Follow Up: Disney & Comcast Bidding War Round 2

In a follow up to an earlier post on this topic, the bidding war between Disney and Comcast over the assets of 21st Century Fox entered round 2 on Wednesday.

Disney announced that they have increased their bid to Fox up to $71.3 billion with the ratios being half cash/half stock instead of an all cash bid. This represents an increase from the $31.00 per share offer Disney originally made for Fox to reflect a new valuation of about $38.00 per share.

The new Disney bid is also 10% higher than the bid that Comcast made recently. The financial news media has been buzzing about this activity all day in the most recent in a long series of events involving this potentially huge acquisition.

However, the perspective that is intriguing is the seemingly increasingly conflicted viewpoints from those in the industry about what Comcast should do and how they should respond. Some anticipate a new bid from Comcast, a counter punch to Disney which is rumored to be around $41.00 per share.

Then, there are others who maintain that Comcast should let it go, that they should walk away and let Disney acquire Fox. The rationale being that it is going to become an expensive and exhaustive process with Disney that will leave Comcast over-leveraged. The ultimate value of Fox will be offset by the damage it will do to Comcast in both the short-term and long-term through the process they would take to obtain the Fox content/assets.

In my perspective I can see both sides of the argument and can understand why Comcast could push even further into the bidding war, or why they could ultimately surrender their position. The question of value will certainly come up in the next week or so while this plays out: What is the value of Fox and what it can provide my business?

The answer to that question looms largely over Comcast HQ in Philadelphia today. The content that Fox holds is certainly intriguing, and content is the new currency in the media industry, as it has been explained on Frank’s Forum in the past.

Moreover, Disney has deep pockets and is a larger entity than Comcast. The impetus for Disney is all of the ways they can maximize new streams of revenue through the rights to the content that Fox currently holds. Disney is the best in the industry at taking characters and marketing/merchandising them to their maximum potential.

In addition, Disney can afford a bidding war here for Fox, where Comcast could be left with some damage from a war with Disney. Disney, as reported by CNBC, also needs the content for their new streaming app service. Comcast has content in the pipeline and has video on demand services for their customers.

The anti-trust regulations are another potential trouble spot for Comcast in this bid. My most recent work detailed the AT&T merger with Time Warner and the differences between horizontal and vertical mergers.

The U.S. federal regulators according to Bloomberg News are likely to approve the Disney bid for Fox. The rationale, as I have written previously, is because they view Disney as a content company that has no stake in telecommunications/cable TV services or broadcast television.

Conversely, the regulators view Comcast as a horizontal threat to create a monopoly because their core business is telecommunications and cable/broadcast television service. That perception is a big issue for Comcast in this bidding war.

In the end, some industry people have predicted that this bidding war will go another round with Disney winning the bid at $45.00 per share valuation of Fox. The other faction believes that this will not go another round, that either Comcast will announce that they have quit, or Fox will state that the Disney bid on the table is acceptable to their shareholders.

The fact will remain that it looks like Disney will get even larger as a result of this deal. They will have a treasure trove of new content and could have tremendous influence on how we, as consumers, gain access to content. The implications of this merger will have a profound impact on the media landscape in the future.

Comcast has the next move, and time will tell how “conflicted” they are over this potential acquisition.

Follow Up: All Cash Or All Stock – The Battle Between Disney & Comcast For 21st Century Fox Assets

In a follow up to an earlier full-length piece on this same subject, the bidding war between two media titans: Comcast and Disney have intensified with the assets of 21st Century FOX clearly in the crosshairs.

The business news media outlets were all buzzing on Tuesday morning with the news that Comcast is looking to attempt a move in mergers & acquisitions known as “crashing the gate”. This maneuver involves putting together, through a variety of ways, a huge amount of cash to put a premium level bid on the table which will change the valuation of the assets involved (in this case FOX assets) to sway those involved to go with that bid over a competitive bid.

The Disney bid which has been known to the public for a while now involves an all stock proposal for the FOX assets. The shareholders of FOX would get Disney stock shares at a level commensurate with their level of involvement in FOX stock ownership. There is a formula for all stock bids of this type which I will not go into further detail, plenty of other writers have covered that component of this deal and have done amazing work in that area.

My focus is two-fold: the bids for this deal as it relates to other media acquisitions and the impact on the media industry which also relates back to the consumers. This method of “crashing the gate” that Comcast is now seeking to employ in this merger is somewhat risky. In past M&A activity it has either worked very well, or failed in spectacular fashion.

The contrasting strategy by Disney, the all stock bid, is a more traditional approach; it is an “old school” method which has a more reliable historical track record. The bid by Disney is seen as a very important acquisition in terms of content ownership in an increasingly competitive landscape.

It should be noted that Fox prefers the Disney bid because the all stock approach would be more favorable for their shareholders. The Comcast bid being all cash would create a scenario where Fox shareholders would have to pay taxes on that in the short term, which is not a desirable position for a corporation to have to pass along a tax increase to shareholders.

The backdrop to this is the impending launch of the Disney streaming app service where the company spent an immense amount of money developing the app which will be a subscription based streaming service. Disney needs the consumers to enroll in their subscription- based app in massive numbers to “break even” on the outlay of dollars they sunk into the project.

The best way to ensure the enrollment of that scale and magnitude is to have a very broad based and extensive content collection. Disney plans to pull their content off of Netflix, with whom they had a partnership to exclusively stream Disney content prior to their own app being developed. The potential acquisition of the 21st Century Fox assets would provide a huge assortment of content for Disney to feature on their new streaming service.

Comcast is trying to also stay in prime position in the race for control of content in the new landscape of the television medium today. The efforts by Comcast to pull together a reported bid of $60 billion for the FOX assets is proof of their strategic importance to the media and cable TV giant.

However, according to Reuters and other outlets, the Comcast “crash the gate” strategy has one caveat that many find curious. Comcast will only pursue the full process of acquiring the FOX assets with an all cash bid if the banking and government entities involved in the AT&T bid for Time Warner allow that merger to take place.

Some found it strange that Comcast would make this request and would be that interested in the outcome of another merger within the industry. I thought about it and realized that Comcast is adding this caveat to the proposal because they want some legal precedent for a large scale merger of this type before they go “all in” on investing time and resources into taking it through the process.

The legal team for Comcast can use the decision in the AT&T / Time Warner merger to alleviate hurdles and a protracted legal suit with government ant-trust regulators if they have a precedent to utilize in their defense. The AT&T proposed merger with Time Warner has been tied up in courts for several months with significant costs to AT&T. Comcast does not want to fall victim to the same fate.

The case for Disney could be made because of the benefits of the all stock transaction but anti-trust oversight will be certainly a factor in either transaction whether it is Comcast or Disney with the winning bid.

However, in order to relieve some of that anti-trust scrutiny, Fox announced that they will take Fox News, Fox Business, and their cable sports division comprised of channels known as FS1 and FS2 ; and they will form a separate company that will be not part of this deal with either Disney or Comcast. The new company will be a spin-off of Fox and will have shares divided up among current Fox stockholders.

In my view, I was concerned about the cable news and cable sports divisions of the company being owned by either Disney (which owns ABC and ESPN) or Comcast (which owns NBC and NBC Sports). The major sports and news divisions would be run by one single entity if that spin-off company was not created. The impact on the viewer would have been significant and created concerns about the control of news and the cost of those cable subscriptions for both news and sports programming.

It remains to be seen what Comcast would plan to do with the content it could potentially wrestle control of from Disney that would represent the assets of the former 21st Century Fox properties. Comcast does not have a streaming app, but it could bolster the VOD (video on demand) offerings for their customers with such an acquisition.

The other industry rumor is that Comcast would seek to create a platform of channels that it could package out at lower rates to their subscribers as well as put together some sort of streaming package of channels like Hulu and YouTube have released recently.

Conversely, this brings about another potential issue with the Comcast bid, that it would benefit only the subscribers to Comcast cable services and not to the rest of the public. The same could be stated for Disney with their streaming app, but the argument could be made that everyone has the opportunity to join the app, but not everyone has the ability to become Comcast customers.

The precursor to the Disney app is the ESPN+ streaming app which just launched about a month ago. I was “grandfathered” into the ESPN+ membership because I held a subscription to MLS Live to watch all the soccer games from my days of covering the New York Red Bulls and the league.

The ESPN+ app is $4.99 per month and it is a tremendous value for a sports fan in my opinion. The amount of content on the app is robust and truly impressive. The ability to live stream games, watch archived games from earlier in a season, and the access to exclusive new programming is worth the cost. The average and the die hard sports fan would have several options and the addition of NHL hockey (which ESPN does not broadcast) streaming on the service is outstanding, especially with the Stanley Cup Playoff games currently ongoing.

A report from CNN later on Tuesday refuted some earlier reports saying that the Fox news and financial news assets would be spun off separately, but the sports division (FS1 and FS2) would go to the winning bid along with the other 21st Century Fox assets. That would be of interest to Disney to gain Fox Sports portfolio to bolster the ESPN+ app service even further.

The launch of the ESPN+ app was a smart business decision by Disney because if their streaming service is going to be on par or better than the ESPN+ service, then that could be a game changer for the industry, no pun intended.

The groundwork has been laid for a bidding war and it will be interesting to see what Disney will do and how they could counter this maneuver from Comcast. The viewers have a lot at stake as the cost that you pay for content could be impacted significantly but what transpires in the next several months.

How Cable and Satellite TV Providers Stay Relevant

I am contemplating switching cable TV providers, and I was thinking about how most of the people I know still have basic cable type packages; while others have done what is called “cord cutting” by eliminating cable.

Those people who cancelled their cable subscriptions stream content over the internet through one of the ever-growing number of streaming device options or Smart TV platforms. They utilize amplified antennas to get broadcast channels locally to supplement their program options.

I was at the gym running on the elliptical machine last week when a commercial came on while I had ESPN on during my workout. It was for the NHL Center Ice package which provides access to over 40 out of market games per week and works out to about $150 paid out over four installments for the season.

The advertisement put an emphasis on the ability to stream games from tablets or other devices as well, since that has become a critical value add for certain consumer demographics when it comes to media products such as this NHL package.

However, the flip side of that situation popped an idea into my head: who has time to watch 40 out of market hockey games a week? I would venture to guess that not too many people could do so, while affording the cost of the package and working. This is where cable remains relevant, and in the paragraphs to follow I will qualify that statement.

The NHL Center Ice or Game Center app does not allow full access to game highlights or condensed game packages without a subscription to the package or without a link to your cable subscription. Those who do not want to pay for the package or have cut their cable service completely lose out on hockey coverage or access to hockey content. This same example can be used for other programming or content available through cable and protected by those cable or satellite providers from those who have decided to “cord cut”.

The NHL Network channel is available only through cable or with a subscription purchased and offers the best alternative for those with a busy lifestyle because you can get all the highlights just by flipping to that channel on your cable box. It provides the ability for more casual viewing of the games as well.

The cable companies also stay relevant because having a cable subscription active allows for the best access to content from live programming that would air on a delay on a streaming device or app, to the ability to “live stream” certain content.

The implications of the Disney – Fox mega media merger as well as the proposed merger of AT&T with Time Warner can and will have an impact on the access to content of all types. The access to content and “protection” and restriction to content is going to shape the media in the next 5 years.
The handwriting is already on the wall, so to speak, with Disney spending truckloads of money to design their own streaming app that they will charge a monthly membership fee to allow access to their content. The recent proposed merger with Fox will expand the amount of content that they can potentially add to this application and restrict from distribution to other outlets.

The individual Time Warner group channels such as CNN, TBS, and TNT have all developed their own streaming content apps to appeal to a wider audience of those who have cut the cord.

The membership payment type apps for streaming are expanding as well with HBO, Showtime, CBS All Access, and the Hallmark Channel app called Hallmark Now ; these apps are all charging fees for access to their exclusive content.

The future of streaming television is going to consist of paying for the content from a multitude of different subscription based app content providers. The cable subscription will offer a potential “value add” because it will allow for access to the streaming content while potentially circumventing some of those subscription fees.

The future of cable and satellite television is unclear at this point as well. The “al a carte” approach that has been a concept that has been enticing to certain viewers is gaining a resurgence. This concept, where each individual household would pay only for the channels they would watch consistently, is largely cost prohibitive within the current cable/satellite TV business model.

The carriage fees (which is the amount the networks charge the cable companies to carry the channel) on some of these channels are a major barrier to this proposed solution. A good example is if your family would watch CNN, ESPN, and Disney channel to provide a mix of news, sports, and family programs. In the current model, the carriage fee is divided among all the subscribers for a respective cable provider whether it is Comcast or Verizon Fios.

The “al a carte” model would create a formula with a lot less subscribers so the fees would go up and your cable bill will follow suit. I have seen sample models where the earlier example provided would break down like this: CNN would cost $35 per month, ESPN would cost between $60 and $65 per month, and Disney would cost between $25 to $35 per month. That means for three channels plus your free network channels, your cable bill would be upwards of $125 to $130.

The carriage fees would have to change or the providers would have to offer more packages to bundle down costs.

In the end, as we approach the New Year, the way we watch TV will continue to evolve. The growing consensus from the consumer perspective is to cut the cord with cable. However, the cable companies and the media companies are largely becoming the same entities with all of the mergers happening in the media landscape.

This translates into a combination of a cable subscription (at least one cable box in your home) and streaming devices or Smart TVs that can stream content. This combination will provide access to the most wide- ranging amount of programming and provide a good value to the consumer.

Recapping The Upfronts: TV Networks – Fall Lineups

The major television networks met with all of the major advertising companies this week in an annual event in the industry known as the “upfronts”. The tradition holds that NBC has the first meeting, followed usually by ABC, CBS had their turn on Wednesday, the end of the week featured FOX and The CW getting their respective meetings.

The upfront meeting is where each network will officially unveil their fall lineups and try to generate interest and energy around their programming. These presentations have always been intriguing to me because each network has a strategy for capturing viewers and each one is different in that approach.

Some networks try to reinvent themselves more often than others do, and right now the changes to the television landscape have pushed the major networks and their subsidiaries into recalibrating their offerings. The scramble for ad dollars is characteristically a highly competitive situation, and this week was no different.

First, NBC entered the upfront meetings with the top-rated show on TV (“This Is Us”) and the top ranking for the coveted advertising demographic of 18-25 year old viewers. The network had to just make some small lineup tweaks and they should be set up to have another strong year. They moved their top show to Thursday nights, which is what NBC does, when a program goes well, they change the time slot instead of leaving it alone. It remains to be seen whether this will have a positive or negative ratings effect.

The “Peacock” is bringing back a former hit show from the ‘90s, “Will & Grace” for a limited run, and it will be very interesting to see how they tie this show to a new fan base as well as appeal to the fans who remember the show from the first run. The network is trying to inject excitement back into Thursday nights, which used to be called Must See TV by their marketing team. However, the reality is that “appointment TV” where people looked forward to a program with anticipation and were there every week to watch it, is long gone. I am interested to see how the viewers react to the new Thursday lineup, and whether NBC put their eggs in the right basket.

The last bastion for viewing trends similar to the old glory days of television remains live events such as award shows as well as live sports programming. NBC will have the return of NFL football games on Thursday nights (split package with CBS) and on Sunday nights (the entire NFL season). The Sunday night primetime game is consistently a ratings winner for NBC as well as a robust advertising revenue driver for the network.

The NFL ratings dropped for the first time in several years in 2016, but it still garners tremendous viewership and appeals to key advertising demographics, so the live game broadcasts will still command large committed ad spending.

NBC has very few new show concepts that I read in the reviews from media/TV critics that are worth mentioning. They will focus their marketing and promotional efforts on a special series they produced on the Menendez brothers case. That limited run special will air in the 10 PM slot (Eastern) for set number of weeks.

The executives at ABC will attempt to address sagging ratings overall from the 2016 television programming year by cancelling underperforming shows. They will look to reinvigorate their lineup with new series concepts of all kinds, from comedies to procedural dramas. The trick up the sleeve for this network was a surprise announcement at their upfront that they had given the approval for a straight to series new concept from Shonda Rhymes (Grey’s Anatomy founder) which focuses on a group of Seattle firefighters.

Then, ABC announced that they will also ride the trend of bringing back old shows for limited run type reboots. The network will bring in Roseanne which at one point in the original run was the top-rated show in America. I am fascinated to see how this concept will connect with new fans and younger age groups.

The network also will bring back another former ratings institution, American Idol which has been given mixed reactions from both media analysts and fans of the program alike. It remains to be seen whether the singing contest style can recapture its former glory. The details on the show remain limited with the only piece of news considered significant is that pop singing star, Katy Perry, has signed on to be a judge on the rebooted version of the once stalwart hit program.

It remains to be seen whether Ryan Seacrest will return to host Idol which films primarily in Los Angeles. Seacrest has recently joined the ABC morning talk hit show Live as Kelly Ripa’s new co-host, and that show films in New York. The logistics could be worked out, but it merits watching which path those negotiations could take.

CBS opened their upfront meeting with a performance from Stephen Colbert, who now has the top rated late night slot in the industry. The decision making by CBS and the other networks as well, as far as cancelled and returning shows are concerned was all studio/content rights driven.

The revenues in television have changed with production costs still rising and other revenue falling due to changes in the way the viewer engages with content (i.e. streaming, video on demand). In that regard, CBS proposed changes to the advertising packages which were originally structured around a 3-day window (Live+3) to a (Live +7) cycle or a 7-day window for the ads to run in association with a specific advertising “buy”.

I have covered in the past the decisions on cancelled and renewed programs, and it mainly comes down to rights fees, licensing, and ownership of the content. In short, each respective network tends to renew content that is made in their own studio compared to an outside studio. This is due to the fact that the network owns the backend rights to that content, which has become more valuable than the frontend rights to the program at this point.

CBS used this rationale to explain the cancellation of 2 Broke Girls (produced by Warner Brothers) and the renewal of Elementary (produced by CBS Studios) even though the former had slightly better ratings than Johnny Lee Miller’s turn at the iconic role of Sherlock Holmes. This same rationale was used to explain the cancellation of Person of Interest (Warner Brothers studios) and keeping Elementary because CBS could make more money on the backend rights.

ABC took some heat for cancelling Last Man Standing but it was produced by an outside studio, and they would rather renew and promote a comedy series produced in their own studio because of the enhanced revenue streams it would provide to offset the production costs and licensing fees.

The major networks are also pursuing a trend where they will change the terms of a licensing agreement on a show from an outside studio production company. The networks have been seeking larger pieces of the revenue pie before agreeing to renew a program. That trend will continue as the viewership habits continue to evolve away from live viewing and into watching the content after it originally airs.

CBS has very few new shows and will juggle a lineup of hit shows as well as NFL football and the top-rated shows in several categories will return to a largely unchanged lineup from last year. They will also introduce a rebooted version of S.W.A.T. (originally aired in the 1970s) and the highly anticipated spinoff from The Big Bang Theory entitled: Young Sheldon.

Fox ordered just six new shows for the Fall, and have moved around most of the returning shows in their lineup, keeping just Sunday night’s lineup intact from last year. They will also feature rebooted series from the past with The X Files returning for a limited series run, Prison Break returning for an undetermined amount of new shows, and a revival of Showtime at The Apollo hosted by Steve Harvey.

The CW announced both new concepts for series programming and a new focus on being a multi-channel partner rather than just a television network. They are taking a more forward thinking approach with partnerships with Apple TV, Roku, Amazon, and other streaming video content providers. This is to capitalize on the revenue for the back-end rights to the programming. This traditionally fifth place network also announced a rebooted series concept of their own, Dynasty, which has earned some industry buzz already.

The upfronts represented a continuation of declining advertising revenue in the form of ad buys as the cost/benefit analysis of that form of advertising is being weighed against the changing trends in the way that viewers obtain content. It is always interesting to see which strategies the networks employ to promote their programming, and which of those programs will make the cut when the first sweeps period is considered.

The ways of viewing television have changed and the ways that networks are approaching the production and promotion of their programming has followed suit. These trends will continue as we enter the 2017-18 television calendar, stay tuned.

Fall TV Season Reviews: Six Weeks In

The Fall television season is about six weeks into the schedule and with a review of the ratings to this point. I have done this the last few television seasons and reviewed ratings at the sweeps periods, and I have had some time for late night viewing of some shows on demand or via streaming services as well.

Those of you who have kept up with my blog here at Frank’s Forum are aware that I am not usually a fan of many of the new shows on the network slates in any given year. There have been a handful of shows that I would even recommend that any of you devote any of your valuable time to watching and following on a routine basis.

However, this season I am surprised that there are a few shows that have exceeded my expectations out of the gate. There are others that I have not seen but have read reviews from other writers whom I trust and have analyzed their ratings to know that they will most likely be cancelled.

No Bull

The first new show that I would recommend watching if you have not done so already is the CBS drama, Bull, starring Michael Weatherly of NCIS fame. I read a review of the show before it aired which was not very favorable, so I approached the pilot episode (which my wife really pushed me to watch) with trepidation.

I was pleasantly surprised, Weatherly is excellent as Dr. Jason Bull (a character adapted and based on the early life of Dr. Phil McGraw) who is an expert psychologist in the field of reading jury reactions in court proceedings. The cases are very interesting and thought provoking, the human behavior aspects are fascinating at points, and the cast is very strong. It is a very likeable show that will definitely entertain and is the character development, the writing, and the production are all excellently done. CBS has averaged around 17 million viewers and it is the top new show of the season for a reason, this program is poised to be another major hit for that network.

NBC Strikes Gold

I must admit that when I saw the trailer for the newest NBC drama, This Is Us, I thought it was a hastily produced fill-in for Parenthood which NBC ushered out of the lineup after a very strong multi-season run. However, this program written by Dan Fogelman is brilliant in the conception and the direction of the character arcs.

In an innovative way (without giving anything away to those who have not watched) it follows the lives of several people all at the same stage in life (mid 30s) and chronicles the unique challenges, joys, and heartaches that each has at that particular point.

The stories are woven seamlessly into themed episodes and the acting is excellent from Mandy Moore, Milo Ventimiglia, and the rest of the outstanding cast that makes this show the second most watched new series and a bona fide hit for NBC.

The only thing that could derail the momentum of this show (which has a massive social media following) is NBC getting involved from a top executive level and making changes to the creative direction or moving the time slot of the show (which that network does often) and it ends up ending in a loss of ratings.

This show is raw and real and very well produced, the writing is excellent, and it is well worth your viewing time.

Designated for Success

The ABC hit drama Designated Survivor looks like it is designated for a successful run on the network after very strong ratings to this point in the new television season. This newly launched show features Keifer Sutherland as the top billed star and the lone surviving Cabinet level official following a terror attack on the Capitol building during the State of the Union address.

I must admit two things: I did not like the premise of the show and the events that precipitate the conditions which the plot line launches, and I have not actually seen this program I have just read some very strong reviews about it.

I would think that it would have to appeal to those who like suspense and government spy type concepts to be the captive viewer for this program. I would tend to be of the opinion that if the ratings are this strong it is usually worth viewing the pilot episode and making a decision from there about it.

Kevin Can Wait

The new Kevin James comedy concept from CBS titled Kevin Can Wait has garnered some pretty strong ratings numbers despite being positioned to the male viewing demographic on Monday nights (opposite Monday Night Football).
In my opinion, the show has always struck me as a retread of the same antics that Mr. James used in his prior TV series hit, The King of Queens. I know that he has a loyal following of fans, but I personally think that you can wait on watching this series for the time being.

MacGyver It

I remember the original version of MacGyver and all of the wild scenarios that the lead character would get himself out of by coming up with some hair brained solution using normal items you would find around your house or garage.

The new CBS reboot which comes under the production guidance of Peter Lenkov (one of the guys who rebooted Hawaii 50 for CBS with great success) but the lead guy, Lucas Til, does not have the right look to be taken seriously as the new MacGyver.

The show has gained a pretty significant rating (the fifth most watched new series) but they will be walking the line between edge of the seat action and completely nonsensical, over the top stunts that could eventually drive away viewers.

Leaking Oil

Several returning shows are losing viewers like a truck leaking oil. The notables among those are two ABC programs Quantico and MARVEL Agents of Shield which will both probably meet with cancellation soon. In fact, ABC has another problem with a new series called Notorious (which is filling a lineup slot while Scandal is on hiatus due to Kerry Washington being pregnant) where the network announced they cut the number of episodes that will air already due to sagging ratings.

The TV industry calls that type of order reduction a quasi-cancellation, and so that series is definitely not worth your time.

The once popular series, How to Get Away with Murder has taken a tremendous decline in viewership this season to the point where it will most certainly be designated for cancellation in the near future.

The ABC network ratings overall have taken a big hit in a declining manner. They have to hope for stalwarts like Greys Anatomy and Modern Family to keep the ratings curve from bottoming out until they can begin production again on Scandal. The network will most assuredly also have a number of mid-year concepts that they will roll out in the winter for testing which could help buoy the ratings tide.

Deflated Ratings

The NFL once dealt with a major issue surrounding deflated footballs, it now has an issue with deflated ratings. The once gigantic ratings producing machine that was live NFL football game broadcasts are no longer the market leader they once were.

The NBC Sunday Night Football telecast was consistently the highest rated program of the week nearly every week that it aired for years. The telecast has experienced double digit ratings losses in 2016. There are some news media sources that track the ratings decline and tie it to the huge ratings that Sunday evening cable news programs are drawing due to the November Presidential election.

The other main national television “windows” for NFL broadcasts are down as well, Thursday Night Football is usually a reliable to be among the top five programs in the week and sometimes will crack the top three in the ratings charts. This season that package of games has also seen a double digit decline in ratings. This is driven by two factors: the matchups for the teams in most of the games have not been compelling, and the national anthem protests have also hurt the ratings for football overall as well.

The ESPN tradition of Monday Night Football has taken the most precipitous decline with viewership of their telecasts off as much as 25% from last season. That is a steep decline for a live sports content product as highly desirable as the NFL usually commands within the television industry. The biggest issue for this telecast and the other national television windows for the league is that the advertisers shell out some serious money for featured commercial time on these live game telecasts. The NFL ratings dip is cause for concern because they might hit the “giveback” territory in the numbers, where the advertising dollars get returned to the sponsors if the ratings decline to a certain threshold.

This type of scenario would impact the networks which pay huge rights fees to the NFL to broadcast the games. The league office in New York is reviewing the ratings decline, but it is certainly something fascinating because the numbers were once off the charts and now they have hit the wall.

Some of you may recall the piece I wrote on the oversaturation of the NFL on television. I wrote, once upon a time, about whether the league had reached a point where there were just too many games on TV and the impact that oversaturation would have on the ratings. It seems like we may have hit that point now.

The television season is still in the early stages, we have February “sweeps” and May “sweeps” periods left to go before all is said and done. We also have an election night in 12 days, and the holidays with specials and movies on the horizon. The networks have some shows they will keep for years, and others they will dump after a month or two. The major networks are split with CBS and NBC doing very well in overall ratings, while ABC, FOX, and the CW are in a ratings plummet that seems to get deeper by the week.

It will be interesting to see when we check in again around The Super Bowl and February sweeps, until then, stay tuned and keep streaming!