NEWS/L'EDICOLA DI LOU - Tv americana al collasso? "Variety" lo aveva predettto un mesetto fa (con tanto di cover): troppi titoli (145 serie in prima serata, +14% rispetto all'anno scorso) e previsioni bulimiche (350 progetti seriali ordinati fino all'estate!). Domanda: quanti di questi spaccheranno e quanti scoppieranno?  

Articolo di Cynthia Littleton per "Variety"

Even the most devoted couch potatoes may be overwhelmed by the deluge of new and returning series premieres that will unspool over the next year. And they’re not the only ones.

Industry executives are quietly starting to use the B-word — “bubble” — in surveying the landscape of scripted skeins across the dozens of broadcast, cable and digital outlets that are serving up original programming. That growth has been fueled by the windfall of licensing revenue from expanding international sales and digital platforms that barely existed a decade ago.
But after a more than 1,000% spike since 1999 in the number of scripted series produced for just pay and basic cable, there are growing concerns, even among those in the production world, about the unwelcome consequences of so much capital chasing talent, viewers and, most important, off-network profits.
At a time when every aspect of the traditional television business is in the throes of transition, some see big losses and a decrease in volume as inevitable, and soon. According to Variety research, broadcast and cable networks this year have aired 145 scripted original primetime series and miniseries, a 14% increase over the same frame in 2013. At least 350 new and returning scripted series have been ordered for the 2014-15 television cycle (including summer 2015), and that’s not including digital outlets. The long-tail theory may not be long enough to support this exponential boom in high-end production.
“Everybody is enjoying Netflix’s emergence as a buyer of all this scripted content, but what we worry about here is supply and demand,” said Michael Nathanson, a veteran media biz analyst and partner in the research firm MoffettNathanson. “The supply of dramas is increasing to the point where in the coming years, there are just going to be too many shows.”

FX Networks chief John Landgraf sees the expansion as a symptom of the audience fragmentation that’s been a fact of life for programmers for decades. He noted the number of scripted series on broadcast TV is actually down about 15% from its peak in the early 2000s — with lower-cost, unscripted shows making up the difference — and he sees a similar scenario on the horizon for pay and basic cable.
“The question is when does the fragmentation become so great that the ability to sustain and nurture these programs from a financial perspective become compromised,” Landgraf said. “We’re probably getting real close to the end of the growth curve for premium and basic cable right now.”
Industry veterans said that the biggest issues resulting from the gusher of production include:
» A significant spike in the cost of securing top talent and sought-after source material, from hot scripts to life rights to existing books and movies.
» Rising prices for crews, equipment, stages and locations, among other necessary ingredients for production.
» Higher demand for promotional time coupled with declining ratings for linear channels, making marketing campaigns more costly and less effective.
» Top cable nets cutting back on off-network buys because of increased commitments to original programming.
» Netflix gaining outsized influence due to its growing clout as an off-net buyer.
The skyrocketing number of scripted series flooding the airwaves has, of course, coincided with an equally dramatic shift in the way people that watch TV. Time-shifted viewing patterns are becoming the norm, and that in turn is having a huge impact on how producers make money on content, from the first exhibition window to long-term library value.
The world’s biggest media congloms are more invested in television programming than ever before, because cable networks and content-licensing are the main profit drivers for Disney, 21st Century Fox, Comcast, Time Warner and CBS Corp. But even the biggest players are facing the how-much-is-too-much question, and adjusting to new financial realities.
“We’re in an evolving ecosystem,” said NBCUniversal Cable Entertainment Studio president and chief content officer Jeff Wachtel. “There will be some version of a winnowing where the business says, ‘Let the strong survive.’ But it’s also about recalibrating our expectations as viewing patterns shift.”

The focus on content production is reflected by recent exec moves at the majors, from Wachtel’s appointment last year to rev up NBCUniversal’s cable studio to feed its inhouse channels as well as non-NBCU outlets, to the restructuring in July that put Fox Broadcasting’s programming operations under the guidance of 20th Century Fox TV studio chiefs Dana Walden and Gary Newman.
Elsewhere on the Fox lot, FX Networks has stepped up activity at FX Prods. now that it has to feed two general-entertainment nets (FX and FXX). Having greater control over more of its programming gives it the ability to profit from content licensing well beyond FX Networks’ walls, and lets the cabler afford more shows.
“If your business strategy is predicated on having hits and hits alone, it’s going to be very fragile,” Landgraf said. “We started FX Prods. because we couldn’t figure out how to pay for as many shows as we wanted. We chose to build a (financial) plan based on what was achievable for us through content ownership.”
The glut of programming has helped drive consumers’ embrace of the time-shifting options that are challenging traditional ad-supported network business models. Sunday night, even in the summer months, is a war zone of competing prestige series that taxes the DVR storage ability in many homes.
With every new show, the dependence on time-shifted viewing for ratings points grows for all but the biggest hits. As more viewers embrace binge-viewing — waiting to watch multiple episodes in one sitting — measurement and monetization questions become even more muddied.
“It’s as if you had a retail store that used to be open in one location from 9 to 5, and now there’s one on every corner that is open 24 hours a day,” said CBS Corp. chief research officer David Poltrack. “With greater access to all programming, it’s no surprise that it’s the hit network shows that gain the most. With so much time-shifted viewing going to the (broadcast) networks, the question for cable becomes, at what point does the return on investment in developing and launching new programming become challenged?”
To some, the current moment in TV echoes the era of irrational exuberance on Wall Street. Venture capital and private equity have been flowing into TV in the form of independent production entities such as Media Rights Capital, which made its mark with Net­flix’s “House of Cards”; and Georgeville, with backing from India’s Reliance.
“It sometimes feels like the Internet bubble in the early 2000s. You had a jillion startups and lots of money pouring in,” said a veteran production exec. “The bubble burst because there was massive failure. Some version of that will occur here. Some of the smaller outlets taking big shots will not be able to keep investing at this level.”

Call it the AMC effect. The dawn of “Mad Men” in 2007 quickly transformed the cabler from a second-tier movie channel to an Emmy-winning contender that saw its market value more than triple because of its targeted investment in original scripted series.
The same strategy had worked for FX with “The Shield” a few years earlier, but AMC’s metamorphosis was more surprising because of its relative lack of resources compared with FX and what was then News Corp.
Today, channels across the listings grid — from CMT and E! to WGN America and We TV — are looking for that same bounce by fielding what they hope will become signature series.
Netflix’s bold entry into the same territory has been nothing short of a stimulus for the creative community. The netcaster’s big upfront commitments, starting with its two-season order for “House of Cards” in 2012, and HBO-sized budgets, have upped the ante for all top-tier networks. Hulu and Amazon Prime to date haven’t been as free-spending on originals, but they are still factors in the marketplace, as is Yahoo.
There’s so much competition now that the broadcast networks, which used to be the first stop for creative talent, struggle during pilot season to find seasoned writers, directors and producers who aren’t tied up on existing shows.
The hunt for talent has driven up prices, particularly for experienced showrunners and established actors. Showrunners who were making $30,000-$35,000 an episode after the cutbacks that followed the 2007 writers strike and 2009 economic crisis are in many cases now able to command $50,000-$60,000 per episode, along with rich overall deals. Below-the-line costs and equipment rentals have seen a similar spike, especially in states that have become production magnets because of tax incentives: New York, Louisiana, North Carolina, New Mexico and Georgia.
Execs note that in the past two years, the traditional discount in salaries for creative talent working on cable shows vs. broadcast has essentially disappeared. “If you want anything good, you have to pay for it,” said one seasoned exec. “The talent agency community has been very effective at equalizing rates among media.”
The rising costs of content production are all the more sensitive considering the surplus of shows has likely contributed to a thinning of margins from TV advertising revenue. The more the audience fragments, the more linear ratings erode. Stemming this shortfall has meant an increasing dependence on after-market licensing for profitability, which in turn has given considerable leverage to deep-pocketed Netflix as the rest of the syndication marketplace shrinks.
Studios traditionally made their money from syndication sales rather than the firstrun license fee, but SVOD and international sales have become the linchpin. With the right properties, execs boast that shows can now be in the black from day one, thanks to a patchwork quilt of premium network license fees, worldwide and SVOD sales.
Netflix demonstrated the industry’s new economics in a pact that jolted the programming marketplace earlier this month, locking up rights to Warner Bros. TV’s Fox drama “Gotham” for at least $1.75 million per episode. The deal was significant for two reasons: It came weeks before the show’s network premiere, and it included all of Netflix’s worldwide territories.
Such all-encompassing pacts for rights in all markets served by an SVOD platform are becoming the norm, industry vets say — and these deals chip away at the studio’s ability to sell a show to the highest bidder in every overseas market.
Netflix has used its market clout to deter content owners from making all current-season episodes of a show available via ad-supported streaming or VOD platforms by letting it be known that it will pay less for shows that have had such broad exposure. Fox will be able to offer only five episodes of “Gotham” at a time via on-demand platforms, which is a standard template for Warner Bros. and other studios to maximize a show’s after-market value. The restriction has led to tensions between studios and networks over so-called stacking rights as networks look to enhance their own VOD offerings.

“The ‘Gotham’ SVOD announcement made us once again stop and think about Netflix’s ever-increasing hegemony, and the proper balance between the now and the future for global media content and distribution companies,” Rich Greenfield, media analyst for BTIG Research, wrote in a Sept. 4 blog post. “We have continually questioned media companies’ strategy in ‘taking the check’ enabling a new video powerhouse that could ultimately undo the current video ecosystem vs. building their own direct-to-consumer business.”
What also worries observers like Nathanson is how much shows that don’t have the sizzle of a “Gotham” might lose amid the flood of product. In the fourth quarter of 2013, AMC Networks took a bigger-than-expected writedown of $52 million on two canceled shows: “Low Winter Sun” and “The Killing” (the latter was resurrected for a final-season run on Netflix this year). Between production costs and marketing expenditures, cable programming is becoming as pricey as broadcast fare to produce.
“People like to say ‘content is king,’ ” Nathanson said. “I say ‘great content is king.’ And there’s just not that much great content out there.”
Perhaps the biggest challenge facing TV’s creative community overall is the need to adapt to new ways of doing business and new definitions of success. In an on-demand environment, networks need to think as much about how they serve as curators of content as they do about investing in “watch tonight!” ballyhoo; and studios need to find better means of measuring the “stickiness” of shows beyond Nielsen ratings.
“Our business is evolving from a pure home run business to one that focuses on what succeeds on (different) platforms,” said NBCU’s Wachtel.
Landgraf echoed that sentiment, and noted that the staggering level of engagement viewers now have with favorite programs is a big reason why networks small and large want a bigger menu of original series.
“I see this cresting wave and all of these challenges, and yet people’s love of the content has never been greater,” he said. “I see various forces driving the total number of series probably beyond what could be sustained in the long run. But I don’t see a cliff.”