It Takes a (Media) Village – NBCUniversal Domestic Television Distribution

By Nicholas FathergillBroadcast Television

NBCUniversal Domestic Television Distribution (which will subsequently be referred to as NBCDTD) is a branch of NBCUniversal, a media company owned by corporate giant Comcast (Brodkin, 2018).  NBCDTD, specifically, develops, produces and distributes NBCUniversal products to broadcast television stations in the US (NBCUniversal, 2018).  They focus on creating and distributing shows, as well as distributing off-network programs (NBCUniversal, 2018), or shows that no longer run on primetime and are made available to local stations, cable operators, or online streaming services (Danesi, 2009).

NBCUniversal Media as a whole has 62,000 employees, with NBCDTD being one of the biggest arms of transmitting content in the United States (Bloomberg, 2018). NBCDTD is headquartered in New York City; however, a lot of the content in produces occurs in Los Angeles (Bloomberg, 2018)(NBCUniversal, 2018).  In 2013, Ed Swindler of NBC Broadcasting took over the duties to oversee NBCDTD from Barry Wallach, the previous head (Block, 2013).  However, in 2016, Swindler decided to step down after corporate reorganization, and no successor was appointed.  Instead, NBCDTD was assigned to both Paul Telegdy, president of alternative/reality shows at NBC Entertainment, and George Cheeks, president of late night programming (Lafayette, 2016).

 

George Cheeks (left) and Paul Telegdy (right) were tasked with overseeing NBCDTD after Ed Swindler’s departure.

NBCDTD’s most important assets in making money are its talent and programs under contract.  Among the first-run shows produced by NBCDTD are STEVE, Harry, The Jerry Springer Show,and Access (NBCUniversal, 2018). Another major source of NBCDTD’s assets are syndicated programs that appear off-network (TV Program Production and Distribution, 2018).  These shows run in repeats on other stations and gather more revenue.  American Ninja Warrior, Law and Order: Special Victims Unit, Law and Order: Criminal Intent, and Dateline are a few of NBCDTD’s off-network programs (NBCUniversal, 2018).

NBCDTD rewarded “STEVE” with a second season earlier this year, giving host Steve Harvey a chance to expand his creativity.

Arguably the most important assets are the talent NBCDTD controls.  The talent currently under contract with the company includes Lester Holt, Hoda Kotb, Maury Povich and Steve Harvey (NBCUniversal, 2018).  These celebrities are so important they are often given considerable creative license to improve their own show.  For example, Steve Harvey’s newest deal gave him significant ownership and creative control, particularly because The Steve Harvey Show, his precursor to STEVE, was so popular (Littleton, 2016).

As discussed above, NBCDTD’s business model is fairly simple.  It produces, sells, and distributes NBCUniversal’s products to broadcast TV in the US as well as off-network syndication (NBCUniversal, 2018).  As a subsidiary of Comcast, its competitors include Disney, FOX, and other producers of broadcast television (Brodkin, 2018).  However, going forward, NBCDTD will face significant business challenges regarding network competition.  Whereas Comcast originally planned to buy FOX, the Disney-FOX buyout will put more pressure on NBCDTD to produce content to compete (Brodkin, 2018).  If it’s unable to keep up with the Disney-FOX giant, NBCDTD may lose revenue in the form of decreased syndication.

 

Disney’s $71.3 million buyout of 21st Century FOX means Comcast and NBCDTD, will have to rethink the future.
NBCDTD makes money from providing content to OTT services like Netflix for continued streaming capability.

 

 

 

 

 

 

 

 

 

 

NBCDTD’s supplier is its parent company, NBCUniversal.  As the distribution division of the media giant, it focuses solely on providing NBC’s products to broadcast, cable, and over-the-top (OTT) services (NBCUniversal, 2018).  Since NBC is such a major network, it’s able to develop in-house programming, which makes it especially difficult for smaller studios and production companies to get programming on broadcast television (TV Program Production and Distribution, 2018).

NBCDTD’s biggest challenge is how to refine its revenue model in today’s increasingly competitive media landscape.  Since it has several different ways of putting content on screen, it has several different sources of revenue.  The company starts by collecting affiliate fees when it provides its programming to cable providers like DirecTV and Spectrum (Gurley, 2010).  However, in NBCDTD’s case, it differs slightly from other production and distribution companies.  Since Comcast – a cable provider – owns NBCUniversal, it is able to keep affiliate fees low, and is the prime negotiator for other cable providers to get NBC programming (Gurley, 2010).

 

Since the older demographic prefers traditional television and the younger prefers streaming, NBCDTD is able to significantly profit in both areas.

 

NBCDTD is able to negotiate deals with online video providers as well to provide OTT programming (Brodkin, 2018).  In fact, first-run programming on traditional TV providers often doesn’t even recoup the costs of making a show (TV Program Production and Distribution, 2018).  Distribution companies have to rely on long-term syndication, DVDs, and deals with internet streaming services for long-term financial gain (TV Program Production and Distribution, 2018).

NBCDTD, aside from getting affiliate fees from cable providers, also licenses certain programs to other networks (NBCUniversal, 2018).  Off-network programs are a major source of revenue for the company.  For example, the debut of Dateline in 2017 was sold by NBCDTD across 80% of the country. Major station groups like FOX, COX Media Group and Sinclair purchased the rights to air the show on their stations (NBCUniversal, 2018).  In this way, NBCDTD is able to make money on shows both on NBC and on other networks.

 

Dateline, NBC’s newsmagazine, attracts viewers with documentaries and investigative reporting.

 

With the FOX deal falling through, NBCDTD may have some challenges moving forward to compete with Disney’s distribution arm.  However, there are positive signs for the future.  First, the continued growth of internet streaming services points to avenues of revenue as more services need more programming (TV Program Production and Distribution, 2018).  Second, US corporate profits and retail sales both rose in the first quarter of 2018: these are both considered indicators of demand for TV advertising (TV Program Production and Distribution, 2018).  It stands to reason that more advertising dollars will benefit NBCDTD.

 

It’ll be important going forward for NBCDTD to keep an eye on retail sales: a drop in sales, and thus a drop in advertising demand, will require yet another catalyst for change.

 

Since the industry is trending toward network control of programming and media dominance, NBCDTD and Comcast are ahead of the curve (TV Program Production and Distribution, 2018).  If the distribution division is able to continue to produce solid content and make licensing deals with as many networks and OTT services as possible, it will likely thrive for years to come.

 

 

Sources:

Ben Block, A.  (2013, August 19).  Ed Swindler to oversee NBCUniversal Domestic TV Distribution.  The Hollywood Reporter. Retrieved from https://www.hollywoodreporter.com/news/ed-swindler-oversee-nbcuniversal-domestic-609089

 

Bloomberg.  (2018). Company Overview of NBCUniversal Media, LLC.  Retrieved from https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=670469

 

Brodkin, J.  (2018, May 24).  Comcast may soon control what you pay to watch your favorite sports teams.  ARS Technica.  Retrieved from https://arstechnica.com/tech-policy/2018/05/comcast-may-soon-control-what-you-pay-to-watch-your-favorite-sports-teams/

 

Danesi, M.  (2009).  Dictionary of Media and Communications.  Armonk, NY: Routledge.

 

Gurley, B.  (2010, April 30).  Here’s How The TV Business Actually Works (And Why It’s Going To Take Longer Than You Think To Disrupt It).  Business Insider.  Retrieved from https://www.businessinsider.com/heres-how-the-tv-business-actually-works-and-why-its-going-to-take-longer-than-you-think-to-disrupt-it-2010-4

 

Lafayette, J.  (2016, December 9).  Ed Swindler Leaving NBCU Domestic TV Distribution.  Retrieved from https://www.broadcastingcable.com/news/swindler-leaving-nbcu-domestic-tv-distribution-161712

 

Littleton, C.  (2016, November 11).  Steve Harvey Gains Ownership, Creative Control in New Talk Show Deal With NBCUniversal, IMG.  Variety.  Retrieved from https://variety.com/2016/tv/news/steve-harvey-talk-show-nbcuniversal-img-1201915932/

 

NBCUniversal Domestic Television Distribution.  (2017, April 12).  “DATELINE” TO DEBUT IN NATIONAL SYNDICATION THIS FALL[Press release].  Retrieved from http://www.nbcuniversal.com/press-release/dateline”-debut-national-syndication-fall

 

NBCUniversal Domestic Television Distribution. (2018).  About | NBCUniversal Media Village.  Retrieved from https://www.nbcumv.com/studios-distribution/nbcuniversal-domestic-television-distribution/about?network=33123

 

NBCUniversal Domestic Television Distribution. (2018).  All Titles | NBCUniversal Media Village.  Retrieved from https://www.nbcumv.com/studios-distribution/nbcuniversal-domestic-television-distribution/shows?network=33123

 

NBCUniversal Domestic Television Distribution. (2018).  Talent Bios| NBCUniversal Media Village.  Retrieved from https://www.nbcumv.com/studios-distribution/nbcuniversal-domestic-television-distribution/talent-bios?network=33123

 

TV Program Production and Distribution – quarterly update 4/30/2018.  (2018).  (). Fort Mill, South Carolina: Mergent. Retrieved from ProQuest Central. Retrieved from https://search-proquest-com.libezproxy2.syr.edu/docview/2032792607?accountid=14214