Alrighty - remember that NBC Universal doesn't produce it, Sony does (and owns all the syndication rights/profits)... but still surprising if cancelled...

Apparently Sony have a history of going dirt cheap to get comedies to syndication. I'm going off what TVBTN are telling me here, I can't think of any specific examples at the moment but I don't think many people expect it to be canceled at this point. Regardless, they'll be willing to go cheaper to get it there, and given that its ratings are solid, I don't see why NBC and Sony won't be able to reach an amicable agreement.

The biggest problem IMO comes from the online content providers themselves and it's only temporary. Hulu P/Netflix/Amazon Prime are all potentially great distribution models for people, but just not quite there in terms of selection. (I tried each btw).

Speaking for myself only, I have zero loyalty to Comcast. I'm a TV customer of theirs because I don't have a better alternative (Dtv isn't practical). I'm definitely not happy with the cost for what I get, or that I'm paying for a ton of channels that don't interest me at all. Between myself & household, a piecemeal subscription to ~12 channels plus two sports leagues (NFL for me, NHL for her) would be perfect.

Add to that, the whole concept of standalone cable TVs being distinct from Internet TV isn't going to hold up that long. People want more integration and are always asking more of their devices, and we're already at the point where monitors and tablets are smoking the resolution of HDTVs.

Now I'm not going to try and predict whether people will be more inclined to ship internet-based content their living room displays via say wireless, or whether they'll decide they can do without altogether them at some point. I'd guess the former due to families watching TV together, but then years ago I didn't think quite so many people would be willing to give up desktop monitor real estate for notebooks either. Or, more recently, that so many would accept a 10" tablet display for video content, much less ever watch anything on a cell phone (which I still don't get). If Aloysius is confident in research supporting "best available screen" behavior then I would say that's pretty damning for traditional TV sets.

But wrt online distribution, the infrastructure is in place and a large market is ready and waiting, so it's just a matter of time. It may not kill TV as we know it for a long time--compare to terrestrial radio programming vs satellite & online radio--but

I think the main problem is is that networks aren't particularly receptive to change. For example, they spent too long trying to stop DVR and not enough time figuring out how to profit off it. I think you're asking too much of them to see anything like that any time soon. Things will change but I think we have to expect it to be slow and painful.

I think you're right.

As far as to Rendle's post (thanks for posting that chart btw):

$4 per channel a la ESPN is too steep, but there seems to be plenty of wiggle room in there as far as price. I totaled up the highest 20 including the $6.45 for the top two I could live without anyway, and got $16.00. Factoring in the digital box rental, DVR and the rest of my bill, there's a LOT of room even if your raise costs going piecemeal.

The thing I see with internet VOD-based service, you have possibilities for things like people having different costs relative to the advertising tiers they're willing to live with, say like with Spotify. Not to mention the idea of Google-esque targeted advertising which can be a lot more effective than just blanketing rough demographics 2 million people at a time.

And I know this sounds crazy, but viewers might be a little more receptive to commercials if they're more relevant to their interests and less annoying. Some Mormon watching might have the option to click off "no interest" for alcohol ads for example, and someone like me might thumbs up that Hardee's Jalapeno burger ad with that smoking woman in it (you know the one) in hopes of seeing it again and again. It's a win-win-win for all parties. Not only do I think there's money to be made there, I think they could do even better.

When I'm surfing online I see a Musician's Friend ad all the time, and it cycles through pictures of guitars and stuff I was actually browsing. I catch myself staring and then wanting to go to their page and get a better look again lol. And I realize what they're doing - plus, I'm already online and "nearer" the product the ad wants to sell compared to TV. That's another win.

It seems like networks are still trying to figure the finer logistics out and the Comcasts of the world will fight (kicking and screaming all the way) to make this as hard as possible, but I don't think advertising in itself is the wrench here.

Not 100% but I think Todd Vanderwerff said when Community was renewed for a 2nd season NBC Universal owned part of the syndication rights/dvd sales/etc for everything after the first season.

Ren - this would be a pretty unusual deal to strike I think - the Studio (Sony in this instance) bore all the risk with pilot production and 1st season episodes... so if a series did get picked up for a 2nd season, it means the asset performed reasonably well, so would be sort of strange for a Studio to give up part of the distribution rights at that point. I mean, that's the only way they make any money on a series.

But anything is possible, just depends on the deal that was negotiated. Perhaps NBC Network agreed to pay Sony Studios 100% production cost (so Sony isn't deficit financing) in Season 2, and in return receive some % of syndication or something.

Well, "advertising in itself is the wrench" because if ad dollars take a hit (as I described above), the TV industry would make less money. And unfortunately, TV industry margins are not fat enough to withstand a big hit in a primary revenue source. This isn't about "lower advertising is bad for business", it's about the sustainability of the business model itself.

(And again, I think people miss this when thinking through the TV model - but even if the holy grail of targeted advertising came to fruition, the TV Networks could still potentially drive less ad dollars because advertisers may begin to seriously shift their budgets, and allocate away from TV content, and on different non-TV vehicles like FB etc.)

Comcast owns NBC Network, NBC Universal Studios, Bravo, USA Network etc etc.... anyway, what do you envision Comcast (I suppose you were just referring to the distribution business so let's stay there) kicking and screaming about? They are a distributor of TV content, right? Their main goals are to keep their current video subscriber base, and grow it. All the decisions they make support this.

Outside of the obvious strategy they have in place to keep subscriber churn down (triple play with bundled service package of video/broadband/phone), they have launched video services to distribute the TV content they have rights to across all platforms, because they know that's what their subscriber base wants. And if their subs don't get this stuff, they will switch to someone who can get them what they want (DirecTV, Verizon FiOS, AT&T U-verse etc).

Comcast is one of several companies that pushed the DVR into the ecosystem to keep their subs happy. Networks were the ones opposed to it for obvious reasons.

Al, fantastic information, as usual, thanks for providing it. I didn't quote the rest just for screen real estate. I'll try to answer what I mean in the places where you were unclear.

I think we're using different definitions of cannibalization. For Blu-ray, it's that it's cannibalizing the content that could have been put on DVD. In other words, there's no longer a delivery medium for that content. That's different than what you're saying about something being watched on one medium not being watched on another. That certainly could be true, but I still think a TV monitor is the preferred method of delivery for a whole lot of people. I have no way to know how many for sure.

When you say things like "independent state", am I to assume that is industry speak for "in a vacuum"? If so, I think that makes a pretty big difference.


I don't really think it's appropriate to equate smart phones, here, due to contracts and plans allowing a very cost effective upgrade every two years. I have no idea what the saturation of tablets is, and I do think they will become like the laptop, in maybe 5 years, but it's certainly not there now. Tablets are definitely a luxury, unless you include the Kindle Fire in that market, which is a more cost effective solution, but still not cheap. You do realize we are in a terrible economy, and a lot of people don't have money to burn, right (and with all of this new technology you really are burning your money by not waiting for a better price point, since we've already had multiple iPad upgrades and iPhone upgrades)? It's only as this technology gets super cheap that people will become really interested. It's why you can buy a new computer every few years, if you really desire one. It's also why the entry to a HDTV has become so low.

Any modern computer wouldn't (of the last 10 years or so), but don't you think the older generation might not have upgraded, and that at least some 56k modems still exist?

I'm not saying their survey is bad, but the questions were stilted to the easy answer. It's no secret that polls look for an answer, and then ask the question that gets them the answer they're looking for. It's why different polls asking the same basic question, in different ways, come out with radically different numbers. Almost anyone who has a computer will have watched "some" programming on their computer. If you ask that same person, "will you only watch Person of Interest on your computer vs. watching it on your DVR through your TV?", you could get a totally different answer.

Al, for sure I'm talking about next 5 years. I just can't see it developing rapidly. Once we know where HDTV prices and tablet prices (I believe the tablet will 100 percent become the mobile delivery choice for television in the future) settle, during that time frame, things will be radically different. I can't see 10 years into the future, and I think anyone who does that for a living is basically trying to act like a psychic when it comes to technology. Go back even 13 years in technology, and you will see how many trends were potentially missed, and how many blew up that no one anticipated. I don't think anyone thought the desktop computer would be verging on obsolete, except for high computing needs situations.

Great stuff, thanks.

Unless I'm interpreting Al wrong, that's not the cost you're paying. That's the cost the cable/satellite company is paying per subscriber. The nature of business, obviously, is to make a profit. So, you're probably paying more than that.

A final note is that when I was in college (1993), there was a vast debate beginning over whether Telcos should be allowed into the cable market. That's happened, and we are now only beginning to see the ramifications of what is happening. The consensus, at the time, was that it would be a very bad thing, but that it would probably be unstoppable. Al, can you give you more info about the impact of Telcos on cable delivery? I think there are others, outside of just FIOS, and U-Verse, ones that took over cable systems, but I can't remember which ones.

Does Person of Interest have the best ratings out of the fall 2011 premiering tv shows?

2 Broke Girls has been the #1 new show.

Once Upon a time's average is probably similar to Person of Interest. Once started higher and trended down while PoI's numbers have increased as the series went on.

As I don't hugely understand the whole ratings system/TV money I found this article pretty interesting.
How Much Gold Is Game of Thrones Worth? How does HBO make money on expensive shows only 3 million people watch?

The Finder is a flop on Fridays. Last week, it got off to a bad start with a 1.1. This week it was a 0.9 with 3.37 million viewers. That's getting it near The Good Guys type territory. Fringe did even worse, with a 0.9 and 2.90 million viewers. Fringe's numbers are so dismal I just can't see why FOX would want to bring it back for even a 13 episode season. On the "positive" side, I now think there's at least a 2 percent chance they could bring back Alcatraz, by itself, next season on Fridays.

FOX renewed Kitchen Nightmares for two more cycles (did not say if it was summer/fall, or fall/spring), so I doubt there's going to be a big shakeup next season on Friday nights. Only one show is probably going to get a shot there, unless they split the season with another show (maybe something like Fringe for 13 at the beginning of the season, even though it is not deserving of this, and Alcatraz for 22 later). They can't launch anything there, so the only thing they can do is send something there to die, or hope the show they're trying to kill has Grimm like ratings. If multiple shows fail in the slot, they'd probably just expand Kitchen Nightmares, as opposed to trying to launch or send a third show there.

I saw no reason why Fox would ever give Fringe anything beyond this season, any hope I may have for an extra 13 episodes is entirely based on rumors.

I'd be surprised to see Alcatraz come back, with it absolutely no where near syndication I can't see it ever being profitable.

To me, I find it a little sad that Alcatraz isn't likely to come back (even if it never gets great), because it was story mapped out to 302 episodes, or whatever the prisoner number is.

At some point, though, FOX needs to put some real effort into Fridays. You can probably guarantee there will be two scripted shows there next season on NBC. CBS is also likely to put something decent there (they tested The Mentalist there, but I think it would be insane to move the highest rated 10pm show to Fridays). ABC used to have the TGIF line up in the 80s and 90s, but it's just reality TV central now. Grimm has proven that a show can "make" it on Fridays, against very similar genre competition.

I think it's time for the networks to stop ignoring Fridays, and to start trying to revive Saturdays, as well. For the Saturday shows, this should be where the DVR numbers/advertising start to get experimented with. No one's going to watch shows live, on Saturdays, but if there are good gains in the DVR ratings, for other shows they try out there, this could help them at least begin to think about the 5 year+ future model, and how DVR will come into play. It really sucks that scripted TV is getting such a short shrift. If most networks make a concerted effort to treat Fridays like it's no longer a wasteland where shows go to die, that day could have some kind of resurgence. Then, that would allow Saturdays to become the new Fridays, and maybe help save a few decent, but low rated, shows. It would also be a good testing ground for DVR economics, in my opinion. Amazingly, NBC may end up being at the forefront of turning Friday into a real night of TV viewing, again. Wouldn't that be something?

You're right that it's mostly based on rumors about Fringe, but the makers and actors seem pretty confident, based on what they've been hearing, that they have a good shot at being back. Rumor has it (lol) that there will be a decision next week.

It doesn't make sense for an advertising model to care what DVR numbers are because DVRers likely fastforward commercials. I know I sure do. Live ratings for scripted programming are gonna keep dropping until eventually they are non-existant.

One of the things most people don't talk about is that they could do a hulu like rug pull out on DVR. Eventually, they could rig the technology (or the live stream of the program, which is more likely) so that you would have to watch at least one commercial per break. Then, at that point, you would be forced to have a TV on the channel, let it get about 15 minutes ahead, or so, and then rewind, if you want to avoid commercials. When I talk about hulu, I'm saying that they teased us with a ton of great, free programming, but now are charging subscription fees to access their best stuff, in the form of hulu+.

I don't know if you've noticed how every single movie has the title graphic playing throughout the entire commercial. If you fast forward through the commercial, you'll always see the name, regardless of whether you watch the commercial. The wave of the future will be changing the way TV ads are done, so that you still can sell your product, even if the TV is fast forwarding (it could be as simple as having a website address static at the top of the commercial).

nunn, you see CBS had 4 comedies on the schedule last Thursday? 3 of them were reruns and they still killed NBC.

I could see them moving Two Broke Girls to Thursday at 8, BBT to 9, and Person of Interest could end up being the highest rated 10pm show next year.

Hopefully NBC moves their comedy block to Tuesdays.

Yeah, I saw that, and I think it must have almost been CBS's way of making fun of NBC. When I heard they were going to do test slots from you, I didn't think they would be reruns. How is that a test? If POI moves to 10pm, it will definitely be the highest rated show, for the week, for sure. We just didn't get any real indication of what these shows could do, since they were all in reruns.

More interesting, to me, is that Rules of Engagement and Rob are pulling in the exact same ratings. The comedy block expansion could result in a timeshare for those two shows, next season, while they try to get Rules to syndication (any word on whether it's considered a good property syndication?). It looks like they're going to need about 5 episodes to get to 88, after this season. It's so weird seeing a show have 6 seasons, but all but one are short seasons. I think, last season, they thought they needed to get it to syndication, but then they changed their mind, this season. I sure would like to know why.

NBC is being bombarded all around, between Idol, X Factor, and DWTS, I just don't know where they could move their comedies to guarantee success. Moving it to Tuesdays would also mean that they have to compete with the NCISs and Glee. I think their ratings could get worse by moving. Maybe they should think about breaking up their comedy block, and leading in their comedies with the reality stuff that gets ratings. I don't know, the network landscape is super crowded, these days.

This isn't exactly true.

DVR households watch way more TV than a non-DVR household. And if you think of your own viewing behavior watching DVR'ed programs (and maybe you're in the minority, but this is true for most people) -- people don't fast forward through every commercial.

So what we're seeing is that although a DVR household will FF through a lot of commercials, the increased amount of TV viewing (and resultant value capture of them seeing some more commercials during this incremental viewing) helps offset DVR impact.

The consumer is not nearly as resistant to commercials in programs as Mr. Baseball seems to think. Meaning, sure, if the tech is there to FF through it, they'll do it. But the consumer understands the implicit value exchange: meaning they get to watch this high quality entertainment product, so their 'payment' is sitting through a couple commercials.

Meaning, ad inventory loads across all platforms are still being experimented with, and the consumer likely won't bolt if they still have to watch some ads in the future.

Yeah, absolutely, Al I don't mind, at all, the way VOD is done for ABC and NBC, where they usually have 2 commercials each break. It's ones like FOX that are the problem. They force you to watch all the commercials, as aired, in the VOD. It steers me away from wanting to watch their stuff, because they are basically forcing a live program on me, and I need those extra 12-15 minutes to watch other stuff. It's the same thing for hulu, or if you watch on a network website (never watched anything on FOX's website). They have maybe 2 commercials (with volumes that are way too loud), but it doesn't get in the way of the experience of watching TV on your computer, when necessary. I don't mind commercials, as long as I don't have to see a lot of them. If I have the ability to fast forward, I will. Most people will.

It is a, for lack of a better term, a "delicate balancing act". If you put the viewer off with too many commercials, they're gone. So a lot of work I guess you'd call it a "stress test" is done with consumers to understand commercial load tolerance.

Ultimately, the consumer demands a VOD TV viewing experience for scripted programming (and when I say this, I mean an on demand experience on any platform) - so you must give it to them. Then it's just what the revenue model looks like: if advertising isn't working, you increase the subscription rate. That's the idea.

Now, if the subscription rate increase also puts off the viewer, well, then the whole economic model is in trouble. In my view, that's a possible outcome. What this means for the consumer is they will see less money invested in scripted programming, so theoretically worse quality entertainment content.

Al, is there a real answer why CBS is so stingy with their content? They don't even have an On Demand channel on my cable (Cox), and where I've heard they do have an On Demand channel, they don't show all the programs. I think it's a big reason why CBS's ratings are consistently so much higher than everyone else. There's just no high quality way to see their programs, if you miss them live. Their SD website programming looks awful, and it's a pretty big deterrent to watching their stuff online, unless I absolutely have to.

I think 3 commercials is the max the consumer will take on those platforms, without being annoyed. 2 is fine, and 1 is ideal. NBC usually uses the VOD commercial breaks to promote Universal movies, and ABC does a lot of cross promotion of its movies (Disney) and other networks (ABC Family, Disney Channel, etc.).

As I said earlier, I will do almost anything to avoid watching a full episode of a FOX show On Demand, because I don't want a completely live experience. It actually causes me to not watch some of their shows, that I otherwise would. It's a big reason why I stopped watching New Girl, because I haven't had time to catch up, and thinking about all the commercials I'm going to have to watch makes it worse. Maybe I'll get a chance to catch up this summer. Maybe not. That's FOX's loss, and I'm sure I'm not the only person who feels the same way.

The answer is I think obvious in the marketplace: CBS is leery of cannibalizing the traditional platform, so they are scared to distribute on other platforms. Now, is it true that this drives higher ratings on the traditional? Possibly. But ultimately it doesn't matter for CBS - everyone is migrating to other platforms anyway, so if they are not on that platform, the consumer will watch their competitor's product.

I think this is a fundamental concept of multi-platform distribution, and CBS does "get it" - they IIRC did a deal with Netflix for their library stuff. It's just a matter of time before CBS gets its current air series on other platforms. Basically you have to go where the viewer is going to be.

Do you know when the Netflix thing happened? As far as I know, they have no content of their current shows on there. Certainly none of their most popular scripted shows are on there. It really aggravates me that I can't watch CBS's stuff elsewhere, probably more than the FOX no skipping our entire 1 hour show VOD.