• by Ken Convoy , January 7, 2008

The recent Jack Myer's Think Tank article, "Advertisers' Strike Tax is the Solution to Writers/Producers' Impasse," opining that advertisers pay a 1% tax on media so those funds can be given to writers, is illogical for three reasons.

One, advertisers already financially subsidize the TV industry; two, they are not responsible for the problems causing the strike; and three, the people who are responsible for and can settle it are not even at the bargaining table.

But there is a way to resolve it for the long term.

The strike is about money: the money producers receive from broadcast, cable and digital networks they have to share with writers. The writers want more, while the producers claim the money is not there.

The solution is to increase the amount of money producers receive from networks, so more is available for writers. To do that, networks need to generate more money from advertisers. To do that, viewership must increase. Otherwise, with every contract, producers and writers will be fighting over an ever-decreasing pool of money.

This means the key to solving everyone's short and long-term problem is higher viewership levels, and that begins with motivating more people to sample the programming. How is that done? Via promotion.

But therein lies the dilemma.

The real underlying, core, debilitating and damaging problem infecting the industry (and advertisers with branded content) is, networks know that sitcom and drama promotion does not work. They know the billions of dollars worth of stockholder assets spent on generating sampling have no positive effect; that their TV and radio spots, print and Internet ads, billboards, Web sites, publicity, etc. cannot motivate people to sample new shows. They actually prevent new people from sampling and, at best, since to "get" the promotion you have to have seen the show, just remind a series' relatively-few existing viewers to tune in again --  that's it.

When this was explained to the executives running promotion and other divisions at ABC, CBS, FOX and NBC, they agreed. They also agreed that, using a strategy they saw that adjusts for the explosion in viewer options, broadcast and cable ratings can increase by 50% to 100%; digital viewership by five, 10, 20 or more. In fact, after seeing examples, both John Miller, NBC's Chief Marketing Officer, and NBC producer Chris Conti, when he was NBC's -Drama Development, placed their agreement in writing. Conti even wrote that this approach will result in ratings equal to what "Desperate Housewives" earned after it debuted - when its numbers were about double NBC's average.

Promotion is the bridge connecting viewers to content for that critical initial sampling. Even a "great" program cannot generate sampling; its role is maintaining loyalty after sampling. The real chokepoint, and what diminishes the pool of available funds, is the promotional bridge is out of order. Who's responsible for it? Networks, not writers or producers.

Not taking this into account automatically limits the pool of viewers and revenue, thus forever shortchanging producers and writers. Extending this means that most series that were quickly canceled did not fail; rather, their promotion did, by not causing enough sampling and, if it did, more would have been successful. And as the number of viewer options increases, the importance of effective promotion will multiply, and it will also become the key factor determining success in non-network delivery systems, such as people becoming their own programmers or Pay-VOD for first-run scripted series.

Therefore, to increase the amount of money for producers and writers now and in the future, the industry must abandon its 35-year-old promotional thinking and enter the 21^st century. Why network management insists upon using ineffective strategies that cut the legs off their own chairs is something they'll have to answer for to their boards.

The reality is  that more-effective promotion will: (a) increase viewership - obviously, having more samplers is better than less -- which will (b) increase advertising, and direct-from-viewer, revenue, which will (c) increase the pool of funds for producers and writers.

For years, the broadcast industry has been living off a false sense of economic security caused by the law of supply and demand increasing advertising rates, as the number of rating points available to sell, meaning viewers, fell. Why? In other industries, when market shares decline companies lower their prices to regain it. But, in TV, as rating points advertisers could buy declined, and since no more can be "manufactured," the broadcast networks had the unique luxury of increasing, not lowering, their prices. But in today's competitive age, this artificial protection is ending.

Producers and writers need to realize they are on the same team and turn their attention to those who build the promotional bridge, which is what expands or limits the size of the viewer, meaning money, pool -- the networks.

However, to maximize results and revenue, the 1970s-based content development-promotion-sales-compensation model -- which results in the same shows using the same ineffective promotion bought by the same method, guessing, and the same market-share-lowering results -- must be overhauled to adjust for the media and technology explosions.

As for taxing advertisers, even the most ardent, tax-loving Democrat would find that impossible to justify.