CW Online Push Causes Ratings, Cord Cutting Concerns (Report)
The CW, co-owned by Time Warner and CBS Corp., has been more aggressive than its TV network peers about catering to its younger target audience by making content available online, including on its own Web site and via deals with Netflix and Hulu. The network has shifted its focus on purpose to reach its target audience and push advertisers to buy ads online and on TV in package deals.
But the Wall Street Journal reported that the CW has to walk a fine line to avoid hurting its traditional core business as upfront advertising season approaches.
Nearly a fifth of the audience of the CW is now watching its shows online, twice the percentage that did so a year ago, the Journal reported, citing network data. But its average regular TV primetime audience has fallen 14 percent to 1.8 million, it said, citing Nielsen data.
These audience trends are a case of good news-bad news as some TV stations have expressed ratings concerns, and the online availability is seen as possibly encouraging pay TV cord cutting, according to the report.
The CW recently started putting shows online the day after a new episode airs instead of waiting three days as it had previously done. While some TV station affiliates supported the change, others have expressed concern.
"This should raise the hair on the back of all affiliates," Doug Gealy, CEO of Acme Communications, which used to on several CW stations, but is now down to one, told the Journal. "The bottom line is that they have to have television stations to reach enough viewers to make their business viable."
Meanwhile, Brie Bagwell, a fan of The Vampire Diaries, which launched on the CW nearly three years ago, is an example of a young cord cutter. She used to watch the series on TV, but has ended her cable subscription and now views for free on the CW Web site, the Journal said. "It's more convenient," the 31-year-old told the paper. "I can just load it up whenever I want to."
Concerns about the fallout from the more aggressive online strategy led to some debate at the CW and its owners, especially at TW where CEO Jeff Bewkes was cautious at first, the Journal said. But a big check from Netflix and the opportunity to test new models won them over.
The "business model was challenged," said Bruce Rosenblum, a CW board member and president of TW’s Warner Bros. Television Group. "Maybe this is now beginning to evolve into a different kind of network - a multi-platform, multi-screen network."
"The bigger danger is not allowing the consumer to watch video where they want to," said Rick Haskins, head of marketing and digital programs at the CW. "There's no point in putting your head in the sand and saying we shouldn't be encouraging the Internet use. That's already happening."