Does NBC’s Potential Primetime Retreat Foreshadow More Changes To Legacy Broadcast Network Model?

When Warner Bros. Discovery CEO David Zaslav wanted to make a tremendous first impression of the company last spring, he used words designed to dazzle an audience of ad buyers.

The newly merged company, he announced, will now stand “shoulder to shoulder” with broadcast network In terms of scale and reach. Three decades after Fox became the fourth major network, Zaslav said, WBD “makes it number five.”

Today’s news NBCUniversal suggests that not everyone is as eager to be a part of the Broadcast Club like Zaslav. Person Familiar with NBCU Conversations confirmation of deadline Joe executives are considering a plan to potentially drop an hour of primetime programming each night and hand the 10 a.m. block back to affiliates. wall street journal That was the first report on those deliberations.

No final determination has been made, and the earliest a move could be made is in 2023. News followed a similarly strict approach to The CW, now mostly owned by Nexstar Media Group. execution on nexstar told investors last week That the company will try to turn a profit on the CW by 2025. “It’s no secret that The CW isn’t profitable,” said CFO Lee Ann Glihae, “but it’s not exclusive to fully distributed broadcast or cable networks. In fact, according to data from SNL Kagan, no other broadcast The network continues to run at a loss.” Nexstar president and COO Tom Carter said the company would be “unlike other broadcast network owners” in its financial rigor and promised “low unwritten costs” and a turnaround from the company. riverdale The network’s signature scripted lineup.

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Cost is a concern for all broadcast network owners, especially when they are looking to fuel their streaming ambitions. NBCU’s Peacock, which launched two years ago, is doubling its spending on content to $3 billion this year, reaching $5 billion in the coming years. If NBCU were to reduce to primetime, it could have saved money on original shows for broadcast broadcasts, taking into account the secular decline in pay-TV bundles and linear ratings.

Rapid cord-cutting and the explosion of streaming options have robbed most of Mojo’s broadcast nets outside of sports and non-scripted programming over the past decade. As media companies restructure to reflect a mixed focus on streaming, cable and broadcasting, there is no longer the spirit of the dominant dog pulling the sled.

“Networks are at an inflection point in terms of cost,” said one broadcast veteran. “Live sports have emerged as the main driver going forward, and their high prices are putting pressure on costs for the rest of the lineup. The question is whether affiliates will prefer shorter hours of primetime network programming.”

For Comcast-owned NBCUs, a rethinking of the entire portfolio is not a new process. Company 43. owns NBC And Telemundo affiliates are in 31 U.S. markets and Puerto Rico, so if NBC pulls back from 10 p.m. it could see gains in its local division as well.

“We’ve said from the beginning that we launched Peacock that we’re taking a different approach than others in the streaming business,” NBCU CEO Jeff Schell said on Comcast’s first-quarter earnings call last April. “We don’t really see Peacock as a separate, distinct business. We think it’s an extension of our existing TV business, and that’s how we manage it. That’s how we set up our business. That’s how we program it. That’s how we sell ads in both Linear and Peacock.”

A group headed by NBC affiliate Eric Meyerowitz, EVP and group chief of Hearst Television, has been a turbulent group in recent years. As the company pours money into peace, it has also renewed its long-term relationship with the NFL, with a $2 billion-a-year contract to run for a decade. NBCUniversal also agreed to be one of three companies to spend a record $7.5 billion to carry Big Ten games, including some exclusive games for Peacock. Both of these big football deals will go into effect next year, which means the retransmission consent fee is likely to increase. At times, even in a low-rated environment, NBCU’s moves faced resistance. In January 2020, when the company announced that it would allow Peacock Premium customers to access The Tonight Show Jimmy Fallon and . with late night With Seth Meyers from 8 a.m., colleagues grumble. The plan is yet to take effect officially, partly due to the Covid hangover.

When contacted by Deadline, Meyerowitz declined to comment through a spokesperson on the potential impact on NBC stations.

As for plans for other networks, Disney’s strategy of late suggests that ABC “could be the logical player” for lower primetime loads, a senior media exec said. “They show up perfectly on Disney+, ESPN+ and FX/Hulu.” A watershed move along those lines was re-routing the main base dancing with the Stars For Disney+ after 30 seasons on ABC.

Talks have yet to heat up inside Paramount Global about any changes to the CBS lineup, insiders there have indicated.

An ABC representative did not respond to Deadline’s request for comment on the company’s outlook on primetime.

As far as how advertisers will process changes in the legacy broadcast landscape, Brian Weiser, global president of business intelligence for major media agency GroupM, sees no particular cause for alarm. A large portion of the TV advertising business, which has shrunk from its high north of $70 billion several years ago, has simply moved to streaming and seems apt to continue. Peacock is now a billion-dollar-a-year advertising business, a plateau passed by Paramount’s Pluto TV and Hulu a while back. Disney+ and Netflix plan to introduce ads in the coming months, and HBO Max added a cheaper ad tier last year.

“This sound Like it’s a big deal, and some people will have a reaction to that,” Visser said of NBC’s internal discussion. In reality, however, such a move would represent a redistribution of the margins. “What really matters to the market is this: is there continued investment in ad-supported programming? The answer is clearly yes.”

“Defending traditional networks to fund streaming has been going on for many years now,” Wieser said, citing several examples of NBCU-esque moves in the media business of late, including Warner Bros.