Network Sweeps: Caveat Emptor

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Although we seem to have barely ended a television season, a new one debuts in a few months. That means the broadcast networks are already stacking their fall lineups for November sweeps, just as they do every year.

The sweeps process is intended to accurately measure program viewership, or so the networks say. For a long time, though, the networks have manipulated their schedules in pursuit of short-term results.

This behavior is not unlike the way companies attempt to manipulate earnings in the financial markets. Investors expect management to build real long-term value, but powerful incentives exist to "play the market" for short-term results. Just as companies manipulate earnings to improve short-term share prices, the networks manipulate their programming to increase quarterly ratings.

This is not surprising. Like public companies under pressure from shareholders to increase market value, the networks are under pressure to improve ratings. They want the largest share of the viewing audience so advertisers will pay top dollar.

News throughout the past few years has been filled with stories about companies inflating their earnings to demonstrate short-term performance. Similarly, the networks' behavior demonstrates that they are concerned often less about long-term health than about short-term numbers.

For example, during the May sweeps, Fox recruited Whitney Houston to make a special guest appearance on Boston Public
and brought Monica Lewinsky back to the nation's consciousness via Mr. Personality.
ABC trumpeted its 50th Anniversary Celebration, featuring cast reunions from the likes of Happy Days
and The Love Boat. NBC "super-sized" two of its top programs, Friends
and Will & Grace. By lengthening each to 40 minutes, the network dissuaded viewers from tuning in to the middle of a competitor's program.

These tactics distort the true measure of the networks' audiences and can suggest increases in viewership that are not likely to hold up throughout the year. This ultimately leads local and regional advertisers to pay a premium. Without an understanding of the ramifications of the networks' behavior, unsophisticated media buyers all too often overvalue the size of the audience.

Others are not fooled by the "stunting" in programming. Like wise stockbrokers, wise media brokers look at more than the quarterly results before making the buy. They evaluate historical trends, compare competitive programming and analyze qualitative audience composition.

They also look to new technologies. Advanced consumer electronics now have the ability to track viewership 365 days a year. Digital systems like TiVo and iTV can determine what advertisement is being watched, by whom and for what amount of time.

As products like these increasingly make their way into American homes, sweeps may become obsolete. It's about time. The networks will be challenged to put their best programming forward throughout the year, and they'll have a much more difficult time inflating their ratings. In the meantime, however, the old saying still applies: Caveat emptor—let the buyer beware.

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