The rise of streaming is sapping cable TV programming
By Tim Peterson
Cable TV networks are contending with an existential crisis. Not only are their linear TV audiences eroding, but so is the market for programming they can acquire to keep the viewers they have and attract new ones.
Right now, cable TV networks find themselves at the mercy of a market that is consolidating and coalescing around streaming. Media conglomerates like the Walt Disney Company, WarnerMedia and ViacomCBS are withholding their studios’ programming for their streaming services.
“It’s been a little bit of a roller coaster with the emergence of all these huge mega-platforms owned by big media companies. They’re pulling back content for their own platforms,” said an executive at one cable TV network.
Cable TV networks that are not owned by the major media companies and that had relied on shows from the conglomerates to populate their channels find themselves scrambling.
“We can’t acquire programming that would perform on the network like we did previously,” said an executive at another cable TV network.
A dried-up programming acquisition market compounds the challenges already facing the cable TV networks that are not part of the major conglomerates. The decline of linear viewership for general-interest cable TV networks has hurt their pitch to advertisers searching for large audiences, especially as streaming companies like Hulu are able to make a similar pitch while offering more refined targeting options. The audience declines also negatively affect cable TV networks involved in carriage negotiations with pay-TV providers. While the networks angle for fee increases, the providers are becoming more willing to drop channels, as Comcast did with Fuse at the end of 2018.
These factors combined “are making it much more difficult [for cable TV networks] to try to grow or even maintain” their audience, said Deana Myers, research director at S&P Global Market Intelligence.
Even cable networks that are part of major media companies are feeling the squeeze.
“We hit a ceiling,” said FX Networks CEO John Landgraf Jan. 9 at the Television Critics Association’s winter press tour in Los Angeles, according to Variety. FX Networks has the benefit of now being owned by Disney, which also owns Hulu, and the network will rely on the streaming service to grow after FX makes Hulu its streaming home in March.
For cable TV networks that are not owned by media monoliths, the programming void is “one of the more important” challenges they face, Myers said. To fill the programming void, these networks are working to load up on original programming. But the economic challenges they face can make it hard for them to recoup the money required to pay for that programming.
The cable TV networks are looking to rein in costs by turning to newer sources for shows, like media companies with experience producing shows for digital platforms like YouTube and Hulu. These programming pacts are typically less costly than deals with traditional TV producers, according to TV network execs.
“Good content is good content,” said an exec at a cable TV network that has acquired programming from digital …read more