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Winning, and losing too

Due mainly to big Nielsen-ratings declines at ABC, the four-network household share of prime time audience has falled to an historic low this season—47%. Not only is it a record low, it's also the first time the four-network share has dropped below 50%, a sort of unspoken benchmark broadcasters dread to fall beneath.

The season that ended with the May sweeps last week is also the first time that basic cable's share of audience surpassed the big four's—collectively, basic cable garnered a record 49 share in prime time, up 8%.

As expected, NBC won both the season and the May sweeps by solid margins and was the only major network to show growth across households, total viewers and the key demographics for the season, although UPN was up as well.

CBS is quick to point out that NBC was helped by the Olympics and that among regularly scheduled programs, CBS was up 5% among adults 18-49 for the season and in second place behind NBC.

Counting all programs (including the World Series, Super Bowl), however, Fox was second among adults 18 to 49, just ahead of CBS.

For the May sweeps, NBC had the best growth story but not the only one. CBS was up slightly among adults 25-54 and held its ground with adults 18-49. Both UPN and The WB grew at least one-tenth of a rating point in adults 18-34 and 18-49.

It's not news that ABC and Fox both struggled this year—ABC more so—declining by record levels in households and adults 18-49.

In a teleconference with reporters last week, ABC Entertainment President Susan Lyne put it plainly and to the point. "We did not perform well this year," she said. (Lyne can't get much blame. She got her job replacing Stu Bloomberg in January when ABC was already in full-disaster mode.)

Lyne last week focused on what ABC can do to stem the slide and maybe even show a little growth next year.

There are a few bright spots: Alias, for one, succeeded as a new drama, and According to Jim
survived in the sitcom genre. Midseason comedies, My Wife & Kids
and George Lopez,
show life.
And the reality hit, The Bachelor, proved to be a "weapon" that should help next season.

It was also crying time at Fox: "It was an unusual and challenging season for Fox," said Sandy Grushow, chairman of the Fox Television Entertainment Group.

Grushow and Fox President Gail Berman also tried to accentuate the positive, noting Fox's second-place finish among adults 18-34 and first-place finish with teens and men 18-34.

Despite this year's setbacks, Berman noted that three new promising series emerged from Fox's schedule this year: Bernie Mac; 24;
and Andy Richter Controls the Universe.
As for The WB, it was a flat year, but the network touted the fact that it planted some solid new shows this season with Reba, Smallville
and Jamie Kennedy.

It's also got a lock on marketers who target really
young women. And it broadened a bit this year, beating ABC among adults 18 to 24.

For UPN, it was an up year and an up May—in fact the best May the network has had in five years. UPN is poised to show strong price increases next year—if only because it's being packaged with co-owned CBS, the don't-take-no-for-an-answer network when it comes to rate hikes.

(But competitors suggest CBS may be willing to shave a bit off its own pricing to goose UPN's up.)

This season's audience-share decline for the four major networks was about 7% against the 51 share they retained last season.

The audience apparently migrated to cable because UPN and The WB each ended the season an average 4 share this season, flat from a year ago.

The six-network share drops four points (7%) to a 55.

ABC alone dropped four household-share points this season, and a record 25% in household rating.

Fox and CBS each declined a share point, while NBC was up two share points.

David Poltrack, executive vice president, research and planning, said the four-network decline itself probably doesn't mean much in terms of ad sales.

"It's the individual network performance that matters," he said. "This season you had the broadcast networks moving in dramatically different directions" in the ratings, he said, a reference to sharp declines at ABC and Fox.

But Jack Wakshlag, chief research officer for Turner Broadcasting System, took issue with Poltrack's position.

True, individual performance does count, and it counts a lot, he acknowledged.

"But every year there's some broadcast network that loses ground that the rest of them don't make up for, so broadcast is losing 4% to 5% of its audience every year to cable."

Still, cable's gains were as uneven as broadcasting's declines, Poltrack argued back.

Of the top-20 cable prime time networks, just over half of them (11) were flat or down for the season.

And, just to provide a sense of how fragmented the TV landscape is, only seven of those top-20 cable networks cracked a 1 rating in prime time for the season. None of them reached a 2.

Still Wakshlag argues that in a perfectly equitable world, the Big Four broadcast networks would get 47% of the national TV ad-sales pie next year and cable would get 49%.

That's not going to happen, of course, although Wakshlag firmly believes that cable may be poised to take in a greater share of ad dollars this year if the networks try to raise their rates beyond a certain level.

"A lot of it depends on how aggressive broadcasters are in holding to their price," he says. "If they want raise rates 8%, then maybe agencies can go to cable" to meet the cost-increase parameters set by their clients. On a cost-per-thousand basis, he says, "cable is so much cheaper now. But viewers to cable have two eyeballs just like the viewers to broadcast. There's no difference."