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Unformatted text preview: CHAPTER TEN Broadcast Television What do we mean by "television" in 2010?
Television describes the industries that produce and distribute the audiovisual programs we know as "TV." Television programming enters U.S. households by two means: (1) terrestrial transmissions from overtheair stations broadcasting on the public airwaves (2) subscription to thirdparty distribution systems: cable satellite Internet Chapter 10 and this lecture focus on the terrestrial (i.e., broadcast, overtheair) television broadcasting industry. Terrestrial distribution dominated television during its first 40 years (1946 1986). The terrestrial television industry is supported by advertising. About 60 percent of TV advertising dollars are spent on programming distributed via terrestrial stations. Terrestrial TV signals enter households by settop or rooftop antennas.
TV station antenna TV set About 17 percent of U.S. households receive television from terrestrial stations (20 percent in Indiana). The terrestrial television industry differs from the cable, satellite, and Internet television industries in ways that include regulation business models revenue streams In terms of audience fragmentation, TV viewing in 2010 resembles radio listening in 2010.
2006: Nielsen Media Research announced that for the first time in history, the typical U.S. household had more television receivers than people. 2007: Nielsen reported that videogame consoles were in more than half of U.S. households with television receivers. Together, these statistics suggest that TV has become primarily an individualuser medium. The televisionasfamilyhearth era is dying, as the majority of the audience views or plays alone. Perspective on the television industry in 2010
Although television in 2010 describes a number of related audiencedelivery platforms that exhibit similarities and differences as both programming sources and advertising vehicles, we can identify three important generalizations: TV is the main source of news for most Americans. Because TV reaches virtually everyone, it remains the primary advertising medium in the U.S. (and most everywhere else). The TV industry's inventory--time available to sell to advertisers--is perishable and hence requires skillful management. For about 40 years, television viewing for most Americans was limited to local TV stations that were affiliated with one of three national networks. The television broadcasting industry began to change in the 1980s as entrepreneurs sought profit in new programming and delivery systems made possible by technological innovation and changes in federal regulation. Today, TV programming is on the Web TV programming is on small screens Many of these changes were made possible by advances in digital technology. Digital. Analogue. What's the difference? Why does it matter? The words "analogue" and "digital" represent methods of signaling in electronic communications systems. Digital offers technical and economic advantages in specific applications (e.g., efficient use of scarce electromagnetic spectrum via video compression). The terrestrial era: 19461986 an outgrowth of the radio industry as it existed at the end of WWII emphasized the network structure, with the majority of programming originated by ABC, CBS, and NBC technology was analogue viewing was "by appointment" Perspective: Many of the ways we use TV--and the ways TV influences American culture--were established during this era. The pioneer years of TV were dominated by two competing technologies developed in Germany. Mechanical television used a cumbersome spinning disk to form discrete images similar to the individual photographic frames of a motion picture. The images produced by the spinning disk were low in resolution. Electronic television used a cathode ray tube to form discrete pictures similar to the individual frames of a motion picture. Compared with the spinning disk, the electronic process yielded images that were both superior in resolution, and produced without noisy motors and moving parts. Electronic television in the U.S. emerged from a bitter fight between Mr. Philo Farnsworth and Dr. Vladimir Zworykin Electronic analogue television was well understood before WWII. Some experimental work was done at Purdue. Electronic analogue TV was demonstrated more than 70 years ago (in 1939); standards for analogue TV signals were standardized by 1941. The start of commercial broadcasting to the public was interrupted by World War II. Early stations and programming After WWII ended, the FCC began licensing commercial TV stations nationwide on 12 channels. Much of the early programming was presented "live" (i.e., in real time). Although often described in retrospectives as "excellent," the quality of early television shows varied. Four companies formed the first commercial TV networks during the late 1940s. DuMont (ceased operations in 1956) ABC CBS NBC The FCC's freeze on TV station licenses (19481952) The original FCC allocation of 12 channels proved insufficient for TV to diffuse nationwide in a way that would have been geographically equitable. In 1948 the FCC imposed a "time out" on the processing of applications to construct new TV stations so that engineers could revise the original plan for allocating TV channels throughout the nation. During the freeze, some TV channels were reserved for noncommercial (educational) use. After the thaw . . . The FCC resumed licensing new TV stations in 1952 after adding 70 channels to the original 12. TV stations on the same channel were separated by about 200 miles. About 50 stations across the U.S. could broadcast simultaneously on each channel. A golden era of analogue terrestrial television followed the freeze. Began: Around 1952 when TV networks, stations, and home receivers diffused rapidly nationwide Started to fade: In the 1960s, when TV lost its novel appeal and became a part of everyday life Was over for most Americans: By the early 1980s, when the cable TV industry began to grow (more later) TV programming was scrutinized around the same time as the radio payola investigation.
The 1959 TV quiz show investigation ended sponsor controlled TV programming (as the payola investigation also ended discjockey controlled music `n' news programming on radio). Analogue terrestrial television matured during the '60s and '70s. Network news programming increased in 1963. Color programming was the norm by 1970. By the 1970s, ABC, CBS, and NBC each captured about 30% of the primetime audience. After 1980, analogue terrestrial television began to change. The cable revolution and the video cassette recorder (VCR) gradually eroded the audience for terrestrial TV stations. When Fox began operations in 1986, it became the first successful commercial TV network to compete successfully with ABC, CBS, and NBC since the failure of DuMont 30 years earlier. Later, the digital revolution introduced new video platforms to compete with audiences for terrestrial TV stations. More to come ... Digital conversion In 1997 the FCC began a process of converting all fullpower terrestrial TV stations from analogue to digital transmission that was finally completed on June 12, 2009. Following digital conversion, one terrestrial TV channel could carry a multicast of four standardresolution signals, one highdefinition signal, or some combination thereof. The number of terrestrial TV channels was reduced to 50. The federal government earned $19B by auctioning the use of spectrum previously assigned to analogue TV (Verizon and AT&T were the big winners; stay tuned for their plans). Major classifications of fullpower terrestrial TV stations Commercial: Revenues from the sale of advertising time. Most commercial TV stations are network affiliates. Noncommercial (not for profit): Revenues from corporate underwriting, auctions, viewer donations, sale of program guides. Most noncommercial TV stations are affiliates of PBS. "Ownership" concentration of terrestrial TV stations a single person or organization may hold an unlimited number of TV station licenses provided the combined coverage of its stations does not exceed 39 percent of the U.S. population. Three major producers of terrestrial TV programming in 2010 Networks interconnect local terrestrial TV stations for the simultaneous nationwide transmission of programs. Most network programming is expensive to produce (e.g., scripted drama and situation comedies). Syndication companies sell television programming on a marketby market or stationbystation basis. Syndication companies produce some original programs, and also distribute offnetwork programs (the primetime aftermarket). Local stations produce mostly news and public affairs programs, and commercials for local advertisers. Distribution of programming to terrestrial TV stations broadcast networks (e.g., NBC) syndication companies (e.g., King World) Popular TV shows are spun off or cancelled when they are no longer profitable to produce. With each season that a TV show remains on the air, abovetheline (creative) costs increase rapidly, largely because star talent in popular scripted shows demand more pay. Quiz shows, reality shows, and comedy variety shows are far cheaper to produce than scripted dramas and comedies. Belowtheline (technical) costs do not increase significantly from year to year. Sources of viewer opinions in the production of TV programs questionnaires to ascertain topics of interest to members of desirable demographics concept testing of program ideas pilot testing of fulllength episodes on cable channels Categories and percentages of ad revenue earned by commercial terrestrial TV stations annually nationally distributed network commercials (36%) spot commercials to advertisers of nationally or regionally distributed products or services (32%) commercials produced for local advertisers (32%) Ads for automobile dealers make up the largest proportion of a terrestrial TV station's local commercials. Public TV broadcasting Some of the earliest TV stations were noncommercial (known as "educational" prior to 1967). The Public Broadcasting Act of 1967 established the Corporation for Public Broadcasting (CPB) and the Public Broadcasting Service (PBS). PBS attracts about 2% of the national audience. Public broadcasting shares an attribute with the newspaper and AM radio industries: It is not attracting a young audience. The average PBS viewer is 50something. The home video industry came into existence along with the VCR and DVD player is divided into production, distribution, and retail divisions opened up a new aftermarket for TV programs with boxed sets of popular series Audience feedback
Nielsen Media Research has measured television audiences since 1950. The advertising and television industries pay for the Nielsen ratings. Nielsen divides the nation's 113M households with TV sets into 210 mutually exclusive, geographically defined markets. Each county in the U.S. is assigned to one (and only one) of the 210 markets. Households that participate in the Nielsen television ratings are selected by a scientific sampling procedure. Households may participate for up to two years. Households receive a few hundred dollars in cash and gifts for participation. Nielsen keeps the identities of participant households secret. The present Nielsen methodology includes: inhome people meters in the larger markets settuning meters in middle markets sevenday paper diaries in smaller markets Nielsen (like Arbitron) is pioneering data collection via portable people meters. Television viewing metrics (same basic computation as in radio) Rating households in a market watching a particular channel at a given time ________________________ market TV households in that Share households in a market watching a particular channel at a given time A third Congressional investigation of broadcasting centered on TV ratings: From 1961 to 1964 Congress investigated the TV ratings industry to assure advertisers that the data were valid and reliable. The process of generating TV ratings has been refined continually since the process began in 1950. Upshot: TV ratings today are based on sound methods. Pros and cons of TV ratings methodology
+ selection of participant households inherent differences between those who postselection viewing behavior of participant households hyping during ratings periods agree to participate, and those who refuse Cost is one barrier to changing the ratings system. The process of collecting and analyzing marketing data is expensive. Perspective on broadcast ratings Human nature is another roadblock to change. Technology exists that can track television viewing, Internet use, cell phone activity, and shopping for a given household. Willing participants have been few due to privacy concerns. TV audience characteristics About 99 percent of U.S. households have one working set (75 percent have more than one set). When summed, the cableonly networks have the most viewers (53%), followed by the broadcast networks (45%) and the noncommercial public stations (2%). Time spent viewing is negatively correlated with affluence. Households that subscribe to cable or DBS watch more overall than households that receive only terrestrial TV stations. On an average day, 96% of those age 15 and over engage in some sort of leisure activity such as watching TV, socializing, or exercising. Watching TV accounts for about half of leisure time for both men and women. Where things stand Television is no longer the growth industry it once was. Advertising revenues at the major TV networks dropped 9 percent in 2009; some industry analysts predict an additional 8percent drop in 2010. What we have learned about other traditional media holds true for TV: Audiences are migrating from older means of distribution to newer ones. TV is still the most effective advertising medium to reach a market with a commercial message. Virtually everyone watches some TV. Perspective on how the terrestrial TV industry is weathering the economic downturn. The TV industry has historically held on to its share of the advertising pie better than all other traditional media. For perspective, consider the TV industry's main competitor for advertising dollars, print newspapers. Network TV inventory (commercial time) is less prone to sudden fluctuations in demand compared with local TV inventory. Network inventory is purchased a year in advance in the "up front" season. Now let's turn to thirdparty distribution of television . . . ...
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This note was uploaded on 01/19/2011 for the course COM 250 taught by Professor Staff during the Spring '08 term at Purdue University-West Lafayette.
- Spring '08
- Mass Communication