NY Times, NY Post

NBCU Revenue Climbs, Though Ad Revenue at Its Cable Networks Declines

Oct 27, 2014  •  Post A Comment

“Sales in [Comcast’s] NBCUniversal entertainment group [in the third quarter] inched up 1.2 percent, to $5.92 billion, with increases in its broadcast television and theme parks groups offsetting declines in its filmed entertainment business,” reports The New York Times.

The story reports: “Advertising results were mixed for the quarter, with the cable networks posting a 4.6 percent loss and broadcast television networks showing a 4.4 percent increase. Industrywide, cable networks have faced ratings and advertising pressure.”

According to Claire Atkinson of the New York Post, NBCU Chief Executive Stephen Burke, commenting on a conference call about the company’s third-quarter results last week, said: “The fact of the matter is the next five to 10 years in basic entertainment cable as it relates to ratings are going to be much more difficult than the last five to 10 years.”

Atkinson adds: “Even when the NBC network was in the ratings basement, NBCU could count on its powerful, lucrative cable business.

“The same was true across the industry, with cable programming a cash cow for big media companies. But that is changing because of viewer fragmentation, shifting audience habits and streaming upstarts.

“Lately, aggregate ratings have taken a dive and advertisers are talking non-stop about shifting dollars to digital outlets.”

NBCU’s cable channels include USA Network, Syfy, Bravo, E! Entertainment, Oxygen Media and Sprout.

About the recent announcements by HBO and CBS that they will start over-the-top streaming services, Burke indicated he was surprised, The Times notes. “He said that HBO risked ‘cannibalizing’ its existing, profitable business because the premium TV network would have a hard time luring new streaming subscribers while not cutting into its base of customers who pay for cable or satellite subscriptions,” according to The Times.

The Times adds: “CBS has long defended traditional television business models, he said.

“ ‘I don’t think distributing to consumers via the Internet is an easy thing to do,’ Mr. Burke said. … ‘I think it’s a voyage that if you’re successful like Netflix, [it] can be a way to create a lot of value, but it’s not an easy thing to do.’”

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