Broadcast TV Struggles to Stay Viable

When I have a spare hour, I want to take a couple of copies of my "local" paper, the Cleveland Plain Dealer and cut out each individual non-advertising piece of content. Then, I want to separate them into piles: (1) locally-generated content with a local perspective, (2) non-local content with local interest, and (3) non-local content.

#1 = Story on some local crime that doesn't affect people who aren't Clevelanders

#2 = Stories about KeyBank. Although they might be written by the AP, they are of special interest to Clevelanders. This probably doesn't include the local movie reviewer unless the film was shot in Cleveland or something like that.

#3 = The AP article about what Obama ate for breakfast today.

I'm pretty sure that the portion of the paper that falls into pile #1 and #2 is pretty small. I skip over #3 because I've already read a better article in The Times. The PD, like almost all local papers, relies on the artificial coupling of generation, aggregation, and syndication to justify its business model. Interestingly, the PD has a terrible internet presence (cleveland.com), but it at least seems to filter out the unique, local content.

How are the broadcast networks different? Youtube has proven that consumers prefer to consume the good content from the broadcast networks at their leisure even if the video quality is sub-standard. So, the big networks' broadcast/syndication capabilities are no longer the value they once were. The NetFlix Roku has proven that the internet is good enough to publish high-quality content cheaply, and it costs only slightly more than a digital TV converter box!

The network's role as aggregator of content has never been seen as a significant benefit -- Who chooses which shows to watch based on the network showing them?

So, what value is left for the networks? They are better than just about anyone else at identifying and producing top-tier content. No one has done an internet-based ER or Friends (yet). Is it the network's ability to use its large audience to market new shows that provides its remaining value? By knowing that they can get people interested in the next ER, they can afford to throw $5M at a pilot. Can alternative methods of producing and marketing high-quality content compete? In the short-term, perhaps. But, when mainstream, entertainment-related content providers (sites about TV, magazines about entertainment and celebrities, etc.) start to talk about the last episode of the new internet-only show right along with a summary of last night's Grey's Anatomy, the networks' last remaining source of power may decompose.

I was surprised that the NYTimes article didn't make a better comparison of the networks' fate with that of the newspapers as their plights are not so different.

Questions I have:

1. How can a business be made of local news production? I'd be willing to pay for it, but I'm not sure that enough people would be.

2. It seems that iTunes, etc. provide a good means of charging consumers for video content. How can the funding/publicity model be changed to allow an internet-only ER to happen? Am I wrong to presume that consumers want top production quality?

I almost pitched this post because I wasn't sure that I'd said anything that hasn't been said over the past few years, but I decided to keep in hopes of sparking some discussion.

But this will not work on the current broadcast system. It only works on the web, and that's why TV is going to have to merge with the Web. The infrastructure is almost all in place, it's just a matter of switching. This is the real shake-up that is about to come, not gradient borders on todo lists.

Some TV shows are good, but they are expensive. But people pay for entertainment. There will always be an audience for Battlestar Galactica, and if the networks cannot offer it, someone else will offer it by making it cheaper and make the profits.

I understand that cable providers gain extra revenue by charging for the delivery, but this explanation still sounds bogus. Could it be that the networks are simply unwilling to pay for decent content, and are instead trapped in a cycle wherein they must settle for crappy "reality" TV that's cheap to make, but has the half-life (and revenue-generation potential) of dead fish? Advertisers like to have their name associated with brands like "Friends" and "ER" -- even in re-runs. I'm not sure they're as willing to pay to be associated with re-runs of "MILF Island".