This week: death of peak TV, latest at CNN plus a strategic plan for Scottish production
Variety VIP+’s ‘Death of Peak TV’ report
This week, a report into the death of peak TV was published by Variety - with the subtitle ‘A 2024 post-mortem on Hollywood’s production downturn’. It was only four years ago we were all talking about TV’s golden age, how quickly that period has now been dubbed ‘bloated’ and the priority now for all studios, streamers and networks is to slim down and get on a more stable financial footing.
The question everyone wants to know is how much of the current situation is cyclical - the natural downward reaction after Covid disruption, ad market/economic pressures and strikes. And how much of the current downturn is actually structural in nature, caused by technology disrupting both how audiences consume content and also the underlying (previously very successful) TV/film business models.
Above are two graphs from Variety’s report. We are so used to seeing similar graphs on the left, showing the overall volume of content production as well as a split by streamers versus traditional networks (here helpfully split by broadcast, cable and SVOD so players like Netflix, Apple, Disney, Max etc). However the graph on the right is not something I’d seen before, which shows the split by scripted vs unscripted. The tale it tells is start (and the full report is worth reading as it breaks down recent trends for documentary, sitcoms, premium scripted plus reality and sports).
As the report says, ‘peak TV was defined by a surge in original scripted offsetting the 2000s reality TV boom.’ It predicts:
While overall content volumes will reduce, streamers are likely to reduce their commitment to expensive scripted in favour of cheaper unscripted content
The report also says while there will be less scripted commissioned, it could be considered a welcome correction to the ‘irrational exuberance’ of peak TV when so many originals went unwatched or didn’t find an audience
For the UK, high end TV (HETV) production spend fell 33% from £4.4bn in 2021 to £2.9bn in 2023; and while the UK will continue to be attractive to international production the report is predicting significant growth in spend in territories like Sub-Saharan Africa and Central/South America, reflecting where new audiences can be found.
An other illuminating graphic (see below) in the report is the share of SVOD originals by service going back to 2008. It isn’t a surprise how large Netflix became over the past decade, considering last year they green-lit nearly four times as many original series as the nearest rival (which is Prime Video). Plus Prime Video is more focussed on acquisitions, having nearly double the movie/TV catalogue of their nearest rival (which is, of course, Netflix). It would also be interesting to see this graphic compared with subscribers or viewing share - while Quibi makes an appearance considering it spent around $1bn on originals, it didn’t exactly translate into building an audience as it was shut down within a year of launch (this Verge piece of a good summary of the Quibi tale).
Taken simply as a reflection of fragmentation in the market, is it any wondering all these companies are struggling to turn a profit when there are this many players in the market competing for a finite amount of eyeballs?
Read The Death of Peak TV on Variety - subscribers only (monthly and yearly subs available).
Separately, the chatter on social from commentators, producers, writers, directors and others is getting louder in terms of the frustrations with the disruption to the old ways of how TV & film got financed and distributed, as well as the impact on the creative output.
Here are three examples but I could have picked others.
Mark Thompson’s plan for CNN start to emerge
Mark Thompson, formerly of the New York Times, Channel 4 and the BBC, has unveiled his plan for CNN in a memo to staff. Thompson understands the challenges faced by news organisations to changing audience behaviours better than most, and his willingness to look beyond the known approaches is welcome.
As he said in an interview when joining CNN six months ago (quoted in a Puck article from when he started six months ago): “I just felt—and I feel this about TV... just like TV, I felt that the newspaper industry was trapped in a psychology of the limits of the possible”.
Seeking to break out of the ‘psychology of the limits of the possible’ and find new business models worked at the NYT where he was pivotal in turning the ‘gray lady’ into a subscription/puzzles/food newsletter behemoth. Puck News’ Dylan Byers summarises Thompson’s CNN memo as being long and honest in identifying the problems (fewer people are watching linear news output and more people are getting news via social or short form video platforms like TikTok) but short on concrete plans for the remedies:
Byers says Thompson did call the cnn.com offering ‘dull’, so a welcome overhaul of the digital portfolio is planned that hopefully will increase audience engagement and monetisation
However, the underlying business model (or models) that can replace lost linear income hasn’t yet been outlined - perhaps unsurprising, considering how tricky this transition has proven to be for media companies across the board
Subscriptions and memberships are the obvious route, however he hasn’t said exactly (yet) what that would look like for CNN and how a linear TV offering would be different to a print/digital text business like the NYT.
Read more (subscription only):
Screen Scotland announces their new strategy to 2030
Director of Screen Scotland David Smith open about the inspiration their plan has taken from Screen Ireland (referencing a Variety piece on the success of the Irish film industry).
The full strategy document is worth a read obviously for Scottish-based producers and talent but also for productions seeking locations as well as anyone with an interest in out of London commissioning.
Other things:
Good news in the UK budget: ‘game changing’ 40% tax relief for films budgeted up to £15m, 40% relief on business rates for studios plus removal of the 80% cap for visual effects costs in the audiovisual expenditure credits - read Deadline for more
‘How Netflix envy broke television’ - great podcast from Vulture from June 2023 (but still relevant in 2024). Two great quotes:
“Netflix did what disruptors do – they destroy things and make something new. What is really to blame is everyone’s blind allegiance to thinking they could duplicate the Netflix model without realising they weren’t Netflix.”
“[Audiences] expected too much. We expected we could get all this TV at low cost and somehow not pay for it.”