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PBS Facing Crisis

Oct 20, 2003  •  Post A Comment

It once was the only place to go for high-quality television programming.
There are still many good shows on the Public Broadcasting System, but viewers now have numerous other choices, especially those who have cable TV, and PBS has experienced years of slow but steady audience erosion. Now, after a decade of failed efforts to reverse the tide and rescue the system, PBS is in crisis mode.
America’s public television service is beset from within and without, facing defections from its 349-station network, falling ratings, loss of public support, an aging audience, internal bickering, serious challenges to its sponsorship system and continuing erosion of its main funding sources.
Moreover, under PBS President and CEO Pat Mitchell, brought in with much fanfare from CNN in 2000, the network has failed to establish a signature drama or to innovate many successful new programming ideas. Since Ms. Mitchell took over, PBS’s prime-time household rating, at 2.0 with a 3 share for the 1999/2000 season, has dropped to 1.7 with a 3 share. During this same period ad-supported cable jumped from a 24 rating/41 share to a 29.2 rating and a 48 share, according to data supplied by Nielsen Media Research.
Some within PBS even argue it is not a network by the usual definition. PBS does not develop or produce most of its programming and does not own stations. The stations, led by WGBH-TV in Boston and WNET-TV in New York, create and fund individual shows and then have huge leeway in terms of how they program them, often airing the schedule out of any national pattern. One former chairman of a major PBS affiliate compared the program development system with trying to make the water go up Niagara Falls: “It was impossible and frustrating.”
“An archaic system and total lack of programming leadership have left PBS a shell of its former self,” stated the ad agency Starcom Entertainment in its annual report issued last month on TV programming.
At a time when PBS is hindered by the nation’s economic problems and support is in short supply in Washington, public television is facing an ever more serious challenge from competitors such as HBO, Showtime and Bravo, which has made giant strides in the short time it has been owned by NBC, adding more than 7 million subscribers. Others after the same audience include the 14 Discovery networks, National Geographic, the History Channel, the Food Network and the A&E Network, which is beefing up programming in the face of its own significant challenges. Once the leader in children’s TV, PBS has lost many young viewers to Disney Channel, Nickelodeon and others. It is expected that Trio will also be a more formidable competitor after NBC acquires it as part of the Vivendi Universal deal.
In the face of this challenge, one defender, AC Nielsen’s VP of Marketing Communications Anne Elliot, said it was “significant” that PBS had done as good a job as it has holding on to its share of audience over the past five years. There are high spots. From show to show, ratings can vary widely, but consistent performers have included “ExxonMobil Masterpiece Theater,” an umbrella for a number of dramas that has seen its audience vary from a high of 2.2 million in May 2003 to 1.8 million in May 2001; and “Antiques Roadshow,” with an audience that been as high as almost 7 million in May 2001 and as low as about 5 million this year.
The reality, however, is that energy in TV comes from a steady series of new hits, and those remain scarce. Ms. Mitchell admitted to the Washington Post that her network is “under stress.” She was not available for comment for this story, but PBS executives who were, including Judy Harris, executive VP, PBS business and development; and Jacoba Atlas, senior VP and co-chief programming officer, repeatedly emphasized that the network is not concerned about ratings. They said PBS puts its “mission” first and foremost, especially a quest to provide “diversity” in programming. “We are not about ratings. We are committed to diversity, to tell a story that television is not presenting,” Ms. Atlas said.
John Wilson, the other co-chief programming executive, said PBS dramas are not “the same six characters in the coffee shop” typically seen on TV, a reference to “Friends” and “Seinfeld.” PBS, Mr. Wilson added, “does not pursue a [cost-per-thousand] strategy].” He argued that there is a sameness among the channels are owned by the five largest media giants, which in contrast is what makes PBS’s programming unique and valuable.
That was the mandate when PBS created its major new program of recent seasons, “American Family.” Sponsored by Johnson & Johnson, it initially was hailed as the first drama series ever to air on broadcast television featuring an all-Latino cast, and the first original prime-time American episodic drama on PBS in decades.
But the first 22 episodes, aired during the 2001-02 season, received dismal ratings, averaging a 0.9/1 share in overnight metered markets while generating little buzz. Even in heavily Latino markets such as Miami, the show averaged a 0.9 overnight rating, raising questions as to whether it was reaching broader Hispanic audiences at all. Mark Monceau, a spokesperson for sponsor Johnson & Johnson, had no immediate comment.
A second season of “American Family” will premiere in April 2004, after a year on hiatus. Prospects are not promising. Some stations have already balked at running it and observers give it little chance to catch fire with viewers.
Another diversity entry, the “American Mystery!” specials “Skinwalkers” and “A Thief of Time,” featuring best-selling author Tony Hillerman’s Navajo tribal policeman characters, will likely become a “limited” series, Ms. Atlas said, with up to 10 episodes. “Skinwalkers” was a PBS hit, generating 7 million viewers.
Ms. Atlas defended “American Family” with an admission that is startling coming from a programmer: “I understand that the numbers don’t add up, but the numbers of `Frontline’ don’t add up either. Thank God there’s a PBS that keeps both of them on the air.”
But will there always be a PBS? The impact of the current funding squeeze is readily apparent, with layoffs across the system, including dozens of positions at public stations KQED-TV, San Francisco, and WETA-TV in Washington and at WHUT-TV, Howard University’s public station in the nation’s capital. WHUT was so short of broadcasting equipment that it was unable to forward its signal last month to cable operators. Public stations in Dallas and Marquette, Mich., are possibly on the sales block. However, KOCE-TV in Orange County, Calif., now appears likely to remain a PBS affiliate after a group of Orange County civic leaders acquires it from a college that can no longer afford to operate it.
A financial analysis by McKinsey & Co., issued earlier this year, concluded that PBS revenue sources are drying up and, after adjusting for inflation, are falling at a rate of 2.6 percent a year. The number of station members, those willing to support public TV financially, has been dropping since 1993. PBS fundraisers are turning to wealthy individual donors for “major gifts” of $1,000 or more, as McKinsey recommended.
PBS has a projected budget for 2003-04, a fiscal year that commenced July 1, of $311.7 million. Some $158.4 million of that comes from dues paid by member stations, and $58.7 million from the government, split between the Corporation for Public Broadcasting and the U.S. Department of Education.
Jeannie Bunton, a spokeswoman for CPB, said the amount of CPB money for this fiscal year nets out to $22.5 million for PBS programming and another $7 million for a separate PBS/CPB Program Challenge Fund. Lots of this goes to overhead. Staffing levels at PBS outlets, despite layoffs, are quite high. WGBH, which produces about one-third of the network’s programming, has 1,100 employees.
With significant overhead, viewer contributions down and programming costs up, PBS had hoped to greatly increase revenue from sponsorships–its version of TV commercials. PBS’s big selling point
is that it offers an uncluttered environment–about 5 minutes of program announcements and sponsor messages in each hour, compared with ad-supported TV, which has as much as 22 minutes per hour.
About six years ago, PBS created an umbrella organization for the first time to reach advertisers on a national level. It was called the PBS Sponsorship Group and included most of the key stations. Unfortunately, there was more infighting than sales. The local stations ultimately wanted to sell to clients separately. The Sponsorship Group fell apart earlier this year. Now WNET in New York and WGBH are competing against each other for sales again. That was the way it was before 1997, and that is the way it is again, said Lance Ozier, VP of National Program Marketing at WGBH. The decision to kill the Sponsorship Group, Mr. Ozier conceded, “may not have been logical, but that is the conclusion we came to.”
With the sponsorship effort in disarray, that source of revenue remains only about 2 percent of the PBS budget, according to the network. A former staff member of the PBS Sponsorship Group, now working for a PBS program producer, described the doomed group as highly dysfunctional, noting that “the egos of the partner stations got in the way. They had been on their own for so long that they did not know how to play in the sand together.”
And it’s not just the infighting. Consider the Starcom Entertainment ad agency, which has had clients such as McDonald’s, Kellogg’s and Lego sponsor PBS programming. Today Starcom executives are critical of some of PBS’s sponsorship rules, its lack of ad guarantees and its execution of sponsorships in general.
Consider the case of a McDonald’s sponsorship of the acclaimed children’s show “Sesame Street,” which stirred an opposition campaign by a nonprofit group called Commercial Alert. It recently sent a petition to Gary Knell, president of Sesame Workshop, imploring the producers of the long-running kids show not to take any more McDonald’s “credits” (PBS-speak for televised promotions).
“Parents entrust their children to you because you are trustworthy,” Mr. Knell wrote to PBS. “We doubt that enticing kids with junk food is part of that trust.”
The accompanying petition was signed by, among others, author Francis Moore Lappe (“Diet for a Small Planet”); Mark Crispin Miller, professor of media ecology at New York University; and Robert Musil, executive director and CEO of Physicians for Social Responsibility.
PBS countered that the credit does not show food and does not induce kids to eat McDonald’s cuisine. However, the resulting publicity, including a segment on CNN, is hardly what McDonald’s and Starcom had in mind when they placed the sponsorship. The credit features only images of Ronald McDonald’s hand and feet and a flower growing with a logo.
Laura Caraccioli-Davis, Starcom’s VP and director, had fought hard to get those feet and hand in the spot, which was the only way a product “mascot” could be depicted.” I can’t believe I argued about full-frontal Ronald,” Ms. Caraccioli-David quipped. “They had me negotiating, `Give me a body part.”’
Robert Coonrod, president of the CPB, which funds about 15 percent of PBS’s budget, found that the McDonald’s issue highlighted a vulnerability of public TV. “Groups like Commercial Alert know that if they criticize PBS, it can get attention,” he said. “They would not get that kind of attention if they criticized MTV or Nickelodeon,” which show McDonald’s commercials that are much more direct.
Sponsors have also been turned off by the stringent vetting of creative by an internal PBS committee that rejects many credits. Those sponsors that remain, such as Chubb, often keep the same credit running for years, week after week, leading to serious overexposure of sponsor creative.
Ms. Caraccioli-Davis recounted a curious incident: Kellogg’s sponsors programming on PBS during the day as part of the kids block. Competitor General Mills, makers of Cheerios, does as well. PBS guidelines specify that characters in credits cannot speak and that sponsor product cannot appear. Yet Ms. Caraccioli-Davis noted that a Cheerios credit had animated O’s dancing around, which looked suspiciously like Cheerios.
When she complained to a PBS sponsorship executive, she was told that “the O’s are animated, that’s what makes a difference,” a remark Ms. Caraccioli-Davis described as absurd.
In response, PBS’s Ms. Harris noted, “We have very high standards here. Sponsors work with us because of the quality of our audience. People who want to work with us understand the idiosyncrasies of public broadcasting.”
But some of these “idiosyncrasies” are clearly counterproductive for PBS. In one incident, Lego, another Starcom client, saw its credit run after its participation in the PBS Kids block had ended. To assuage Starcom and Lego, WGBH, which produces the program, agreed to pay residuals to actors in the Lego credit. Thus, WGBH was paying for an ad to run, not the other way around.
Several top PBS shows are currently without sponsors, or in jeopardy of losing them, the most egregious example being “ExxonMobil Masterpiece Theater,” a staple of PBS for over three decades. ExxonMobil will cease its $7 million annual appropriation at the end of 2004, and no new sponsor has been lined up. WGBH’s Lance Ozier said PBS might opt for multiple sponsors, without a single lucrative title sponsor. He said the network is committed to the show until 2006, even if it has no sponsorship. After that, however, all bets are off.
CPB’s Mr. Coonrod noted that ExxonMobil also pulled its funding for “Mystery!” and that CPB declined to step into the breach.
Meanwhile, popular documentary producer Ken Burns is looking for a new sponsor to augment the support he has traditionally received from General Motors. PBS denied that GM has cut its funding at all. However, a source close to the automaker’s advertising effort noted, “I like the initiatives they seem to be taking to be competitive, but they have been kind of in another world.”
Some close to GM complain that the Burns sponsorship, while prestigious, has not moved product for the giant automaker. However, former GM ad guru Phil Guarascio had praise last week for PBS’s sponsorship efforts.
“From my experience, PBS has always been protective of their `DNA’ but realistic when confronted with the needs of program supporters,” he said. “Further, in many cases, what appears on PBS is only part of a broader effort.” That effort can include, for example, using images of documentarian Ken Burns in GM ads. Good for the company’s image, perhaps, but not necessarily as potent a symbol as a film or TV star.
Shows that currently lack sponsors entirely include “Mystery!” which has relied on British dramas, and the documentary series “Frontline,” which is critically acclaimed. “Antiques Roadshow,” one of PBS’s highest-rated shows, will lose its only sponsor, Chubb, at the end of 2004.
PBS has also had to contend with major pressure this year from conservative groups outraged at Bill Moyers, host of a Friday night PBS series called ”Now With Bill Moyers,” who frequently criticizes the Bush administration. Last February, Mr. Moyers said the U.S. flag had been “hijacked” by the White House and turned into the trademark of a monopoly on patriotism. The resulting pressure has been great enough to force CPB’s Mr. Coonrod to publicly question the network’s policy on fairness and objectivity.
In an interview last week, Mr. Coonrod stressed that CPB had not supported the creation of “Now With Bill Moyers,” which he described as a newsmagazine that is not “sufficiently unique.” Mr. Coonrod said CPB had pushed for Mr. Moyers to host a continuing series of specials that would have examined how the country was affected by the Sept. 11 attacks and the consequent war on terrorism.
CPB’s objection reflects a belief that Mr. Moyers overstepped the boundaries of most news organizations and combined news reporting with pointed commentary.
“Where he’s coming from is les
s of an issue than how he gets there,” Mr. Coonrod said. PBS’s Ms. Atlas stated, “We stand by Bill. We feel Bill has earned the right to say what he wants.”