TCA 2013: Fox's Kevin Reilly on Broadcast Bashing, Ratings Issues and The Unreported Mystery Audience of Netflix - Ed Martin

Beverly Hills CA In what was by all counts the liveliest executive session at the Summer 2013 Television Critics Association tour a very passionate Fox Entertainment chairman Kevin Reilly began his time on stage by speaking at great length about changes in the television business and in the viewing habits of consumers problems with current audience measurement and the need for reporters who cover television to begin writing about how episodes of broadcast shows perform not only on the night of their network premieres but on different viewing platforms in the days weeks and months that followThe one thing Reilly didn39t say much about whether by default or design was the most serious issue Fox faces heading into the 201314 season The problematic state of the network39s mammoth talent competition series quotAmerican Idolquot which will face significant challenges in the season aheadThe only real news of the session was Reilly39s revelation midway through that Keith Urban would be returning as an quotIdolquot judge next season amp8211 which felt almost like an ohbytheway afterthought It was actually included in an answer to one reporter39s question about quotIdolquotThat was about it for quotIdolquot information quotI can39t talk too much about it because we have to continue our yearly tradition of me not being able to say anything about the showquot Reilly laughed referring to the many changes and welldocumented tumult that have engulfed it in recent years He did say that despite rumors there is currently no deal in place for Jennifer Lopez to return to the showThe aging quotAmerican Idolquot is still critically important to Fox given that the closest thing the network has had to a new hit during the last two seasons is quotNew Girlquot Before yesterday one might have been tempted to refer to quotNew Girlquot as a quotmodestquot success but Reilly made clear that he39ll have none of that during his lengthy opening remarks which some critics called a quotfilibusterquot He spoke out against the ease with which the press embraces certain shows on cable and elsewhere regardless of their actual performance while holding broadcast shows to the firequotI don39t have any chip on my shoulderquot Reilly insisted quotI think it39s all fair competition I watch and love a lot of those cable shows I don39t think we39re a bastard stepchild or some sort of broken system But I do have one frustration A lot of times I see network successes with an asterisk next to them as if they are modest successesquotHe used as an example Fox39s quotThe Mindy Projectquot With a 22 rating quotMindyquot quothappened to be the highest rated new comedy of the season last year by virtue of the fact that most of the competitors canceled all their new comediesquot Reilly saidquotI was very happy to continue with the showquot he continued quotHowever there was sometimes a muted response to it as though it was kind of a middling performer There was a little asterisk next to it like 39Well this thing kind of squeaked its way through39 What is frustrating though is if you put ratings for quotMindyquot against a number of the top cable hits amp8230 many of those shows would have the word 39hit39 attached to them without any asterisk without any notation of any relative audience or performancequotBelieve me I would watch 39Louie39 on a loop amp8230 but you have to combine the numbers for 39Louie39 and 39Girls39 together to get even close to the 39Mindy39 rating I think we have to be a little bit more diligent about keeping that in context I mean I like 39Portlandia39 but you39d have to play a 39Portlandia39 12 times to equal the rating of 39New Girl39quotIt39s all about accurate and contextual audience measurement Reilly asserted quotAs analysts of TV we39ve really got to do a better job of getting our hands around this We are inundated with measurement every day and yet we haven39t been able to roll it up and synthesize it certainly not in a way that we can provide it to you the press on a regular basis We39re going to change that right now Our guys have recently built an internal dashboard that allows us to take the total viewing audience on any platform and give us a snapshot on an ongoing basis of just where that audience is and what they39re watching And I think it39s very very important that we provide that information to you and that you guys take time to periodically pull back and report beyond the live same day ratingquotPart of Reilly39s plea was for reporters to pay more attention to Live 3 and Live 7 ratings Traditional time period ratings are just quota fraction of the storyquot he said quotWhen you then go and layer in the Live 7 numbers we are seeing dramatic lifts in the performances of our shows Look at 39The Following39 for example Our competitors amp8230 looked at the 26 rating when 39The Following39 premiered and said 39It39s doing okay That39s a solid number39quot But its performance increased 65 percent with its Live 7 number and made it the No 1 network drama and the No 1 new show of the season he notedquot39New Girl39 with 66 million viewers on average in live plus same day rolls up to 946 on multiple platformsquot Reilly revealed quotThat means 33 percent of the viewing of 39New Girl39 happens outside traditional television It39s eight percent on VOD and 25 percent on Hulu and foxcom It39s even more dramatic with a show like 39Family Guy39 Thirtyseven percent of the audience is watching outside our traditional network platformquotReilly started to lose the room when he began talking about a 30day window and beyond primarily for VOD and streaming quotWe39re beginning to see an increasing amount of activity outside that 30 day window If you roll up all of the views for the season on some of our top shows you see some unbelievable numbers 39New Girl39 185 million views 39The Following39 283 million views 39American Idol39 560 million views Sometimes I read stories where they say nobody is watching network television anymore Well that39s a lot of nobodiesquotAs for traditional audience measurement quotwe think that39s an antiquated and arbitrary policy that we39re going to be pushing back onquot Reilly said quotWe39re doing some smart things to try to counter that like dynamic ad insertion that we39ll begin rolling out in our shows this year where we can monetize the rest of that windowquotI want to talk a little bit about context in the competitive landscapequot Reilly continued barely coming up for air quotThere were 1050 original shows on basic cable last season Of those 1050 basic cable shows only four would have made it into the Top 50 shows on television Now last season also marked the first time we saw a basic cable show become the No 1 show on television and deservedly so 39The Walking Dead39 was the No 1 show on television so that system is capable of producing that kind of performancequotReilly then moved on to Netflix and similar streaming sites quotWe know that there are new services now competing and we39re seeing real quality television on these services that deserves to be watched and reported onquot he said quotBut I think we need to keep some context around it We have always been in the business of speaking loudly to a big audience There are a lot of services that are now speaking loudly to a small audience And there are services like Netflix that are speaking loudly to an unreported mystery audiencequotLook we39re going to have to report those first blush ratings They39re not irrelevant I39m up at 530 in the morning living and dying by them myself I made a joke about Netflix but that is my definition of heaven that I get to make television and not have to ever look at or talk about ratings anymore But that39s not the business we39re in We look at those live same day ratings and I either sit there going 39Oh my God it39s going to be a long day39 or I run into work with a skip in my stepquotReilly39s remarks about Netflix he admitted quotprobably come out of jealousy because good for them they get to live in that world Look they put on some great shows I39m not taking anything away from it But I do think that the other part of their business is an important part of our business They39re going to have competitors in the marketplace now They39re not going to enjoy a monopoly for longquotIf you are receiving this report you are a registered member to Jack Myers Media Business Network or are receiving it as part of a registered corporate membership As a member Jack responds personally to your emails requests and comments He is available to speak at your company events In addition to Jack Myers Media Business Reports your membership underwrites MediaBizBloggerscom Women in Media Mentoring Initiative Jack Myers Wall St Report Jack Myers Video Media Report plus our exclusive industry economic forecasts trend forecasts and corporate performance research Redistribution in any form except among approved individuals within 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TCA 2013: Fox's Kevin Reilly on Broadcast Bashing, Ratings Issues and The Unreported Mystery Audience of Netflix - Ed Martin

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