The New York Times discussing comments from FX CEO John Landgraf and HBO head of programming Michael Lombardo:
Mr. Lombardo and other executives say it is harder than ever to build an audience for a show when viewers are confronted with so many choices and might click away at any moment. As a result, executives say, it’s hard to make money off that show.
The success of scripted shows like “Modern Family,” “The Walking Dead” and others has set off something like a land grab. The number of scripted shows produced by networks, cable networks and online services ballooned to 371 last year, according to statistics compiled by FX. Mr. Landgraf believes that figure will pass 400 this year, which would nearly double the 211 shows made in 2009.
There was no reference in the article to the increase in the number of channels. FX grew into FX, FXX, and FXM in the fall of 2013. How are viewers supposed to keep track of where to watch that new show they heard of? Never mind that cable bills are growing partially due to these bloated bundles with more and more channels.
Diminished ratings in television have been a reality for some time, but that has largely been credited to technological challenges and changes in viewing habits. Mr. Landgraf, counterintuitively, attributes declining ratings, in part, to too much choice, no matter how good the show.
Cable companies and TV networks have treated their customers with hostility - bloated and expensive bundles, limited options to watch later or on mobile devices, increased advertisement loads, terrible customer service, and more. Of course viewers are drifting to platforms with less friction such as Netflix, Hulu, HBO Now, and iTunes.
However, the economics are evolving. Selling rights for an old show to Netflix used to be viewed as extra profit for the networks. That is changing as more consumers reduce or cancel their cable packages and spend more of their viewing time on online platforms. This is exactly why Netflix, Amazon, HBO, and everyone else is creating more original content. Sounds great for consumers - until Netflix has a critical mass of popular shows and starts raising prices to cover programming costs (just like cable companies have done over the last fifteen years).