The TV Business Has Changed Forever

Technology, through the spread of multiple platforms and the generation of alternative revenue streams, has made possible innovative new formats, many of which are virtually self-financing.

It has stimulated both creativity and financial stability, which in turn, has sparked renewed audience demand. That's monetizing an intangible asset. JL

KM McFarland reports in Wired:

Network television used to deficit-finance shows and then make those expenditures back through advertising money. The shows would then generate more revenue by getting lucrative syndication deals. But now cable shows draw in ad revenues, carriage fees, and international sales to satellite, cable, and streaming or on-demand services. When those various revenue streams add up, a show can be profitable from the get-go.
When Lost went off the air in 2010, there were around 200 original programs on television. This year, there will be more than double that. Netflix alone will spend nearly $6 billion on 600 hours of original programming and acquisitions. It’s a completely different landscape right now from the one Carlton Cuse entered when he began creating TV shows like Nash Bridges and Martial Law in the 1990s. But Cuse currently has three shows on the air: Bates Motel (A&E), The Strain (FX), and Colony (USA), with a series adaptation of Tom Clancy’s character Jack Ryan starring John Krasinski lined up at Amazon.
“It used to be that there were many fewer shows and writers, and showrunners would have overall deals with exclusivity at one place,” Cuse told the audience at the 2016 WIRED Business Conference. “It’s much more common now for people to be working on a variety of shows, gigging around and doing different things in different places.”
Network television used to deficit-finance shows and then make those expenditures back through advertising money. The shows would then generate more revenue by getting lucrative syndication deals. But now, as Cuse explains, cable shows draw in ad revenues, carriage fees, and international sales to satellite, cable, and streaming or on-demand services. When those various revenue streams add up, a show can be profitable from the get-go. Cuse cites AMC as the model for how to transition from repurposing films to producing original content like Mad Men, Breaking Bad, and The Walking Dead, which increased the prestige of the network and boosted its carriage fees. “There’s a lot of value in making a successful, quality television show,” Cuse says. The changing business of television has also significantly affected the range of acting talent that wants to be on a show. Cuse says, “television is not off limits to anyone now.” But there is a calculus to what type of show in-demand actors want to be a part of. Cuse shared a story about casting a traditional, 22-episode network show and a cable network show at the same time. “There were a bunch of wonderful actors willing to come in for the cable show, which was five months of work a year,” Cuse says. “None of those actors would come meet on the network pilot which was the 10-11 month commitment.”
That shift away from the standard network television structure has also affected storytelling. “The idea of highly-serialized, super intense storytelling is evolving,” Cuse says. Many of these stories are getting shorter, Cuse noted, referencing True Detective and Fargo’s seasons of eight and 10 episodes, respectively. That provides show creators the opportunity to go from A to Z in more hours than a film allows, but with a precise plan in mind as opposed to the open-ended nature of ongoing network television.
Cuse has several plates spinning at the same time, so it’s difficult to say whether any of the four shows he’s working on can ingrain itself into the pop culture psyche the way Lost did. But he’s been able to identify the trends of television production as they bubble up, and diversify in such a way that he runs shows on three different cable networks and a rapidly-expanding streaming service. He’s the perfect example of a modern showrunner—stretched thin, but always creating new and interesting programming.