Home / Networking / AT&T to Madison Avenue: Time to Hang Up on TV Networks? (Column) – Variety

AT&T to Madison Avenue: Time to Hang Up on TV Networks? (Column) – Variety

You hear it from programming executives all the time: TV fans don’t watch networks; they watch shows. AT&T seems ready to transform that maxim into a truism.

In a presentation to advertisers today, the telecom giant’s WarnerMedia broke down plenty of silos – some of which advertisers might prefer remain standing, at least in the near term.

For decades, when it was known as the Turner unit of Time Warner, the company’s big cable channels had big definitions. TBS, once a general-entertainment outlet best known for Braves games, reruns and World Championship Wrestling, became recognized as a comedy outlet. TNT, which launched in 1988 as a venue for late-night “MonsterVision” and other movies, became known best for drama, and, over time, basketball. Tru was a place for unscripted fare, and Cartoon Network and Adult Swim for animation. Those big categories have been the foundation for years of success and growth in the cable industry, as Turner, NBCU, Viacom, Discovery and others built big-audience brands that were just narrow enough to woo ad dollars from their broadcast-network rivals.

Under AT&T, those categories are being reworked. How else to explain why “Snowpiercer,” a long-gestating dramatic TV series about survivors of an apocalyptic world living on a giant train, is moving to TBS? The series sounds tailor-made for TNT. Meanwhile, “Chasing the Cure,” an unscripted series led by anchor Ann Curry that tries to find crowd-sourced solutions for aberrant medical maladies, is slated to air live across TNT and TBS. And Tru is going to launch its first animated series. Worlds, such as they are in the TV business, seem to be colliding.

It’s almost as if executives are saying the following: “Viewers come to TBS for Samantha Bee or Tracy Morgan. Or a ‘Big Bang’ rerun. People watch what they want and discover it on their own. So let’s stop building network brands. And let’s just make a bunch of shows and try to make sure people can find them.”

That’s a big bet. Advertisers buy shows, sure, but they also buy multi-program schedules. More often than not, they buy multi-network schedules. The idea is to use the brand prism of a specific network – drama, comedy, food, mysteries, sports, what have you – to identify what sort of viewers tune in and then throw commercials at them so they can be viewed by thousands or millions in a single fell swoop. Hundreds of millions of dollars flow into media-conglomerate coffers as a result. They will continue to do so.

But AT&T likely has other visions in mind. The company has made no secret of its efforts to launch a streaming-video service, now slated for 2020. Nor has it been shy about its ability to use “170 million” different touchpoints with consumers – DirecTV subscribers, broadband-plan users and more – to accumulate data about behavior that it can use to identify customers for advertisers. With that kind of infomation at the ready, specific consumer behaviors come to the fore. Who needs broad viewing patterns? And if that’s the case, who really needs networks?

The strategy seems to put full confidence in the belief that video-watching, once the biggest of mass media, is teetering irrevocably toward becoming a niche behavior. In a not-too-distant future perhaps, consumers will churn in and out of seven or eight streaming services, hitching on when a series or a sports event they have to see makes it worth opening their wallet to do so. The SVODs will become great pots of content – cooking shows; kiddie series; documentaries; world-building fantasy dramas; special live events – that anyone can dip into, for a price.

To play along, advertisers will have to cough up data and insights about their target consumer, identifying what she or he likes to eat or buy, or the services he or she is most likely to need. With that in hand, the media companies can find out what types of customers their sponsors want and work harder to develop the shows that cater to such distinctive crowds – all, they hope, at a premium to what their competitors may have under the tent.

That vision carries risk. TV may not be as dominant as it once was, but it sure lures bigger audiences than most everything else. And Procter & Gamble and Toyota still need to reach the largest audiences they can to move boxes of diapers and Camrys and Priuses in an efficient manner. If advertisers spend their days tailoring commercials to HBO binge-watchers, Hulu churners and CBS All Access subscribers, they will never get anything else done.

AT&T is right to test new waters, to build new media properties and systems to support them. But you never want to undermine your current business until the last customer signs off. That’s why Netflix keeps sending DVDs through the mail and why America Online collected dial-up fees for months after the mobile web entered U.S. homes.

If AT&T is smart, it will keep drama at TNT a while longer, and not add to the one currently whipping through the media and advertising industries as technology disrupts the connection entertainment stalwarts have with TV fans.

 


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