TV Broadcasting

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 850 television broadcasters in the US operate studios and facilities for the programming and transmission of TV programs to the public. Firms may also produce or transmit programming to affiliated television stations, which broadcast programs to the public. They generate revenue primarily through advertising sales, which include on-air and digital media.

Cyclical and Seasonal Sales

Advertising sales, which are the main source of revenue for television broadcasters, are seasonal and cyclical and driven by political campaigns and major events, such as the Super Bowl.

Competition from Alternative Media

Television broadcasters compete for advertising revenue with a variety of alternative media, including newspapers, magazines, outdoor ads, direct mail, multichannel video programming distributors (MVPD), over-the-top video distributors (OTTD), and online media (Google, Facebook).

Industry size & Structure

The average television broadcaster employs about 147 workers and generates about $74 million annually.

    • The television broadcasting industry consists of about 850 firms that employ about 126,200 workers and generate $63 billion annually.
    • The industry is highly concentrated; the top 20 companies account for about 86% of industry revenue.
    • Large firms include Sinclair Broadcast Group and Nexstar (Tribune Media Group). The major television broadcast networks (ABC, NBC, CBS, Fox, CW) also own and operate local television stations, primarily in major media markets. Major media companies, such as Gannett and Hearst, also own stations that operate as network affiliates.
    • About 1,760 television broadcast stations exist in the US, including almost 400 educational stations, according to the FCC.
                                Industry Forecast
                                TV Broadcasting Industry Growth
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Mar 6, 2023 - Viewership Decreases
                                • Broadcast TV usage decreased 6% year over year in January 2023, according to Nielsen’s The Gauge report. Sports and drama viewing accounted for 25.3% and 23.4% of broadcast content consumption, respectively. The Gauge noted that broadcast sports viewing jumped 55% in January, with the NFL playoffs making up the top 10 telecasts for the sports category.
                                • The corporate parents of broadcast TV networks are increasingly focused on cutting costs, restructurings, and streaming heading into the 2023-24 season, according to The Hollywood Reporter. Three of the five networks have made leadership changes in the past year. The biggest change comes at The CW, which is now majority controlled by Nexstar, with Brad Schwartz now tasked with making the younger-skewing network profitable for the first time following the unexpected departure of TV’s longest-tenured president, Mark Pedowitz. CBS has reduced management costs by replacing Kelly Kahl and his top lieutenant Thom Sherman with Amy Reisenbach. Fox has seen Charlie Collier — who led the network following the sale of its studio counterpart — depart for Roku, with the broadcaster tapping unscripted chief Rob Wade for the entertainment job.
                                • Media buying company Magna Global is predicting a 22.9% decrease in local TV advertising in 2023 while national TV networks will see a 6.3% decrease. The local TV declines come after a year when political advertising hit record levels in 2022. Television advertising “will suffer from continued erosion in linear viewing” but that the declines will be “mitigated by resilient pricing,” a report from the company said.
                                • TV networks, news organizations, movie and television studios, and entertainment giants have laid off hundreds of workers due to an advertising slowdown, economic worries, and strains of the shift to streaming, according to The Wall Street Journal. Traditional broadcast and cable television continue to face viewer and subscriber erosion, and entertainment companies that spent the past few years spending heavily on streaming services that are now seeing the return on them decrease. NBCUniversal is expected to make job reductions as part of cost-cutting across the unit. The company recently completed a voluntary retirement program that offered buyouts to people age 57 or older. Paramount Global’s CBS unit recently restructured its entertainment operations as part of a cost-cutting effort, leading to the departures of two senior executives. There have also been cuts at Paramount’s ad sales units and production units at both CBS and Paramount.
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