Earlier this decade, several cable networks determined that the key to their future was to follow the lead of AMC and FX: reinvent themselves as a home for premium scripted series, and ride the wave of increased buzz and ad revenue that would likely follow. That led more than a dozen networks—including A&E, Bravo, CMT, Discovery, E!, ID, MTV, TV Land, VH1 and WGN America—to try their own luck in the space by creating their own scripted shows.
But now, given the seismic changes in the industry during the past few years, all of those networks have changed course within the past year, and have either pulled out of scripted entirely, or significantly curtailed their efforts there. Even if a network’s early scripted series like Mad Men didn’t initially make money on their own, “they were more than worth it because they raised the profile of a network, raised ratings across the network and drove ad dollars to those networks,” said David Campanelli, co-chief investment officer, Horizon Media. “Because if I want to get a Mad Men spot, I’ve got to spend a million dollars [advertising] in movies on AMC.”
However, as other cable competitors tried to follow suit, they were stymied by new competition from streaming services like Amazon, Netflix and Hulu, whose prolific output is most responsible for the doubling of TV scripted shows that aired in 2009 (211) versus 2017 (487). “Too many people got into the space, and it got too hard to create a hit,” said Peter Olsen, evp of ad sales, A+E Networks, where A&E was one of the first to throw in the towel on scripted, in April 2017. “It’s very hard to play in that space part time. The economics are difficult.”
In addition to a hefty budget for a scripted show—scripted hours can range from $3 million to $6 million, or roughly 10 times the budget of a typical unscripted hour—the networks have to spend heavily on marketing to alert viewers of their new efforts in the space. Meanwhile, Netflix is spending $2 billion on marketing this year, more than the annual programming budget of several cable competitors. “If it’s hard to break through, then it’s hard for you to make those shows drive network revenue, versus just show revenue,” said Campanelli. “The model doesn’t work the way it did five or six years ago.”
That new reality has prompted several networks to end their scripted dalliances. Now that “the majority of media players are playing in scripted series and scripted movies,” said Discovery Inc. president and CEO David Zaslav, he decided that his company—where Discovery, ID and TLC had also tried scripted programming—would focus on “everything else,” an area he predicted will “continue to grow” as the industry evolves. (Only OWN, which continues to have success in the space, will continue to make scripted shows.) Of the ad-supported cable networks that recently began dabbling in scripted, only History, National Geographic and OWN remain consistent players.
With scripted dramas more likely to be time-shifted, Bravo made a “strategic decision” to move away from serialized scripted shows to event series that could drive more urgent viewing like the upcoming Dirty John, which debuts Nov. 25 and is based on the Los Angeles Times true crime podcast, said Frances Berwick, president, lifestyle networks, NBCUniversal Cable Entertainment. “We wanted to do shows where we could really create a moment.” E!, which Berwick also oversees, canceled its two scripted shows, but is still developing new ones, including a series about the creators of the Juicy Couture fashion label.
The first networks to exit scripted and refocus on their unscripted roots have been rewarded for their efforts: MTV now has five consecutive quarters of year-over-year ratings growth; A&E’s streak is now at six quarters, and the network has also seen ad revenue gains, even without the higher CPMs that scripted series would yield.
Marketers, in turn, have shifted their perspective on unscripted fare, in part because innovations like audience targeting have shown that the consumers they are seeking can be found in those shows as well, and aren’t just watching scripted content. “It’s about the quality of the production, the quality of the storytelling, and it’s also who’s watching and the environment that some of these brands want to be in,” said Berwick. “The days of associating unscripted with something less desirable are over.”