There was nothing surprising when I read last week’s coverage of FX CEO John Landgraf’s tally of original productions in 2019. According to Landgraf, the number of original dramas, comedies and limited series across all SVOD and TV networks in the U.S. reached a new high of 532 (approximately what he previously predicted). That was up from 495 in 2018, 487 in 2017 and just 182 in the pre-SVOD days of 2002.

This dynamic, which Landgraf has dubbed “Peak TV,” is leading many, if not most, ad-supported entertainment-oriented cable TV networks onto a road to nowhere if their goal is to remain ad-supported entertainment-oriented cable TV networks in the long-term. What is far more likely is that being this type of network will become unviable and so they’ll morph into studios that provide premium original and library content, mostly for bigger platforms (e.g. Amazon, Netflix, Apple, Hulu, etc.) and sometimes for their parent companies’ direct-to-consumer OTT services.

Indeed, there is ample evidence of this happening already: a bunch of ad-supported entertainment-oriented cable TV networks (e.g. Bravo, CMT, E!) are reducing their originals’ budgets or redirecting content to be carried on DTC services vs. linear networks; FX transitioning its library to Hulu and planning to debut several high-profile shows on Hulu; National Geographic programming being included in Disney+.

At a conference I attended in December, an SVP of Distribution for a cluster of top ad-supported entertainment-oriented cable TV networks said on stage he fully recognized the risk of distributing their content on Amazon - that the e-commerce behemoth could simply analyze viewership data, which would inform what to procure directly from production partners (i.e. without the network acting as a middleman), or use its asymmetric insights to reduce what it’s willing to pay the TV network (a strategy Netflix has used brilliantly as it allocated more budget to its own originals). When I told him that in either case the long-term result is his networks will morph into a studio, supplying content to Amazon and others, he nodded.

Peak TV has spoiled all of us as viewers; there are more high-quality originals than any one of us could ever watch. The tech platforms are pursuing the Peak TV arms race for their own reasons (Amazon because driving Prime/e-commerce is a pillar of its business model, Apple because defending iPhones is essential to its profitability, Netflix because Wall Street has given it a permanent pass to try dominating global SVOD regardless of its losses, so why not keep trying?, Hulu because Disney understands better than anyone where the world is heading, etc.)

So the brutal reality for many ad-supported entertainment-oriented cable TV networks is that the game has changed permanently - the big tech companies are using their unlimited funds to drive “Peak TV” and the cost of premium programming, even as cord-cutting is picking up steam and big operators like Comcast - and even it seems AT&T - are essentially walking away from low-paying, high-churn video subscribers. In short, many networks are boxed in from all sides.

News that Amazon is pitching networks on selling their ad inventory on NON-Fire TV devices was another twist of the knife. When a distributor like Amazon can suggest IT can get better unit monetization (i.e. CPMs) than a network can for its programming, the end of many networks’ legacy business model is nigh.

Only the timing of this ultimate recognition remains to be seen.