Report Says Broadcasters Could Save $100M By Sharing Services

NEW YORK—U.S. broadcasters could save more than $100 million annually by using advances in digital and IP-based technologies to share resources and streamline operational workflows, according to a new report by Positive Flux.

The report, “The HD Transition has just begun” was released in advance of the IBC Show and indicates that only a small percentage of U.S. TV stations is taking advantage of shared services to manage production and distribution costs. Highlighting critical operational areas including news production, graphics, weather, master control and others, the report points to savings that could be recouped by U.S. broadcasters by using shared services models to eliminate redundant processes, pool resources, streamline operational workflows, and create foundations for future multiplatform operations.

“Broadcasters, cable programmers, Internet video producers and others have been slow to embrace shared services, citing concerns about loss of control, lack of quality or the complexity of transitioning as factors,” said Positive Flux president Larry Thaler. “The reality is that today’s hostile economic environment presents an opportunity to find game changing solutions. We are seeing clear signs that companies that have embraced even limited shared services opportunities are in a better position to weather the changing environment.”

The study surveyed senior engineering management at more than 350 U.S. broadcast stations of all sizes including station groups, O&Os and independent stations. Positive Flux is a firm that specializes in transforming media companies to address new opportunities.

Some findings from the report include:

  • • A 10 percent expansion of centralized graphics as a shared service would reduce the cost to the US TV Stations industry by $35 million annually, while at the same time improving on-air quality.
  • • The report also finds that a full 30 percent of US stations are not yet sharing news clips to improve their story-telling capacity by bringing in stories from outside their markets.
  • • Only 22 percent of U.S. TV stations are sharing images and animations, enabling personnel to focus on branding and revenue building opportunities instead of creating news graphics that are available elsewhere within their own group or through cloud-based services.
  • • While almost 90 percent of stations have adopted non-linear editing, few have established unified workflows amongst desks, departments, or affiliates. Unless addressed, this situation means that each new delivery platform will multiply CAPEX and OPEX, which could otherwise be managed by eliminating the duplication of efforts involved in delivering to multiple platforms.

"Broadcasters are facing some tough decisions,” said Thaler, “much brought about by their reliance on old models and processes. It is not enough to head to IBC to look at technology—we need to think about operational impact and production efficiency first, before we even begin to consider upgrading systems.”

A complete executive summary of the report and additional information is available online.