Wall Street Journal article ~ Ratings slip threatens CW Network

This Wall Street Journal article lays out the CW's crippling ratings issues. As we know, the numbers for the CW network are very low. I gave you several examples previously ~ Smallville 3.96 million, Gossip Girl 2.11 million, Supernatural 2.53 million and their newly renewed freshman show Reaper 2.47 million. Moonlight would instantly more than double the number of viewers their highest rated series.

It's No Gossip, Ratings Slip Threatens CW Network
By Rebecca Dana

Time may be running out for the CW network.

Two years after CBS Corp. and Time Warner Inc. combined their second-tier networks UPN and WB into the youth-oriented CW to pool young viewers prized by advertisers, the network's hopes of surviving are looking increasingly bleak.

Despite the buzz about "Gossip Girl," a prime-time soap opera about a group of rich kids on the Upper East Side of Manhattan, the network has lost about 28% of its target audience of 18 to 34 year olds so far this season. Its ratings during this month's "sweeps" period -- the all-important measure upon which future advertising rates are set -- are down about 22%.

Advertisers eager to reach a young demographic initially clamored to sign on to the CW, but have since cooled to the network. Steven Kalb, director of broadcast media for media-buying firm MediaHub, owned by Interpublic Group, says there were high hopes for the network when last year's lineup was unveiled. Now, he says, "It has collapsed."

Part of the problem is that the CW's young audience is most prone to spend leisure time on the Internet. Last winter's Hollywood writers' strike, which forced scripted shows off the air for three months, hastened the defection of viewers to the Web.

Increasingly, people in the industry are asking whether this coming season is the CW's last chance. One person close to the situation confirms that without significant progress in the next year, at least one of the network's owners is likely to abandon the venture.

The defection of viewers recently led the network to suspend the free Web streaming of "Gossip Girl," angering some fans in the process. After several weeks of the experiment, ratings have remained essentially flat.

The CW's fall schedule, unveiled this week, suggests the network has few fresh ideas. It is debuting only three new shows, all designed to complement "Gossip Girl," which executives hope will find a larger audience come fall. The new offerings are: "90210," an updated version of the 1990s hit prime-time soap about rich kids in California, "Beverly Hills, 90210"; "Surviving the Filthy Rich," a drama about rich kids in Palm Beach; and the reality show "Stylista."

The network has made a series of radical moves in recent weeks to stem its financial losses and draw more attention from advertisers and viewers.

Last week, the CW said it was bringing in an outside production company, Media Rights Capital, to program three hours of Sunday nights, often the most-watched night on broadcast television but a poorly rated time period for the network. To take a slice of prime time and essentially cede it to another programmer is a rare event for a major network.

Also this spring, the CW elected to stop airing wrestling on Friday nights -- an admission that chasing a young male audience was no longer part of the network's mission. Wrestling had drawn high ratings, but advertising rates were lower because it draws an audience less desirable to advertisers. At its upfront presentation this week, the CW redefined its target audience as exclusively 18- to 34-year-old women.

The success of the venture is of importance for CBS Chief Executive Officer Leslie Moonves, who has been closely involved in every element of building and promoting the network.

Mr. Moonves sits on the executive board that overseas programming and marketing decisions at the CW. The network's president, Dawn Ostroff, is a longtime associate and protégé of Mr. Moonves, and he was instrumental in placing her at the helm of the network. Mr. Moonves declined to comment.

CW executives attribute the network's poor ratings performance not to a lack of viewers but to flaws in the system of measure. "Obviously, we would have liked to do better," Ms. Ostroff said this week. "Our young audience certainly knows how to get their content in different ways, and we have to figure out different ways to measure how they're getting it."

The CW has two strategies for this: work with Nielsen Media Research, the company that records ratings, to improve its methodology; and continue efforts to lure more and younger viewers to the network. Despite its stated demographic targets, the CW viewer's median age is 34, Ms. Ostroff says.

Nielsen says in a statement that although it believes its ratings "provide a fair picture of what younger viewers are watching," the audience is challenging to track. "We are working closely with the CW and all of our clients to continuously improve our measurement."

In the past two years, the CW has experimented with different ways of presenting advertisements to its young viewers, who are proficient with digital video recorders that allow them to fast-forward through commercials, and who have especially short attention spans.

The network introduced multipart commercials called "content wraps" in its first year; in its second year, it introduced ultra-short commercials it called "cwickies." Next year, the network is focusing its efforts on TV and Web integrations, says Executive Vice President of Network Sales Bill Morningstar.

Bruce Rosenblum, president of the Warner Bros. Television Group and a member of the CW's board, says he was disappointed the network had not managed to capture a larger audience. But he pointed to the strength of its distribution system and its new-series development as reasons for optimism.

Although the CW isn't profitable itself, it has helped its parent companies launch shows that can make money down the road on other platforms such as syndicated reruns and DVD sales, Mr. Rosenblum says.

Combined, UPN and the WB lost about $2 billion in the 11 years that spent on the air. It is unclear how the CW's losses compare, since neither company reports earnings for the small network. CBS and Warner Bros. incurred significant start-up costs when they launched the CW, including a multimillion dollar marketing campaign. CW draws about a quarter of the audience that CBS does.

Nancy Tellem, president of CBS Paramount Network Television Entertainment Group, says that CBS's commitment to the network is open-ended and that the CW has suffered mostly from too-high expectations. "I honestly believe that we did not expect it would be as difficult as it was," she says.

http://online.wsj.com/article/SB121089546043097065.html?mod=hps_us_whats_news