NBC profits rise, but did the strike hurt?
In a first quarter where scripted programming was severely limited by the effects of the lengthy Hollywood writers strike, NBC Universal managed to boost its revenue by 3 percent to $3.58 billion, and increase it profit also by 3 percent. But it fell far short of its target of 5-10 percent profit growth.
The truth is, NBC was a bright spot in a surprisingly weak quarterly financial report of parent General Electric, whose overall results were hurt by the soft economy. GE has so far said little about the catalyst or troubles of its media arm which has been struggling since favorites “Friends” and “Frasier” ended their runs four years ago and faces particularly intense pressure to rebound. NBC could again finish the season last in the ratings race behind Fox, ABC and CBS.
It’s possible the profit and revenue gains were the result of cost-cutting. Or, despite Bruce Springsteen’s assertion that there are “57 Channels and Nothin’ On”, maybe TV lovers, you know, love TV, no matter what is on — even if it is a never-ending stream of reality programs such as “Deal or No Deal” and “The Apprentice.”
Fortune suggests that the results may fuel cries for GE to spin off or sell its media holdings.
UPDATE: Here’s what GE executives said about NBC Universal on the conference call they held with investors Friday morning:
- Its shows have been performing pretty well and NBC prime time is on track to finish number two.
- Local ad spending was down 11 percent, “an indicator that it’s tough out there.”
- In cable, “USA was No. 1 for the seventh consecutive quarter.”
- MSNBC had its highest-rated quarter in six years.
- Ratings at CNBC Business Day were the highest in seven years
- Film “had a very strong quarter,” and operating profit was up, principally driven by the this year’s DVDs.
Keep an eye on:
- Yahoo may have played its top two cards by pulling out possible deals with AOL and Google, but it does not seem to have changed Wall Street’s view that Microsoft will eventually win the takeover battle. (Reuters)
- Blockbuster is developing a set-top device for streaming films directly to TV sets and is expected to announce the offering sometime this month. (Hollywood Reporter)
- Facebook has hit 70 million users. It still trails MySpace, but is growing fast: Last summer, Facebook hit 30 million active users. (AlleyInsider)
- Is Katie Couric simply overpaid? (Time)