In my previous post, Byron Media’s Dr John Morse captured the year-to-year subscriber losses for a selection of U.S. Cable / Satellite channels.
- Nat Geo Wild and Smithsonian gained subscribers, though from smaller footprints than the major networks.
- Read the full report here.
Lost Revenues:
What is the revenue impact of these subscriber losses?
- Basic cable channels enjoy a dual revenue stream: from affiliate fees paid for each subscriber; and from advertising.
- Affiliate fees are set in steady, long-term contracts between the channels and cable operators like Comcast or satellite systems like DirectTV.
- Monthly per subscriber fees vary across the network landscape.
- ESPN‘s is close to $8.00
- Rupert Murdoch’s Fox News is around $1.10.
- The Discovery digi-net American Heroes is $0.14
The following worksheet captures my back-of-envelope estimate of the revenue losses (and two gains) from network subscribers in the year since October 2017.
The math is based on my estimate of the monthly subscriber fee for the channels, though I haven’t seen any of the contracts.
| Estimated Revenue / Subscriber / Month** | Estimated Subscriber Revenue / Year: Change 2017-18 ($’000) | ||
| Network | Subscriber Universe: Change, October ’17 – October ’18 (‘000)* | ||
| A&E | -1,924 | $ 0.33 | $ (7,619) |
| AMERICAN HEROES | -3,922 | $ 0.14 | $ (6,589) |
| ANIMAL PLANET | -3,705 | $ 0.17 | $ (7,558) |
| BBC-AMERICA | -622 | $ 0.15 | $ (1,120) |
| DISCOVERY | -3,031 | $ 0.48 | $ (17,459) |
| FOOD | -2,611 | $ 0.21 | $ (6,580) |
| FOX NEWS | -2,750 | $ 1.11 | $ (36,630) |
| HGTV | -1,943 | $ 0.30 | $ (6,995) |
| HISTORY | -1,882 | $ 0.19 | $ (4,291) |
| ID | -3,084 | $ 0.16 | $ (5,921) |
| MTV | -2,076 | $ 0.56 | $ (13,951) |
| NAT GEO CHANNEL | -1,091 | $ 0.29 | $ (3,797) |
| NAT GEO WILD | 1,246 | $ 0.16 | $ 2,392 |
| OWN: OPRAH | -2,978 | $ 0.25 | $ (8,934) |
| SCIENCE | -5,289 | $ 0.13 | $ (8,251) |
| SMITHSONIAN | 3,605 | $ 0.13 | $ 5,624 |
| SYFY | -2,433 | $ 0.29 | $ (8,467) |
| TLC | -3,307 | $ 0.26 | $ (10,318) |
| TRAVEL CHANNEL | -866 | $ 0.17 | $ (1,767) |
| TRU TV | -1,741 | $ 0.34 | $ (7,103) |
| VELOCITY | -369 | $ 0.26 | $ (1,151) |
| VH1 | -1,893 | $ 0.25 | $ (5,679) |
| WETV | -1,959 | $ 0.16 | $ (3,761) |
Source: * Nielsen Cable UEs October 2018
** Peter Hamilton analysis.
Takeaways
- Revenue losses flow directly to programming budgets and operations.
- Their impact is felt as staff cutbacks, more development expense & effort demanded of producers, fewer hours commissioned, fewer episodes in reorders, harsher deal terms and more.
- Efficient, repeatable series are promoted at the expense of single docs and limited series.
- Network buyers are more averse to risk and are more likely to be fearful of their jobs in a time of staff contraction.
- (Listen to my podcast with Michael Hoff.)
- Meanwhile, the shrinking subscriber base makes it harder for networks to maintain their ratings, thereby draining the other revenue source – advertising.
LISTEN TO MY PODCASTS
- Program Development & Pitching Trends with veteran producer Michael Hoff
- The Obamas’ Output Deal With Netflix. Takeaways for Producers with StoryCentric’s Ed Hersh
- THE CLEANERS An Anti-Case Study From Berlin and Sundance with Christian Beetz
- The Development History of NATIVE AMERICA, a $3-4 million Signature PBS Series with Gary Glassman
- Netflix: Its Deals with Producers and its Impact on the Channels… with John Ford, GM of the NPACT Producers’ Association
My coverage in podcasts and posts of trends in measuring digital engagement in video content is sponsored by Parrot Analytics.
- How to Measure and Value Audiences for Unscripted Programs with Parrot Analytics’ Courtney William
- Trends in How Americans View, Measure and Value Programs with Byron Media’s Dr John Morse
And read more about John Morse and Byron Media here.
Updated August 2018
Original analysis and coverage from DocumentaryBusiness.com
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