I cannot tell you how many times I heard the alarms blaring last week that the broadcast economic model is broken — and maybe can’t be fixed. And all that chatter comes as broadcast and cable networks prep to duke it out in the upfront advertising market.
This talk about the sustainability of the broadcast model has been rife for a decade, but today, in the new environment of non-linear, short-form programming, the panic seems more pending — especially when you hear it from an ex-broadcast executive like Ted Harbert, who left ABC, went to DreamWorks SKG and is now the president of struggling E! Networks.
I caught up with Harbert for drinks last week as he swung into town to woo media buyers. He looked at me like I had three heads when I asked him why he left his high-powered job programming ABC back in 1996.
Almost a decade ago, he said, the broadcast networks were wary about audience segmentation from cable, but couldn’t figure out what to do about it.
And today they still don’t have the answer, Harbert said. He’s now placing his bets on cable and trying to turn around E!, which sources say was starved of development money under the rein of previous president Mindy Herman, who left with a $17 million package.
Somewhat surprisingly, middle-aged executives like Harbert and others who run cable and broadcast networks are turning to their teenage children for the answers.
Consulting firms like Deloitte’s Technology, Media & Telecommunications are echoing the same mantra: Watch the wireless habits of the 14-to-17-year-old set, who treat their cell phones not only like a phone, but a computer and TV, sending instant messages, playing games and viewing short-form programming.
Deloitte’s TMT U.S. managing principal, Tony Kern, a former broadcaster with ABC and a now consultant to many of the top media companies, says that the broadcast-network model is doomed for extinction, unless it changes.
For years, he argued, audiences have become fragmented and will become ever more so as new options like DVD, Internet-protocol television and video-on-demand chip away at the mass market, broadcast’s fundamental selling proposition.
I happen to agree with Harbert and Kern. I don’t get particularly excited about big headlines like Comcast Corp. and Time Warner Cable carving up the Adelphia Communications Corp. properties.
But I do get excited about smaller headlines, like Fox creating “mobisodes” of 24 on the Verizon Wireless platform, because that is the future.
While I’ll never give an inch to the annoying teenage throngs who dominate malls and movie theaters, I realize that generational issues always win.
For now, I’m comforted because I have the money and they don’t. But that won’t matter as all networks prepare for a new and different future. Right now, it’s a future aimed at capturing the elusive 14-to-17-year-old set.