Glued to TV for Now, but When Programming Thins and Bills Mount …
It happened around the world, and now it’s happening in the United States: The more people stay home to avoid the coronavirus pandemic, the more they find themselves glued to their screens.In South Korea, as cases spiked, television viewership shot up 17 percent, according to Nielsen. Last month in Italy, the size of the TV audience increased 6.5 percent, with a 12 percent rise in hard-hit Lombardy.The same trend has arrived in the United States. In the Seattle area, total television use increased 22 percent on March 11 from the week before, according to Nielsen. In New York that day, as more people started working from home, use went up 8 percent. (Total use, as defined by Nielsen, includes live television, on-demand viewing, streaming and gaming.)But for media companies, the benefit of having a bigger-than-usual audience may be short-lived as the outbreak threatens to undercut the very structure of their business. With businesses scaling back workers and analysts warning of a recession as global economies slow, a significant number of viewers may decide in the coming months to break away from cable or cut back on streaming subscriptions.The gain in audience size “will be replaced pretty quickly by the necessity of reducing monthly bills, when people will have to deal with the financial impacts of a recession,” said Craig Moffett, a co-founder of the research firm MoffettNathanson. “Cord cutting will accelerate with a vengeance.”The Walt Disney Company, ViacomCBS and other media giants face a pivotal moment as the delicate ecosystem that protects their business — live content tied to high-cost subscriptions — erodes even faster. It started last week with the sudden disappearance of a dependable asset: sports programming.Live sports coverage generates billions of advertising dollars and fuels television subscriptions — a combination that delivers fat profits. Now the industry is facing the postponement and cancellation of almost every major sporting event, including the Masters golf tournament, a CBS staple, as well as the remainder of the National Basketball Association season and postseason, which are consistent draws for the AT&T-owned Turner channels and Disney’s ESPN and ABC networks.The sports coverage has become critical at a time when the audience appetite for dramas and sitcoms has shrunk. Advertisers spend more than $2 billion on live games and tournaments during this part of the year, according to Kantar Media. And with LeBron James benched indefinitely, ESPN is expected to lose $481 million in N.B.A.-related advertising; for Turner, the loss will be about $210 million, according to MoffettNathanson.In statements, ESPN and AT&T’s WarnerMedia said they were confident that they would weather the challenge, but declined to make executives available for interviews. For now, ESPN has filled the gaps by running “SportsCenter” nearly nonstop.NBCUniversal executives have been eagle eyed on the Tokyo Olympics ever since President Trump called last week for a possible postponement. More than $1.25 billion in advertising commitments are on the line for the network and its parent company, Comcast. More