Blog Post

Fitch: Expect NBC Or ABC To Become A Cable Network By 2011

The worst of the past year’s advertising downturn appears to be over, but the damage will reshape the competitive landscape dramatically over the next two years, according to a forecast (sub. req.) from the credit ratings agency Fitch. The changes will proceed slowly over 2010, mainly in the network and cable TV businesses, and will pick up steam in 2011, when at least one of the four major TV broadcasters could begin the process of becoming a cable network. The most likely candidates are NBC and ABC, Fitch says. With the official word that Comcast (NSDQ: CMCSA) will acquire a majority stake in NBC today, the odds of that happening just increased significantly.

It’s clear that if NBC or ABC decided to change its stripes from broadcast to cable, the respective company’s group of local affiliate stations would be negatively affected. The remaining broadcasters and their affiliates would naturally benefit, at least in the short term. Considering the havoc some affiliates say NBC has created by replacing its 10 PM dramas with Jay Leno’s new show, some local stations might not be too sorry to see NBC go, if things come to that point.

If Leno’s ratings show improvement, and if the ad rebound is stronger than expected, talk of one of the networks abandoning the broadcast model would probably fade. But the lines between cable and broadcast are sure to converge at some point, given the former’s continued audience and advertising growth and the attendant declines of the latter. In the meantime, Fitch says both will benefit from a “modest recovery” in ad spending next year.

2 Responses to “Fitch: Expect NBC Or ABC To Become A Cable Network By 2011”

  1. N. Herbig

    I certainly hope there is no network change from broadcast to cable television as have lost all major television programming except ABC and PBS. We lost NBC, CBS, FOX, ION, and MYTV signals due to the DTV fiasco.
    There is no cable programming in our area, and we cannot afford pay television due to the poor economy. This family is far from the only television viewer in this situation.