Grey Matter: What Shonda Rhimes' Move to Netflix Means for ABC

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Even as it begins its 14th season on ABC, 'Grey's Anatomy' is still one of broadcast TV's top 10 scripted shows.
Even as it begins its 14th season on ABC, 'Grey's Anatomy' is still one of broadcast TV's top 10 scripted shows. Credit: ABC

With three shows on the ABC schedule for next season and two more in the works, Shonda Rhimes dramas filled with salacious sex and scintillating scandal have come to epitomize the alphabet network. So as the showrunner ends her 15-year relationship with ABC and decamps for Netflix, the broadcaster -- and its advertisers -- face with a new urgency to locate its next big hit.

As things stand. ABC's "TGIT" lineup on Thursday nights might as well be called TGFS: Thank God for Shonda.

Rhimes' four shows last season -- "Grey's Anatomy," "Scandal," "How To Get Away With Murder" and the now-canceled "The Catch" -- accounted for 20% of ABC's primetime scripted gross ratings points and 44% of its drama GRPs.

Not only are the Thursday shows ABC's top-rated dramas, but they are among the few returning hours on ABC heading into the 2017-18 season.

And even as "Grey's Anatomy" enters its 14th season, the medical soap remains a workhorse. It averaged 7.8 million viewers and a 2.1 rating in the 18-to-49 demographic last season. While that was down a bit more than 2% in total viewers and off 7% in the demo, "Grey's" was still among the top 10 scripted shows on broadcast in the 18-to-49 demo last season.

In a large part, ABC has Netflix to thank for "Grey's Anatomy's" renaissance. The show has become a favorite binge for younger viewers, who were mere toddlers when the show first debuted on ABC. Many of these viewers are now watching over 200 episodes of the show on Netflix and then tuning in to watch live on ABC.

While "Scandal" has experienced steady ratings declines, averaging 5.6 million viewers and a 1.4 rating among 18-to-49-year-olds last season, a 33% decline in the demo from the season prior, its upcoming final season is expected to be a big one for the network. And "How to Get Away With Murder" holds its own in the difficult 10 p.m. timeslot, where broadcasters last season averaged a mere 1.0 rating. "HTGAWM" pulled 4.6 million viewers and a 1.3 rating in the demo.

Even as ratings decline, the dependability of these shows are attractive to advertisers, who are willing to pay top dollar to be part of TGIT. "Grey's Anatomy" still ranks as one of the 10 costliest programs for advertisers, according to Ad Age's 2016 upfront pricing survey. A 30-second spot in the show cost about $200,000 a pop.

Marketers are also attracted to TGIT's upscale audience, which has a highly engaged social following. And the programming's diversity both in casting and storylines appeals to brands.

Rhimes' move to Netflix, where she struck a multi-year deal to produce new series for the platform, adds to the growing concern among advertisers about the amount of content being viewed on non ad-supported platforms.

ABC has built its Thursday nights around Rhimes dramas, rebranding the lineup "TGIT" (Thank God It's Thursday) in fall of 2014 and assembling Shondaland's drama trio back-to-back-to-back. In this way, ABC set out to convince viewers to not only watch three hours of TV, but to watch it live and all on one network.

When ABC switched up the night last fall to include the non-Rhimes drama, "Notorious," which replaced "Scandal" while Kerry Washington was pregnant, the interloper only managed to pull a 0.9 rating in the demo.

Rhimes' move to Netflix, accompanied by longtime production partner Betsy Beers, follows the news last week that ABC parent company Disney will pull its movies from Netflix as it prepares its own streaming service.

Still, at least in the immediate future, not much will change for ABC. TGIT will return intact next season. And Shondaland still has two more series coming to ABC: the legal drama "For the People" and a spinoff of "Grey's Anatomy" set in a Seattle firehouse. ABC Studios also has a promising pilot, "Adult Behavior," and several other projects in various stages that will remain with the studio.

And with "Scandal" ending next year anyway, ABC would have needed to do something with the night regardless.

"Shonda, Betsy and I started working together with the first episode of 'Grey's Anatomy' and those early days will forever remain one of the highlights of my professional life," Channing Dungey, president, ABC Entertainment, said in a statement after the Netflix deal was announced.

Glory days past?
Rhimes certainly has redefined gender, sex and race on TV, but Shondaland has struggled to find a new hit since "How to Get Away With Murder" debuted in 2014. After a mediocre freshman season, "The Catch" was retooled for its second season, but it still averaged just 3.3 million viewers and a 0.7 rating last season. And "Still Star-Crossed," a take on "Romeo & Juliet" originally picked up as a mid-season show for last season, was pushed into the summer, where it was essentially dead-on-arrival.

ABC has passed on several Shondaland pilots, including an attempt at comedy, in the last few development cycles.

For Rhimes, moving to Netflix presents "the opportunity to build a vibrant new storytelling home for writers with the unique creative freedom and instantaneous global reach provided by Netflix's singular sense of innovation," she said in a statement.

It's a jump that Rhimes has been thinking about for some time. In an interview with Ad Age last spring, Rhimes discussed life after broadcast TV. "Network television has obviously been very good to me and I love it, but there are a million other ways to tell stories now that are out there that are fascinating and I think monetizable and audiences can get really excited about," she said at the time.

In the category of silver linings for ABC, Rhimes' exit could create space to bring in fresh talent -- arguably sorely needed. ABC ended last season in last place among the Big Four broadcasters for 18-to-49-year-olds, averaging a 1.6 rating in the demo, down 11% from the year prior. It also saw a 9% drop in its total audience, averaging 6.2 million viewers.

"Shonda has been great for them, but there hasn't been much in the pipeline, she hasn't been feeding the beast," said Carrie Drinkwater, senior VP-group director investment activation, MullenLowe. "It's time for the next generation of Shondas, and this hopefully opens the door to those."

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