By Joe Flint
The broadcast networks will be happy to put 2020 in their rear
view mirror.
Unlike streaming platforms, which got a tremendous boost from
the nationwide shutdowns caused by the coronavirus pandemic, the
broadcast networks endured steep drops in prime-time viewing this
year.
The drops in Nielsen ratings go far beyond the typical erosion
of the past decade that is a result of viewer fragmentation due to
the dramatic increase in content options coming from streaming
services.
The declines in prime-time viewers range from 32% for ViacomCBS
Inc.'s CBS, 28% for Fox Corp.'s Fox, 25% for Comcast Corp.'s NBC
and 7% for Walt Disney Co.'s ABC compared with the fall of 2019.
Fox Corp. and Wall Street Journal parent News Corp share common
ownership.
The drops can be attributed in large part to the effects of the
virus on their businesses. Production shutdowns in the spring and
summer left broadcast networks scrambling to fill their schedules
with fresh content in the fall, making them less able to capitalize
from an increase in overall television viewing from people being
stuck at home.
Broadcast networks operate under a more restrained business
model than Netflix and other streamers, which stockpile programming
and had plenty of new shows and movies to offer housebound viewers.
Broadcast shows are typically ordered in the spring for the
following season. This season, new episodes of existing series
weren't ready to air until late fall. The few new series there were
had to be rushed onto the air without the usual lengthy development
process.
Networks got some cost savings from the reduction of original
programming being produced and developed for the fall. However,
production costs in general have increased because of the
precautions put in place because of Covid-19. For a one-hour drama,
the additional costs are more than $300,000 an episode and over
$150,000 for a comedy, people familiar with the matter said -- a
10% to 15% increase over the usual production costs.
The decline in ratings is being felt on the advertising side as
well. NBC ad revenue was down 12% in Comcast's third quarter, which
included the month of September. ABC's ad revenue for the early
fall was flat while the company saved money from production
shutdowns. Ad revenue for CBS in the third quarter was off 1%,
while Fox's last quarterly results through September showed ad
revenue declines of 15%.
The networks took different approaches to dealing with the
disruptions to their content pipelines that the pandemic wrought.
CBS relied heavily on reruns of current shows, betting its lineup
of traditional sitcoms and procedural crime dramas was
well-positioned for repeat viewing.
NBC relied on imports such as the Canadian dramas "Nurses" and
"Transplant" to fill holes left on its schedule as well as game
shows such as "The Weakest Link" and a new season of the talent
show "The Voice."
"I actually think we weathered the storm better than I thought
we would, " said Jeff Bader, president of program planning for NBC
and its cable networks. Mr. Bader said NBC managed to have 82% of
fresh content during the fall, a decline of just 6% from the
previous fall, thanks in part to a heavy quotient of new unscripted
fare.
Not every gamble NBC took paid off. A pandemic-inspired new
comedy called "Connecting" that primarily took place in video chats
was pulled after only four episodes.
The dramas that have been on for much of the fall have also seen
double-digit growth in catch-up viewing either via DVRs or on NBC
platforms, Mr. Bader said. This is indicative of the continuing
trend of viewers pivoting away from live television to on-demand,
which is also how the networks are now determining success. A show
with seemingly low linear ratings isn't necessarily headed to the
chopping block if it does well on secondary platforms.
"The definition of success is constantly evolving," said Fox
Entertainment head Michael Thorn.
ABC and Fox were fortunate to be able to make fresh episodes of
their unscripted hits "The Bachelorette," "Dancing with the Stars"
and "The Masked Singer," respectively. The success of "The
Bachelorette" helped cushion ABC's fall, while Fox's heavy drop
would have been even bigger without "The Masked Singer." Both
networks were starting from a lower base audience, making their
drops less impactful.
ABC also was one of the first networks to resume production and
had new episodes of "Grey's Anatomy" and "The Conners" and a new
dark crime drama called "Big Sky" to give it momentum heading into
the new year.
"We didn't go the route that many other networks did -- which
was to slate their fall with reruns, or turn to acquisitions," said
Ed Isabella, vice president of research for ABC. "We knew we wanted
our original shows back on the air."
Fox took a similar approach to ABC, launching with its regular
Sunday night animated lineup. It did try two new shows -- dramas
"Next" and "Filthy Rich" that were canceled after a handful of
airings. Fox was stung by a low-rated World Series as well. The
success of "The Masked Singer" helped the network finish first in
the key adults 18-49 demographic.
"Certain shows still catch the fascination and hearts of the
audiences," Fox's Mr. Thorn said of the success of "The Masked
Singer."
CBS Entertainment President Kelly Kahl said in an interview that
it was a "fool's errand" to compare this fall with last fall given
all the disruption.
"We acknowledge it was a rough start, but we knew it was
coming," Mr. Kahl said. Besides most shows not being ready in
September and October, Mr. Kahl said the gradual return to
production also made finding a scheduling rhythm a challenge. In
the new year, there should be a more traditional pattern of several
weeks of new episodes of a show running before a repeat
appears.
If there is a financial upside to the chaos the pandemic created
this season it is that the networks won't be ordering as many
scripts to develop for next season because there are plenty left
from the previous pilots season.
"We're committed to making them, which is why we rolled them
into the next cycle," said Fox's Mr. Thorn.
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
December 31, 2020 07:14 ET (12:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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