Are TV shows worth their price tags?

Marketplace Staff Oct 6, 2006
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Are TV shows worth their price tags?

Marketplace Staff Oct 6, 2006
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TEXT OF INTERVIEW

MARK AUSTIN THOMAS: An odd change is taking place on the small screen. The L.A. Times says the cost of producing a TV drama for one season is about the same as the price of making a movie. And TV executives are spending this money at a time when the total audience for television is getting smaller. Mike Speier is the Managing Editor for Daily Variety. I asked him if he understood the logic behind this decision

MICHAEL SPEIER: Very few people get the economics of this decision. It really strikes me as a bad business model and it strikes a lot of people as such. Why would the price of something go up if the retention and the audience was going down for anything? And the only reason you can explain it is desperation. Because there are certain shows that have clicked that cost a lot, like Lost, that were very expensive and saved a network. So any network would love to have that in their pocket and that’s what they’re going for. The problem is that the risk is so huge. So getting a Lost is not that easy, but you have to compete and that’s what you have to do: Spend the money.

THOMAS: A measure of the desperation is how many new shows fail. When you think of that and you think of how much money they’re putting into it . . . you don’t find those kinds of odds in Vegas.

SPEIER: Right and television has always been like that. The fall season has always had, let’s say, 30 new shows and on average — and this is before the money was spent — five or six shows stick around for more than two years. That’s a very small percentage so if you think that same percentage is still carrying over today, why would you spend all that money on these drama pilots if the chance of getting a big hit were very slim and the chance of even getting a regular hit was slim?

THOMAS: The popularity of reality shows was supposed to be a big plus for television because they were cheap to produce. What happened?

SPEIER: They’re still cheap to produce. The problem is, of course, too much of a good thing because we started just with Survivor and now of course every network has 10 of them and so we have a glut of them and then the ratings a) plunge and critics aren’t so happy with them and they decide to go in a different direction because that’s what television does. They click with something, they go to it ad nauseum and then people realize that it’s not always going to work and then they have to go to something else.

THOMAS: How do demographics fit into this? Is the industry not appealing to the right group of viewers?

SPEIER: It’s appealing to the right group of viewers and they’re trying very hard because they do their research, they know what they have to get. They know the big demo, they know the 18 to 34 or 18 to 25 demo is what they want. The problem of course is that demographic is busy doing a million other things that they didn’t have years ago. So while you have iPods, while you have the computer to compete with, you’re trying to get that same audience. So what do they do? They make shows that are very attractive, very pretty, spend a lot of money and hopefully compete with the movie business, compete with the DVD business. That’s one segment that they think they can compete with. Whether or not it’s working remains to be seen because there’s a lot of these shows, as good as they are, as attractive as they are, people aren’t tuning in. Something like Kidnapped or Standoff — attractive shows that people say ‘wow this is a noble effort’ but in a year it’s gonna be gone.

THOMAS: Thanks Mike.

SPEIER: My pleasure

THOMAS: Mike Speier is the Managing Editor for Daily Variety. And in Los Angeles I’m Mark Austin Thomas. Thanks for joining us. Have a great weekend.

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