Can you imagine fewer unscripted/reality TV shows on cable networks in a few years?
MoffettNathanson Research says producers of unscripted TV programs -- a major piece, if not the biggest -- of
many cable networks prime-time schedules are getting more expensive.
“Producers of nonfiction content -- which makes up the bulk of programming for many cable networks -- are getting
squeezed with margins reaching unattractive levels,” writes Michael Nathanson.
Where will those shows go? The belief is subscription video on demand networks -- like Netflix, Amazon, and Hulu, which have already dipped their toes in the
waters -- will continue to pursue this content “along with everything else.”
For sure, many like TBS, USA Network, FX and others also run expensive, well-known off-broadcast
network rerun programming -- like “The Big Bang Theory,” “Modern Family” and “The Simpsons.” Increasingly, SVODs are also in this marketplace, as well.
Looking to perhaps stabilize its big reality programming slate, MTV recently made a deal for
long time stalwart off-network sitcom, “Friends.” Already, it has become the network’s number one acquired TV show.
This is just a Band-aid. In recent years, it has been
original programming of all kinds that is key to cable network growth -- from advertiser revenues, as well as higher carriage fees from traditional pay TV providers. For years, unscripted TV content
has been a good deal -- in particular because of its relative smaller expense to that of acquired programming.
Should this work up into a meaningful trend, it will probably hurt small- to
mid-size cable networks -- networks already feeling the pinch when it comes to carriage fees on traditional linear pay TV services -- or worst.
Recently, NBCUniversal had to make the decision
to abandoned Esquire TV as a traditional linear TV network; opting to continue it as a digital/Internet enterprise.
Other analysts also worry small/midsize cable networks will also feel the
effect of not making the cut for new digital providers of cable networks, like Sling TV or DirecTV Now.
Right now, this isn’t a make-or-break decision. But new programming and business
models for some cable networks will need to surface. That’s the reality.