Leno moves nightly to primetime (1 Viewer)

[Lou Sytsma]

Originally Posted by pitchman

Obviously, it's too early to see a trend, but it looks like ABC and Castle benefited from the lack of scripted drama on NBC at 10.

Yes. But one that would be an excellent trend to continue. Scripted TV needs to prove it can hold its own where ever possible.

 

[pitchman]

I partially retract my earlier remark about Castle. The 'bump' I commented on may be more a result of a couple-of-minute DWTS overrun than anything else. Castle's numbers dropped in the second half hour and the program skews old. That has been ongoing and is likely to worsen when Castle has to follow The Bachelor.

 

[Adam Lenhardt]

Originally Posted by DaveF

I don't know how, or if, it changes the conversation, but in this very interesting conversation I see an implicit mis-statement of who the customers and the products of the networks are. It's implied that we, the viewers, are the customers and the TV shows are the products.

That doesn't seem to be so. The networks' customers are the advertisers and the "product" is we-the-viewers. The content is the delivery service to get us to advertisers.

Networks are "simply" providers of eyeballs to their bill-paying advertisers. If they can't bring enough eyeballs to the advertisers they will go out of business, so long as they're in the advertising business.

This would be the case if the airwaves were unregulated, but the advertiser-driven focus is made more complex by FCC mandates which require that broadcast networks provide certain services to their viewers in exchange for a license to use the public's airwaves. Networks make their money off appealing to advertisers, but they are essentially renting their platform from us, the public.

Originally Posted by Brian^K

Hindsight is always 20/20 of course, but I'm surprised I didn't "know" this was going to happen in advance. Maybe I'm simply so hopeful that Heroes will survive, do well, excel, etc., that I didn't really look at it objectively: Against House, Heroes is doomed, I think. I hope they give us a good wrap-up at the end of this Volume, because I fear it might be the last.

Part of it derives from the macro state of network programming today. NBC has made bad choices for so long that their schedule is in tatters. They have very few shows to use as anchors to launch new shows, and they have very little fertile space in which to nuture existing programming. It took them a long time to get into this state, and it'll take them a long time to get out of it. Part of the reason I think launching the Jay Leno Show was shortsided is because, while it helps the network's bottomline in the near term, it essentially blocks NBC from ever returning to #1 again. You can't be the top network of television with only 10 hours of primetime a week. The 10:00 hour is one of the key things that keeps CBS dominant over FOX most nights in overall viewers.

"House" is the number one show on television, but it's also helped by being on the number one network. The success of "House" will help "Lie to Me" grow when it premieres next week, which will in turn help the affiliates' local news broadcasts. Most of NBC's surviving "hits" date back to Kevin Reilly's tenure at NBC. When NBC dumped him for the disasterous Silverman, FOX swooped him up and he's worked his magic on a much bigger stage.

 

[Brian^K]

Quote:

Originally Posted by Adam Lenhardt

You can't be the top network of television with only 10 hours of primetime a week.

Yes, you can be. Fox arguably is/does, at least if you're just counting scripted programming.

CBS might have comparable audience to Fox, but they spend far more to accomplish that feat. It's good thing, for CBS' execs, that the company is far more closely-held.

 

[mattCR]

CBS does a way better job of horizontal marketing of their scripted programming across multiple platforms and making money off of it, and they develop more of their own programming. This makes scripted programming far more valuable to CBS then NBC, true.

I'm sure NBC would love if they hadn't passed on house (which is an NBC/Universal production airing on Fox) but that's decision making for you

 

[Brian^K]

CBS made the same mistake with Medium, clearly shown by their taking the show as sloppy seconds when NBC released their hold on it.

 

[DaveF]

PeeWee Herman, 20 years past relevancy, making a plate at a salad bar. This is what Leno has come to? This is what NBC is betting its future on?

 

[Brian^K]

With just a 1.5 rating, "The Jay Leno Show" could make $300 million a year for NBC -- and probably spark other networks to follow suit.

http://www.hollywoodreporter.com/hr/content_display/television/news/e3ic1a340c9e2d852e5c71c767e50baa19c

You can quibble about it, but money is money. Even if that number is inflated, there is still enough money to be made to make this change worthwhile to NBC.

But not because it is a lot of money: Rather strictly because the costs are too high, and the benefits are too low, for scripted programming.

 

[DaveF]

I can look forward to learning more about salad bars from once-forgotten stars!

 

[pitchman]

Originally Posted by Brian^K


http://www.hollywoodreporter.com/hr/content_display/television/news/e3ic1a340c9e2d852e5c71c767e50baa19c

You can quibble about it, but money is money. Even if that number is inflated, there is still enough money to be made to make this change worthwhile to NBC.

But not because it is a lot of money: Rather strictly because the costs are too high, and the benefits are too low, for scripted programming.

I read that too. To me, the big question in all this is how it's going to affect NBC's ad rates. If over time, Leno ends up delivering (on average) the same kind of numbers he was delivering at 11:35 p.m., are media buyers going to pay a premium to NBC for that same audience delivery just because it comes an earlier hour? I think not. Granted, the program can be produced for a lot less money than a scripted drama, but if NBC has to drop its drawers on rate, it may wind up being only slightly better than a wash on paper. Plus, there is virtually no residual revenue to be derived from syndication or home video rights.

How this impacts affiliates is potentially even more devastating. In a small to medium sized market where an affiliate (back in the salad days of ER) may have been able to get $800-$1,000 for a local :30 second spot, they now could have to settle for as little as $75-$150 for that same ad. If an affiliate relies on that 10-11 p.m. ad revenue to help make its annual operating budget, the situation could get dire pretty quickly. How does the network make this revenue loss up to the affiliate? With more local avails? If so, where does that inventory come from? If it's a giveback from the network, then that's less ad money going to NBC. If they add more (or longer) commercial breaks to the show, that may further affect Jay's ability to compete.

I have a feeling repercussions of this "experiment" will be felt in ways NBC never counted on...and for years to come.

 

[Brian^K]

I think it is ridiculous to assume that NBC hasn't though of all the implications and possibilities that we viewers bandy about online. They're not idiots, despite some of the self-serving but essentially baseless protestations to the contrary.

 

[mattCR]

One minor problem with this: Tuesday night Letterman pulled a 4.0.. and Conan pulled a 2.0. So, while they "make" $300M on Leno at 9, they lose money they were making when the tonight show was pulling 5.1 share..

One other problem... affiliates are finding their local news casts now have nearly worthless advertising rates. NBCU doesn't have to figure that into their national in/out, but local affiliates do, and if they aren't an NBCU owned affiliate (numerous) it's kind of bad.
Promoting how well they will do on Leno short sells the impact this entire change makes elsewhere. It also isn't a fair example because it says "here's how much profit we will make: $300M!" But it doesn't say "because scripted at a higher # was break even, $0 total gross after advertising revenue"

In fact, in week-after-week, "The Tonight Show" is down over 60% in ratings. and the Late Show is down over 50%.

Surprisingly, juts because you have a position of authority in a company doesn't make you a genious or all of your decisions correct.

But, on the good news front, I can now buy ad space during the NBC Nightly News local cast at less then I can pay TimeWarner for generic cable advertising. That's a first.

 

[pitchman]

Originally Posted by Brian^K

They're not idiots, despite some of the self-serving but essentially baseless protestations to the contrary.

Not to turn this into a pissing contest, but if this remark is directed at me, then I take some offense to it. I do not feel my post is "...baseless protestations to the contrary" as you put it. I am not a media buyer, but I work in media and as part of my position, I do have to place a TV buy 3 or 4 times each year. I know for a fact that in Fall 2008, I was paying $75 a pop to the local NBC affiliate (not an O&O) for a :30 second avail in the Tonight Show with Jay Leno. This is when Jay was getting comparable (or better) numbers than he currently is at 10 p.m. There is no way I can cost-justify spending much more than that for Jay at 10 p.m. unless there is an exponential spike in audience delivery. So far, that isn't happening. My corporate supervisors would have my head. And I do not think my situation is unique either, especially for anyone who works in a smaller market. As Matt succinctly points out, "...just because you have a position of authority in a company doesn't make you a genius or all of your decisions correct." And I completely agree with him when he says that "...Promoting how well they (NBC) will do on Leno short sells the impact this entire change makes elsewhere."

 

[Francois Caron]

If the nightly local news ad rates are now down the toilet, is it necessarily Leno's fault? Or might it be Conan's fault? Are Leno fans turning off the TV after watching Leno now that they don't have to stay up so late? Or are they switching over to The Daily Show which also starts at eleven and may have more merit in content than the local news?

Conan fans would most likely never watch the local news, preferring to watch The Daily Show and record The Colbert Report for later viewing.

The way I see it, it may all come down to old vs young. Older people are more inclined to watch live broadcasts, while young people will be more inclined to record or download their favourite shows and watch them at their convenience. Do the Nielsen ratings even take this into consideration at all?

 

[Brian^K]

Age of viewers is definitely part of what is reported. Then advertisers can use that information as they see fit, based on who they believe their advertisements will prompt to buy their products and services.

In the end, do keep in mind that ratings are falling, precipitously, overall. People are simply watching less television (a recent study showed a remarkable spike in Internet activity, just as one example of where attention previously aimed at television is clearly moving to), and spreading their television watching over a larger number of channels. So attributing any decreases to solely one factor is ridiculous.

 

[mattCR]

Francois-
Your argument would be good except that other local markets aren't reporting a steep drop in the nightly news, or at least aren't reflected it in ad value.

And, while everyone talks up the daily show, there are a large group of people, in that "young parent" group and "local sports fan" group and "local weather" group who like seeing that content. Hell, the internet won't tell me anything about elementary school closings until a fair clip later then the local news.

While you may be right, it could be conan's fault, that still makes it NBC's fault.


Here's what happened:

They went from a weighted average 2.6 Share at 10PM to a hoped for 1.6.
They went from a 5 share for Tonight Show to a 2.
And a 3.1 Share for 12:30 to a 1.6 share.

How "profitable" a single show is to the network doesn't mean everything.. it may be paper profitable, true. Hell, they could run an infomercial and be wicked profitable to the network.

But the profit the show generates has to be gaged against what it made.
I'll take for example, Law & Order SVU last year, a 10PM slot show.
Let's say the ratings were "eh" but looking at Wiki and some google, it did about a 3.5share.. slightly over double what Leno gets.

So, let's say cost figured in it made the network a profit of $20M. So, that's one night a week. NBC also had two nights a week last year of airing "Dateline". "Dateline", a news program, is CHEAPER then Leno to produce. And, it gained slightly higher ratings (slightly, roughly the same right now) Dateline also had the perk of accomplishing the goal of meeting NBC's FCC Licensing requirements. So, NBC will still end up running Dateline here and there, it will now just drop into a timespot taken away from higher rating programming.

You add all of those things up, you see where the profit/loss for them last year was, and THEN you take Jay's $300M profit on the show. You probably make SOME money, but it's not as though you're $300M ahead of last year. And if The Tonight Show and Fallon continue to tank, the profitability made on that one show quickly gets swallowed up. If Vivendi thought that suddenly an extra $300M in over the line profit was being added in, I don't know if they'd be as quick to ramp up this sell of their 20% stake.

Ratings in general are down as more choices are out there. But NBC cannot be leading the pack in a super-fast bullet run to the floor while their competition holds / gains ground off their losses.

 

[DaveF]

Originally Posted by Brian^K

* Large companies act like idiots routinely; definitely from a longer-term, looking perspective and sometimes from an it's-obvious-to-the-peons perspective. They demonstrably do not consider the long term repurcussions of their actions; or at least don't care because short-term incentives are too large.(Lehman Brothers and AIG, who clearly didn't think through "all the implications and possibilities" of their business plans) And I think it's not uncommon to be driven by internal power struggles as much as reasoned planning. (GM devolving Saturn from a game-changer to a normal auto shop due to attacks frgom other GM businesses.)

 

[Brian^K]

* People posting online act like idiots an order of magnitude or two more often than large companies.

 

[mattCR]

Brian:

I don't know what's up with the need to insult people, but I haven't seen anyone here say something that is completely unsupportable through current widely available data or anecdotal evidence. While I prefer the empirical evidence as a means to justify my claims, I haven't seen anyone say something, including yourself that cannot be reasonably argued.

So, it'd probably be good to knock of the ad hominems.

 

[Brian^K]

It is strange to see you write that given that my comments directly mirrored your own, just with a different, indeterminate set of people as the target. You have a double-standard: The people you want to insult, it is okay to insult them, but the people you like, it isn't okay to insult them.

I think you should take your advice to heart: Recognize and acknowledge that large companies don't regularly act like idiots. Recognize and acknowledge that the needs of consumerists need to be balanced with the needs of investors, and the needs of taxpayers, and the needs of employees, and the needs of communities, etc. The extremism you've put forward against the networks is the root of the problem.