The Olympic Channel, owned and operated by Comcast, has announced that it will be shutting down on September 30. Is this an isolated incident, or is it a sign of things to come? Here’s the way I see it.
Cards on the table
There are too many channels on traditional pay television.
I’ve been saying this for a decade and it’s even more true now. Fewer people watch traditional, live, pay TV now than did a decade ago, and that trend probably won’t change. It’s not because live TV is bad, it’s just because there are other choices. You could stream, you could use an antenna, or you could participate in any of the many social media options. Hey, reading a book still isn’t off the table as far as I’m concerned.
Yet, traditional pay TV still clings to a model of multiple channels showing the same content. In some cases, there’s an east and west coast feed of the same stuff. Sometimes it’s multiple channels like the many iterations of HBO and Cinemax that often share the same content. Sometimes it’s due to synergies that have happened. There was a time when Discovery, Science Channel, OWN, DIY, and HGTV were all different entities. Today they’re all part of Discovery Networks and there are a lot of shows that bounce from channel to channel. It’s all part of making sure the content spigot is flowing 24/7, for the least amount of money.
It’s wasteful. It’s not a lot wasteful, but it’s wasteful. Those channels cost money to program, money to beam up to a satellite, and money to deliver to customers. But the traditional thinking has been, it’s worth it. People see a large hunk of channels and think they are getting their money’s worth.
Traditional thinking is wrong
Maybe I’m not talking to the right people, but I don’t know anyone who really thinks that way. For the most part, if you see a rerun on a second channel, that doesn’t really increase your perception of value. People want to see what they want to see. They want to DVR or stream things on their schedules. Fewer and fewer people just flip up and down the channel list settling on something that’s on now.
And you know, I think most folks would be ok with 2/3 of the duplication just disappearing. Cut it down to two HBOs. Get rid of DIY and Destination America and just fewer reruns on HGTV. I think it would make those channels seem more valuable, not less.
I think the time has finally come for a change.
Warner Bros. Discovery owns it all
Without even looking at their web site, I can tell you that one company — Warner Bros. Discovery, operates all these channels:
- All the HBO and CInemax channels
- Discovery and Science Channel
- HGTV, DIY, OWN, and Destination America
- CNN, Headline News, TBS, and TNT
- Cartoon Network and Adult Swim
- Food Network, Cooking Channel
- Animal Planet, Investigation Discovery
- TruTV and Golf Channel
- Turner Classic Movies
And I’m sure there are more that I’ve forgotten about. That’s a lot of channels and a lot of them show the exact same content. Warner’s David Zaslav says he’s all about cutting costs. Although he claims he wants to support traditional TV, I wonder if some of these channels will disappear soon.
What’s holding them up, probably
Warner Bros Discovery has contracts with pay-TV providers that might make it hard to cut channels. Hard, but not impossible. They also get a certain amount of money per channel, per subscriber. But again that’s not impossible to deal with. I could see them renegotiating all those contracts to keep the same amount of revenue with fewer channels. After all, they control a large and indispensable amount of programming. I’m guessing they know it too.
The smart pay-TV companies would frame this as a value add for consumers. All the same content, they’d say, fewer places you have to search for it. They may even say that it’s a move designed to keep spiraling pay-TV rates under control.
I for one look forward to this “channelpocalypse.” It’s time for some common sense in live TV. I think that pay TV, traditional pay TV, still has decades left in its life. But, only if they act wisely and keep up with people’s thinking. So, your turn, Zaslav. Be smart in what you cut, but as far as I’m concerned, there’s room in the live TV schedule for the knife.
