The Future of Network Affiliates Without Broadcast
Network affiliates and local stations have no clear course of action for a post-television landscape. As syndication grows into a model that relies on internet distribution and networks start to push TV Everywhere—placing less importance on affiliate-exhibited network product in the country—television stations start to lose their importance in the system. In summary, the dilemma is: affiliates’ two main identifiers are network and station number. However, station number barely matters in a cable environment (and even less in an internet environment); and networks have an interest in gaining total control of their content distribution through an online programs like TV Everywhere.
The situation took a direr turn in late 2009, when the FCC started an investigation into the probability of converting part of the current over-the-air television spectrum to a broadband spectrum. The trend is becoming clear: the interest in broadcast television is losing ground to online television. Early 2012, Congress authorized the FCC to auction off sections of television broadband. Soon, the FCC will hold a meeting on rule adoption for broadcast channel sharing. Even without this re-purposing, the general trend is increased online viewing. In homes that cut the cable cord, television viewing via internet has seen immense growth. This correlates with the first drop in households with televisions. Consequently, Nielsen has stated that it is looking to expand the definition of “television” to include PCs and tablets as screens where people can watch content.
While broadcasters fret about the loss of spectrum, viewers are losing interest in owning televisions. Local affiliates, therefore, face a bigger problem than technology’s encroachment on their distribution.
As people move away from television, online local content becomes lost in a sea of national and international content. Moves in the online video space center on finding content that either appeals to wide base of people or speaks to interest-based niches rather than location. In a 2009 post titled “A Long-Tailed Media Omnivore’s Dilemma,” Jonathan Nichols-Pethick (in full disclosure, he was my college academic advisor) argued that media consumers should try to turn their interests towards locally produced content since video hosting sites will only produce content that interests large user bases.
Affliliates can look to this “local content” logic when creating news reports to engage viewers. Only producing retellings of national events creates a product that has multiple copies across the internet. The old broadcast system allocated some value to these products (like the local newspaper relying on syndicates for national coverage), but that doesn’t exist in this new market. Local news operations will have to try to succeed by producing content that deals directly with issues important to local citizens, but not necessarily to a larger populace.
Affiliates are rarely entirely stand-alone operations. Usually, large media companies own multiple affiliates. Still, the quest for local content is one that can be best fulfilled by local productions. On May 1, 2012, NBC announced that it was going to up the investigative news budgets for its affiliates. This would result in the addition of new sections on their websites specifically for investigative reporting.
One of the tangible effects of this has been seen in Washington, DC, where both the NBC and the CBS affiliate improved their investigative teams. Local viewers quickly responded to the change and caused a spike in ratings that made the NBC affiliate—the established leader of 6pm and 11pm news—the new ratings leader of the 5pm news. At the same time, the CBS affiliate saw a 27% and 49% increase at the 5 and 6PM hours, respectively. This in spite of a 12% drop at the 11pm hour.
In the current forward march away from broadcast, affiliates will need to create some way to drive viewers to their content in an environment where network cannot be counted on as a valuable lead-in. The ABC affiliate, WJLA, was a former leader of the 5pm news hour due to an Oprah lead-in that disappeared in May 2011. A year later, WJLA now ties WUSA and WTTG (Fox affiliate) for second place. As people gravitate away from live television, the effect of lead-ins further decreases. Yet, these ratings also show the pull that local stories have on a metropolitain area.
The local newscasts are far from dead and are still the primary source of news for most viewers. A July 2011 FCC report details how the viewership of local TV news has increased, with stations successfully serving multiple platforms while increasing the amount of news hours on broadcast. This push into the uncharted territory of online video demonstrates that there is still an interest in local newscasts online.
Broadcast spectrum cannot be the sole point of delivery for local content, especially when local content is still relevant in an online ecosystem. Even in a smaller ecosystem like Washington DC’s broadcast station, it’s still the local stories that garner higher ratings. By producing niche, local content, producers can ensure viewership with exclusive news.
By Zac Stockton, Product Manager