Broadcasting

1. Broadcasting, Cable, The
Internet, and Beyond
An Introduction to Modern Electronic
Media
Chapter 7
The Business of Broadcasting, Cable, and New Media

2.  It’s time for a short quiz.
 One question : What is the primary product that
a radio or television station has to sell? Here are
the choices :
a) Entertainment
b) Advertising time
c) Listeners to advertisers
d) Weather updates
If you answered c, you’re right. All the other
answers are less correct.

3. The Business of Broadcasting,
Cable and New Media
 Let’s dwell on this for a just a minute.
 Commercial mass media have a unique dual nature.
 Mass-media technology is designed to link audiences
with program suppliers and with sponsors.
 Broadcasting and cable operations need to provide
listeners and viewers with programs that meet their
tastes and needs.
 Stations transmit programs to attract an audience.
 Internet sites develop information and entertainment
on their sites for the same reason.

4.  Banner and other ads on Web sites provide
revenue for the Web producer in much the
same way.
 Mass-media technology provides a means of
reaching a large number of people
simultaneously, and as a result it is an
economical way of linking audiences with
advertisers via television and radio
programming.
 Essentially you and your friends are the
product a broadcasting station is selling to
an advertiser.

5.  In all electronic media there is this kind of
interplay among the technology, the consumer,
and economics.
 For example, there is an interplay for the cable
industry, but it works just a little differently from
broadcasting.
 Obviously cable has advertising, and thus cable,
too, must be selling the audience’s attention to
advertisers (unless a consumer is willing to pay
extra money to receive noncommercial channels
such as HBO or Showtime).
 But there is a difference between over-the-air
broadcasting and cablecasting.

6.  Cable companies also charge viewers a monthly
subscription fee for the privilege of receiving cable
programming.
 In fact, the majority of cable’s revenue is generated
by the monthly subscription fee that consumers pay
to receive the service.
 Cable thus has a dual income : Cable operators sell
advertising, and in addition they collect revenues
form a monthly subscription service.
 Some cable companies such as Comcast and Time
Warner are also offering high-speed Internet access
and telephone (VoIP) as services, which act as
additional sources of income for these companies.

7.  Of course cable operators also have a different
cost structure because cable is a different
technology from over-the-air broadcasting :
Cable franchisers have a large video distribution
network to maintain, while broadcasters just
have a transmitter and studios.
 The business model for radio and television is
thus different from that for cable : both cable
and broadcasting must be technology-
dependent.
 Web sites make money through ad-placement,
much like a newspaper and magazine, or by
selling goods or services like iTunes store.

8. Competition and Electronic Media
 Radio, television, cable, and satellite
broadcasters all face competition from other
services.
 Web services compete against many similar
pages with similar information.
 The amount of competition often helps the
government determine how closely it will monitor
and control the mass-media facility.
 Generally the amount of government oversight of
the electronic media is tied to how competitive
those media are.
 If there is more competition, there is less
regulation.

9.  The different electronic media have different levels of
competition and face different amount of government
oversight as a result.
 If a medium faces no competition, there is a monopoly.
 If there are a limited number of competitors – say, only
three national commercial television networks – we would
call that an oligopoly.
 If a market faces complete competition – say, a large radio
market with 25 or more radio signals available – it is
possible to let the listeners decide which stations will
become popular and thereby gain a large share of the
advertising dollars.
 We call this a “marketplace” solution – pure competition.

10. The Economics of Networking
 In the 1970s, when the networks were at the
peak of their power, the government barred them
from owning financial interests in their programs
(financial syndication rules).
 These government regulations, which allowed
independent producers to develop, were relaxed
in the recent years as more competitors have
entered the television market place.
 Today television networks own or coproduce a
great deal of their own programming, and they
can develop new programming with the intention
of profiting from the show when it is placed into
the syndication marketplace (reruns) or when it
is sold to international audiences.

11. Syndication and Local Sales
 Example : Suppose WEEE-TV decided to pay
$10,000 per episode for the rights to show 150
episodes of CSI – Crime Scene Investigation
three times each.
 Striped across the 5-day week, 150 x 3 is 450
daily showings; this will provide approximately 1
½ years of local programming for the station.
 This deal, worth $1.5 million for the program
producer, would be based :
1) on the size of the market and
2) on how much other TV stations in that market
are willing to bid for the rights to the show.

12. Syndication and Local Sales
 If the producers were able to strike similar
deals with 50 of the largest television
markets in the US, they would be very happy
and very rich.
 To carry this example to a conclusion, WEEE-
TV sells the number of commercial minutes
available within each CSI episode locally or in
national spot sales.
 The station must make back the cost of
syndication plus enough money to cover
station overhead cost, station commissions,
and still meet a profit target.

13.  You can see that the amount of money to
support network re-runs, particularly big
hits, on the local station can be very high.
 Because costs of quality programming can
be so high, many shows are offered as
barter syndication.

14. Radio Programming
 To unlock the secret of radio programming today,
it’s helpful to turn to the biological sciences.
 Biologists define symbiosis as “the living
together in intimate association or close union of
two organisms,” especially if mutually beneficial
– like silverfish and army ants or coral and sea
creatures.
 Radio enjoys a close and mutually beneficial
relationship with a variety of other “organisms.”

15. Radio Programming
 All these illustrates how radio is intertwined today
with the movie business.
 The success of TV shows like Glee and MTV’s 10 On
Top and the numerous stars who have graduated
from American Idol to become successful pop stars,
point to radio’s interrelationship with TV.
 But radio’s most symbiotic relationship is with the
popular music business : the world of iTunes, CDs,
and DVDs.
 Radio is in a flux today.
 As younger listeners mix local radio and Web stations
and music services, change is in the wind.

16. Radio Regulation and Format
Design
 For this symbiotic relationship to work, it’s
necessary for stations to have the freedom to
choose the programming they want to provide to
their communities.
 Section 326 of the Communications Act in US, is
the law the empowered FCC to govern broadcast
operations.
 However, FCC has no right nor the power to
control radio programming.
 Radio stations are free to program their airtime
however they may.

17. Radio Regulation and Format
Design
 Congress has directed the FCC to promulgate
programming rule.
 However, the bulk of radio programming – music,
news, and information – is largely free of
governmental intrusion.
 In fact, this characteristic is one of the
fundamental distinctions between the sound of
American radio and that of the rest of the world.
 Basically, American radio is programmed to
satisfy listener tastes and not, as in government-
owned systems, to serve political or bureaucratic
interests.

18. Radio Regulation and Format
Design
 We call this situation “format freedom.”
 Faced with the task of filling 24 hours per
day, 365 days a year, radio programmers are
on their own.
 Their task is simple : to provide attractive
programming to meet the informational
and/or entertainment needs of an audience.
 In commercial radio, the audience must be
large or important enough to be of interest to
advertisers.

19. A Matrix of Radio Programming
 Local programming is original programming
produced by the radio station in its studios or
from locations in its immediate service area.
 Pre-recorded or syndicated programming is
programming obtained by the station from
commercial supplier, advertiser, or program
producer from outside the station.
 Common sources of this type of programming
are from record companies or program
distributors.
 Pre-recorded programs may also be received by
stations as MP3 downloads through an Internet
connection or by microwave relay, and very
commonly from a satellite or distributed via CD.

20. A Matrix of Radio Programming
 Stations that belong to a network such as
ABC, CBS or National Public Radio are
permanently interconnected via Internet
connection or satellite transponders.
 Unlike syndication, network programming
is regularly scheduled; that is, with few
exceptions, network programs run the
same time each day at every station on
the network.

21. TV Programming
 We study television for a lot of reasons : it’s
social impact; its effect on politics; its influence
on modes of conversation, fashion and
relationships; and on and on.
 But for the majority of the public, television is
really about only one thing: programming.
 And that programming, whether it’s found on the
broadcast networks, local TV stations, cable,
satellite on the Internet, has only two main
functions : information and entertainment.

22. A BRIEF HISTORY OF TV NEWS

23. The Kennedy Assassination : The Death of
Camelot, the Growth of Conspiracy Theories,
and the Birth of Television News
 Was there a government cover-up? Did Aswald
act alone?
 Nearly 60 years after JFK’s death, the majority of
Americans are skeptical of the official conclusions
about his death.
 Despite countless government investigations and
television documentaries, the majority of
Americans seem convinced that Lee Harvey
Oswald had help assassinating the young
president.
 Did television have something to do with
reinforcing this persistent belief?

24. The Kennedy Assassination
 JFK had been warned not to go to Dallas, a city
torn by political and racial unrest.
 The press had hinted there might be trouble.
 A large contingent of the media was on hand as
the president’s motorcade passed the Texas
School Book Depository when loud shots rang
out.
 The president was shot twice, in the neck and in
the head, and was announced dead a short time
later

25. The Kennedy Assassination
 Within 5 minutes, news of the shooting moved
on the United Press wire service.
 Within 10 minutes the three TV networks had
interrupted their afternoon lineups of game
shows and soap operas.
 Receiving news from a reporter, he told the
nation on CBS that its president had been slain.
 Incredibly, within hours, a suspect was
apprehended at a nearby theater.

26. The Kennedy Assassination
 Assassinations in other nations often lead
to government chaos and public violence,
but in the United States it turned people
to their TV sets for news, for comfort, and
most importantly, for explanations.
 For four days, all regular programming
was suspended and people sat, seemingly
transfixed by the story unfolding on TV.
 The full resources of the TV medium were
turned to this one event.

27. The Kennedy Assassination
 Television was there when President Kennedy’s widow,
Jacqueline, returned with the coffin to Washington and
when the accused assassin, Lee Harvey Oswald, was
himself gunned down by a Dallas nightclub owner, Jack
Ruby.
 And TV permitted the nation to attend the funeral, as world
leaders came to pay their respects.
 How was it that Ruby seemed to have access to killing
Oswald before the assaliant could explain himself and
before authorities could be certain he was the only shooter.
 How could this happen? Many asked questions, but there
were no answers.
 Many Americans became convinced that events were
carefully orchestrated and that Oswald did not act alone. A
conspiracy theory was born.

28. The Kennedy Assassination
 Like the events of 9/11/2001, more than 9 in
10 Americans were said to have watched the
TV coverage that fateful weekend.
 Watching too, were over 500 million people in
23 countries, as the coverage was fed to a
new device that had recently been launched :
the communications satellite.
 More importantly, however, the events
surrounding the assassination began the era
of television news supremacy.

29. Television and Civil Rights
 In 1962, Dr. Martin Luther King, Jr, outline a new
strategy :
We are here today to say to the white men that we
will no longer let them use their clubs in dark
corners. We are going to make them do it in the
glaring light of television.
 It worked! And this is precisely what we are seeing
today.
 TV was there in Little Rock in the year 1957 to
capture the violence following the integration of
Central High School.
 It was in Montgomery, Birmingham, and other
southern cities to witness sit-ins at lunch counters
and bus stations.

30. Television and Civil Rights
 In darker days TV was there to cover civil
disorders, presenting searing images of
white police chiefs turning dogs and fire
hoses onto defenseless demonstrators.
 It revealed the hatred of white
supremacists, including Ku Klux Kan, as
throngs of peaceful protesters file through
their towns.

31. Television in Vietnam
 A second major news event of the 1960s took place
thousands of miles away.
 But it too harnessed the power of TV – particularly its
ability to distant events and news into America’s
living rooms at home.
 The event was the war in Vietnam.
 During this period, TV news made , virtually all its
major advances : portable cameras, satellite relay
systems, color, videotape replay, etc.
 This was the era when TV’s first generation of
reporters, who have been trained in radio or print
journalism, gave way to a new wave of youthful
reporters who had grown up in the age of TV.

32. Television in Vietnam
 Vietnam provided a training ground for
the new people and techniques coming to
TV.
 As a result, the public was deluged with
daily report, with illustrations of American
and enemy dead, and with dramatic
“point-of-view” shots from cameras
mounted on helicopter gun ships and later
in the bellies of evacuation aircraft.

33. Television in Vietnam
 For many who lived through those years, the war is
remembered as a series of indelible images :
o the whirr … of engines as choppers evacuate
wounded soldiers;
o GIs “torching” a village with their Zippo lighters
(reported first by Morley Safer on CBS in 1965);
o antiwar demonstrations chanting “the whole world
is watching” as they clashed with police during the
1968 Democratic National Convention in Chicago;

34. Television in Vietnam
o the execution of prisoner by Saigon police
chief Lo An (aired on NBC in 1968);
o panic-stricken South Vietnamese clutching
the landing gear of evacuation aircraft in
1975;
o and flotillas of rafts and fishing boats
crammed with refugees as the “boat
people” fled their country in the late
1970s.

35. One Small Step
 Starting in 1957 the US and the former
Soviet Union were locked in a fierce battle
to control the new frontier : space.
 During the early days it wasn’t clear who
would win; but beginning with Alan
Shepard’s space flight in 1961, “space
shots” became a major focus on TV news,
leading up the lunar landing of Apollo 11.

36. One Small Step
 In the summer of 1969 Neil Armstrong set
foot on the moon, an event witnessed by
the largest global TV audience up to that
time, an estimated 600 million people on
six of the seven continents.

37. One Small Step
 NASA had carefully orchestrated the event as a TV
program, having mounted a small camera (provided
by RCA) on the steps in of the landing craft, in front
of which astronauts Armstrong and Edwin Aldrin
would cavort.
 The two unfurled and planted an American flag,
stiffened by an aluminum rod to give the appearance
that it was fluttering in some imaginary lunar breeze.
 Within minutes President Nixon was on a split screen
to talk to the astronauts by telephone.
 Two hours later, the world audience watched as the
astronauts blasted off for the return trip to earth.
 The astronauts had provided for this unique TV angle
(the first point-of-view shot from outer space) by
setting up another RCA camera in the lunar soil.

38. TV News Becomes Big Business
 Civil rights; Vietnam wars; the space race;
and subsequent events like the Watergate
scandal (in 1974 and 1975), the hostage
crisis in Iran (in 1980), the disasters
involving space shuttles Challenger (1986)
and Columbia (2003), the unthinkable
collapse of the World Trade Center towers,
the aftermath of Hurricane Katrina (2005),
the oil spill in the Gulf (2010), and 2011
earth quake and tsunami in Tohoku, Japan
which killed 15,899 people ….,
brought TV news to the forefront.

39. TV News Becomes Big Business
 The major networks expanded their news
coverage and local television news also
grew. And it grew for good reason.
 It had become a profit center for
television stations, accounting for as
much as one-third to one-half of all
advertising revenues.

40. Major Trends in TV News – Happy
Talk
 In the late 1979s a new breed of newscasters began
to appear.
 Men were younger, more daring, and even dashing,
frequently dressed in the most modern clothing
styles, many with facial hair.
 For the first time women began to appear in the
anchor positions.
 Like the new breed of male newscasters, they were
young and attractive.
 On-camera looks, charisma, charm, and sex appeal
became at least as important as journalistic training
and ability.

41. Major Trends in TV News – Happy
Talk
 Not only did this new breed look different,
but they also acted different from their
predecessors.
 They talked to each other on the air.
 Sometimes they talked about the news
reports they had just seen; sometimes they
just seemed to be engaging in the kind of
gossip and repartee found in most offices.
 TV news was lambasted by the print media,
which called it the “happy talk.”

42. Major Trends in TV News – Happy
Talk
 There was a concern that TV news was from
information to entertainment, and away from
serious news to “sleaze.”
 Research seemed to support these claims.
 Studies found that stations with the happy-
talk format feature more sensational and
violent content than did traditional
newscasts.
 They also had higher ratings.

43. ENG and SNG
 Another new trend in TV news was its dependence on
new communications technologies.
 Electronic news gathering (ENG) emerged in the
mid-1970s, when video cameras and recorders
became commercially available. Lightweight, portable
TV cameras and small videotape recorders
revolutionized news coverage.
 With ENG, cameras and recorders could go anywhere.
 Events could be recorded in full, with natural sound,
and the most important parts could be edited
together electronically in a speedy and cost-efficient
manner.

44. ENG and SNG
 Several years later, the dawn of satellite news
gathering (SNG) arrived.
 Satellite news gathering refers to the use of the
mobile trucks mounted with satellite communications
equipment to report local and international events.
 SNG trucks and vans could transmit up to
communication satellites the pictures and sounds
gathered by SNG.
 The satellites sent the signal back down to local
stations and networks to use in their news programs.
 It was thus possible to obtain live news pictures from
virtually anywhere in the world.

45. Network Television : The Big Four,
Plus Three
 From the beginning of TV in the late 1940s to the late
1970s, TV programming was dominated by three
commercial networks : CBS, NBC and ABC.
 Their programs – variety shows such as Ed Sullivan’s
Toast of the Town, comedies like I Love Lucy and
Mork and Mindy, dramas like The Fugitive and sports
programs like Super Bowls.
 In the 1980s, a new service emerged as a fourth
network : Rupert Murdoch’s Fox Broadcasting
Corporation.
 In the 1990s, two newer networks struggled to join –
Paramount (UPN) and Warner Brothers (WB).

46. Affiliation
 The backbone of any network is the group of
stations that carries its programs.
 Stations that receive network programming
are known as affiliates.
 Traditionally, roughly 200 stations were
affiliated with each of the Big Three of ABC,
CBS and NBC.
 This is critical because national coverage
enables them to sell the nation’s leading
advertisers commercials within their
programs.

47. THE WORLD OF TV SYNDICATION
 After the networks (broadcast, cable and PBS), the
largest purveyors of programming are the
syndicators : the companies that sell programs
directly to TV stations and cable services.
 The growth in the number of TV stations, the arrival
of cable and new broadcast networks, and the growth
of the home video market have created tremendous
new demands.
 Where once syndication meant only two things –
movies and network reruns - the syndication universe
today ranges from films to talk shows, music videos,
and adventure yarns, to how-to shows on everything
from exercise to hunting water buffalo.
 Today TV syndication is about a $9 billion annual
business.

48. The Syndication Market
 There are two primary buyers or markets
for syndicated programming.
 The traditional market for syndication is
local TV.
 Nearly 1,400 local TV stations obtain
syndicated programming to fill their
program schedules during time periods
without network programs or local
programs (mainly news).