NBC Entertainment Co-Chairmen Discuss Broadcast, Streaming


George Cheeks and Paul Telegdy, co-chairmen of NBC Entertainment, weighed in on the company’s “nuanced” approach to its new streaming platform, the need for better audience measurement systems and the power and reach of broadcast networks in their NATPE keynote.

Cheeks and Telegdy were interviewed by television journalist Soledad O’Brien, the CEO of Starfish Media Group. O’Brien asked the duo about the health of the broadcast network business as younger viewers embrace online viewing methods.

“We know that the picture is broader than just who is watching linear TV,” Cheeks said. “Take a show like Brooklyn Nine-Nine. On-air, the average age is about 46. Digitally, the average age is 27. Even a show like SVU, a quintessential, traditional procedural—on the network it’s a 57 average age; on digital, Hulu in particular, it’s down to 30. The shows we’re producing are resonating throughout the audiences, they’re just consuming it in different ways.”

However, Cheeks added, “Our job is to stay focused on the linear platform; live ratings do matter, particularly for our affiliate partners—we’re never going to lose sight of that. But as we redefine the metric for success, it’s important to think about the totality of consumption.”

Telegdy stressed the importance of broadcast linear TV as the initial launch platform, noting, “we still have big national events with huge reach and relevance, whether it’s sports or some of the other big shows on our air. We have an incredibly broad platform that we can use to launch shows, which then live on through multiple windows.”

The conversation then moved to NBCUniversal’s recently announced OTT service. “The company has been very thoughtful about how we go to market,” Cheeks stated. “Netflix-chasing is not a strategy. We feel excited and bullish about where this is headed. It does affect our content strategy going forward. For all these major media companies that are approaching this, there is no one-size-fits-all strategy. One possibility is you take all your originals and your licensed stuff once it cycles off the licenses and put them all in your ecosystem. Our strategy is going to be a bit more nuanced and bespoke. We’re going to look at every original production, every licensed show that cycles off and decide, where does this show belong? It might be that it belongs exclusively in our ecosystem. It might be that it belongs exclusively on an outside ecosystem. Or they might be an in-between. There may be non-exclusive models that make sense, windowing models that make sense. It requires a reinvention of that whole process.”

The upcoming NBCUniversal OTT service will offer both ad-supported and ad-free options.

“As a company, we love advertising,” Telegdy said. “We’re not ashamed to say it. We have a strong and ever-evolving relationship with that bit of the industry that is part of our unique funding model. So as we bring online these services, it’s nice that we can continue to evolve those relationships as well.”

Cheeks added, “We do recognize that we need to optimize the viewer experience. We know that audiences fundamentally might resist advertising because of the way it’s traditionally been set up. But we believe that through less ad clutter, more targeted, contextual, relevant advertising, we’ve actually seen improvement in terms of engagement in the commercial pod. There is an ad-supported model out there that people aren’t afraid of. Hulu has an ad-supported model. There’s a lot of iterating and experimenting to be done, but with all these interactive ad products and the movement toward being more sensitive to the user experience, I feel like there’s a lot of opportunity in that space.”

Asked about the fate of The Office, which is currently streaming on Netflix, Cheeks responded: “The Netflix license goes for a couple more years. We’ll have to see where it goes. The fundamental takeaway for us is that we know how to produce great content that people will find wherever it lives.”

O’Brien asked the panelists about Nielsen and audience metrics. Cheeks noted, “There is fundamental frustration with the fact that we don’t have a cross-platform, universally recognized measurement system. That frustrates all of us, particularly as digital viewing increases. Last season, about a third of our prime-time viewership was digital, not all of which was counted and monetized; the year before that it was 21 percent. Some shows, like Superstore and The Good Place, are as high as 40 percent. This is mission critical. Lucky for us we have the best-in-class ad sales team who is laser-focused on this.

“We have to come up with one measurement platform that exists for all so that we’re not getting into these narrow debates between the advertisers and these different companies. There has to be one universal measure that is accepted.”

On whether or not the viewing platform still matters as more watching takes place online, Telegdy responded, “We would be reckless and neglectful if we didn’t lean into making shows that take advantage of the unique platform that we still have. Yes, we are platform-agnostic as a producer and a studio. But we can still make a virtue of the fact that we have mass and huge reach on a weekly basis, both for the promotion of shows and for the shows themselves to have an expectation of breadth that we still lean into.”

On Netflix, Amazon and Apple spending large fees on exclusive talent deals, Cheeks said, “There’s no question there’s an arms race for talent right now. For us, part of it is financial, we know we have to step up, but you really have to present to talent the overall value proposition. When we talk to talent about NBCUniversal, we first talk about the full ecosystem. So when a creator has a project, we’d love for it to be at NBC, but if it’s right for one of our cable nets, for one of Sky’s channels, for our soon-to-launch OTT service, we’re there for them. Or if they believe strongly that it belongs on Apple, we can support that as well. We can allow them to retain that optionality in a way that if they go do a deal at Netflix they can’t. We continue to press the idea of giving them all the tools to expand themselves creatively.”