Commentary
It's Not TV, It's TKO
- by Joe Mandese @mp_joemandese, June 23, 2021
Today's TV Watch was inspired by two stories I covered this week: A report from GroupM calculating the world's biggest media companies, and Google's Timelapse app, which won an award at this week's Cannes Lions festival. I decided to mash them up to see what the equivalent 37-year time lapse has had on the media industry in general, and the TV industry in particular.
I don't have the tech chops to program a real-time visualization the way Google has for planet Earth, so I'm showing the old fashioned way: a data table.
The left-hand side shows the top 10 media companies of 1984 ranked by revenues, according to the Fortune 500. The right-hand side shows GroupM's estimates for the 2020 ad revenues of the top 10 media companies.
Aside from the obvious economic disparity -- 2020's fourth-ranked company, TikTok owner Bytedance, is bigger than all of 1984's top 10 combined -- the most striking initial observation is that all 1984 companies were in the TV business. Even big newspaper publishers, which owned large groups of broadcast TV stations.
In 2020, only two of the top 10 -- Comcast and Disney -- are appreciably in the TV business, unless you count YouTube owner Google and Prime owner Amazon. I mean, YouTube does operate YouTube TV, which is a vMVPD service. But you get the point.
The other striking detail is that several of the 1984 companies no longer exist, while all but three in 2020 do. Comcast, Disney and Microsoft -- didn't exist in 1984. Interestingly, one of those defunct companies, Media General, gave birth to what today is the largest independent media buying service: Horizon Media. While another, Metromedia, was the foundation for Fox Corp. And if you want to be really technical, there's still some jostling going on vis-à-vis Time Warner (Discovery) and Capital Cities/ABC is now part of Disney.
Another interesting tidbit is that 1984's newspaper-based companies have mostly gotten out of the TV business and are essentially pure-play publishers.
If you really want to squint at 2020's toppers, you could argue that many represent the "new TV," including Google (YouTube), Facebook, Alibaba, Bytedance, Tencent, Baidu and Microsoft, while old-schoolers Comcast and Disney are still on the list.
To be honest, I'm not 100% sure what the actual insight is here, except that the TV industry has — and will continue — to evolve.
When I coincidentally started covering it in 1984, the big trend was something called "cable TV," which classic broadcasters like CBS sought to label as something other than TV. Early attempts to distribute it over digital networks -- videotext, audiotext, etc. -- largely failed, but ultimately paved the way for the internet-based streaming and over-the-top TV distribution.
Qhether you're watching it via Microsoft's Xbox, or Google's YouTube TV, it's still TV. Unless it's HBO, of course.
The last thought I'll throw in here is a nod to my old friend Mitch Oscar, who like me, has been frustrated that the industry hasn't come up with better names for what to call this stuff. Mitch coined the term "televisual," which I thought was pretty good. More recently, GroupM's Brian Wieser suggested we call it all "CTV+."
Or maybe we should avoid relabeling it altogether, because chances are that 37 years from now, we're going to want to call it something else.
Joe Mandese is the Editor in Chief of MediaPost. You can reach Joe at joe@mediapost.com.
Joe, it's misleading to compare these in "then year" dollars. Many options are online for calculating what $1 in 1984 is equivalent to in 2021; averaging several says the conversion is about $2.60. Thus, CBS revenues in 1984 would be worth about $24.7B today - putting it right between ByteDance and Amazon (and maybe indicating CBS then was a powerhouse people took for granted); and Time Warner would be tied on the 2021 list with Microsoft.
Your overall point is certainly valid, that the players have notably changed in the ensuing 40 years, but i think you are overplaying your hand by not coverting to equivalent dollars.
@Dave Tice: Well, then it's probably worth noting that the actual 2020 advertising marketplace values CBS (and the rest of its parent company Viacom) at only $9.8 billion, according to GroupM's recent estimates. So so much for inflation adjustment calculators, but anyone who wants to calculate these comparisons that way are welcome to. Here's one from the U.S. Bureau of Labor Statistics:
https://www.bls.gov/data/inflation_calculator.htm
Joe, my observations on this kind of comparison touch more on the significance of the rankings and the nature of the incomes than on strict comparisons of dollar amounts across a four decade span. Aside from subscription/single copy sales for the newspapers and magazines, most of the 1984 ad revenues for the top ten were from the same sources----national and local branding advertisers. Indeed, in many cases, the top media were competing with each other for these dollars on the national and local levels.
When I look at the 2020 top 10, I don't see the same thing. In fact, many of the digital media ad dollars are not obtained in competition with traditional media. Instead, they are heavily weighted towards promotional "advertising"---search, for example---and direct response ---and, I suspect, there is a huge difference in terms of advertiser budget size with millions of small fry---often, local small fry---- swelling the current totals. If digital media suddenly disappeared, many of these dollars would revert to direct mail, printed directories such as the yellow pages, free standing inserts, etc. or would simply not be spent. In other words, because of digital media we have redefined the term "advertising" to include many functions that before were handled separately by advertisers---usually as part of their sales promotional, not branding, activities. The promotional "ad" budgets of 1984 were probably not included in the "ad revenue" stats for most of the old top 10 and many media companies below the leaders---but they were quite large.