TELEVISION GLUT
Programming ‘ballooning’
The TV industry will make a record number of shows in 2017, as streaming services Netflix, Amazon and Hulu propel a swell in production that’s creating an oversupply, veteran Fox executive John Landgraf said during his semi-annual presentation for critics.
TV networks will make 500 original scripted shows in 2017, almost 20 per cent more than the 419 produced in 2015, which was itself a record, according to Landgraf, chief executive of 21st Century Fox Inc.’s FX Networks.
Netflix alone will make 71 shows — not counting the service’s growing number of kids series, documentaries, movies and foreignlanguage programming.
The escalation in production poses a danger for TV networks and the media companies that own them, Landgraf warned. By producing more programming than viewers can watch, networks are losing money on a lot of shows.
“We are ballooning into oversupply, and that balloon will eventually deflate,” Landgraf said. “I continue to believe there is a greater supply of TV than can be produced profitably.”
Cable TV continues to be Fox’s biggest business. Last quarter, revenue grew 9.9 per cent to $3.92 billion for the unit, while profit fell slightly to $1.21 billion. The company is planning new investments in programming with $200 million to refresh the schedule at the National Geographic network and expand original series at FX.
It’s not the first time Landgraf has sounded this warning about oversupply. He’s widely credited with coining the term “peak TV” at the Television Critics Association tour a couple of years ago. Peak TV is the notion that the industry is producing shows at an unsustainable rate, and is overwhelming viewers — and critics.
Yet the growing ambitions of online-streaming services took the industry by surprise. Landgraf had predicted a decline in production by 2017. Now he says that won’t happen until at least 2019.
Netflix has been a particular target for the former NBC executive, who uses this presentation twice a year to hold court on the state of the TV business, woo critics and embrace his inner Cassandra. Netflix spends six times as much money on shows as FX and will soon produce more shows than HBO, Showtime, Starz and FX combined, said Landgraf, who has run FX since 2005.
Netflix said earlier this year that it will spend $5 billion on programming in 2016, exceeding any other U.S. TV network. To help pay for that growing budget, the company raised prices for millions of U.S. and foreign users. With more than 47 million customers in the U.S., exceeding any domestic premium cable network, Netflix is spending more on original series made in foreign languages to reach customers in newer markets.
Netflix didn’t respond to a request for comment on Landgraf’s remarks, but Netflix chief content officer Ted Sarandos conceded in July that there were too many bad shows being made. No one ever complained about too much of a good thing, Sarandos said.