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Evan Shapiro: Nobody Knows Anything

Date January 11, 2012
Evan Shapiro: Nobody Knows Anything

Those three words are why I work in TV. Nobody Knows Anything.

William Goldman introduced that phrase in his book, Adventures in The Screen Trade -- IMHO, the best book ever written about the entertainment business. He originally used them to say that in Hollywood no one really knows how any specific film will do when it opens. Over the years, though, the phrase has become the cliché that describes how the entertainment business itself is run. Nobody Knows Anything.

So, after dropping out of college 25 years ago, I thought to myself "hey, I don't know anything; I'll work in show business!"

Please, please, don't get me wrong... The entertainment industry is full of intelligent, well-trained women and men, who make thousands of completely rational decisions based on mountains of research. However, at a ratio unlike almost any other industry (except perhaps fashion or food), many key decisions in the media business are made by either gut or accident.

In our business, it's almost too easy to point to decisions that failed (it's also a tad gauche for one TV exec to point out the mistakes of his peers in the HuffPost). So instead, I'll offer two choices -- one made by accident and the other made on gut instinct -- that worked out way better than could have been expected.

The Accidental Network: Last century, American Cable companies invested billions of dollars and four decades of hard work laying cables underground to deliver more and better TV into their customers' homes. What they did not foresee, however, was that they had also built an "accidental network" that would become the backbone of the Internet. The pipes originally built to carry thousands of channels of TV, evolved into broadband -- a business that now provides significant margins and growth for those cable companies, (and, ironically, also allows customers to view billions of hours of video without a cable subscription). Like Velcro and Vaseline, Broadband was an accidental success story, built on the back of good gut instinct.

The Programming Crap Shoot: In determining what makes Good TV, many of us use the Justice Potter Stewart axiom for Pornography -- we don't know exactly what it is, but we know it when we see it. This is part of what makes the TV business equal parts frustration and fun. For example, in retrospect, Always Sunny In Philadelphia may look like a sure thing. The show, though, was a gamble for FX -- their first real foray into comedy and a foul-mouthed sitcom, with no stars, based on a pilot shot for $200 and edited on some kid's computer. A bigger risk came in green-lighting season two, after a first season that didn't exactly set the world on fire. However, network execs decided to take a chance and had the patience (unusual in our business) to stay with it. They went with their gut, rolled the dice and doubled down on the show. They were rewarded with a loyal audience, seven seasons to date and a record-breaking syndication deal for basic cable comedy.

Sure, the Cable Industry execs knew it was important to invest in their infrastructure and create increased capacity to deliver more and more content to their customers. However, that investment paid off with entirely new products no one could have foreseen. Yes, FX knew they wanted to expand their programming into comedy. But no one could have predicted that their show would run seven (plus more) years and manage to make Philadelphia cool. Just like few of us would have predicted in advance that Apple would be the world's most important music distributor; that Netflix would be America's 15th largest TV network; or that Glee would resuscitate the prime time music video.

Yet, that doesn't stop countless media "experts" from making myriad predictions about the future of the TV business around this time each year. So, as you read these prophecies, I ask you to do so with a barrel of salt. Are these writers smart? Undoubtedly. Are their theses well-researched? Absolutely! Is what they write true? Who the heck knows?!? And, what's more, they tend to contradict each other on a daily basis.

In the past few weeks, there have been dozens (seriously, dozens!) of pieces written about cord cutting, and how it will disintegrate the pay TV business (some, in fact, responses to my post, The Death of Television). On Friday, Deloitte published a report predicting a Cablepocalypse, saying "9% of Americans have cut their pay TV connection because they can watch all their favorite shows online, while a further 11% are considering doing so." Then, over the weekend, Kevin Sintumuang wrote a hysterical (both meanings) piece in the Wall Street Journal called Cutting The Cord on Cable. It's literally a "Dear John" letter to Cable TV ("Don't be sad. We've had a really good run. I've known you longer than my computer. My mobile phone. And all of my Nintendos"). He even provides a list of ways to avoid paying for TV (all of which, btw, involve paying for TV).

The very same week, however, Leichtman Research issued a report, The Phenomenon That Still Isn't, contradicting pretty much all of that ("Contrary to the provocative headlines, pay TV services ADDED subscribers last year"); and then Disney signed a decade long deal with Comcast which pretty much ensures that in order to get some of the world's most vital TV programming you must have cable (the combination of ESPN, Pretty Little Liars and Modern Family is a TV Triple Crown in the Shapiro Clan), but encourages the asymmetrical viewing that most of us want.

The Deloitte report says interest in cutting the cord is highest among "Leading Millennials" (aged 23-28), at 19%; and, 11% of Baby Boomers have already cut the cord, more than any other group. These are troubling trends to say the least. However, Leichtman says that "the economy is the deciding factor for much cord cutting"; and that for every home cutting the cord, more than one other house signs up for pay TV.

So, who's right? The answer: Nobody Knows Anything. Predicting exactly what's going to happen in the TV business in the next 36 months is like guaranteeing the Miami Heat will win the NBA Championship this year. Sure, you can say it, but be prepared to look like a moron. And that's why I love this business. If you come in stupid and learn something new each day, chances are you'll be right as often as wrong, and your wins will outweigh your losses.

In addition to "Nobody Knows Anything" Goldman also said "You Can Never Trust What You Read." In the first quarter of every year, everyone is an expert, and no one is wrong (yet). As you surf the interwebs and read these reports, predictions and forecasts, however, remember this one thing: It's those who know for sure that are dangerous.

 

Follow Evan Shapiro on Twitter: www.twitter.com/eshap

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