Voyage of Discovery: Net needs ratings makeover

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What a year for Discovery to go from hot to not.

With the coldest cable upfront market in recent memory playing out, Discovery finds itself having to explain serious ratings shortfalls to media buyers. TLC and Discovery's ratings fell 35% and 14%, respectively, over the past season.

"It's never a good year to have a ratings fall," said Rino Scanzoni, chief investment officer at Media-edge:cia. "But when it happens in a year where there's more pressure on revenue because the overall marketplace hasn't grown a lot organically, it's almost like the perfect storm."

TLC and Discovery have in the past commanded premium pricing with cost per thousand price increases 15% to 20% higher than most general-entertainment cable networks. Last year the cable giant nabbed 9% to 11% cost-per-thousand increases.

"There's nothing wrong with Discovery," said Billy Campbell, president, Discovery U.S. "We feel fantastic about our positioning and we're going to write a great upfront."

Mr. Campbell has publicly accepted blame for TLC's over-reliance on the home-makeover genre and one-time boon "Trading Spaces," relatively inexpensive to make and ripe for product integration.

But now he vows, "I will fix TLC."

"It was like the heroin problem," said a cable programming veteran, of "Trading Spaces" and its spinoffs. "They got addicted to it."

Marketers such as Procter & Gamble Co., Lowe's and Home Depot bought in, substantially increasing ad dollars with the network by 45% to 110% in 2003 and 2004, according to TNS Media Intelligence. When the bottom fell out this season, make-good issues cost the network millions of dollars of inventory.

STILL `IN DEMAND'

To be sure, "Trading Spaces" is still "an in-demand show," said one major buyer. "Advertisers still want to be in it." But the show's white-hot days are over and TLC is now charged with rebuilding a brand defined by home makeovers. It's new focus will be on "life, life experiences, life unscripted," Mr. Campbell said, pointing to "The Adam Carolla Project," which features the comedian-also a registered contractor-as he revamps a dilapidated house. "It's so character-driven, so different from that [home-makeover] genre, you really wouldn't identify with that," he said.

Several other shows, such as "Small Mediums at Large," about little clairvoyants changing lives, have not yet been given the greenlight.

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