Jon Nathanson, writing for the Priceonomics blog:
Viewing Subscribers grew like gangbusters in 2009 at 23% year over year (Breaking Bad premiered in 2008 and first gained traction in 2009; Mad Men had premiered in 2007). It increased at a respectable clip in 2010 and even in 2011, despite a small decline in Total Network Subscribers. And it grew at 19% from 2011 to 2012, the same year Breaking Bad doubled its audience size.
To determine the show’s effect on the network’s revenue, we need to hit the books. AMC Networks earned $1.25 billion in revenues in 2012, about 41.7% of which came from advertising, and 58.3% came from distribution and affiliate fees. As discussed, the 41.7% is the figure we care about in our analysis; it’s the one driven directly, year over year, by the shows on the network.
This was a fascinating read, and the comparisons to Venture Capital seem apt. There are a very small number of winners — and it’s hard to predict which — that really drive all the profits in the industry.
I’m waiting for someone to turn this industry on its head. In fact, the whole creative content distribution industry seems ripe for some change.