It’s a privilege to have the opportunity to write about PR and media trends on this blog and generate conversation that helps our connections understand the changing environment. It’s an honor to be regularly asked by media outlets themselves to analyze their own businesses.
But there’s always room for learning. And no matter what you know, there’s usually someone who knows more than you do. I learned that this summer.
I remember in 1991, a book called “Three Blind Mice: How The TV Networks Lost Their Way” earned attention in media circles. I also remember ignoring it, because, as a budding broadcast journalist, I knew I wasn’t interested in the negatives of the industry. With the benefit of hindsight, I realize that back then as I was filled with optimism and determination, my head was, to a great extent, more comfortable in the sand.
23 years later, the fact that I hadn’t read that book began to gnaw at me. It was easy to find, because we have a one-of-a-kind, gigantic used book store in Detroit, John Kings Books, where I picked up the 1991 hardcover for $6, then devoured it on vacation. Author Ken Auletta was given unprecedented access to the executives, strategies, finances and emotions of ABC, CBS and NBC, when all three networks were sold in the ’80s. His 577 pages told, with remarkable detail, the inside story I had only seen from the outside. It was, to say the least, fascinating. I folded down pages, prepared to write in here about what had changed, how it had changed and how, somehow, these networks still exist, albeit in a much different form.
But my words can’t do this justice. I had to find Ken Auletta. Using what I assume are some leftover reporting skills, I was able to track him down. While I could have spent a weekend talking shop with him, just scratching the surface, I asked for five questions, to be respectful of his time. He agreed. And here they are. I hope you can learn from him, as I have:
1) When you finished “Three Blind Mice” how did you envision the three networks would look a generation into the future?
There’s always a problem writing an ending to a story that continues. What I wrote in the last chapter was that the financial problem the three networks faced was that they were reliant on a single source of income, advertising. But if they could tap other sources, including, I wrote, changing fin/syn rules to allow the networks to own more programming and benefit from syndication and overseas sales, they would be better placed. My book was published in 1991. In 1992, Congress passed the Cable Act, which compelled cable system owners to pay broadcast and other networks to air their programs. Today, this generates about $4 billion for various networks and stations. Then the fin/syn rules were altered, opening another revenue spigot for networks. And new digital platforms — Netflix, iTunes, Amazon, YouTube — appeared, paying for network programming. Last year, CBS and Fox each received $250 million from Netflix alone.
2) How remarkable is it that while there has been so much change and competition around them, so much of what they were doing then appears to be the same now?
My book was, in part, about how a new technology — cable — was disrupting broadcasting. Today, digital technology and the Internet are disrupting — and sometimes funding — cable as well as broadcasting. The disruptive aspect exceeds the new revenues. For the Internet allows Netflix and others to stream programs directly to viewers. It allows ad-free viewing, or viewers to skip ads. It tells advertisers how many of their expensive ad buys are wasted. It allows viewers to watch what they want, when they want, for as long as they want, and on multiple devices.
3) One fact I learned in your book is that as recently as 25 years ago, network news was a big money loser. I was surprised because in local TV, since almost its infancy, news has been a virtual ATM for station owners. How did the “public service” contingent in newsrooms finally concede they had lost the war?
The idea that news should not be a money loser gained traction when the new owners acquired the three networks in 1985-86. The previous pressure from the Congress for them to provide public service had lessened. And the new owners were corporate businessmen who measured success more by the bottom line, not intangibles like public service.
(Friedman note: In other words, they had no choice.)
4) I have a concept that I would love to see. Maybe you can give me a reality check? Can you foresee a day in which one or more of the old-line networks blows up at least a portion of the schedule that they have adhered to since the 1950s? For example, could you ever see any of them “stripping” news in Prime Time, to fill a void for a straight newscast free from political agenda and screaming heads, on what’s still the world’s most powerful medium, taking advantage of HDTV in a time slot in which modern Americans are not stuck in traffic? That newscast, in part and in whole, could be available on demand, for online viewing. Or will they still insist on a white man reading a prompter to a gray audience at 6:30 p.m.?
No, I cannot imagine the networks placing a newscast in primetime, as some nations — like Israel — do. Why? Ratings and demographics. And the Internet. The average age of the three newscast viewers is 65, thus the ad rates are low. And because the Internet has made possible for citizens to be exposed to news 24/7, fewer people wait to learn what happened today. More likely we’ll see broadcast networks air live and special events — sports, awards shows, the Sound of Music and Peter Pan movies, etc.
5) As far as programming, do you agree that we’re now, despite a lot of the “reality” trash on the air, we may now be in something of a Golden Age, because competition has led to, overall, a better quality of choices across the channel universe?
We have more choices, and better choices. Yes, there’s a lot of crap. But the Good Wife on CBS, or Friday Night Lights (then on NBC), are as outstanding as many of the best shows of yore. And then you have HBO, Showtime, AMC, Netflix, etc. Bruce Springsteen’s lament, 500 channels and nothing on, is wrong.