What's new for the old guard? The 'Big Three' US TV networks fight back

The old guard of ABC, NBC and CBS have been around a long time, but for how much longer? Well a lot longer by the looks of things, thanks to cord-cutting and net neutrality.

It doesn’t seem too distant a future where the question ‘what are the top three channels?’ will be met with names like YouTube, Netflix and Hulu, with Amazon Prime not far behind. But once upon a time there were three other titans, the ‘Big Three’ – ABC, CBS, and NBC. They’re still prominent players of course, but it’s worth taking a look at just how hard they have to work to remain relevant in today’s ecosystem.

In the mid-80s, each of the three major broadcast networks went through a major shake-up. What used to be three big dogs in a small kennel of seven channels became three members of an old guard faced with a new reality of 33 channels and the proliferation of the VCR.

As expected, this new wealth of choices only made the space less profitable. There was a time when nine out of every 10 viewers tuned into those networks nightly – the kinds of numbers we’ll never see again.

Those 20th-century problems faced by the networks were relatively short lived, soon to be replaced with cable television and then the internet, offering even more places to find quality programming.

Brian Wieser, a media industry expert from Pivotal Research Group, explains, however, that while rating might have been gradually declining and audiences eroding for individual programs because of alternative viewing options, the reach of broadcast networks “remains almost as high as ever”.

“Virtually everyone watches a broadcast network at some point in a month,” he says, “if less frequently.”

Packages of advertising, which Wieser says are “typically sold at the network level, not at the program level,” have retained “the capacity to have significantly greater efficiencies because they avoid unintended audience duplication, or excess frequency”.

The difference now is that as cord-cutting and cord-shaving expand, broadcast networks retain the potential for reach better than cable networks because they are typically carried through every distributor.

Mark Gorman of Matrix Solutions takes it a step further, saying cutting the cord could be a huge advantage for the big networks, because “how many of these streaming networks are you going to want, right?”

“How many are you willing to pay for? You’ve got Netflix, you’ve got Amazon, you’ve got maybe is Hulu… At a certain point you’re going to say ‘enough is enough’ because you’re still going to want an alternative.”

And that alternative? Well the main draw of the Big Three and what will keep them there is the very low cost for consumers – they’re free.

“There’s a legacy there that could be sort of a drag on the network,” says Gorman, “but at the same time it could be a great opportunity, depending on how they respond.”

Despite all that the networks face, they’re still opportunity for them to thrive. According to media firm Zenith, on a list of the top 30 shows for the always coveted 18 to 49 age bracket, NBC has seven shows, ABC has eight and CBS nine.

A trend Wieser is seeing is the networks looking to provide programming with broad appeal that essentially everyone could watch or would want to watch together. “Years ago,” he said, “there was an argument to be made about the value of co-viewing [family watching programs together].” And with the influence of regulatory bodies like the FCC and consumer review boards like the Parents Television Council, that still seems to be the case today.

ABC, for instance, has committed Sunday evening programming for reprises of classic game shows like Family Feud, Match Game, and $100,000 Pyramid. Each of these integrates celebrities in a humanizing way, often pairing them with regular citizens for added excitement.

It can also rely on its parent company Disney, whose upcoming streaming service looks to disrupt the digital streaming ecosystem with a catalog to rival Netflix and which has only been bolstered with the mega deal it worked out with 21st Century Fox.

NBC took over the Olympic telecast at the beginning of the new millennium and won’t be letting it go until at least 2032. It’s also got a dedicated Sunday nights in fall for NFL telecasts, as well as an abundance of quality programming including This is Us, Law and Order and the Chicago Fire franchise.

In late 2017, an all-hands meeting between NBCUniversal and its brand and agency partners took place, looking for ways to improve on and better measure ratings for an “ad-supported ecosystem that may cease to exist in about 10 years”. NBC, in a similar way to ABC, has a parent company with deep pockets in Comcast. The only difference is that Comcast, an internet service provider, stands to benefit greatly with the repeal of net neutrality by the FCC.

Net neutrality, ironically, gives the largest opportunity for all the broadcast companies. As Gorman notes, video streaming services like Netflix et al drain bandwidth. The relatively cheap price of them providing content to watchers and bingers isn’t sustainable.

There’s one measure he suggested that consumers may not like, but are already seeing from television’s print counterparts – a paywall.

“At a certain point,” Gorman believes, “you’re going to have to say to the consumer, ‘if you’re hogging that much bandwidth, you’re going to need to pay extra for it’. How many hours a day does the average American spend watching television? About eight hours? When you bingewatch, you’re pushing that much through your broadband.”

If so, this forces Netflix to do what it hasn’t quite yet: charge power users when they surpass a time threshold – maybe 150 or 200 hours. Or implement things like programmatic product placement, an idea it has mentioned recently.

Where the Big Three can prosper is the means to diversify where they place their content. CBS, although its own entity, has Viacom behind it and assets like the CW and the All Access platform to distribute content through. ABC and NBC have their media giant parent companies to leverage.

Ken Auletta called them ‘Three Blind Mice’ in his 1991 national bestseller about how the networks had lost their way, but with greater obstacles in their way than each other, at least they’ve got guides with deep pockets to help them navigate through it all.

This feature first appeared in The Drum's February print magazine, in The Future of TV issue.