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TV Networks Face Falling Ratings and New Rivals

Prime-time ratings for the Big Four broadcasters — ABC, CBS, NBC and Fox — together are dropping more precipitously than ever. Even their biggest hits, like “American Idol” and “Dancing With the Stars,” are fading fast. Advertisers are moving more cash to cable, cutting into the networks’ quarterly profits. New technologies are making it easier to skip those ads, anyway.

That’s not all: there are more outlets for programming than ever, with Netflix and Amazon and dozens of cable channels competing for actors, producers and, most important, viewers. Government regulators want to take back some of the spectrum allotted to local television stations. And start-ups like Aereo are threatening to deprive the stations of subscription revenue, causing some broadcasters to talk of options that were unthinkable a few short years ago. Some have warned they might go off the air entirely.

The many pressures bearing down on the industry are casting a shadow over this week’s upfronts, an annual tradition in New York in which the new sitcoms, dramas and reality shows are previewed at splashy, open-bar events and the networks try to capture their portion of an estimated $9 billion in advertising commitments.

“The networks are getting picked at from every direction,” said Jessica Reif Cohen, the senior media analyst at Bank of America Merrill Lynch. “This year was the tipping point,” she said, “when the television ratings really fell apart.”

The broadcast networks have managed declining viewership for years, but executives by and large said they believed that they had escaped the punishing losses that digital media exacted on the music industry and newspapers.

Now, though, they say they are not sure; even the industry’s biggest boosters concede that the business is under assault, though many express confidence that the networks will adapt. While the challenges before them are numerous, said Gary Carr, who oversees ad-buying at TargetCast, “the networks are far from dead.”

They are certainly smaller. Historically the broadcasters have had outsize cultural and civic importance in the country; their owners pledged long ago to uphold the public interest and provide news programming in exchange for valuable access to the airwaves.

These days the public has mostly forgotten about those commitments. The major network news divisions as a group have suffered hundreds of layoffs in recent years, though they have added staff members to supply news for their Web sites.

No matter how confident the Big Four networks may feel about their new seasons — TV executives are masters at forgetting last year’s failures and staying on message about the future — the stress factors are enough to make them long for the days of “I Love Lucy,” when 50 million Americans would watch the same show at the same time.

Now NBC and ABC are lucky to get five million to tune in. Goldman Sachs found last month that broadcast ratings in the 18-to-49-year-old demographic, the one most coveted by advertisers, fell by 17 percent in the winter months compared with last winter. Goldman Sachs called it “the sharpest pace on record.”

While broadcast networks were setting record lows, cable channels were setting record highs; AMC’s “The Walking Dead” and the History mini-series “The Bible” regularly beat almost all the shows on network television while they were on.

At ABC, the lowest-rated of the four broadcasters, first-quarter profit fell 40 percent compared with the same quarter last year, but the network still made $138 million. NBC, on the other hand, lost $35 million in the quarter, because of lower advertising revenues. NBC’s parent, Comcast, said the network would have fared better if its biggest hit, “The Voice,” had been on in the quarter.

Ad revenue slipped at Fox too, partly because “Idol” has lost nearly a quarter of its viewers this season, on top of a 50 percent decline over the previous five years.

CNN Gets a Ratings Boost From Boston

Breaking news is always good news for CNN, and April’s ratings are the latest example.

Total viewership was up nearly 80 percent compared with the same month a year ago; among the viewers news advertisers pay to reach, the increase was more than 100 percent.

By comparison, MSNBC was actually down in viewers from the same month a year ago — despite the enormous interest in the Boston bombings — which may say something about how viewers see one of CNN’s news channel competitors.

Meanwhile, Fox News, which did not grow nearly as much as CNN, still had plenty of regular viewers to win in all categories.

In total day ratings for April, CNN jumped to an average 638,000 viewers from 356,000 viewers last year. Among viewers 25 to 54, the age group that news advertisers buy, the increase was bigger, to 228,000 from 109,000.

Fox News’s overall numbers were much bigger, with a total average audience for the month of 1.2 million, up from 1.08 million a year ago, a 14 percent increase. In the 25-to-54 group, Fox was up 2 percent, to 278,000 from 273,000.

MSNBC somehow lost viewers, dropping to 407,000 total viewers from 426,000 a year ago. It had no increase in the 25-to-54 group, staying at 139,000.

One reason may have been that MSNBC viewers turn to NBC network coverage when breaking news is on, and the broadcast network did have the most-watched coverage — and among the most critically praised — for two nights of the breaking Boston story.

But not getting any kind of ratings bump at a time of such intense news interest may also be an indication that MSNBC’s viewers look to that channel for opinion-based reporting instead of straight news reporting.

For example, the network’s flagship morning program, “Morning Joe,” was down 10 percent this April, despite the heavy news. And its strongest prime-time hour, with Rachel Maddow, was down 7 percent in total viewers.

Bump in Ratings for Men’s College Basketball Final

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NBC’s Ratings Plummet From First to Worst

The ratings of last September through December, when NBC shocked the television industry by winning 13 of 15 weeks, have dissipated to numbers so small they have not been seen before by any broadcast network — certainly not during a rating period known as a sweeps month, when networks present their strongest programming.

When the official numbers are completed Thursday, NBC will finish this sweeps month not only far behind its regular network competitors, but also well behind the Spanish-language Univision. No broadcast network has ever before finished a television season sweeps month in fifth place.

NBC executives expected a falloff after the N.F.L. season, but last December they expressed hope that some momentum could be sustained. Now, the network is playing by the silver-linings playbook.

“This February was tough, but thankfully the fall did as well as it did,” said Jeff Bader, the chief scheduling executive for NBC. “If we had the fall we were expecting — which was an improvement, but not to be No. 1 — this month would have been a lot harder to take. This is just frustrating.”

It is also likely to be costly. NBC executives previously acknowledged that their entertainment operation has been losing hundreds of millions a year. The financial picture is exacerbated by the dearth of popular shows NBC owns that it can sell in syndication, an area that generates hundreds of millions in profits for competitors, especially CBS.

Advertising executives note that ratings this month on many shows are so low they may force NBC to offer a spate of what are known as make-goods — free commercials to cover shortfalls from rating guarantees. And in less than three months NBC must unveil a new schedule for advertisers, one that will emphasize the improvements of last fall, but will also contain a short list of holdover shows with attractive ratings to sell. That will put great pressure on the lineup of new shows NBC selects.

The network’s prime-time record this month is a litany of ratings sorrows: Shows that looked like hits last fall, like the new comedy “Go On,” have collapsed. New shows, like the comedy “1600 Penn,” started weak and have fallen fast. NBC even had the lowest-rated new network drama of all time, “Do No Harm,” which was rated 0.9 in the 18-49 category for its premiere this month and fell to 0.7 in its second week.

It was canceled after two episodes.

Perhaps more painful, because it was the favorite project of NBC’s top programmer, Robert Greenblatt, has been the fate of the Broadway drama “Smash.” Introduced last winter with great expectations — and a hugely expensive promotion campaign — “Smash” returned three weeks ago to audience indifference. Last week’s episode could not eke out even a 1 rating among viewers aged 18 through 49, the audience NBC sells to advertisers.

Over all, the network’s ratings have fallen so far that no episode of any show on NBC in February came within one million viewers of a show on PBS: “Downton Abbey.” And forget approaching the numbers of a cable hit like AMC’s “The Walking Dead.”

Nothing NBC has put on in prime time has matched even the appeal of the “Talking Dead,” a show with people simply discussing “The Walking Dead.” That show managed a 2.2 rating in the 18-49 audience. NBC’s best prime-time number for the month has been a 2.1, achieved by episodes of “The Biggest Loser” and “The Office,” a comedy that is about to go off the air.

Remarkably, the best-rated show on NBC all month has been “Saturday Night Live,” which produced two original versions in February, both times hitting a 2.3 rating, topping everything else on the network. “SNL,” though, is not even in prime time — and it is 38 years old.

This article has been revised to reflect the following correction:

Correction: February 25, 2013

A picture caption with an earlier version of this article misspelled the given name of an actress in the canceled show “Do No Harm.” She is Stephanie Roth Haberle, not Stepanie.

Bucks Blog: Morningstar's Latest Ratings of College Saving Plans

Morningstar Inc. has updated its rankings of the country’s largest 529 college savings plans, giving its top rating to plans offered by four states: Alaska, Maryland, Nevada and Utah.

Morningstar, a provider of investment research, is best known for its rating of mutual funds. But it also tracks 529 plans, which are state-sponsored plans named for the tax code that created them. Money in the plans grows tax free, and  stays that way as long as it’s used for educational expenses when you withdraw it. Many states also give tax breaks for money saved in the plans. (Families aren’t restricted to investing in the plan in the state where they live.)

Morningstar rated 64 plans representing 95 percent of assets held in the plans. Factors that it said it used in the rankings included the plan’s strategy and investment process; the plan’s risk-adjusted performance; the skill of the plan’s manager; the practices of the plans administrator and parent firm; and the fees involved in managing the plans.

Over the last year, many plans have showed a trend toward better-quality investments and lower fees, said Laura Pavlenko Lutton, who oversees Morningstar’s 529 Ratings.

Twenty-seven of the plans were given medal rankings (gold, silver and bronze) and are “likely to outperform their peers, based on Morningstar’s analysis. But just four plans were given a “gold” rating, meaning they were “highly regarded” by Morningstar analysts. “Over all, these plans stand out as best of breed for their ability to help college savers meet their goals,” the company explained in a statement.

The gold star plans went to these plans:
• Alaska’s T. Rowe Price College Savings Plan, managed by T. Rowe Price;
• Maryland College Investment Plan, managed by T. Rowe Price;
• Nevada’s The Vanguard 529 Savings Plan, managed by Upromise Investments; and
• Utah Educational Savings Plan, managed by the agency of the same name.

Four more plans were rated silver, and 19 were rated bronze.

A “neutral” rating means the analysts don’t think the plans are likely to deliver “standout” returns, but also that they’re unlikely to significantly under-perform. Most plans — 33 of them — fell into this category.

And these four plans were rated negative because of poor-quality investments or high fees:

• Kansas’ Schwab 529 College Savings Plan, managed by American Century Investment Management;
• Minnesota’s College Savings Plan, managed by TIAA Tuition Financing;
• Rhode Island’s CollegeBoundfund (Advisor-sold), managed by AllianceBernstein; and
• Rhode Island’s CollegeBoundfund (Direct-sold), managed by AllianceBernstein.

More details on the plans and their rankings are available on Morningstar.com’s 529 plan Web site, but a subscription is required.

Are you surprised by your 529 plan’s Morningstar rating? What has been your experience with your 529 plan?