A problem with “narrowcasting” is that as
niches become more sharply defined they also become smaller. This is a problem for the TV companies that make their money through the sale of
advertising spots in their
commercial breaks. A small audience will yield small
ad revenue.
The counter argument is that a better-defined audience makes for more valuable media; consequently the average 30s spot on “Men and Motors” should be more valuable to a Ford than the equivalent spot on “Sky 1”. The specialist channels allow advertisers to develop niche-marketing campaigns that are supposedly more cost effective.
Both these arguments are true; since the cost of running a channel is falling, the narrowcasting business model is becoming increasingly more viable. Accordingly, the number of TV channels is increasing.
Most people think that this kind of media fragmentation is a bad thing. In the 80’s, TV pundits predicted that this approach to channel design would result in more choice. Actually, the opposite seems to be true. The reason is that, all channels no matter how small have to fill up a schedule – small channels can only afford to show a few premium shows so the rest of the content has to be cheaper padding.
Although there are the same amounts of good shows out as there always were, they have been diluted by a far greater quantity of bad shows. It’s harder for people to find the things they want to see. This has fuelled the demand for products like TiVo and Video on Demand – both systems actively overcome the weaknesses of narrowcasting.