Like beauty, TV ratings are often in the eye of the beholder. But in an era of fragmentation — in which 500 channels could truly become a reality — some cable networks are finding it more difficult than ever to gain traction.
And it's not just a case of larger general-entertainment networks losing at the expense of niche services chipping away at their audience. Across the board, cable networks are struggling to hold their own.
Among those are The Weather Channel, A&E and ESPN, as well as USA Network — still reeling from its loss of the World Wrestling Federation — and Nickelodeon, which is trying to fend off the fast-growing Cartoon Network and energetic Disney Channel.
Basic cable as an entity continues to gain against the broadcasters; that's just basic math in a universe that now contains more than 50 cable networks with access to at least 30 million homes out of about 105 million nationwide.
But the same forces that have decimated the over-the-air audience are putting ever-greater demands on cable programmers as well. In the second quarter, six of the 10 top-rated ad-supported networks lost household ratings points, according to Nielsen Media Research.
At a time when the number of multichannel homes is rising by about 4 million to 5 million per year, five of the 10 networks declined in the number of households they reached. The sixth, A&E, rose by an anemic 2 percent.
The use of raw figures can be misleading, because many networks pick up viewers just by dint of the expanding multichannel universe. Therefore, a network whose household delivery grows by 2 percent as the number of homes rises by almost 5 percent is actually losing viewership in real terms.
When examined even in terms of demographics — the data that networks use to sell ads today — fragmentation is taking its toll.
Using ratings points, which are more of an apples-to-apples comparison of audiences, only two of the top 16 ad-supported services gained in the second quarter among 18-to-49-year-olds, when compared to the previous year.
Of those, eight networks lost at least 0.1 ratings points. Only The Learning Channel, TNN: The National Network (fueled by the WWF) and FX (with help from stock-car racing) gained significantly in this category.
"The more channels, the more difficult it gets," said Tim Brooks, senior vice president of research at Lifetime Television, which is enjoying a banner year in demographics and household ratings.
Added Turner Entertainment president Brad Siegel, "When you go from 40 channels in '94 to basically doubling in 2000, that has to be pulling viewers."
Treading water is an impressive task in an environment where digital cable now reaches an estimated 12 million homes.
"If you hold your own in this environment, with all this fragmentation, you're doing very well," said The Weather Channel CEO Decker Anstrom.
Fragmentation does not seem to extend to cable as a whole. The ratings suggest that people aren't turning off their TV sets to surf the Web or use their PlayStations. In the second quarter, basic cable's household delivery grew by 8 percent and its household ratings rose by 6 percent.
"We still have the industry growing at a pretty healthy rate," said Turner vice president of audience development Bob Sieber.
THE HALF-FULL SCENARIO
Some executives suggest that cable is just growing up. At least for the larger networks, it's becoming more like broadcast TV in that it's caught up in the ebb and flow of ratings cycles. Some are networks up and some are down, but the pie keeps growing.
"There's a real share-shifting among channels," said Mindy Herman, president of E! Entertainment Television. "It harkens back to the broadcast business, where you see the broad-based strength of a particular show. You have a network that's No. 1 drop to No. 3."
And like the broadcasters, cable networks are becoming increasingly program-centered, as viewers increasingly choose specific shows rather than just identifying themselves with a network.
Five years ago, few people searched for their favorite shows — they watched Nick for kids' shows, ESPN for sports, Cable News Network for news or Turner Network Television for movies. Now, basic cable is moving closer to appointment viewing: Nick's Rugrats
has long driven viewers to the network, as has South Park
for Comedy Central.
Other networks are trying to duplicate that feat, with shows such as Witchblade
on TNT and The Chronicle
on Sci Fi Channel.
That, said Herman, has added volatility to the ratings mix, leading to larger swings in the ratings picture.
Volatility really hammers the larger networks. For the first half of the year, the Turner Entertainment Networks basically held their own among adults ages 18 to 49, with TBS Superstation growing by 5 percent and TNT by 4 percent. But in May, TNT lost 6 percent and TBS a whopping 14 percent in that all-important demographic. The picture was even worse among men 25 to 54.
DEMOS, AND A BRAND
Siegel said his networks suffered in the second quarter from the loss of the World Championship Wrestling franchise, the Atlanta Braves' struggle in the first half of the baseball season (they have since recovered) and Turner's decision to postpone much of its marquee programming until the latter part of the year, in the face of a possible Writers Guild of America strike.
Long term is what counts, Siegel insisted, and the Turner networks have seen major investments in original movies, series, miniseries, off-network programming and sports pay off.
"Year-to-year, we keep showing overall gains in key demos," he said.
The problem for many networks, said Brooks, is repeating the task and landing that second hit show.
Just like NBC could never find a strong show to follow Seinfeld, Comedy Central has failed to follow up its South Park
But some networks have succeeded and are reaping the rewards, while others are still searching. Lifetime's Sunday night trifecta of The Division, Strong Medicine
and Any Day Now
helped propel that network to the top of the primetime ratings heap for total homes for the first half of the year.
Sci Fi president Bonnie Hammer hopes her network can find its own South Park. Such a show also cements the network's brand in audience's heads, she said.
Cable networks are finding it as tough as broadcasters to land the type of signature show that can overcome the effects of fragmentation and increased competition.
VH1, for example, finally broke through with such shows in Pop Up Video
and Behind the Music,
but has struggled to find a follow-up hit.
Executives at other networks reported similar problems, ones not found at the larger general-entertainment networks.
At Sci Fi, for example, Hammer said she considers science fiction to be "anything outside what we know to be true. It's broad enough [to attract] people genuinely interest in good, smart programming."
The risk? "The trick is, how do we broaden our base and be true to the genre … and still maintain our fan base?" Hammer said. "We have to be smart and not put on product that's so broad you can see it on any other channel, cable or [broadcast] network."
E!'s Herman agreed. "What really makes sense in a large channel environment is to have a very strong brand with a very loyal core," she said.
E! has branded itself as the home of the entertainment and pop-culture world and created some series that drew solid audiences in its key 18-to-49 demo.
But proving how hard it is to move the needle — and how important it is to constantly churn out new, quality programming — E!'s delivery among 18- to 49-year-olds stayed virtually the same in the second quarter. That's despite the fact that in the first quarter, its viewership grew by 34 percent for that age group.
But Herman says the focus on demographics means E! doesn't need large audiences to make money.
"It's not my goal to be a 2-rated network," she said.