August 23, 2016

Overfishing

Resource scramble: competitive behavior that occurs when a number of organisms utilize common resources that are in short supply.

It’s the dog days of August, but the fall 2016 TV season is right around the corner. While doing some summertime reading, I stumbled upon the idea of the ‘resource scramble.’ Ecologists use this term to describe what happens when growing competition for declining resources turns into a frenetic free-for-all. Sounds a bit like the US TV industry, no?

So what can ecology teach us about the future of TV? Two things…

1. Big is Not the Same Thing as Infinite
Resource scrambles occur in a variety of contexts. Examples include the buffalo hunts of the 1870s (which nearly wiped the bison off the face of the earth), water resources in the American Southwest (i.e., the Colorado River), and overfishing in the Pacific today (which is devastating the Bluefin tuna).

In every case people thought the resource was unlimited. Until it wasn’t. Prior to 1800, the bison population of North America was roughly 60 million. Contemporary accounts describe herds so large that they filled the horizon for 20 miles or more. Everyone ‘knew’ that the population was limitless. By 1900, there were only 300 bison remaining.

US daily TV viewing (including both legacy and broadband video sources) is roughly 100 billion minutes per day. From the perspective of an individual TV show, that number may seem limitless, but it’s not. By any measure you choose (total viewing hours, pay-TV households, Nielsen ratings, even Netflix subscriber growth) the US TV viewing audience is flat or declining. If we remove the massive pool of retired or retiring Baby Boomers (who watch tons of TV), the declines are even greater. The inconvenient truth for the US TV industry is that new shows are all fighting for a share of a declining market, and there is no magical rising tide capable of lifting all boats. This leads to my second point.

2. What Works in the Micro May Not Work in the Macro
Individuals act in their own self-interest. When they become aware that a particular resource is declining, the natural reaction at the individual level is to extract more, and faster. Buffalo hunters double up on ammunition, farmers drill another well, and fishermen throw out an extra line. Everyone does what he or she can to get theirs. The effect on the overall system of this behavior is as obvious as it is bad. Faster extraction of limited resources makes things worse, fueling an all-out scramble.

The upcoming fall TV season seems to fit this pattern to a T. Ratings are weak, and yet the fall 2016 line-up likely includes more new shows than we have ever seen in the history of television. By one count there are 123 new shows, but I’m sure that’s missing some. The broadcast networks alone are launching more than 40. We’re talking about multiple new comic book-derived shows (Luke Cage, the Preacher), multiple new time travel shows (Timeless, Time after Time with Making History coming in 2017), and multiple movie spin-offs (The Exorcist, Lethal Weapon, Westworld).

I understand why individual networks want to put out as much new content as they can, but how can this possibly work in the aggregate? Adult viewers watch 35-40 hours of video per week (including both legacy and broadband video sources). A big chunk of this (I’d argue at least 80%) is already spoken for by news, sports, and returning shows that people already know and enjoy. This leaves (at most) 7-8 hours a week available for new shows. For most people, digesting 7-8 new shows a week is still way too much cognitive load – their attention span for embracing truly new shows is more like 2-3. And this is among people who like TV.

There are two obvious problems here. First, there are simply way too many new shows chasing way too little of the ‘shelf space’ in the viewer’s mind. Even if they wanted to spend time evaluating and selecting from all these shows, they couldn’t possibly do so. Just watching the pilots for all the new shows would consume more than 3 weeks of TV, even for a heavy viewer who watched nothing else. Second, as Barry Schwartz taught us in the Paradox of Choice, too much choice is not liberating, but rather overwhelming and paralyzing. Throwing this many new TV shows at an audience already saturated with video choices may cause many potential viewers to simply select ‘none of the above.’

Conclusion
There’s a fine line between abundance and a resource scramble. 1873 was the greatest year for buffalo hunting in history. By 1876, the great Southern herd had been wiped out. For those in the business of making TV shows, the last few years have been dubbed a ‘new Golden Age.’ We too often forget, however, that the TV audience is a limited resource that can only absorb so much content. Supply, with respect to new shows, is running way ahead of demand. The fall 2016 new show line-up is not sustainable, and a shakeout is inevitable.

Stick with TDG and stay ahead of the curve.

Joel Espelien is a Senior Advisor for TDG and serves as an advisor and Board Member to the video ecosystem and technology companies. He lives near Seattle, WA.

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