Dick Wolf's Views on The Evolution of Television Programming

Wednesday's Wall Street Journal's Marketplace section featured an interesting interview with Dick Wolfe, the creator of the long (17 years) running TV series, Law and Order.

As a creator of video content for nearly two decades, it is instructive to read his thoughts on the imminent evolution of the medium. To that end, his first quote, regarding the future of network television, is,

"....Please, you think ringtones are going to be a major revenue stream for studios or networks?....Unfortunately, the business model is irreparably broken, and people are going to have to figure out something new...I'm 59 years old. I don't think the world is going to come crashing down in five to six years, but I guarantee you, if anyone tells you what the television business is going to look like a decade out, they are on drugs."

Well put. He further believes that the trend toward a single sponsor taking an entire show, and doing product placements as well, has limits. As well as marks a return to the original business model in place at the dawn of TV.

Perhaps the most interesting business comments he makes is regarding the value in syndication of current and future television content. Wolfe questions how valuable such video content will be anymore to networks such as USA or TNT, if the episodes have already been available on Netflix, DVDs, etc.

When asked how different TV series creation is now, from 17 years ago, Wolfe responded,

"The business has changed massively.....You will never have the market forces again that, how do I put this, that allow people to get rich....The reality is you will never have the licensing fees negotiated again that resulted in 'ER' getting [millions of dollars] an episode, and that's where a lot of people made what many would probably insist is an unconscionable amount of money...The upside home runs for shows have been sort of flattened out by the new economic models of how shows are produced."

While I understand and agree with Wolfe's remarks concerning predicting how the network television world will look in a decade, I was struck by his comments, and included them liberally in this post, because they seem to have a bearing on that future.

To wit, I think the same economic forces which are now limiting the profitability of series producers on network television, are driving those same people to online digital distribution. And, probably making the club far, far less exclusive.

Translation- don't try to own network distribution assets, which are, comparatively, narrow and lacking in bandwidth. Instead....own a well-regarded, popular piece of online real estate.

Would that, perhaps, be YouTube at present? Yes, I think it would. Maybe not in another 2, or 5 years. But for now, sites like YouTube seem to be creating value simply by being there, first.

Perhaps in years to come, networks will create their own stable of production talent, in order to own their video content, and regain control of the distribution of it. Maybe they'll join the growing ranks of online video sites, and, in the end, simply leave network TV to be something simple and barebones, with the real revenues coming from online distribution.

If that happens, then I guess you'll have the networks bidding against Google, cable companies, and perhaps private equity lenders and banks, to fund promising content producers.

Wolfe's right- it's impossible to forecast what that future will look like. Except that it won't look remotely like what it is now.