Is TV's Traditional Business Model Broken?

The broadcast networks are in New York this week pitching their fall TV shows to advertisers. David Greene talks with reporter Kim Masters, of The Hollywood Reporter, about the new shows and indications the industry is in decline. Masters also hosts The Business on member station KCRW.

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DAVID GREENE, HOST:

The big broadcast networks are in New York City this week. They're pitching new fall TV shows to advertisers. We're talking about big money here - the networks are expected to sell about $9 billion worth of commercial time. That sizable payday, though, has been overshadowed by concerns over what's considered to be an industry in decline.

Reporter Kim Masters is in New York, covering the network presentations for the Hollywood Reporter. Hey, Kim.

KIM MASTERS, BYLINE: Hey, David.

GREENE: So, you know, we're hearing more and more about this idea that the traditional business model for TV is kind of on its way out. I mean, what are networks like ABC, CBS, NBC up against here?

MASTERS: Well, they're up against the fact that every single one of them has seen their ratings decline over the past year and in some cases, pretty precipitously. CBS has done the best, but the rest of them are really hurting. And you've seen Fox, which has had a long, dominant run with "American Idol" - see that show in freefall. So there's a feeling that there's all this encroachment from a lot of different material from a lot of different places: the Internet, big screen, small screens, portable screens, cable hits like "Walking Dead" or "Duck Dynasty" that are outrating their shows. At one point, NBC was trailing Univision.

GREENE: Wow.

MASTERS: I mean, the dominance of the four broadcast - big broadcast networks is definitely under challenge.

GREENE: Let me get this straight. I mean, it sounds like it used to be these networks came, and they just tried to get advertisers for their shows. Now, there's an additional challenge, which is to get advertisers just to come to television at all, with all these other options out there.

MASTERS: Well, that's overstating the case a bit because all networks have made a strong point, you know, there still is not enough clarity. There's a lot of cacophony in this other entertainment - YouTube channels, whatever - and the broadcast networks still aggregate eyeballs, still have the biggest audiences, still have live sports that is dominant, such as the Super Bowl, which you watch in real time. You don't skip the ads. Really, the advertisers are going to have to come to the networks.

GREENE: Well, let's get to the fun, here. We've got some tape lined up here of a couple of the new shows that are getting some attention.

(SOUNDBITE OF TV SHOW, "AGENTS OF SHIELD)

UNIDENTIFIED WOMAN: What does SHIELD stand for, Agent Ward?

UNIDENTIFIED MAN: Strategic Homeland Intervention Enforcement and Logistics Division.

UNIDENTIFIED WOMAN: And what does that mean to you?

UNIDENTIFIED MAN: I think someone really wanted our initials to spell out SHIELD.

(SOUNDBITE OF TV SHOW, "THE MICHAEL J. FOX SHOW")

UNIDENTIFIED WOMAN: 911, what's your emergency?

MICHAEL J. FOX: (as Mike Henry) No, 911? No, I didn't call 911. You know what I did? I called 917, but I misdialed. My drugs hadn't kicked in. No, I'm fine. I'm fine.

GREENE: I think some of music is sometimes part of the fun in hearing these types of clips. So what were we listening to there?

MASTERS: Well, you might have recognized the voice of Michael J. Fox. He's got a new show named after himself on NBC, what's old is new again, obviously, a beloved star. He's sort of playing a version of himself, a guy, a newsman with Parkinson's, and there are a number - they showed some clips at the NBC presentation. There are - you know, there are Parkinson's jokes. Only Michael J. Fox could make those jokes, but they played pretty well in the room, and we'll see whether that sustains a TV show.

Before that, you heard an ABC show, "Agents of Shield." That's from Marvel, which brought you "Iron Man," which is in the theaters right now, and "The Avengers." You know, this is the thing that Disney, ABC's parent, does brilliantly. They have these brands, and they put them across all kinds of platforms - you know, ABC, movies. You name it, they sell it.

And "Agents of Shield," probably has the most buzz. I mean, there's just built-in recognition for that, and I think ABC is pretty thrilled to have that on the schedule.

GREENE: Comic book blockbuster from the big screen comes to the small screen, in a way.

MASTERS: Exactly.

GREENE: And I heard that fans of the show "24" have something to be excited about. They're bringing that massively popular show back.

MASTERS: FOX will bring that back, supposedly in the spring of 2014. It will not be like a regular TV show. It's going to run about a dozen episodes. And a number of the networks are experimenting with sort of a return of - I guess you could call it an expanded mini-series. I mean, FOX is also doing an O.J. Simpson story, and a reboot of "Shogun," which you may remember from long ago.

GREENE: Of course.

MASTERS: That's something they're experimenting with, and they're doing it because they want to keep a lot of fresh programming going year-round, instead of having the set fall and spring season where people sort of drift away a little bit. They're really pushing to have fresh, original programming going all the time.

GREENE: Another way that the model is changing.

MASTERS: Another way to compete.

GREENE: As the model sort of changes in this industry, I mean, is there one network best-positioned for success right now?

MASTERS: Yes, clearly, it's CBS. Les Moonves is the head of CBS. Every year, they have a breakfast with the press. And all these other networks have presented and emphasized their programming is available on multiple platforms, and they'll sell ads to advertisers on all these different platforms. And Les Moonves stood up in front of the room and said: Anybody who spends 20 minutes in an upfront presentation talking about multiple platforms doesn't have much else to sell.

And he made the point that "Big Bang" is not only number one in broadcast, but number one on cable in repeats. So he's saying if you have the goods, broadcast is still dominant, and he is a guy who sells hard, and is going to ask for a big increase in ad rates because of that.

GREENE: OK. So CBS still believes get it right on broadcast, and all these other platforms will kind of, you know, work themselves out in your favor.

MASTERS: Absolutely.

GREENE: Sounds like a fun thing to cover. Enjoy it in New York.

MASTERS: Thank you, David.

GREENE: Kim Masters. She hosts "The Business" on member station KCRW.

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