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Conan's Jump to TBS Shouldn't Really Surprise Anyone
Conan O'Brien's decision to move to TBS made a lot of headlines this week, with lots of reactions along the lines of "Conan's going from broadcast to cable? Huh?" and "Geez, TBS of all places?" But dig a little deeper and Conan's move shouldn't surprise anyone, as it represents yet another blurring of the distinction between broadcast TV and cable TV.
When it comes to bidding for expensive talent like Conan ($12 million/year reportedly), cable is at a big advantage to broadcast. The recession and ad spending downturn has highlighted the benefits of cable's dual-revenue stream (monthly distributor fees + advertising) model vs. broadcast's ad-only approach (which is further motivating broadcasters to seek retransmission consent payments). Last summer I wrote that the improving quality of cable's programming is becoming more obvious, as cable garnered 272 of the 487 Emmy nominations. This is a trend I expect will continue.
Distinctive cable programming - that isn't available for free online - is the major firewall against cord-cutting (see above for more on that this week). More than that, maintaining a valuable subscription offering, whether through cable, satellite or telco providers, is essential so that the downstream creative and production workforces that support on-camera talent like Conan can continue to thrive. Cord-cutting may seem enticing to many, but the reality is that if it becomes a groundswell, you can likely say goodbye to seeing top-tier talent on TV at all.
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