Reducing Friction: The Key to Success in Programming

Last week, the New York Times published an article under the headline “‘Jeopardy!’ and ‘Wheel of Fortune’ to Leap to Streaming“. Although all kinds of content has been “leaping” to streaming in one fashion or another (The Super Bowl, the Academy Awards, MLS Soccer rights, etc.), this headline grabbed me. I’ve spent the majority of my 40-year career with companies that serve local television stations, and a big chunk of that time was in the television syndication business with Warner Bros. and King World/CBS Television Distribution. The notion that the top two syndicated television programs are potentially moving to a streaming platform seemed, at the same time, shocking and obvious.

When I was at Warner Bros., two of our most highly rated programs we took to the syndication market were “Friends” and “ER”. Like “Wheel of Fortune” and “Jeopardy” stations engaged in heated bidding wars for the exclusive rights to these programs. What many bidders didn’t consider was that WB retained cable distribution rights and, after a few years of solely airing on local TV stations, additional rights were sold to TBS and TNT. We reassured our local TV clients that we believed local consumers would choose a local telecast over a national telecast of the syndicated episodes. That did not turn out to be entirely true.

The unbundling of “Wheel of Fortune” and “Jeopardy!” from the traditional TV-only model emphasizes a significant step in the evolution of media consumption. For local television stations, this transition requires a delicate balance between traditional broadcast loyalty and the embrace of digital innovation. As the sands of the media industry shift, those stations that can adapt quickly and creatively will likely emerge resilient, continuing to play an integral role in their communities while embracing the broader trends of the streaming revolution.

I have probably used the word “friction” more than any others in recent client and industry discussions about a key dynamic in consumer engagement with video content. One interesting example of this is from the coverage of the most recent presidential election last fall where Amazon Prime aired a one-night special with former NBC News anchor Brian Williams. At Magid, we conducted an election-night study with 3,000 election night news consumers and a key takeaway was that fragmentation of the audience of news consumers reflected diverse consumption habits that vary significantly across demographics. One of the key attributes consumers mentioned about the “Election Night Live” program was its “availability”. It was where news consumers were. For connected TV viewers, promotional and consumption friction was reduced by Amazon Prime. And, by the way, consumers who did follow convenience to this platform also saw something they liked and expressed desire to see more.
 
The decision by Sony to shop the streaming rights introduces both challenges and opportunities. By entering the streaming arena, these shows stand to reach a broader audience including younger consumers who favor on-demand content over scheduled linear programming. For local stations, however, this move signals a likely decrease in viewership and ad revenue as some audiences will shift from watching the telecasts live on linear TV to viewing on streaming platforms at their convenience. Retransmission fees would also be threatened if more core MVPD consumers decide to cut the cord.

Local broadcast TV groups and their stations need to innovate to retain viewers and leverage digital platforms to offer their own exclusive content to keep audiences engaged. As networks and streaming services continue to vie for exclusive content, local stations need to lean into creating original programming that highlight their local communities, regional culture and interests, setting them apart from generalized, nationwide content.

What is a local TV station’s “superpower”? It’s their ability to reflect and connect with the local communities that they serve. The key to their future lies in their ability to tailor content and services to match the needs, interests, and characteristics of their communities, fostering a loyal viewership that values the station’s role in local life. That content and those services, like Amazon Prime’s election night coverage, needs to live on streaming platforms which is where consumers and advertisers are moving as they follow the content they care most about.

If you work in the media ecosphere, ask yourself these questions:

• What are you doing right now to reduce the friction for your consumers to discover and consume your content and what insights are driving your strategies?
• How are you tailoring your content and distribution to meet the needs of both your consumers and your advertisers?
• How can you ensure that your content and platforms are indispensable to your core constituencies?
• Lastly, the ability to repair your “plane” while it’s in the air is no longer a fool’s errand, it’s a business imperative. Do you have the right tools for that repair job?

Please reach out with thoughts and additional questions. All of us at Magid are dedicated to helping your teams understand what information matters most, where to share what, and how to keep ahead of your competition in the face-paced digital age. 

Bill Hague
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