Since NBCUniversal confirmed to The Wall Street Journal earlier this fall that it is considering ending its network programming at 10 p.m. and giving that hour back to its affiliates, speculation has been running rampant about the decline of network primetime programming.

I’m surprised by this reaction since this trend is nothing new and has been going on for a long time. It is part of a slow, gradual shift of scripted programming toward online streaming media from over-the-air primetime broadcasting. If NBC does cut back its primetime schedule—and it very well might—no decision will be made until next year. 

Common Sense
Let’s use a little common sense here. The handwriting has long been on the wall for top-tier scripted programming on over-the-air television. (Let’s be clear—this does not include live sports, events or late-night programming, which will remain broadcast staples for the foreseeable future.) The burst of streaming media choices, however, was bound to put financial pressure on the networks’ primetime schedules. 

Television began with only three networks competing among themselves in the 1950s. Now there are dozens of networks—many with very compelling programs. The competition for eyeballs is more ferocious than ever.

So, of course, costs are not only a concern for the broadcast networks, but also for highly competitive streaming outlets as well. Even NBCU’s Peacock, the network’s new streaming media arm, is ramping up its spending on new shows. That is bound to put pressure on the costs at the NBC on-air network.

The fact is there are some great shows being made today—perhaps the best in the history of the television medium. The problem is, to watch most of them requires much agility on the part of the  viewer and fees to a range of streaming services. A lot of us do “free trials” to watch shows we want to see and then forget to cancel the service. I get it—that’s a clear business model for streaming services.

There is also the issue of commercials. Yes, network television is supposedly “free” (that’s another argument), but many of us now have developed an intolerance for commercial breaks. We got that from paid streaming media services, thank you.

Also, hybrid broadcast-internet late night shows have changed television. I can’t remember ever watching “The Late Show with Stephen Colbert” on a live feed; I always watch it the next day on the internet. All television is fragmenting in different directions and that is part of the complications for the traditional over-the-air networks.

Let’s face it, though most of us enjoy watching good, creatively produced television programming, where we watch it is definitely changing. Broadcast network television is no longer the big dog in the viewing game. 

“Networks are at an inflection point in terms of costs,” a broadcast veteran told Hollywood’s Deadline. “Live sports have emerged as the main driver going forward, and their high prices are putting pressure on costs for the rest of the lineup. The question is whether affiliates would like fewer hours of primetime network programming.”

Game-Changer
I see the internet as a game-changer that will gradually erode over-the-air primetime broadcasting, especially if the best shows (and most costly) continue to move to pay services. There is only so much good programming and where it is shown will determine where the audience follows.

NBCU, which owns 43 NBC and Telemundo affiliates, could see cutting its network primetime programming to enhance those local broadcasters. But again, what viewers want to watch in that late primetime hour will be determined by program quality and little else. My guess is some affiliates will strike gold, while others will flounder. It all depends on the quality of the programming the station puts in that hour.

ABC, owned by Disney, is mainly focused now on Disney+, ESPN+ and FX/Hulu. Recently, Disney moved its “Dancing with the Stars” to Disney+ after 17 years with the ABC network. That’s a sure sign of changing priorities.

Though there is no change yet afoot at CBS, Fox has slimmed down its primetime lineup and altered its programming due to the Disney-Fox deal. Since the merger, Fox has mainly focused on sports, animation and non-scripted entertainment.

Of course, driving all broadcast primetime is advertising. That number has been reduced to the over-the-air networks from its high point of $70 billion several years ago. Five streaming services—Hulu, HBO Max, Discovery+, Paramount and Peacock—accounted for 65% of online spending last year.

It should be noted that NBC, ABC and CBS are the only English-language broadcast networks that currently air shows at 10 p.m. each weeknight. Those shows are usually dramas. It also should be noted that each of the broadcasters has experienced primetime ratings declines over the past decade. Other networks that have reduced their primetime schedules over the years include The CW and Fox.  

Television is transitioning very slowly, but it is clear that traditional broadcast networks are gradually being cut back in order to fund streaming. This trend is not new and continues at a steady pace.

The lesson is this: great programming will always have viewers. Where audiences watch it is constantly changing. 

NEW YORK—TV networks want to double check Nielsen’s numbers regarding TV ratings during the COVID-19 pandemic. A formal request for a third-party audit of Nielsen has been issued by the Video Advertising Bureau, which Variety first reported.

A letter sent from VAB CEO Sean Cunningham, which represents the TV networks, cites the “profound dissatisfaction and concerns with Nielsen’s handling of our industry’s month-long urging for rightsized remedies to shortfalls in the company’s COVID period TV usage and measurement data.”

VAB has been making the argument that Nielsen let its system degrade during lockdown, saying that the network of households the supply “usable” information shrunk by 20% between February 2021 and February 2021. VAB also claims that the number of homes registering no TV viewing at all rose 120%.

Nielsen has that it has full confidence in its reporting of numbers.

VAB is demanding that Nielsen submit to an audit from Ernst and Young to verify data from March 2020-March 2021. VAB wants a response from Nielsen by April 19.

For more information, read the full story on Variety. 

WASHINGTON—The affiliate groups of the four major TV networks want the FCC to take a fresh look at OTT regulations that were first proposed in 2014.

This comes from a summary of a teleconference that representatives from ABC, CBS, Fox and NBC affiliate groups had with FCC Chairman Ajit Pai had last week, during which they discussed the current state of the video marketplace.

The affiliates detailed how traditional MVPDs have been greatly impacted by the COVID-19 pandemic, which is compounding previously present challenges with “increasing competition for advertising dollars … increasing concentration in the national programming distribution business and the rapidly developing trend toward streaming of video content,” the summary reads.

They requested that the FCC reevaluate proceedings dealing with virtual MVPDs that had been pending since first voted on in 2014. The regulations were crafted as a Notice of Proposed Rulemaking by then FCC Chairman Tom Wheeler and would define some OTT providers as MVPDs. This was supposed to offer these OTT providers the same FCC-enforced access to vertically integrated programming, but also require them to negotiate retransmission consent with broadcasters. As for which OTTs would classify  under MVPDs and if any other rights and obligations would apply, that was to be considered in the NPRM. However, there was no vote on the order as there was pushback on the proposal.

According to TVT’s sister publication B+C, if this NPRM was voted on and approved, it would reverse the tentative conclusion in the Sky Angel program-access complaint. In that decision, it was concluded that MVPDs had to have a facilities-based transmission path, as well as have control of both content and the transmission path. This is something that OTTs lack.

There has been no comment by the FCC on whether or not it will reexamine the NPRM.

The complete summary of the teleconference is available online. 

Editor's note: This story has been updated. The previous version said that the request was made by the TV networks rather than by the TV affiliates.

LAS VEGAS—Three out of the four commercial TV broadcast networks are fully behind deployment of ATSC 3.0, and the fourth is not anti-NextGen TV but does not want to take a leadership role in the rollout, said Gordon Smith, president and CEO of NAB.

During an interview following a celebration of NextGen TV that brought together Madeleine Noland, ATSC president, Gary Shapiro, president and CEO of the Consumer Technology Association, and Smith on the main stage in the Grand Lobby of the Las Vegas Convention Center on Jan. 8 during CES 2020, the NAB chief responded to a question about the willingness of TV networks to advance ATSC 3.0 deployment.

“I think three without any reservation [support ATSC 3.0], and another one has told me: ‘We’re not against it; we just don’t want to be in the first wagon,” he said.

Smith did not identify which of the networks wishes to hold back; however, CBS has gone on record in the past about its desire to make its subscription over-the-top CBS All Access service a top priority.

“They are for it, and they, I think, will participate in all of the momentum that’s behind this,” he said.

In Smith’s view, supporting 3.0 for broadcasters is a matter of remaining competitive in the future. “The NFL and different sports networks, they are going to want this 4K.”

“They [broadcasters] are going to want to have the best and the brightest so broadcasting can continue to be the best way to grow their [sports leagues’] fan base,” he said.

Network support for the standard is an important ingredient to its rollout and ultimate success. Because broadcasters must continue to transmit ATSC 1.0 to viewers for the foreseeable future and because they have not been granted additional spectrum to simulcast both 1.0 and 3.0, a new level of cooperation involving the relationship between networks and their affiliates, as well as among competitors in local markets, will be needed to bring NextGen TV to local viewers.

Smith is optimistic about the prospects for cooperation. “I have no doubt about their [local stations’] willingness to cooperate with one another, and I know some are already working on it,” he said. “This is a harder lift than analog to digital, so it will take that cooperation to make that lift happen.”

Another key ingredient will be educating the public about NextGen TV and promoting its benefits. NAB has a line item in its budget for the 3.0 rollout, said Smith.

“We are very invested in making this happen,” he said. “Having all these qualitative improvements [made possible by 3.0] will be something that sells in the store and will be viewed with great favor by the American people,” he said.

For a comprehensive source of TV Technology’s ATSC 3.0 coverage, see ourATSC3 silo.

PLANO, TEXAS—Seeing select premium networks alongside a few other channels going direct-to-consumer (DTC) with streaming services is more than a passing fad.

Citing the ongoing unbundling of cable TV packages in the coming years, The Diffusion Group predicts that all “major” TV networks will introduce OTT-powered, direct-to-consumer services by 2022.

That, of course, would build on several of the services that have already been launched, such as HBO Now, Starz, Showtime, CBS All Access, as well as those that are in the plans from The Walt Disney Co., including ESPN Plus, among others.

Mike Berkley, TDG’s senior advisor and author of the report—"The Future of Direct-to-Consumer Video Services - Analysis & Forecasts, 2018-2028"—said those mark the “early signs of an emerging media tribalism.”

[The Future of OTT Streaming]

TDG predicts that the move by major networks to go OTT and reserve their best content for direct-to-consumer offerings will help drive total DTC subscriptions close to 50 million by 2022.

"Big media companies are reacting more boldly to changes in TV viewing behavior," Berkley added. "Consolidating, bulking up on originals, and marketing directly to consumers are driving their strategic direction."

He also stressed that DTC strategies by networks are also risky and could damage their relationships with traditional distributors.

“If networks extract too much high-value content too quickly, channel conflicts are inevitable,” he said.

This story first appeared on TVT's sister publication Multichannel News.