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Cable Summit 2011 – HRTS Newsmaker Luncheon Recap

Cable Summit 2011 panel

Is television television or is there still a big difference between cable and broadcast? When it comes to entertainment enterprise how, when and where do you balance creative needs with business realities? How do we learn the lessons of the past while embracing the audiences and business models of the future? On February 23rd, five of the brightest minds in the business came together at the Beverly Hilton to discuss these issues and more, to figure out where we are all going and how we’re going to get there.

Brian Lowry

Brian Lowry

Brian Lowry, Media Columnist at Variety, moderated the annual Cable Summit luncheon with panelists Loretha Jones, President of Original Programming at BET Networks; John Landgraf, President and General Manager of FX Networks; David Nevins, President, Entertainment at Showtime Networks; and Jeff Wachtel, President, Original Programming at USA Network and Co-Head, Original Content at Universal Cable Productions.

Jeff Wachtel at the 2011 Cable Summit

Jeff Wachtel

Lowry set a jovial tone when he offered a cash reward to anyone who can take a picture of him that doesn’t look like Leonard Maltin. He then asked the panel an open question on how they would characterize cable v broadcast in 2011. Wachtel noted that the broadcast-cable divide is “more philosophical than real at this point” and especially given that the reach of cable networks is now often comparable to that of the broadcasters, that “more than half the audience is watching cable”. Landgraf said that it’s not so much broadcast v cable as it is a symbiotic, mutually-beneficial relationship since cable networks are “highly dependent on off-net series”. He added that it’s a content ecosystem out there and it will always need a top predator to keep things functioning smoothly. Jones concurred, pointing out that her acquisition of The CW show “The Game” has been a smash hit on BET. In light of the nearly 8 million viewers, Jones added that she knew the show had potential but “had no inkling it would do that kind of number”. Nevins having a subscription-based business model is in the fortunate position of being where “a lot of different programming services are starting to go”. Ratings and ad revenue worries aside, his subscribers are comfortable writing a monthly check.

Loretha Jones at the HRTS Cable Summit

Loretha Jones

With the launch of the Oprah Winfrey Network and the transition of Conan O’Brien from broadcast to cable, does the panel feel that this is a watershed moment for cable? Not so much. Nevins pointed out that the broadcast networks are becoming dual-revenue and so if anything it’s that broadcasters are becoming more like cable and not vice versa. Landgraf agreed, saying “I think it’s overstated”, he acknowledged the importance of recent transitions but noted that “I don’t think the broadcasters are going away anytime soon”. Wachtel said that “I don’t think it’s a watershed moment in that sense”, since there are “positive signs of life at the broadcast networks”. Jones said broadcast networks prompted her to start BET Studios - it’s been a number of years since there was a broadcast show centered on an African-American cast and so she and her team “don't have access to off-network shows to buy in syndication”. This being the case, she felt that she had to start creating original programming not to compete with broadcasting but to keep her pipeline full.

David Nevins at the 2011 Cable Summit

David Nevins

Given that Showtime does not need advertisers, Lowry asked about the importance of ratings. Nevins replied that “an extra two million viewers for 'Dexter' does not mean any more revenue for us”. That being true he went on to add that “we want to put on shows so people who aren't subscribers want to subscribe and people who are subscribers want to keep their subscription”. Ad revenues or subscription renewals, it’s all about attracting and retaining the eyeballs.

Lowry asked Landgraf about his decision not to renew “Terriers”. Landgraf said that on the creative side “it’s really hard to cancel a show that is that good”. On the business side “it's not hard to cancel a show that is not doing well from a ratings standpoint”, since to run a drama for seven years costs in the area of $200 million.

In terms of cancellations, Wachtel said that he’s been fortunate in the past several years to not have to cancel shows. He also said that with “Law & Order: Criminal Intent” he decided to give the long-running show a final season out of respect to the audience, decided to give it a victory lap, unlike what NBC did with the sudden cancellation of the original "Law & Order".

John Landgraf at the 2011 Cable Summit

John Landgraf

Going forward, Lowry wanted to know what some of the challenges may be as pertaining to audiences and business models. Landgraf said that sports, reality shows and game shows are what audiences want to watch live whereas other shows can be watched on DVR and so there is “enormous pressure put on scripted programming”. Specifically addressing his much-lauded show “Damages”, Landgraf said that he wouldn’t make that show again since it has a heavily serialized nature and so “we made a show that literally is better to watch via piracy and DVR than live”. Jones said that she expects new media to continue to expand her audience in the short-term although disruptive technologies may eventually shrink the audience through fragmentation and market clutter.

Lowry ended with a lightning-round, asking the panel if there’s a channel or a company they look at and say ‘they’re really hitting it out of the park right now’. Wachtel said “AMC, outta nowhere, quality stuff”. Nevins generated a laugh when he asked “do you think it would be unseemly for me to point out that CBS is doing really well right now?” Landgraf said that the “History Channel is just unbelievably fast in its growth, it’s a very potent force in talking to men, which is why we noticed them”. Jones said “I would say AMC also, to be able to do something like ‘Mad Men’ and then turn around and do ‘Walking Dead’, both of which I love, it wasn’t about the brand as much as it was about great storytelling”.

In the end, The Great Divide may no longer exist. Television is television, content is content, viewers are viewers. Audiences and business models are changing across the board and will continue to do so but the business is healthy and the outlook bright, the amount of content is going up not down, new networks are being born and unprecedented quality is all around us.

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