Population Statistic: Read. React. Repeat.
Thursday, April 26, 2021

Reality television certainly is popular — a reliable source of watercooler fodder. But is that the main reason why the powers-that-be have doubled down on them, instead of traditional scripted programming?

Harvard professor emeritus Richard E. Caves, in his book “Switching Channels: Organization and Change in TV Broadcasting”, makes almost the opposite argument: As the viewing audience for traditional broadcast networks fragments and gravitates toward cable and Internet, the economics in producing traditional programming makes less sense.

The programming is a fixed cost — networks pay for the programs even if nobody watches. If paying an extra $1 million to get a star onto a show, for example, raises every customer’s love of the show by the equivalent of $1, the investment more than pays off if there are 10 million potential viewers. But the $1 million investment would be a terrible flop if there were 10,000 potential viewers…

With the big shift to cable and satellite television (we now watch more cable than broadcast programs), cable networks have had a big incentive to upgrade their product, while the incentive for broadcast networks has moved in the opposite direction.

So the increase in reality programming is not just a matter of broadcasters wanting to save money. It’s that a shrinking potential market gives the networks less incentive to spend money. They can’t recoup it with enough viewers.

But this doesn’t explain why cable networks are flooded with so many reality shows as well. If anything, this indicates how much trending accounts for strategic decisions in television programming: It’s assumed that ABC, CBS, FOX, and NBC will continue to bleed away viewers, and so the cost-cutting is implemented now.

More importantly, those viewers aren’t going to congregate to an equivalent handful of cable network equivalents — the audience will remain fragmented across dozens of niche channels. Certain events, like Super Bowls, will score tons of viewers in one shot, but those will be exceptions. Plus, the Web will continue to siphon away eyeballs from cable as well as broadcast. So there’s no inverse trending toward cable, and so channels there follow course and keep their production costs low as well, leading to even more reality shows.

And advertising ties it all together. The buy-in from sponsors ensures that lower production values will fly. There’ll be a bottoming out, looping back to audience preferences, but as long as the ad money keeps flowing, the business will hum. The opportunity for niche-audience product targeting only sweetens the deal.

So the explosion of cable channels led to the rise of “Survivor” and the like. As YouTube and other user-generated/submitted content sites draw more eyeballs, the race to the bottom hasn’t ended yet.

by Costa Tsiokos, Thu 04/26/2007 10:00pm
Category: Business, Internet, RealiTV Check
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2 Feedbacks »
  1. You know what killed the nets? Bad TV. Supertrain. BJ and The Bear. Pink Lady and Jeff. Circus of the freaking stars.

    All look quaint in retropect, but if “The Sopranos” and “Rescue Me” had been the staple 20 years ago instead of the flukes they are now, we might not be having this conversation.

    Your argument, though, has one gaping hole: It assumes that what the viewing public watches en masse today has no value. Clearly its meeting some sort of need. It might not be Masterpiece Theater, but nobody watched that crap when it was on, either.

    Comment by Jeff — 04/26/2007 @ 11:40 PM

  2. Well, we are talking about mass media — the bedrock of Theodore Sturgeon’s “90 percent of everything is crap” observation. I think reality TV underlines how there’s crap, and then there’s crapola.

    Comment by CT — 04/29/2007 @ 11:18 PM

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