NBC in Trouble
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Case Code: BSTR233 Case Length: 23 Pages Period: 1990-2006 Pub Date: 2006 Teaching Note: Available |
Price: Rs.400 Organization: NBC Industry: Media, and Television Broadcasting Countries: US Themes: Failure of Strategy, Revival, Competition, Trends |
Abstract Case Intro 1 Case Intro 2 Excerpts
"I can tell you, it's like a weird monkey off the back in a way. Business is cyclical... nobody stays on top all the time."
-Kevin Reilly, President, NBC Entertainment, on the declining NBC Viewership, in 2005.
"we're not as strong as we've been, maybe, but we're only one breakout hit away from being there again. Of course, breakout hits are harder to come by these days."
- Jeff Zucker, then President of NBC Universal Television Group, on NBC's poor performance in 2004-05.
Introduction
In the television rankings for the 2005-06 season, NBC Television Network (NBC) was ranked fourth for the second consecutive year in the most popular broadcast network category. The rankings were released by Nielsen Media Research in May 2006. NBC trailed behind rival networks CBS Television (CBS), FOX Broadcasting Company (FOX) and American Broadcasting Company (ABC). CBS had been the top network since 2002-03 season during which it dethroned NBC from the top spot. In the 2005-06 season, NBC had lost 1% of its viewers as compared to 2004-05 season (Refer Table I for viewership details in 2005-06). FOX emerged as the most popular network among the 18 - 49 year-old segment (where advertisers paid premiums) for the second consecutive time, while NBC stood fourth here too.
Moreover, the Thursday night primetime slot, which had earlier been dominated by NBC, was now taken over almost completely by CBS. NBC, the television network division of NBC Universal, suffered as its own hit series like Friends, ER, etc. completed their run, while at the same time, rivals moved in. FOX's American Idol was the 'most popular television show' (second consecutive time) during the 2005-06 season. CBS had a great hit in CSI: Crime Scene Investigation and ABC had Desperate Housewives. But NBC had no new shows to boast of. Its biggest hit was the game show Deal or No Deal, but this came in 13th in terms of viewership in the year 2005-06. Even the telecast of Winter Olympics (held in Turin) in February 2006, which usually drew a big audience, could not help NBC. Bill Caroll, Vice president and Director of Programming at Katz Television Group, remarked, "If you were optimistic about the Olympics, you'd have to be somewhat disappointed with the numbers NBC delivered." To revive its sagging ratings, NBC acquired the rights to televise the prestigious National Football League (NFL) games which were to start in September 2006.
NBC acquired these rights after a gap of seven years. NBC was hopeful that the NFL games along with its new shows would boost its ratings in 2006. Walter Podrazik, Chicago-based writer and communications and logistics consultant said, "Getting NFL football onto the NBC primetime lineup is a major accomplishment. If they have that as an initial lure, it's not that they're one hit away from being the No. 1 network, because they're a little too far behind. But if they can start getting clusters of shows that spill over and get people interested in other shows, then they build in something that gives them, over two or three years, the potential for a comeback....
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