The golden age of television may have hit its saturation point according to one of the key players in the industry.
John Landgraf, the CEO of FX Networks, told reporters at the Television Critics Association on Friday that the growing volume of original scripted series programming will begin to decline after next year. Why? Because: “there is simply too much television.”
Last year saw 352 original scripted comedy and drama series on primetime and late-night TV – of those 129 were on broadcast TV, 199 on cable, and 24 on streaming services. To give you an idea of the difference – in 1999 there were only 26 scripted cable series and no streaming series, and even as recently as 2009 there were only 87 scripted cable series and no streaming.
Landgraf predicts that number will pass 400 by the end of this year and rise again in 2016 before the decline begins – and when it happens it will be brutal. Landgraf says we are: “in the late stages of a bubble. We’re seeing a desperate scrum – everyone is trying to jockey for position. We’re playing a game of musical chairs, and they’re starting to take away chairs.”
The problems are beginning to increase. The fracturing of the audience across a greater number of shows, and the instant access to an array of older series that streaming offers, means many new shows are failing to garner an audience at launch as people are overwhelmed by the sheer volume. Second chances are out, slow builds are rarely offered and when they are audiences often won’t stick around for them.
The pool of skilled talent that can manage a series is shrinking fast, and measures of success are changing as viewership is spreading out chronologically over time due to DVR, VOD and streaming which has seen first night viewing often replaced by windows from three days to four weeks after broadcast.
Then there’s the rise of the commercial-free environment of SVOD platforms and on-demand viewing which customers are preferring and is rendering ad-supported television obsolete. With people scheduling TV around their lives, rather than the other way around in the pre-DVR days, the old business models are dying and advertising is going to have to radically change and be more targeted and less intrusive if it expects to survive.
“It’s going to be a messy, inelegant process” says Landgraf, but he adds you shouldn’t count out the big conglomerates: “It’s a bumpy, rocky transition, but it’s not a transition that leads to a valueless future for Disney, Time Warner and 21st Century Fox and only Netflix (succeeds). Brands are increasingly important as mediating filters for an overwhelmed public.”
Landgraf has seen the change in the past decade since he took over – FX’s advertising has dropped from 55% of its revenue to 32%, and the shortfall has only been part made up by content licensing – a number that is continuing to grow fast as the channel’s production units grow.
Content production is where revenues will grow in the near future, and only those with large and relevant portfolios of original shows will survive – which is why many networks are choosing to green light shows produced and developed entirely in-house.
The comments come following a week in which giant media conglomerates were hammered on the stock market over concerns about cord cutting, concerns that saw their share prices lose $60 billion in value in just two days before they stabilised. They have every right to be concerned as well it seems as Variety reports that the second quarter of 2015 saw the largest quarterly subscriber declines to date with 566,000 subscribers cutting the cable – compared to 321,000 a year ago.
The number of pay-TV households is now shrinking at an annual rate of 0.7%, up from 0.1% a year ago, and that comes as U.S. household numbers increase which means the drop is steeper. Cable vision Systems CEO James Dolan has downplayed the fears saying that he predicts it’ll be five years for 10% of the market to move, and then another five for 30%.
What will the industry look like in a decade? Right now, no-one seems to have a clue.