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CBS is to Yahoo as FOX is to Google?

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February 22nd, 2008

CBS   equals.jpg  Yahoo!  quest.jpg

I've taken some heat, mostly via e-mail for being more than a bit cantankerous lately in terms of how the EYE network is handling parts of its lineup.  Particularly, I've railed on CBS about placing shows like Big Brother and Jericho in timeslots where reruns of its crime dramas or Two and a Half Men would not only fare better, but vastly better.

My analysis has nothing to do with the shows, or the content.  I'm not a Big Brother fan, but I'm not an American Idol fan either.  But American Idol prints cash for FOX in spades.  Printing as much cash as you can is what the game is all about, so the fact that I don't personally like American Idol doesn't matter - I like what FOX is doing.

But I don't like what CBS is doing.  FOX seems to be going for optimization.  I like optimization.  It's why I think of Google as such a great company.  Google optimizes to make as much cash as it possibly can.  While it's true Google is dominant when it comes to search, there are cases to be made that more people spend more time (more "engagement" if, you prefer such terms) with AOL and Yahoo sites than they do on Google.

Yahoo can put out whatever press releases it wants to in terms of engagement, but the market tells the story.  While Google has had a bad run of things (the stock is under $500 as I write this), the market cap of Google at this time is $156 billion versus $38 billionish for Yahoo.    FOUR TIMES the valuation.  Engagement doesn't mean anything if you can't actually monetize it.

In complete fairness, it should be noted that CBS, Yahoo, and probably your mom's blog do a better job of monetizing than TVbytheNumbers, but that's completely beside the point.  The point is making as much cash as you possibly can.  When I look at FOX and what it does as a television network, and when I look at CBS and what it does - for me, it's definitely trending that FOX is to GOOG as CBS is to YHOO.  If I was a shareholder of CBS, I wouldn't like the trend, which seems to match the last five month trend of the CBS stock price.  Of course, CBS has a market cap of less than half of YHOO as I write this ($17 billion-ish), so it's still better to be Yahoo than CBS.

Because FOX is wrapped up in the News Corp empire, it's hard to make relative comparisons (News Corp has a market cap of ~$59 billion as of this writing), and its stock has fared similarly to CBS over the last five months (down), but when I look at FOX vs. CBS, CBS seems negligent in its performance.  My old pal  Kara Swisher from the Wall Street Journal has harassed Yahoo about such negligence for eons, and though I think she has sometimes been too hard on Yahoo, the one thing she hasn't been is wrong.

Am I a little too hard on CBS?  Probably.  The question is: am I wrong?  Time will tell. 

 
  • SG

    Well, the strike has really hindered CBS' chances of performing well, as only Survivor has brought in powerhouse ratings. Once the CSIs and other dramas get back to work in April, everything will be back to normal and CBS will retain its crown as “America's Most Watched Network”.

    The thing is that FOX has dug itself a hole on nights like Mondays, Thursdays, and Fridays when CBS is most competitive. Their shows are frequently outpaced after season premieres by the rest of the pack. The 18-49 demo might attract advertisers, but it doesn't attract viewers. CSI consistently beats Grey's because of that.

    I do think, though, that CBS will end up realizing what works for them and what doesn't. Over the past few upfronts, they've taken riskier moves, especially with “Viva Laughlin” and “Cane” this season. I think that next season, they'll make enough shifts to help them out.

    “Criminal Minds” and “CSI:NY” are just one batch of shows that are doing excellent and I think moving them around could be a risky but profitable move.

  • SG

    Well, the strike has really hindered CBS’ chances of performing well, as only Survivor has brought in powerhouse ratings. Once the CSIs and other dramas get back to work in April, everything will be back to normal and CBS will retain its crown as “America’s Most Watched Network”.

    The thing is that FOX has dug itself a hole on nights like Mondays, Thursdays, and Fridays when CBS is most competitive. Their shows are frequently outpaced after season premieres by the rest of the pack. The 18-49 demo might attract advertisers, but it doesn’t attract viewers. CSI consistently beats Grey’s because of that.

    I do think, though, that CBS will end up realizing what works for them and what doesn’t. Over the past few upfronts, they’ve taken riskier moves, especially with “Viva Laughlin” and “Cane” this season. I think that next season, they’ll make enough shifts to help them out.

    “Criminal Minds” and “CSI:NY” are just one batch of shows that are doing excellent and I think moving them around could be a risky but profitable move.

  • Rob

    It may be that CBS does not have unlimited rerun rights. The previous seasons of Two and a Half Men are syndicated to local stations, right and off limits to CBS? Doesn't that mean CBS has only 10 or 11 2007 episodes to work with? How many times are they legally allowed to rerun them? Twice perhaps? There are diminishing returns at work here……….they may have no choice but to air something like Big Brother until the strike effect is over.

  • http://tvbythenumbers.com Robert Seidman

    Rob, I checked around on that a little bit, and in fairness I am not sure how the rights work when it comes to previous years, but they seem to have unlimited rights with the current. They have so many shows (all the CSIs, Criminal Minds, Without a Trace, etc) to work with, and they really only seem to be saying “screw it” in a few timeslots. But I don't think “screw it” is a good attitude for them to have with any time period.

    Consider that during the 10p-11p hour last SATURDAY — a night where not many are watching broadcast TV, 48 Hours Mystery had more viewers at 10pm on a Saturday than Jericho or Big Brother had on a Tuesday night when many, many more are watching broadcast.

    I'd at least be experimenting with “Hmmmm what works better, Big Brother or rerunning 60 Minutes?” They have so many options, that I'm steadfast (rightly or wrongly) in my opinion that optimizing for making the most cash is not a priority at CBS.

  • Rob

    It may be that CBS does not have unlimited rerun rights. The previous seasons of Two and a Half Men are syndicated to local stations, right and off limits to CBS? Doesn’t that mean CBS has only 10 or 11 2007 episodes to work with? How many times are they legally allowed to rerun them? Twice perhaps? There are diminishing returns at work here……….they may have no choice but to air something like Big Brother until the strike effect is over.

  • http://tvbythenumbers.com Robert Seidman

    Rob, I checked around on that a little bit, and in fairness I am not sure how the rights work when it comes to previous years, but they seem to have unlimited rights with the current. They have so many shows (all the CSIs, Criminal Minds, Without a Trace, etc) to work with, and they really only seem to be saying “screw it” in a few timeslots. But I don’t think “screw it” is a good attitude for them to have with any time period.

    Consider that during the 10p-11p hour last SATURDAY — a night where not many are watching broadcast TV, 48 Hours Mystery had more viewers at 10pm on a Saturday than Jericho or Big Brother had on a Tuesday night when many, many more are watching broadcast.

    I’d at least be experimenting with “Hmmmm what works better, Big Brother or rerunning 60 Minutes?” They have so many options, that I’m steadfast (rightly or wrongly) in my opinion that optimizing for making the most cash is not a priority at CBS.

  • Marc Meisels

    “The UNIT” is a great match to NCIS I hope they make the right choice and bring it back next fall
    with it's 11 million + viewers

    good luck

  • Marc Meisels

    “The UNIT” is a great match to NCIS I hope they make the right choice and bring it back next fall
    with it’s 11 million + viewers

    good luck

  • Vicki

    I think Friday nights for CBS should belong to game shows with the example of over 9 million viewers tuning in to see the Price Is Right and they should move Moonlight over to another night where there are more of the coveted 18-49 audiences home watching television. Moonlight is a potential hit, but CBS has to promote it more aggressively and move it to a more lucrative night. It would be a shame to order 4 new episodes for April broadcast, then cancel it. They have the sets, the actors, etc; they should officially announce its renewal for the Fall season and move on.

  • Addy

    I love Cane and I think CBS does things all wronge Cane isn't the only show in jepordy at CBS to be Cancelled does that tell you something they don't know how to line up shows and put them in the right time slot and day.Do they know how to promote shows on CBS, honestly I never clicked to CBS until I heard from mouth about a great show that was airing with some latino actors, so I clicked over.Their are not to many Latino shows they cancelled George Lopez that is a funny show the only show that seems to be on regular networks based on a latino family is Ugly Betty.I think CBS should leave Cane on for another season ans see how they will do and they need to be more appealing as yahoo needs to do the same.It is true I can google about anything than Yahoo.

  • Vicki

    I think Friday nights for CBS should belong to game shows with the example of over 9 million viewers tuning in to see the Price Is Right and they should move Moonlight over to another night where there are more of the coveted 18-49 audiences home watching television. Moonlight is a potential hit, but CBS has to promote it more aggressively and move it to a more lucrative night. It would be a shame to order 4 new episodes for April broadcast, then cancel it. They have the sets, the actors, etc; they should officially announce its renewal for the Fall season and move on.

  • Addy

    I love Cane and I think CBS does things all wronge Cane isn’t the only show in jepordy at CBS to be Cancelled does that tell you something they don’t know how to line up shows and put them in the right time slot and day.Do they know how to promote shows on CBS, honestly I never clicked to CBS until I heard from mouth about a great show that was airing with some latino actors, so I clicked over.Their are not to many Latino shows they cancelled George Lopez that is a funny show the only show that seems to be on regular networks based on a latino family is Ugly Betty.I think CBS should leave Cane on for another season ans see how they will do and they need to be more appealing as yahoo needs to do the same.It is true I can google about anything than Yahoo.

  • YM

    I agree with SG (or is it GS) that CBS will settle on the right mix. The fact of the matter is that CBS is investing in both content and New Media (e.g. Outernet), and in short time they will own a powerful marketing tool to continue driving people to their network. Don't underestimate CBS. They're forward thinking.

  • YM

    I agree with SG (or is it GS) that CBS will settle on the right mix. The fact of the matter is that CBS is investing in both content and New Media (e.g. Outernet), and in short time they will own a powerful marketing tool to continue driving people to their network. Don’t underestimate CBS. They’re forward thinking.

  • KV

    With all the ambiguity about the future of Cane, CBS runs the risk of losing a large loyal market for their advertisers if they cancel this Latino show. While the show may not return the highest ratings in the 18-49 market, it has maintained a respectable number of viewers in the ever dwindling network audience; lets remember that network viewership is trending even further down from its current low 40-45% of the audience, with the vast majority of the audience moving to cable and other media. Cane has consistently maintained respectable numbers in a slot CBS has not been able to “win” in years, and more importantly it is returning large enough numbers in the Hispanic Market. It would be a shame to see CBS be that short sighted and dismiss this fastest growing market or worse learn that they simply played this community by green lighting the show in the first place and filling it with some of the most treasured Latino actors, like Jimmy Smits, Rita Moreno and Hector Elizando, in an attempt to gain these valuable Hispanic market viewers to exploit its buying power.

  • KV

    With all the ambiguity about the future of Cane, CBS runs the risk of losing a large loyal market for their advertisers if they cancel this Latino show. While the show may not return the highest ratings in the 18-49 market, it has maintained a respectable number of viewers in the ever dwindling network audience; lets remember that network viewership is trending even further down from its current low 40-45% of the audience, with the vast majority of the audience moving to cable and other media. Cane has consistently maintained respectable numbers in a slot CBS has not been able to “win” in years, and more importantly it is returning large enough numbers in the Hispanic Market. It would be a shame to see CBS be that short sighted and dismiss this fastest growing market or worse learn that they simply played this community by green lighting the show in the first place and filling it with some of the most treasured Latino actors, like Jimmy Smits, Rita Moreno and Hector Elizando, in an attempt to gain these valuable Hispanic market viewers to exploit its buying power.

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