great show, where should we put it?”
“That’s mostly true,” Marcus said. He added streaming companies have “struggled trying to find reality shows” — like the ones a Fox group might produce, for example — that work on their platforms.
“They’re learning that it is a different experience,” Marcus said of streamers and what they provide consumers. “It is hard to find something that works in both.”
Moderator Ken Werner, former president of Warner Bros. domestic television, asked if that provides a company like Debmar-Mercury an opportunity to “step into the void.”
Marcus said he wants multiple players — especially the large studios — to join him in stepping into the void.
“I want Warner Bros. to bring a $50 million talk show in,” Marcus said. “I want Warner Bros. to try really hard to hate me and hate my shows and send a white paper about how bad my shows are. I really do.”
For Marcus, competition sets a high bar for content producers across the board. He added that it does nobody any good to “chase the crap down the middle,” and said “it doesn’t make any sense for the marketplace” if a company such as his becomes the most robust supplier of content to a major station group.
However, Marcus also asserted that big studios like Warner Bros. don’t appear to be upholding their end of that unwritten agreement and taking the lead in quality content production.
“Maybe in the short term we can get an advantage, assuming we can make money on a show in the environment, but long-term we’re going to need a lot of suppliers to make the stations successful because they need rating points, too, at the end of the day,” Marcus said. “We do take big swings and we want to take bigger swings; all I’m saying is it’s a healthier environment if there’s five shows vying for that ‘yes’ than one. Everybody would be healthier if it’s more vibrant.”
Litton’s McDaniel concurred. “There’s less people at the party and so I’m not vying [as much] for dance floor space, but we need to figure out how to engage with our partners like [Fox] and [Sinclair] and everyone else, who are having the same struggles, but on the buyer’s side — that’s the new competition,” she said.
“Instead of looking at it as: There’s eight of us coming out with a show and we’re all competing for that spot, it’s: There’s only two of us coming out for the same spot. But now how do we make the best deal? How do we create the best opportunity so we get the spot?,” she said. “So it’s still competitive, it’s just a different dance.”
Read more TV2025 coverage here.