When we started this series, back in September, the intention was to follow the summer project we’d sort of backed into, examining each of the major film studios, as well as the mid-majors, the smaller ones and the indies. It seemed like a natural progression to move into television, starting with the broadcast networks and going from there. The three major pay cable networks were a logical follow-up to those, and then the three largest streaming services.
Which is why, in this third-to-last entry in the series for 2016, we are once again delving into the delicate world of basic cable television, a business that, for all intents and purposes, appears to be dying a long, slow and painful death. I explain this here as a sort of exposition, and to reassure you that the original intention was not to bring the whole thing to a close with one downer after another. It just seems like it’s turning out that way.
One would think, with the expansive and pervasive holdings of NBCUniversal, that the massive conglomerate — a subsidiary of Comcast, which just happens to be the biggest media company on the planet — would be impervious to such trends, but even it is susceptible as, of its 15 cable television properties, only one gained viewers from 2014 to 2015.
That’s right. NBC Sports Network went from 81 million households to 83 million, making it the only cable property owned by NBCUniversal to rise from one year to the next. That means USA, E!, Syfy, MSNBC, CNBC, Bravo, Oxygen, the Golf Channel, the Esquire Network, Chiller, CNBC World, Universal HD, Sprout, and Cloo , all decreased in the number of households that subscribed to the particular networks. Granted, the first six listed here are all in at least 90 million homes (led by the USA Network, the high water mark with 94), which is better than most cable networks these days, but lower numbers are lower numbers, and you don’t need to be good at math to see that.
Having said all that, it is important to note that both revenues and operating income, each down the year before, have been up through the first three quarters of 2016. It certainly doesn’t hurt that the company had the Rio Olympics to broadcast over the myriad of channels, but even without that viewership factored in, numbers were improved. The cable channels grew by 4.1 percent in the third quarter over the year before and were up 4.3 percent for the year to date. Add in the numbers from the Olympics, and those numbers jump to 22 and 10.2 percent, respectively. This is why NBC spent $1.23 billion for the right to broadcast them — because NBCUniversal as a whole increased its revenue by 28.3 percent from one year to the next. That right there is a good investment.
The question that arises, of course, is will people stick around on these cable networks once the Olympics are gone? We won’t know that for a while, at least after the year-end numbers are released, including that one referenced above, involving the number of homes where each network is seen, but the short term growth is at least a hopeful sign.
Which brings us to the networks, themselves. Excluding the five news and sports networks, which don’t really fit under our purview, that leaves 10 to discuss, and it probably makes sense to start with the biggest: USA.
USA has been a successful purveyor of original content for a good number of years now, with such diverse past fare as Law & Order: Criminal Intent, Burn Notice, The 4400, The Dead Zone, In Plain Sight, Royal Pains, and White Collar, among plenty of others, but while there are some current shows on that have garnered a fair amount of attention and viewership — like Suits, and, just in 2016 alone, Colony, Queen of the South, Eyewitness, and Falling Water, as well as Shooter, with Ryan Philippe and based on the bestselling novel by Stephen hunter, which recently premiered. But let’s be honest here — the biggest thing to come along for USA in a number of years, and maybe ever, is Mr. Robot.
Sam Esmail’s groundbreaking drama took home the show’s first two Golden Globe awards and its first two Emmys this year, the former for Best Drama Series and Best Supporting Actor for Christian Slater, the latter for Best Actor in a Drama for Rami Malek and for Best Dramatic Score. It has been a cultural sensation almost since its premiere in summer of 2015, has given Slater a career resurgence, has made Malek a star, and has established Esmail as one of television’s most visionary creators. It also, in its second season, dropped precipitously in ratings from its excellent first season numbers. Season One averaged a 0.48 rating in the 18-49 demographic, with 1.39 viewers, totally solid numbers for a basic cable show, but season two dropped to 0.30 and 742,000 viewers, which is a 38.2 percent drop off in the former and an astonishing 46.7 percent drop in the latter. USA has renewed the show for a third season, of course, but if numbers keep falling off like that, then Mr. Robot will join the long list of brilliant TV shows that didn’t last because not enough people watched it. Which, obviously, would be a shame.
With shows like Mr. Robot and Falling Water, the network has made a concerted effort to shift from lighter fare like White Collar and Royal Pains toward weightier dramas that have some grit and gravitas to them. This is why the network is once again in business with legendary creator Dick Wolf, whose untitled FBI project has already been ordered to series. There are also pilots under consideration, like the adaptation of Petra Hammesfahr’s bestselling novel The Sinner, starring Jessica Biel and Bill Pullman; Damnation, a period piece about a 1930s preacher who wants to start an insurrection; and The Tap, another period piece, set in 1969 at Yale University, about a trio of students trying to find their way. The network has also joined the recent fad of turning real events into fictionalized dramas with Unsolved, that will chronicle the investigations into the murders of Tupac Shakur and Biggie Smalls and, if it’s even remotely good, will almost certainly be a ratings magnet, which, let’s face it, would come in rather handy.
Syfy has made some impressive strides in original programming over the last few years, as well, drawing impressive numbers for its zombie show Z Nation, now in its third season and averaging close to 900,000 viewers per episode, The Magicians, which garnered close to 800,000 viewers and a 0.29 rating in the key demo, as well as the gender-swapping reimagining of Van Helsing, The Expanse, Killjoys, and Wynonna Earp, all renewed for a second season, Dark Matter, Channel Zero, and the adaptation of the Terry Gilliam cult classic 12 Monkeys, all renewed for a third. The ratings are all pretty similar, the low being 12 Monkeys at 0.12, the high being The Magicians at 0.29, with most of the rest falling in the 0.16-0.22 range, with between 500,000 and 700,000 viewers. Again, solid numbers for the size of the network.
Interestingly, much of the material ordered to series and in development is based on comic books, starting with the highly touted Superman spinoff Krypton, which follows the story of the Man of Steel’s home planet before he is born and eventually sent to Earth. That joins the cop story Happy, based on a Grant Morrison mini-series and in preproduction, and the sci-fi adventure series Umbrella Academy, from My Chemical Romance frontman Gerard Way, still in the development phase. There are also a couple of adaptations of classic novels, Robert Heinlein’s Stranger in a Strange Land and Aldous Huxley’s Brave New World, which join other creepy fare, like the ordered to series Blood Drive, about a vicious, bloody, cross-country car race, all of which fits neatly into the network’s mission statement, which coincidentally happens to be its name. It’s nice to tune into a network and have a pretty good idea what you’re going to get, which is one of the reasons why it is NBCUni’s second most-watched cable network.
Bravo has also done rather well, between its unscripted programming, led by the various Real Housewives series, as well as the likes of Vanderpump Rules, Top Chef, Shahs of Sunset and Flipping Out, and scripted series like Odd Mom Out and Girlfriends’ Guide to Divorce, all of which feature upscale characters, both real and fictional. The network’s third quarter numbers, in fact, were the best in its history across various platforms, including VOD. All of this, as well as the popular late night talk show Watch What Happens Live, from Andy Cohen, who is at least partly behind the network’s growth over the past decade, including past shows like Queer Eye for the Straight Guy and Project Runway (which eventually migrated over to Lifetime).
That, in fact, is a consistent strength of NBCUni’s various networks, that they know exactly what they are going for and the audience to whom they’re appealing. Just look at smaller operations like the Esquire Network (sporty and adventurous men), Chiller (for horror fans), Sprout (an online and satellite network for kids), Cloo (true crime fanatics), and Universal HD (rebroadcasting company programming and films). Each focuses so specifically on its audience, there’s not too much room for movement in one direction or another, which is, in this case, a good thing. For a company to survive in this current climate, it needs to be able to hold on to its viewers and create some loyalty there.
Perfect example: the E! Network, which made the Kardashians famous and gives its audience all the red carpet coverage it can handle for awards shows, major film premieres and the like, and made The Royals its first-ever scripted show about a fictional British royal family led by Elizabeth Hurley as the Queen of England (because, why wouldn’t she be?). E! has succeeded in this space for over two decades, and there’s no reason to believe it won’t keep doing so for the foreseeable future. Also, after The Royals did so well, there’s now a second scripted show with a green light, The Arrangement, a 10 episode drama series that will premiere on March 1st.
And then there’s Oxygen, which is for women what Esquire is for men, with the same focus on reality programming. The two networks are in a similar number of homes (Oxygen in 77 million, Esquire in 68), but Oxygen tends to get more press, simply because its viewers tend to watch more TV. That does not mean, however, that they necessarily draw so many more viewers. In fact, the network’s programming drew an average of a quarter million viewers per show in 2015, down 35 percent from the year before. Esquire, meanwhile, had about half that many, but was up 25 percent. It’s clearly all about context.
Ultimately, while it’s good that revenues and operating income have been up of late, there’s no avoiding the fact that the overall numbers aren’t terribly attractive. The fact that each and every non-sports network in the fold lost millions of households from one year to the next is an unavoidable negative. It certainly doesn’t hurt, in this case, that NBCUniversal is part owner of Hulu, which gives it the major online presence that, say, Viacom lacks, nor do the licensing fees generated by the programming each of the networks produces, but there is no avoiding the reality of those hemorrhaging viewers and, with them, lower advertising revenues.
We don’t really know for sure if the cable TV business is actually dead, or dying, or, less likely, perhaps just going through a rough period before it somehow makes an unlikely recovery. What NBCUniversal has going for it is the number of networks and variety of target viewers. With such a wealth of possibilities, there is that much better a chance at survival, and let’s face it, there is no shortage of money to keep pushing that as far as it will go.
For more entries in our network series, click here.