A Traditional Media Case Study
by: Robin Spielberger
After years of cursing the ad-skipping devil machine known as the DVR and losing a multi-million dollar lawsuit against Dish Network’s ad-skipping Hopper and new Sling technology, at least one broadcast network finally decided that resistance is futile.
Fox hyped the 2013 premiere of Kevin Bacon’s serial-killer thriller series, “The Following,” with commercial advertisements featuring announcer’s bellowing “Set your DVR now!” in addition to mentioning the show’s live air date. The same sort of reminder for the show can also be found in the network’s print and bus ads, as well as on billboards. However, this might not seem all that groundbreaking to the viewers because DVRs have been a common technology featured in American homes for years.
Leichtman Research Group‘s 2012 survey of 1,300 households found that 52 percent of
the ones that have pay-TV service also have a DVR. That translates to about 45 percent of all households and is up from 13.5 percent of all households surveyed five years earlier by Nielsen.
But Fox’s outright lack of resistance to DVR technology really is sort of radical: Networks really want you to watch their shows live, and until recently, they’ve been reluctant to do anything that might encourage delayed viewing, much less encourage it.
The Fox Broadcasting Company, commonly referred to as Fox, is an American commercial broadcasting television network, owned by the Fox Entertainment Group, a division of 21st Century Fox. Launched in 1986 as a fourth television network, Fox became the highest-rated broadcast network in the 18–49 demographic from 2004 to 2012 and in the 2007–08 season was the United States’ most-watched television network.
When Fox introduced American Idol in the summer of 2002, the average American household had 102 television channels, compared to a whopping 181 channels ten years later. Other developments in the media landscape, such as the growth of DVRs and Video on Demand services, the development of YouTube and other sources of streaming video and audio, the emergence of new venues for original series, and the massive growth of mobile technology and social media have had an impact on the television industry.
An article at the Hollywood Reporter argued that the television industry needs a “Steve Jobs – like visionary and needs it soon.” While television networks have been slowly adapting to the changes in viewer behavior, they have not been considered particularly viewer friendly.
While the film industry continues to see profound changes in the way movies are produced, distributed and monetized, the television industry is experiencing its own major shifts. Viewers have been drifting away from viewing television in real time in favor of recording things on their DVRs and “hopping” through the commercials, or jumping on the cord-cutting bandwagon and consuming series television entirely online or through new technologies such as Roku or AppleTV.
Traditional Nielsen television ratings no longer portray a complete representation of the audience for a program, cable channels have caught up with the big networks and more and more outlets for original series (like Netflix, DirecTV and Amazon) are materializing with desirous offerings, tantamount to what’s being broadcast over traditional airwaves.
Joe Earley, the network poured over the ratings for its new fall shows and one trend stuck out in a big way: almost one-third of all viewers who watched Fox Tuesday night sitcoms did so via DVR, and because those viewers weren’t just sitting back and watching whatever show was up next, other new sitcoms on the Fox lineup didn’t exist. Fox executives thought people weren’t rejecting these other shows but instead were just not watching them. “We began talking about how we might be in a new world where we had to tell people to set their DVRs,” Earley told Vulture in a January 2013 interview with Josef Adalian.
Most television networks use Nielsen‘s Live Plus service to track viewer ratings. Live Plus depicts who watched shows on their DVRs within different time frames. Generally, it tracks three major categories: Live-Plus-Same-Day, Live-Plus-Three and Live-Plus-Seven, with each one tracking a broader time frame. Live-Plus-Same-Day looks not only at who was watching when the show aired, but measure a program’s DVR viewing until 3:00am local time, that night. Live-Plus-Three and Live-Plus-Seven track who watched within three, and seven days of the original airing, respectively, and although the Live-Plus-Seven ratings are the closest thing to a “true popularity,” from Nielsen, they’re not available until three weeks after the show originally aired.
When Nielsen first rolled out its Live Plus service, network executives were uncertain, but it’s become an industry standard. These Live Plus ratings can make a big difference when a large portion of a show’s fans is watching on their DVRs. For more information about Nielsen‘s television ratings, click here, and to hear it directly from the horse’s mouth, click here.
Now, armed with Nielsen’s “special DVR data,” television executives are trumpeting the big viewership gains their shows are seeing up to a week after original air dates. This DVR data has become an increasingly important part of the calculations as each network decides which new fall shows to keep, and which to axe.
Rather than begin blanketing its airwaves and commercials with “Love Your DVR” PSAs, Fox executives decided to experiment using “The Following” as a guinea pig. Their submission to rampant DVR use by American households paid off, with the freshman thriller jumping 34 percent in the wake of the premiere in 2013. “We want people to be there from the beginning of the series,” Earley explained in his interview with Adalian, of Vulture. “We don’t necessarily want to encourage people to delay viewing. But we also don’t want them to miss it.”
“Sleepy Hollow,” Fox’s fall 2014 millennial spin on Washington Irving’s classic tale (for full text, click here), saw a huge impact on viewership once the DVR viewers were added to the mix. The premiere audience rose from a moderate 8.6 million to a vigorous 13.5 million viewers.
Fox was the first broadcast network to integrate DVR messaging into a promotional campaign for a new television series, but it appears to have become more common as time-shifting continues to impact how we watch “our stories.”
Advertising and DVR message integration isn’t the only way in which Fox is dealing with the disruption of the “glory days” of media conglomerate’s business practices and audience viewership ratings. FX President John Landgraf and Fox Chairman of Entertainment Kevin Reilly, are looking at ways to modify their networks, both owned by Fox Broadcasting Company, for a changing media landscape.
Landgraf, who is touted as one of the smartest executives in television, by Chief TV Critic Tim Goodman (@BastardMachine) of the Hollywood Reporter, observed that 2013 was a year in which cable series like AMC‘s “The Walking Dead,” FX‘s “Sons of Anarchy” and A&E‘s “Duck Dynasty” were in the 20 most watched shows, and that scripted series, were particularly exploding.
“In 2002 when we launched ‘The Shield,’ there were 33 scripted dramas or comedies on basic and premium cable,” Landgraf told Alison Willmore (@alisonwillmore) TV Editor at IndieWire during the Winter 2014 Television Critics Association Press Tour. “This year there will be about 180. That is over a 500% increase. And it doesn’t account for the fact that Internet delivered TV services like Netflix, Amazon Prime and Hulu Plus are now rolling out their own original series.” However, Landgraf doesn’t see an increase in series competition as FX’s biggest challenge – ”Somehow our shows seem to keep hitting all time highs every year.”
Rather, the chief obstacle he sees is that as viewing habits change, the networks are experiencing a huge loss of advertising revenue. For example, FX’s original series, “Sons of Anarchy” season premiere earned over five million adult viewers ages 18 to 49, but only two million of those were watching it live and only three million watched the commercials. FX’s response to this disruption has been to create an On Demand streaming service called FXNow, but also to produce more of their original programming.
Landgraf argued that television series are no longer “a disposable medium” in which the shows are made predominantly for the viewers that watch it in real time. ”Now I think we’re making shows for posterity,” he told Indiewire.
“That’s the thing that’s most exciting to me about television,” Landgraf expounded, “is that now television seems like a medium that has a long life. Therefore, it’s worth making things that not only galvanize an audience the night they air, but might be useful to someone 15 or 20 years later. And, of course, we own most of our programming, so we’re benefiting from both those revenue streams.” In addition, he noted that “the number of times when there were challenges over here on the ad sales front, the ownership of content has bailed us out. So it’s a nice thing, actually, to have some sort of more certain long tail revenue that sort of undergirds a more volatile thing like advertising sales.”
One of the ways Fox is dealing with the changing realities of the TV landscape is by bypassing the traditional pilot season, according to Kevin Reilly, Fox’s Chairman of Entertainment. Networks normally take pitches for new television shows in the early summer, order scripts in the early fall, and pilots in January. However, most of these pilots never get any closer to becoming a new series September or January.
“The broadcast, development, and scheduling system was built for a different era,” Reilly explained to Willmore of Indiewire, calling it “highly inefficient” to take place on a randomly compressed period and rigid schedule. He noted that cable networks have “a lot of flexibility in when the shows can go on” and that they “are able to course correct creatively and reshoot and recast.”
Fox has begun ordering multiple series throughout the year and at any given point are in some stage of production on at least 9 separate projects. Reilly believes this change will be “more talent friendly” and will allow more year-round programming and more flexible season lengths, making Fox comparable to the cable networks. “There shouldn’t be a set order pattern,” he said. “There shouldn’t be a set time when we launch things. There are thousands of original shows competing for attention right now — we just can’t do it all at once.”
Fox will begin its new scheduling system this year by rolling out 12-episode miniseries “24: Live Another Day” in May, when series are historically winding down. It will also begin slating some of its new series to begin next summer, instead of in the fall. Reilly noted that they have been starting shows earlier in the year in order to give the shows more room to rework potential issues. “It’s not a big story when cable rolls back a premiere date,” he explained to Indiewire. “There’s barely an HBO show that doesn’t reshoot half of their pilot every time, and no one throws their arms up about that. That’s how you make things great. We want to have that same maneuvering ability.”
Fox’s aforementioned surprise hit of fall 2013, “Sleepy Hollow,” was a 13-episode season, and they’re not currently looking to change the number of episodes ordered for its second season. “I think for most shows and dramas in this day and age, it’s better for the audiences to focus and to do shorter orders,” Reilly said. “Many dramas are just better creatively on a shorter-order pattern.” However, this year’s change to the scheduling system means, Fox will be starting next year’s production of “Sleepy Hollow” in March and will be months ahead of any other network, according to Reilly.
Fox Broadcasting Company has also caused the media landscape some disruption of its own by being one of the first networks to honestly address the issue of diversity in television programming. Fox initially began talking about diversity as a business imperative three years ago; shifting the conversation to the need for TV programming that reflects the multicultural reality of today’s world to keep younger viewers. It has since held annual conferences on diversity, telling top show producers that their casts and crew had to feature more people of color. The Deadline Hollywood blog reported on the 2013 event, held this past October for more than 150 people including representatives from the top talent agencies, Def Jam Recordings co-founder Russell Simmons, and top executives from several Fox television, film and business divisions.
Television viewers are more likely to watch shows that employ racially diverse casts and writers, according to a study done at UCLA’s Ralph J. Bunche Center for African American Studies. The study is the first in a series of analyses that will be done for the center’s Hollywood Advancement Project. The project will track over time whether the TV-and-film industry is “employing diverse groups of lead actors, writers, directors, producers and talent agents, and it will identify best practices for widening the pipeline for underrepresented groups,” according to its website.
In an analysis of more than 1,000 television shows that aired on 67 cable and broadcast networks during the 2011–12 season, UCLA researchers studying racial diversity in the entertainment industry found that more viewers were drawn to shows with ethnically diverse lead cast members and writers, while shows reflecting less diversity in their credits attracted smaller audiences.
“Diversity is the new ka-ching. “Not only are you going to have more chances of a show being made here, more chances of a show being a success on TV, more chances of making it into syndication, more chances of a show selling globally and making you millions of dollars, but you are going to bring more viewers to our air and keep us in business,” Fox Broadcasting COO Joe Earley announced to the “Seizing Opportunities” diversity event guests at Zanuck Theater on the Fox lot in 2013.
“Fox has managed to quietly introduce some of the most well-rounded roles for black men in the last decade—and this year’s slate of new shows goes even further. Outside of Shonda Rhimes’ deliberately diverse casting on ABC, Fox is the least whitewashed broadcast network of the four heavyweight media giants, and it hasn’t stopped there,” wrote Sonia Saraiya (@soniasaraiya), Assistant TV Club Editor for the A.V. Club blog, in a November 2013 article.
Fox’s new revolutionarily diverse casting work has created some of the strongest and most refined roles for men and women of color in television, and has helped to produce critically acclaimed shows that are garnering significant viewership and accolades for their focus on authenticity and complex character.
TV Critic Eric Deggans reports in the NPR blog CodeSwitch that Fox’s openly acknowledged business decision to hire more diverse casts has not only helped redefine the roles of black women on a television series, but has helped create new storylines with fresh perspectives, as in the case of Fox’s “Sleepy Hollow.”
“When the show featured a storyline centered on Mills’ sister, we got to see two black women in an action/adventure setting, fighting the bad guys instead of waiting to be rescued or seduced,” Deggans wrote in his November 2013 article for CodeSwitch. “It was exactly the kind of diverse casting I had been waiting for since 1999, when the issue hit a crisis point as the broadcast networks offered a fall slate of new TV shows without a single character of color.”
“Sleepy Hollow’s” supernatural drama, complete with a Four Horseman of the Apocalypse crime fighting plot, is anchored by the character of Abbie Mills. A strong, young female police officer, played by an up-and-coming African-American actor, Nicole Beharie, the character gets to kick down doors, carry her trusty sidearm, and play a skeptical but smart lead role.
Deggans added that “an upcoming episode will find the duo facing the legacy of slavery — a storyline that a more old-fashioned network series might have glossed over now has a new twist with an African-American co-lead.”
Fox Broadcasting Company’s recognition of the shift in viewer’s desire towards more racially diverse casts and the need for more authentically diverse roles in television programming is in part because of its newly created Audience Strategy division. According to its website, this division of the Fox Group “develops and implements transformative strategies to catalyze a cultural shift in the industry, embracing a multi-pronged approach of working from the inside-out to drive behavioral change and outside-in to advocate for diverse perspectives, and to engage all audiences in our multicultural world.”
The Fox Writers Intensive, a highly selective writer’s initiative held at the Fox Studios in Los Angeles, CA, from January 2014 through May 2014, is just one of the many strategies Fox is employing to help maintain its multicultural perspective. The Intensive is designed to introduce experienced writers with unique voices, backgrounds, life, and professional experiences that reflect the diverse perspectives of the Fox audiences to a wide range of Fox showrunners, writers, directors, screenwriters and creative executives. “These collective individuals work with the selected writers in a series of master classes to build on both their general craft and further their skillsets in the business of writing for television, feature films and digital content, according to the Fox Writer’s Intensive FAQ on its website.
Technology never remains static for long and often moves in unexpected ways, as we’ve seen in the television and news industries. This case study addressed some of the ways that Fox has modified its schedules, strategies, and behaviors due to the variety of transformations broadcast has gone through in the past decade with satellite, cable and on-demand irrevocably altering our viewing habits.
However, more recently mobile is starting to transform the face of broadcast and the on-demand model that we have quickly become accustomed to will soon to be complemented with “on-the-go” and “interactive” models, enabled by the ever-increasing sophistication of mobile solutions. With the number of mobile-connected devices soon due to exceed the number of people on earth, broadcasters must respond to even more changes in viewing habits to meet consumers’ expectations of experiencing a more engaging, interactive and tailored broadcast experience.
It will be interesting to see what new techniques Fox will employ in order to continue to adapt in the continuously changing media landscape and to any new disruptions caused by the extreme growth of new mobile technologies.