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Lost’s Ratings & Revenue

By nato64,

  Filed under: Lost, Uncategorized
  Comments: 25

As many of you are aware, Lost’s ratings haven’t been as great as they used to be, despite Lost’s return to glory in the eyes of many T.V. critics. Currently, I work in the entertainment industry and hope to shed some light on the realities of the Nielsen Ratings. Hopefully, as an enormous and vocal fanbase, we can help ensure that Lost’s grand plan never becomes compromised by lower-than-necessary ratings.

 

The Bad News

Season 4 started out strong with 16 million viewers but bottomed out with 11.4. From premiere to finale, season 4 lost 1/3 of it’s audience.

Worse yet, season 5’s premiere got the same 11.4, giving the premiere episode the same ratings as the worst episode of season 4. Premieres are supposed to generate more viewers, they are usually the highest episode of the season. If the premiere of the season isn’t as high as hoped, it doesn’t bode well in terms of the rest of the year. With all the amazing press the two hour premiere got, Lost still had the lowest rating season 4 had.

I’ll be honest, I am concerned. Articles like this are showing up everywhere. A repeat of Criminal Minds on CBS beat Lost in the 9pm timeslot, except for the 18-49 agegroup. The fact that Lost’s time slot has moved twice since Season 2 isn’t the greatest sign of confidence by ABC that they can sell Lost to the masses. Everyone believes the ABC press releases when they say they promise to not cut Lost’s large on-location budget but money is money and promises go out the window when studios are pressured. If season 5’s ratings plummet like season 4 did, well, I don’t want to think about what things ABC might do.

How the Nielsen Ratings Work

From entertainment.howstuffworks.com:

Nielsen uses a technique called statistical sampling to rate the shows — the same technique that pollsters use to predict the outcome of elections. Nielsen creates a “sample audience” and then counts how many in that audience view each program. Nielsen then extrapolates from the sample and estimates the number of viewers in the entire population watching the show. That’s a simple way of explaining what is a complicated, extensive process. Nielsen relies mainly on information collected from TV set meters that it installs, and then combines this information with huge databases of the programs that appear on each TV station and cable channel.

That all sounds well and good but the system is archaic in the 21st century. I worked as an news package editor for a Orange County news station. Eventually, he morning news show was canceled because of low ratings. What that meant was that advertisers couldn’t be convinced that anyone was watching our show. Why is the system flawed? There are a total of six Nielsen meters in all of Orange County. Those set-top boxes represent thousands of residents. There was no way to measure exactly how many people watched our show because (theoretically) less than 1/6th of Orange County watched. The fact is that we could have had thousands of viewers but had absolutely no evidence. With no evidence came no ad revenue, thus we all got laid off.

 

Downloads

As many of you know, Lost is the most legally and illegally downloaded show when it is on-air. An easy action to take is asking the illegal downloaders to actually watch Lost live, hoping that some of those people you’re pleading to happen to have a Nielsen meter on their television. However, I doubt people with a Nielsen meter would be so careless towards the system, choosing to download a show they care about instead of watching it live. So, asking people who download Lost illegally to watch it live is, in my opinion, not very helpful. The only aspect they harm is Lost’s DVD sales, as someone who has the episodes on their hard drive would probably not spring $50+ per season of Lost.

 

DVR

Lost’s ratings do improve when the DVR numbers come in. However, they don’t count towards commercials because people skip over them. Those numbers only matter towards in-show advertisements such as product placement, which aren’t very adept to Lost’s habit of being on an island. Nokia phones and McDonald’s cups aren’t very logical things for Jack to hold while being emo over Kate. Even worse for product placement, I’m sure the writers piss the execs off by insisting that all products used also tie into the mythology of lost. Sun pulling out a Widmore Labs pregnancy test is the perfect example. I have a friend who worked on Lipstick Jungle, a show riddled with very efficient product placement that blends well with the show’s tune. Their DVR numbers matter a lot due to people subconsciously watching those advertisements.

 

iTunes & ABC.com

The studios are also aware of the flaws in the Nielsen ratings and their vulnerability to illegal downloads. It has pushed them into experimenting and implementing new streams of revenue. iTunes ($1.99/$2.99 HD per episode) brings revenue directly to ABC Studios. Streaming Lost online at ABC.com brings new forms of revenue. The problem with ad revenue from online streaming is the lack of research done into advertisements’ effectiveness online, lowering the amount a given ad agency will pay per view. People’s state of mind and habits watching T.V. online completely differs from how people watch T.V. from their couch, in which decades of research has gone into studying. When you’re watching on your computer, you can alt-tab (or command-tab for you Mac users) to another application, diverting your attention to something besides the advertisement. That is why ABC.com requires you to click a button to continue. It forces you to view the advertisement in some form and interact with it instead of the episode continuing directly after the advertisement automatically.

After the news show was canceled, I was hired to edit a Web TV news show for the Orange County Register (which was canceled last month-I dunno, maybe it’s me?). Ad revenue was extremely hard to determine. Between the number of people who watched the opening, closed the window 15 seconds before the end, or viewers that watched all the way through, the advertisers were extremely hard to convince just how many people watched for how long. So, on ABC.com, you can’t skip ads and they require some interaction.

 

Conclusion

What I’m getting at is how to help make sure Lost’s greater plan isn’t threatened by low ratings from a flawed system. The ideal situation is to improve Lost’s immediate ratings via the Nielsen system. When a previous fan reads a news story about Lost’s season 5 premiere having low ratings, how motivated are they going to be to start watching again? Press is everything and if people start hearing that Lost’s ratings are back, they might come back too.

Until then, support online downloads on iTunes. Watch Lost on ABC.com and make sure to press the “Continue” button immediately when it appears, showing them that you were attentive to the ad instead of changing applications or tabs.

I hope this sheds some light on how things work. In the end, the Nielsen Ratings system is still the king of the hill until advertisers are more convinced that online revenue is an untapped recourse. So if you ever meet someone with a Nielsen box, introduce them to Lost. Or break into their house and turn it on for them.

From TVFrenzy:

  • RodimusBen

    I wasn’t aware that Lost’s ratings, despite being slightly lower than last year’s, were anything to be concerned about. Don’t networks like ABC expect a certain amount of attrition during the course of a six year show? And furthermore, I would hope they would have analysts who would realize that A) 8 month gaps between seasons are going to create some attrition and B) Lost is a unique case because it’s extremely difficult for new viewers to jump in mid-stream? All of this should have been taken into account when the network made the deal for three more seasons of 16 episodes. Most fans felt it would have been better to do two seasons of 24, but the network insisted on dragging it out… they’d better not cancel the show early as a result of their own miscalculation.

    • Season 4 started out strong with 16 million viewers but bottomed out with 11.4 (http://www.buddytv.com/articles/lost/lost-season-4-suffers-ratings-17888.aspx). From premiere to finale, season 4 lost 1/3 of it’s audience.

      Worse yet, season 5’s premiere got the same 11.4 (http://hollywoodinsider.ew.com/2009/01/lost-premiere-r.html). Think about that, the premiere episode of season 5 got the same ratings as the WORST episode of season 4. Premieres are supposed to generate more viewers. They are usually the highest episode of the season. If the premiere of the season isn’t as high as hoped, it doesn’t bode well in terms of the rest of the season. With all the amazing press the two hour premiere got, Lost still had the lowest rating season 4 had.

      I’ll be honest, I am concerned. Articles like this (http://www.hitfix.com/articles/2009-1-29-tv-ratings-fox-s-idol-rubs-salt-in-wednesday-wounds) are showing up everywhere. A REPEAT of Criminal Minds on CBS beat Lost, except for the 18-49 agegroup. The fact that Lost’s time slot has moved twice since Season 2 isn’t the greatest sign of confidence by ABC that they can sell Lost to the masses.

      Like I said, I am concerned. Although I seem to be the only one. Everyone believes the ABC press releases when they say they promise to not cut Lost’s large on-location budget but money is money and promises go out the window. If season 5’s ratings plummet like season 4 did, well, I don’t want to think about what things ABC might do.

      • FYI, I did add this comment to the top of the article due to me failing to point out the logic in my conclusion that Lost’s ratings are not a good sign.

  • Markus

    There have been studies which examined the differences between watching TV on your TV or on your computer. The results aren’t very suprising if you reflect on your own behavior: When sitting in front of your pc you are in “action”-mode and when sitting or lying on your couch in front of your tv you are in “laid back”-mode.
    I guess the problem is that the ad makers are only slowly adapting the online ads to the different behavior of the vivid online-stream-watching viewer. It’s not necessarily a different audience but the viewers are just in another state when watching online streams. And that requires other ads, too.
    (I’m sorry if my two cents make no sense, but I’m not a native speaker.)

    • Markus

      Something I forgot to add: One of the reasons that Lost is the most downloaded show is probably that it needs you to be in “action”-mode and therefore it matches better to your state when you are watching it on your computer.

      • No, it makes perfect sense. I was just saying that the more recent studies on online viewing don’t compare to the decades of research gone into advertising to people watching television. There isn’t a ton of evidence of what kind of ads work and what don’t. A lot of experimentation is going on, leading to advertisers not yet being fully confident in ads on streaming content. That’s why hulu (by NBC | Universal) is very important to the future of online video. It provided a new model to advertisers after a few years of marketing research done by NBC | Universal. Very new stuff.

        I agree with your statement about Lost being an ‘action-mode’ show and more conducive watching with your computer.

  • Ole Christian

    It’s no secret that Lost is no longer the mainstream TV show it proclaimed to be the first season.
    In the 5 years it has aired, it has evolved to more of a cult TV show, and will hopefully be remembered as a cult TV show after it ends.

    I don’t understand why ratings are so important anymore.
    It gets the last season wether the ratings suck or not.. Doesn’t it?

    And the fans are still here.. thats got to count for something, right?

    • james

      Yes, it definitely gets the last season no matter what. Unless Hawaii disappears. This show has too much after-its-over DVD sales potential to ever worry about ratings. I know I’ll buy a boxed set once its over, and ABC can count on millions of other fans for the same thing.

      This isn’t the FOX network.

    • Adam R

      To Ole Christian:

      It will most probably get the last season no matter what the ratings but the ratings do matter as ABC could cut the budget for the show meaning we wouldn’t get the quality we get now on the show. Which would mean cutting back on surprising guest stars, Special effects and possibly actors… This is a big problem!

  • professorstotch

    I would have to say that the fact ABC execs had enough trust in Lost to negotiate an end date, that they’re probably going to let it ride itself out. They may do something like put it in the Friday night death slot, but I highly doubt Lost faces any chance of cancellation or anything like that.

  • james

    It moved from Thursday night to Wednesday night. That explains the shift right there. And you say “except in the 18-49” as if that is some sort of bad thing. 18-49 is the only thing that the execs look at, and we constantly do awesome in that range.

    There is a 0% chance that this show will get cancelled. Its impossible.

  • KissyS006

    Isn’t this a moot point since there is a contract to take the show through it’s sixth and final season?

  • Butterfly_Kate

    I disagree with this idea that people who download are less likely to buy the DVDs – I think that the reason that Lost is the most downloaded shows is that people all ove the world can’t wait to see it. This translates to big international DVD sales. Regardless of ratings the DVDs are going to be making ABC a lot of money.

    • Angel

      ok maybe i am sick and i need professional help, but not only do i have all the dvd’s, AND have all the epi’s on my computer, plus i have it all on my dvr/flash stick. i have one dvr just for LOST and Heroes. even if i “accidentally” illegally download some epi’s I still pay for the DVDs

  • docarzt

    I’m guessing LOST’s strength as a global product and DVD sales alone will ensure the story is told to the end. The worst we have to look forward to is ABC shuffling episodes or cutting budgets.

    • Kermet

      Doc – you heard me mention on FB that when the show premiered my friends that were fans of the show started coming out of the wood work. I was surprised at the numbers saying the were looking forward to the premiere. Now, I haven’t seen that for any show. I am in two classes regarding television – History of Broadcasting and Aesthetic and Criticism – and most of the people in these classes are fans of Lost. In my opinion, the ratings system is flawed and pointless.

      • DocArzt

        Preaching to the choir Kerm. 😉

  • Matt

    Well… I personally got 9 Freshman students at my school into LOST last semester, and they’re almost all fully caught up now and watching it live on Wednesdays. Unfortunately for me though, I have rehearsals every Wednesday night… so, because I need to watch LOST AS SOON AS I CAN, I come home and download it from a torrent site as soon as it’s available, which is usually a half an hour after it finishes airing. I don’t feel so guilty though because A) I have gotten over the course of the show at LEAST 30 people into the show, and B) I buy every DVD box set, and posters, and merchandise and everything… I LOVE this show… it is seriously my life, and it sucks to see the ratings drop, and I wish there was more I could do for it (besides having to wait to watch it online).

    • Hipster Doofus

      Heh, you’ve got to get on the up-and-up. When I’m without TV, I have methods of downloading that are available less than 15 minutes after airing.

      But that doesn’t mean I don’t buy the DVDs when they come out.

  • Trevor

    Um… 11.4 viewers, while a drop from LOST’s previous numbers, is still by no means bad. It’s still second in it’s timeslot, losing only to “Lie To Me” which has “American Idol” as a lead in. It still beats Lie to Me in the 18-49 range, which is more important anyway. The fact of the matter is that the LOST audience over 5 seasons has been diluted to almost exclusively the diehard fans (even more evident as there was hardly any drop-off from the season premiere to the next week). The good news is these fans will stay with the show to the end and ratings will hardly falter until the show ends. The true test of LOST’s fanbase and ratings will come when the ratings monster American Idol changes to it’s 9pm timeslot against LOST. Hopefully the fanbase will stay true and LOST will still come out in second place.

    This is all moot, however, since they’ve negotiated the deal to the end of season 6. LOST may be down, but it’s still, along with Grey’s Anatomy and Desperate Housewives, one of ABC’s prized shows. It’s not going anywhere.

  • Charlie’s Ghost

    BOTTOME LINE – DON’T PUT SUCH AN EXTENDED AMOUNT OF TIME IN BETWEEN SEASONS AND YOU WON’T SEE THE DROP-OFF IN NUMBERS. SUCH A BAD IDEA ON THE PART OF ABC

  • TheRadioTower

    18-49 is the only thing that matters to the network and the advertisers and atleast so far LOST is easily a top-10 show among 18-49. For some reference Lost got a 4.9 in 18-49 demo, whereas other ABC shows like Private Practice and Scrubs get like 2.4 in 18-49 and are still on the air. Once again, for some perspective Prison Break rarely got above a 4 and yet lasted 4 seasons. There is nothing to worry folks.

  • All I can about is that it’s not on Fridays (death day for shows) and in prime time. They got screwed last season with a 10pm time slot. Most people I know, have to work the next day and 10-11pm is too late. Scrap the 8-9pm recaps and show the NEW episode from 8-9pm. Are they afraid of American Idol on Wednesdays 8-9pm? Come on LOST – Don’t jump the shark on us…

  • jackuh

    There is much to worry about. No, the show will not be canceled outright. But, if the network doesn’t feel it justifies the time slot and budget it currently has, they won’t hesitate to change it. So unless you want to be watching Lost on Fri. night at 10 pm with half it’s current budget, you might want to do something to help the ratings.

    • claytron5000

      I thik they’re almost done with production of 13 of this season’s 17 episodes. So the worst I see happening is Lost moving to a monday or a friday and having to cut back its budget. Most likely that will translate to the audience as less “large ensemble,” episodes and more focus on individual characters each time out. Which we’ve already been witness to and isn’t necessarily a bad thing.

      This whole ratings business is a crock of crap. If ABC was solely basing their confidence in Lost on the dinosaur monolith that is Nielsen then the show would have never gotten the extra three season order. Think about how many other revenue sources ABC gets out of this show. Monster DVD sales, iTunes, streaming content (what do you think that whole writer’s strike was bout?) companion books, trading cards, posters, clothing, action figures… on and on. Not too mention the international market.

      Plus every TV show’s numbers are down. Is that because less people are watching television? Nope, Nielsen just can’t keep track of the way people are watching it. You wanna guess how many people had to download or stream the post superbowl “Office” episode today because the game ran over the schedule? Ahhhh… but those people don’t even exist according to Nielsen.