Here is a really great article. I strongly suggest you read the whole article when you get time. A couple of bits I thought were very insightful and might help explain to some of you not familiar with ratings why some shows get renewed and others cancelled.
Ratings still matter — but not as much as they used to.
Falling Nielsen numbers (and the decline in ad revenue that sometimes results) are by no means a good thing for networks. But increasingly, broadcasters are realizing they don’t have to be fatal to the bottom line. “As recently as five years ago, [TV] was still 80 percent about winning and being competitive,” one industry vet says. Today, the equation has changed. Nets still want Nielsen numbers, and they want to draw more of the right kinds of viewers (i.e. young people) than their rivals. Nearly as important now, however, is what Hollywood suits like to call “asset creation.” That means using the network platform to create shows that bring in revenue from sources other than advertising — sales to international markets, U.S. cable networks, and, increasingly, streaming players such as Netflix or Hulu. Even programs that don’t grab that many viewers when they air on traditional linear TV — think NBC’s Hannibal or the second season of CBS’s Under the Dome — can still turn into moneymakers for networks through these alternative revenue streams. Ideally, of course, networks want every show to be like Empire or How to Get Away With Murder — a blockbuster that prints money every which way. But since such big hits are increasingly an exception, broadcasters are figuring out new ways to get by.
Owning the shows you air is crucial.
All of the aforementioned alternative revenue streams only kick in if a network has some sort of financial stake in a show. If a series is produced by an outside studio, the network only has one big way to make money from it: selling ad time. That’s fine when a show is a big hit, but with so many series now getting by with modest ratings, broadcasters don’t have any interest in modestly performing shows they can’t fully exploit. That’s why Fox axed Almost Human last season (the show came from Warner Bros. TV) and why ABC might pull the plug on Cristela (which has actually improved ABC’s Friday ratings). The downside of this corporate synergy: Some really good pilots may die next week because they were produced by the wrong studio.
Falling Nielsen numbers (and the decline in ad revenue that sometimes results) are by no means a good thing for networks. But increasingly, broadcasters are realizing they don’t have to be fatal to the bottom line. “As recently as five years ago, [TV] was still 80 percent about winning and being competitive,” one industry vet says. Today, the equation has changed. Nets still want Nielsen numbers, and they want to draw more of the right kinds of viewers (i.e. young people) than their rivals. Nearly as important now, however, is what Hollywood suits like to call “asset creation.” That means using the network platform to create shows that bring in revenue from sources other than advertising — sales to international markets, U.S. cable networks, and, increasingly, streaming players such as Netflix or Hulu. Even programs that don’t grab that many viewers when they air on traditional linear TV — think NBC’s Hannibal or the second season of CBS’s Under the Dome — can still turn into moneymakers for networks through these alternative revenue streams. Ideally, of course, networks want every show to be like Empire or How to Get Away With Murder — a blockbuster that prints money every which way. But since such big hits are increasingly an exception, broadcasters are figuring out new ways to get by.
Owning the shows you air is crucial.
All of the aforementioned alternative revenue streams only kick in if a network has some sort of financial stake in a show. If a series is produced by an outside studio, the network only has one big way to make money from it: selling ad time. That’s fine when a show is a big hit, but with so many series now getting by with modest ratings, broadcasters don’t have any interest in modestly performing shows they can’t fully exploit. That’s why Fox axed Almost Human last season (the show came from Warner Bros. TV) and why ABC might pull the plug on Cristela (which has actually improved ABC’s Friday ratings). The downside of this corporate synergy: Some really good pilots may die next week because they were produced by the wrong studio.
Source:
Ratings still matter but to a much lesser extent, cost of the show and critical love also helps the show. Completely agreed for the shows owning you air part, but I think Cristela wasnt cancelled because of that, it was either Cristela or FOTB, FOTB was better in ratings and Cristela got cancelled.
ReplyDeleteI am still starting to worry about network television. This year it really hit some huge lows! On the other hand, as said in the article, we do have major Hits such as Empire and big hits such as How to get away with murder! We shall see where it goes from here. The season finales are around the corner, hopefully all shows rise a bit and then in 4 months it is time for thr Fall to start again. This upcoming week will be very difficult to watch, full of heartbreaking, nail-bitting moments
ReplyDeleteThis was a nice read, thanks for posting. I'm still completely baffled at Empire's success, it's just really not my type of show at all. What worries me though is how it will effect TV in the future, I don't want musical soaps to become a trend! I still think it's glory days won't last very long though. Genre shows have been increasingly popular for years now and they're my cup of tea, I never want it to end!
ReplyDeleteEveryone is always talking about these infamous years when NBC were in serious trouble, I kind of wish I'd been following ratings back then. I think Limitless could be a Scorpion type hit next season for CBS and I don't think Scorpion itself will be a victim of the sophomore slump either. There was no mention of The CW at all. FOX's -21% in ratings performance from last year really isn't pretty.
Jo Adalian is always great on Twitter with his insights, I recommend people follow him if you don't already.
ReplyDeleteThe owning the shows point definitely seems important, it kind of makes you wonder why studios do series for other networks anymore.
As far as the infamous years when NBC was in trouble, I suggest you watch 30 Rock because Tina Fey chronicles NBC's struggles vey well from the time they were owned by GE to the time they were bought by Comcast.
ReplyDeleteSuch a great read! Especially for Us who aren't that familiar with all that ratings, platforms performance and other stuff. I like he simplified it and gave us some insight in the way networks are thinking.
ReplyDeleteThis made me so excited for the upfronts and all the upcoming decisions.
Amazing
ReplyDeleteBiggest take from some renewals: international markets and a good partner behind it never hurt.
ReplyDeleteCSI: Cyber, maybe Mysteries of Laura are all driven by it, Agent Carter was probably something Marvel wanted, owning both Marvel and ABC and after SHIELD's spin-off got passed, they pretty much sealed its fate, American Crime is one renewal I didn't understand at all, but it makes sense when it comes to owning a show.
Yesterday I mocked that Sony and Warner should create their own channel: The SW, jsut like CW is for them and CBS, difference is CBS has a own network itself.
ReplyDeleteThey will always get passed, NBC is the only network they have some Voice, hence the Mysteries of Laura renewal attached with Undateable and another Sony package for Night Shift + Game of Silence + The Player.
CBS is always in house, I'm surprised they have a new drama from ABC Studios and Warner, they give one shot for outsiders, stick to it if it is a hit then move it after some time (see POI and Mentalist), ABC has zero dramas from other studios right now and none picked up, FOX is going towards this direction, as their chairmen are related to the studio itself.
I guess this could be the reason behind canceling Forever and Cristela (low rates that they don't own) and renewing Galavant and American Crime (low rated that they own) also a ABC didn't pickup any new show that they didn't own. All are owned by ABC completely with the exception of Uncle Buck (co-owned with Universal) and Dr Ken (co-owned with Sony).
ReplyDeleteExactly. As much grief as Sony gets for packaging their properties together, that is the only way they have a chance at keeping their projects on roster and adding new shows. No broadcast network needs to take non-owned properties anymore. They can just fill in the gaps with specials or reality. WB (and others) should follow their lead and it looks like they already have with Undateable and MOL, which weren't strong enough or profitable enough due to middling ratings to warrant renewals in their current format.
ReplyDeleteThis is a great article. Thanks for recommending it! :)
ReplyDeleteIf they want to make more money and hopefully keep more new shows, they need to start selling show merchandise. There are tons of Dr Who things for sale and the fans eat them up. If they had sold a replica of Henry's watch and branded some faux antiques from Abe's shop from Forever, they would have generated alot of fan revenue. They would make more money doing this than from the ads. And there would have been a greater chance of renewal.
ReplyDeleteI miss 30 Rock for the constant NBC jokes.
ReplyDeleteThat was the best part of the comedy!
ReplyDeleteInteresting article. I think everyone is waiting to see when Fox si gonna air EMPIRE and teh otehr networks will follow from there.
ReplyDeleteI found inetresting that they dont talk about CW. Why is that?
Thta's why i think Arrow and Flash will last as much as the actors want to and it will spawn 1 or 2 more spin offs(not counting Legends that it seems to be an event series for mid-season only. I mean full 23 episodes series for the fall: i would love The Atom and Constantine on CW).
ReplyDeleteThe income these shows have on the foreign market and the comics and toys and merchandising money the make Warner... These are real jewels. You can make a toy for every freaking character, jfc!
Wow, I watch a grand total of 3 shows mentioned in that article (and, NO, one of them is not "Empire").
ReplyDelete"I'm still completely baffled at Empire's success".
ReplyDeleteYou're not the only one. If I was a FOX bigshot, that would have been road-kill before the casting call went out.
I'd bookmarked this way back when, and just got around to reading today.
ReplyDeleteA little dated in it's predictions considering upfronts are now long over and most fall schedules finalized, but it was still an interesting read and its main points are still very much relevant. Thanks for sharing.