Thursday, January 20, 2011

Too Many Cable Channels?

Ok, so the linked article is about HGTV and Food Network losing viewers to competition from other cable networks. A couple decades ago, broadcast meant general market programming to the widest audience. Cable networks were formed to take over the niches that a broad network wasn't going after. One channel for all news, one for all music, one for food, and so on. Their viewership may have been strong, but as an aggregate, they provided an alternative to over the air. And as they were available by cable systems, an advertiser could buy a cable ad inexpensively and only reach the town or towns they needed. With broadcast, it was always about the DMA.

But cable networks found that a niche wasn't enough. They wanted "broad coverage" across the country and local ad insertion was harder too. Cable systems began owning the DMA and preferred selling bigger not smaller slices. Cable networks wanted more eyeballs for their shows too. So the niches became broader as well. And they began to overlap. Hence multiple cable networks for news, finance, sports, and yes, even food. Was that show on Food or TLC, Bravo or A&E? In the beginning, each cable net had its own niche; today, they bump each other constantly, competing for shows and eyeballs. And in each networks' attempt to reach a wider audience base, the shows themselves are aimed at a much less esoteric level.

So are there today too many cable networks? As long as people are watching, almost all with stay around. Others will simply change their name and start again. Hence Discover Health is now OWN. But this broadening of content is not a new phenomenon. Broadcast stole audience from radio. Cable is stealing audience from broadcast. And internet content is following the same strategy of going after the niches. But with history as a guide, those niches will soon become mainstream.