Fox Affiliates Have Bittersweet Week
With "American "Idol" having remained strong and "Glee" emerging as a hit seemingly out of nowhere, it's been an energizing few years for Fox stations. So even with some uninspiring performances during the 2011-12 premiere week, it's too early and unfair to get worked up about the network's programming.
But Fox putting a top show - or one thought to be - on video on-demand platforms might be less than thrilling news at station groups such as Sinclair and Nexstar, even as they receive a cut of the revenue pie.
First, some of the ratings uneasiness. The "Glee" season debut last week had ratings in the 18-to-49 demo come in nearly 30% below a year ago (by one measure). Then, "The X Factor," which many stations spent months promoting heavily in their markets, had results that were more than discouraging.
There was rightful optimism the Simon Cowell creation, which has been a big it in the U.K., would serve as a highly rated fall complement to "Idol" in the spring.
Yet, as "X Factor" ran four hours last week, it finished second in two of them -- by large margins at that. "Idol" finishing second in a time period would be astonishing.
Nonetheless, there were two positives for Fox: freshman comedy "New Girl" performed very well on Tuesday and, even if "X Factor," is not an A+, it should give Fox a notable presence on Thursdays.
Also, singing competitions can build interest as seasons go on if compelling favorites emerge. The show will also be original all fall, even as other networks go into repeats. And again, it has only been a week and Cowell has tremendous instincts and might be able to reformulate successfully on the fly.
Even if that happens, the specter of difficult relations between Fox and its affiliates continues to percolate. During tense negotiations between Sinclair and Time Warner Cable several months ago, it emerged that Fox had cut a side deal with the cable operator, cutting some leverage out from under Sinclair, which operates 20 Fox stations.
Fox has also been "the most aggressive," according to Wells Fargo's Marci Ryvicker, in looking to grab a cut of the payments its affiliates grab from cable and other operators.
Broadcasting & Cable's Michael Malone recently reported there was a meeting between Fox and affiliates that offered some open lines of communication.
But word emerging Monday in a Multichannel News report that episodes of "X Factor" would be available on VOD for three days after air on Comcast, Time Warner Cable and Cox services might be bittersweet and more bitter for stations. Fox has made shows available on VOD for some time and a Fox representative said the affiliates share in the ad revenue generated from the streams, but "X Factor" is different.
It functions somewhat like a sports event, where live viewing is dominant. Assuming the show becomes a hit, it will offer an element of appointment viewing and -- while viewers can of course record it and watch later - making it available and promoting it on VOD offers another way to reduce a station's chance to aggregate a large audience at once.
The Multichannel News report noted that Fox will get credit for ratings generated during the VOD airings as part of the C3 currency used in the national market. Local stations won't get that benefit.
They will, however, benefit from "Idol's" return in more ways than one. Fox doesn't have rights to make it available on VOD or any other on-demand platform.