Wolk’s Week in Review: The unexpected brilliance of “Expensive NBC”, The Diamond RSN implosion continues

Wolk's Week In Review

1. The Unexpected Brilliance Of “Expensive NBC”

Back at what now seems like the dawn of the streaming era, an unnamed TV executive was quoted as sneering that Apple’s Apple TV+ was just “expensive NBC.”

Meaning, of course, that it was aiming at a broader, more middlebrow market than services like Netflix and Amazon Prime, the latter of which was slammed from the other direction for only making shows “aimed at the Silver Lake crowd.”

Apple TV+ has long confounded the industry because it’s never been quite clear what Apple’s intent is with the service, a lack of clarity that is only amplified by the fact that Apple TV+ lacks any sort of back catalog of the sort that everyone else has either inherited or purchased.

This is why it is even more confounding to many that Apple is one of the few services that seems to have actually found its footing and created a relatively clear brand identity around the types of shows it has on offer.

As the record ratings for the final season of Ted Lasso indicate, there’s a lot of demand for “expensive NBC.”

Why it matters

The New York Times did not have four articles above the fold about the series finale of Ted Lasso. New York magazine did not devote entire columns to Jamie Tartt or Keeley Jones.

But the series did stick in the popular imagination in a way that few streaming shows do, an antidote to the dark antihero fare that has defined the second Golden Age of Television.

It’s not just Ted Lasso either. Apple TV+ series like Acapulco, Slow Horses, Physical, Severance, The Shrink Next Door and WeCrashed (just to name a few) have helped to define a fairly consistent aesthetic, one that fits neatly between the more highbrow offerings from Netflix and HBO and the more lowbrow ones from the networks.

But more than that, it seems to also fit in neatly with Apple’s entire brand aesthetic. It’s as if they took those iconic white stores and brought them to TV.

That matters (you knew I’d get to that) because churn will continue to be a major issue for the streaming services, especially those creating “HBO-like” content whom viewers tend to think of as interchangeable. Meaning they are also likely to unsubscribe when their favorite series is over.

By creating a strong brand, one where viewers feel confident they know what to expect, Apple should be able to reduce churn. 

The $5/month price tag helps too, especially as the price of other services goes up and the “no more sharing the Netflix account with grandma and grandpa” hammer comes down.

As for Apple’s ultimate plan, that’s still unclear, but it might not matter. Do they plan to get into the TV business in a serious way? Or is Apple TV+ just a very smart marketing tool for the world of Apple products?

Either way, they’re doing something right, and the decision to take their own path and not try and imitate everyone else seems to be working out for them.

What you need to do about it

If you’re Apple, keep on doing what you’ve been doing. I used to count myself among those who thought you needed a library of sorts in order to keep viewers from churning, but given the low price point and the ready supply of binge-worthy new series, that’s not really become a problem.

If you’re one of the other streaming services, learn from the way that Apple has been able to keep a consistent brand image to their content. They have a wide range of dramas and comedies and movies, but you have a sense of what they’re about. That’s something that is going to help you to reduce churn and to stand for something other than the last hit series you’ve released.

Because viewers, they’re a lot like goldfish.

2. The Diamond RSN Implosion Continues

It seemed like such a good idea at the time. Buy up a bunch of lucrative RSNs for just under $20 billion. Launch them as streaming apps as a way to attract young fans. Sit back and watch the money roll in.

Only things did not work out that way for Sinclair and its Diamond Sports subsidiary.

The MLB was not a fan of the plan and negotiating with Commissioner Rob Manfred took some doing. 

Fans did not flock to the streaming apps—it seems they only have 203K subscribers, just slightly over half of what they were looking for.

Which led to a bankruptcy filing. And now the latest: Diamond walking away from a multibillion-dollar contract with the San Diego Padres and their bankruptcy attorneys getting into a vitriolic shouting match with MLB’s Manfred during testimony in which he described Sinclair’s approach as being akin to blackmail.


So how did we get here and what happens next?

Why it matters

We got here because sports rights have always been unnaturally high, especially those for the local teams.

They were, back in the Bronze Age, originally given to over-the-air broadcast networks where they were free. In New York, for instance, Mets games were on WOR, Channel 9 and Yankees games were on WPIX, Channel 11, both of which were independent stations (not affiliated with any of the networks.)

Free was good, but reception was not, and much of the game was spent adjusting and readjusting the rabbit ears antenna.

At some point in the early 80s, fledgling cable companies realized that one way to attract subscribers was to offer live sports, cable’s advantage being the far superior picture quality.

To get those rights, they paid the teams millions… and then passed those costs on to customers. 

RSNs were almost always included in all of the cable company’s various tiers, a sports tax that non-fans could not avoid.

It made lots of money for the teams and leagues and helped line the cable operators pockets too.

Fast-forward to the streaming era and declining cable TV subscriber numbers mean declining revenues along with pushback from the MVPDs on including the RSNs in every bundle. (They need to try and retain what subscribers they have left.)

Worse still, the vMVPDs—Hulu and YouTube in particular—want no part of the high-priced RSNs. 

So streaming apps.

Only MLB is not having it. They want to control the streaming. Or do it themselves. But they don’t want to give Sinclair the rights, for reasons that were made clear in a Houston courtroom this week where Manfred all but accused Sinclair’s Smith of shaking him down Mafia-style.

The macro story though, is bigger than that.

There is a school of thought that says that each team should control its own destiny, that each team should be able to take the rights to their home games and sell them on the open market, both domestically and internationally.

This is lovely in theory, but will quickly create a system of haves and have-nots, where the Yankees and Heat can easily sell rights and merchandise on a global basis, but where lesser-known  teams, the Cleveland Guardians and New Orleans Pelicans, for example, may struggle.

Which is why the leagues are likely to step up their involvement, the way MLB is stepping in to stop Diamond from defaulting on the Padres. 

Because what that does is to create a form of socialism within the leagues where the spoils get split more evenly and there are no big winners and losers, which in turn prevents the favored teams from using their TV rights wealth to buy up all the good players. (Or trade them around with increasing frequency.)

Which is not a bad system to maintain at a time when fans are increasingly becoming fed up with the overcommercialization of sports.

What you need to do about it 

If you are the NBA and NHL, take Manfred’s lead. Having a few superstar teams helps no one and if you want new owners to come on board you have to create financial incentive. There’s certainly enough money (for now) to keep everyone happy.

If you are Sinclair, it’s a tough call. $19 billion is a whole lot of money to toss away, so I get it. It’s just that selling rights back to the leagues may ultimately be a better move, if you factor in the costs of all those lawsuits, and the herding cats aspect of getting all those leagues moving in the right direction.

Or you could try and stick it out. You are privy to numbers and deal details that will tell you whether that is the right move.

If you’re a fan, just be patient. Eventually, they’ll figure it all out.

Join us June 12 at the StreamTV Show in Denver as TVREV presents “The Future of FASTs Workshop.” TVREV’s “FASTs Are The New Cable” reports helped define the state of FASTs today. In this session, brought to you by TVREV and the StreamTV team, we’re going to take things to the next level. Come participate as we talk to key thinkers and decision-makers in the field to explore where the FAST ecosystem is heading in the years to come with an eye towards the ways it will impact programming, advertising, the interface and local TV. View full StreamTV Show Agenda.

Alan Wolk is co-founder and lead analyst at the consulting firm TV[R]EV. He is the author of the best-selling industry primer, Over The Top: How The Internet Is (Slowly But Surely) Changing The Television Industry. Wolk frequently speaks about changes in the television industry, both at conferences and to anyone who’ll listen.

Wolk's Week in Review is an opinion column. It does not necessarily represent the opinions of Fierce Video.