America’s Most Watched Network? For Now.

Media researchers, particularly those of us that were fortunate enough to steer networks and studios, used to be called “spin doctors”–people who could use creatively use data to paint a reasonably credible picture of dominance or momentum for an eager trade press and investment community.  But in a world where increasingly the number of outlets that could report on that is diminishing by the day (farewell, BuzzFeed News 🙁 ) and the amount of proprietary first-party data that is increasingly being used as negotiating currency increases, those that remain fighting the windmills of change are more like “spinsters”–increasingly archaic, siloed from the decision-makers and needing to rely upon increasingly less experienced and talented staffers to somehow craft something worthy of clickbaitability.

So I suppose I should grudingly give credit to the team at CBS, who yet again found a way to get several outlets to pick up on what has become the latest way to reinforce a decades-old narrative.  As Deadline’s Katie Campione dutifully regurgitated earlier this week:

CBS programming generated more than 281B minutes of viewing across all dayparts in the first quarter of the year, with more than 30% dedicated to primetime content.

According to the broadcaster, primetime entertainment programming tallied more than 92B of the network’s total minutes watched. The FBI franchise alone drew more than 15B minutes viewed with the NCIS franchise right on its heels.

Sports generated 77B viewing minutes, while news content aggregated around 57B. In late night, The Late Show with Stephen Colbert drew 8.5B viewing minutes. Daytime was responsible for 53B led by The Price Is Right and The Young and The Restless.

The chart attached to the release shows the narrative that CBS has pushed forth for decades as “America’s Most Watched Network”.  Pre-streaming, pre-pandemic and pre-devices, this was determined by much simpler metrics: how many rating points, how many average viewers, how much reach.  But because of the newly embraced “common ground” metric of time spent that theoretically levels the playing field between broadcasters and streamers, and, bluntly, because the numbers now attached to those traditional metrics are simply too damn small, the “wow” factor of minutes viewed has become CBS’ drug of choice in continuing to attempt to position itself as number one, at least against its traditional competition.

But the very complexity of the qualifiers needed to even make this statement speaks volumes to how fragile this positioning is.  To her credit, Campione’s follow-up paragraphs that typically get reduced to single-digit agate type are front and center, and actually take up more space than the highlights themselves:

The viewing measurements use Nielsen’s “most current” data for all content, which includes 35-day windows where possible. The data for the broadcast networks doesn’t include multi-platform viewing because CBS doesn’t have access to its competitors internal data. The CBS number does include any live streaming on Paramount+.

While it’s not a perfect unit of measurement, reporting viewership in total minutes does allow for a comparison between the broadcast networks and streaming services, since this is the metric in which Nielsen measures streaming viewership. The streamers have notoriously kept audience data close to the chest because they aren’t bound by the same third-party reporting agencies that track broadcast metrics and are able to report viewership numbers at their own discretion.

The data shows that CBS came in second only to Netflix, which generated a whopping 337B viewing minutes from its original content in the first quarter. This is primarily due to the sheer volume of original titles on Netflix, which frequently dominates Nielsen’s Top 10 streaming lists.

But volume is also central to the CBS narrative.  As the network parenthetically noted, daytime viewing contributes nearly a fifth of their aggregate minutes, and they program more than twice as many five-day-a-week time slots than do either NBC and ABC (FOX doesn’t program the daypart at all).  First quarter saw more diffrent network sports windows for CBS (playoff football, golf, soccer and college basketball) than their competitors, particularly ABC, which pivots the majority of their content to ESPN.  Not to mention late night, which will be losing a half-hour of time soon with the demise of James Corden’s LATE LATE SHOW, and its eventual replacement with the half-hour revival of @MIDNIGHT. whose track record in its first iteration suggests will contribute fewer viewers as well as minutes.

As for Netflix and their “competitive set”, their story and relevance is in more flux than ever.  As Campione further elaborated, even CBS’ generous positioning is rampant with assumptions and frustrating partial lenses for third party observers:

The data for the streamers doesn’t include any acquired or licensed content, which of course is a huge source of viewership for all of them. Presumably, the numbers are even more unbalanced for HBO Max, which is differentiated from HBO among Nielsen’s streaming metrics. That means viewing for shows like The Last Of Us and Succession wouldn’t be included in streamer’s 8B viewing minutes for the quarter.

When factoring in streaming for HBO originals, HBO Max’s total is up to 43B viewing minutes for the quarter — which is still a far cry from the broadcast nets but would put it well above any of the other measured streamers.

But all of that is changing by the day.  Earlier this week, Netflix released its first quarter results, which THE HOLLYWOOD REPORTER’s J. Clara Chan dutifully helped their “spinsters” talking points position in the best possible light:

Netflix, reporting its earnings for the first time without former co-CEO Reed Hastings, started the year by adding 1.75 million subscribers, bringing up the total number of global subscribers to 232.5 million.

The subscriber growth represented a 4.9 percent year-over-year increase compared to the disastrous first quarter of 2022, when the streamer lost subscribers and set off a domino effect of sorts for other media companies that had, up until that point, gone all-in on streaming.

Compared to each quarter, the 232.5 million total subscribers number for Q1 is a modest increase compared to Q4. The streaming giant closed out 2022 with a total of 230.75 million global subscribers, representing an addition of 7.66 million subscribers during the fourth quarter after a year that saw the company lose upwards of 970,000 subscribers at one point and face a major stock price plummet as a result.

Netflix saw modest growth in the U.S./Canada region, adding 100,000 subscribers during the quarter — though some of which appear to have been at the cheaper ad-supported level, given that the average revenue per membership dropped from $16.23 in Q4 to $16.18 in Q1. The Latin America region underperformed for Netflix as it lost 450,000 subscribers during the first quarter.

And it is that last point that my fellow media savant Eric Steinberg–recently a true “spin doctor” for CBS when it had stronger stories to tell–picked up on earlier this week:

As usual, Netflix releases information about subscription gains/losses in the various large regions around the world. In Q1, Netflix gained subs in every region except for one: Latin America.

We don’t have the country-by-country stats, but I find it an interesting correlation that the region in which the password-sharing crackdown has been in effect the longest (the countries are Chile, Peru, & Costa Rica) is also the one that declined in members. The program just began in Canada this past quarter, and that country’s membership is tiny compared to the US– Netflix reports the two together. New Zealand also just started.

Direct cause and effect? I can’t know- but I do notice the correlation.

And Steinberg linked to a more dour and nuanced view to the Netflix narrative which Forbes’ David Phelan attempted to place in context:

In a note to shareholders released yesterday, Netflix said that it has recently launched what it calls paid sharing in four countries and the company is “pleased with the results”. It had already rolled out paid sharing in some Latin American countries.

The note goes on, “We are planning on a broad rollout, including in the U.S., in Q2”. That means we should expect it to arrive between April and June this year or, in other words, potentially any minute now, but more likely later in the next two-and-a-half months.

In theory, adding more different subscriptions would have the same effect on billions of minutes as they would come from different IP addresses, in effect splitting up what may not may be counted as communally viewed.  Note further that the timing of all of this just happens to be in line with upfronts, which Netflix will enter as a (fledgling) ad-supported service for the first time this month.

Netflix’s nominal ad-supported base can’t compete with the likes of CBS’ for advertisers right now–CBS has hundreds of millions, Netflix only a couple of million.  But they do compete with HBO and Max is heading into its first upfront with the fortification of the Discovery library, which, like it or not, has the potential to add a whole lotta aggregate minutes to content that’s already got more potential than CBS’s data is willing to admit, as noted above.

And if and when Nielsen One finally gets its act together and finally, FINALLY, starts to report viewership, whether it’s in minutes or persons, on “unconnected” screens, the gap between CBS and streamers (that compete with Paramount+) will narrow.

And as we’ve seen this week, Netflix is sure attempting to broaden its content and recency.  The LOVE IS BLIND reunion show, despite the service’s forgettable inability to deliver it live, still attracted (so at least they say) 6.5 million viewers. –about 800,000 more than who have watched an average episode of SURVIVOR this season.  On CBS and Paramount+.  Once they figure out what Amazon has already learned how to do, and find more unique, original content beyond merely expensive, limited, closed-end series with smaller libraries such as LOVE IS BLIND, creating destination content and a reason to subscribe, they may be able to impact the kind of stories that Forbes’ Trainer posited this week:

After the release of 1Q23 earnings, I continue to find that NetflixNFLX +0.7% remains highly overvalued and should trade closer to $175/share.

1Q23 earnings show, again, that Netflix is a low-growth business with deteriorating profitability, while the stock is priced for the exact opposite: soaring revenue and profits. As I noted in my report Netflix: A Meme Stock Original, NFLX has historically moved more on narrative and sentiment than fundamentals. I think it’s time investors wake up to the company’s fundamentals and value it accordingly.

Trainer speaks as a frustrated investor, not necessarily as a viewer.  And it’s this summative statement of his that I would contend should offer not only some hope for a reversal of fortune, but also should be taken as a shot across the bow to the spinsters at both CBS and MAX:

Netflix is Just Another Streamer: While Netflix was once the dominant player in the streaming industry, its recent actions prove that its first-mover advantages are gone. It is now just one of many streaming services.

I’ll pile on. It is now just one many SERVICES.  The differences between broadcast and streaming apart from physical distribution are narrowing.   As Netflix builds out unscripted content, its appeal to investors will likely improve.  As CBS drops hours of content its ability to generate aggregate minutes will be diminished.  Not perhaps to the level of switching places any time soon.  So CBS’ narrative seems likely to stand for a while.  But there’s enough evidence already that the momentum arrows could continue to show consistent hockey sticks for CBS’ competitors, and decents like who Drew Carey calls “Yodely Guy”. for America’s Most Watched Network.

Well, maybe things may not get QUITE that bad.  But remember, I’m a spin doctor, not a spinster.  Feel free to rebut.

Your turn, CBS.

Until next time…



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