The crisis facing broadcast television isn't looming on the horizon anymore — it's here. Viewership has tipped decisively toward streaming, advertising is shifting to more-targeted digital platforms, and historically reliable revenue streams that have sustained local stations for decades are eroding rapidly. Broadcasters’ traditional strategies — consolidating ownership, harvesting political ad cycles, lobbying regulators — are proving collectively inadequate in the face of seismic consumer change. The Jimmy Kimmel spectacle may have grabbed headlines, but it was a sideshow compared to the real story: the accelerating obsolescence of the broadcast TV model itself. Streaming’s Relentless Winning Streak Streaming has officially overtaken traditional TV. In May 2025, streaming services captured 44.8% of all U.S. viewing, edging past broadcast (20.1%) and cable (24.1%) combined at 44.2%. YouTube alone now commands more screen time than any single broadcast network. Free ad-supported streaming services already draw bigger audiences than some of the legacy networks that once defined American culture. This transformation is not a slow erosion, it’s a wholesale realignment of consumer habits. Comparing May 2021 to May 2025, streaming usage surged 71%, while broadcast fell 21% and cable dropped 39%. Audiences now expect content on-demand, personalized, and mobile-first. Local TV, rooted in linear distribution and decades-old dayparts, struggles to keep pace. Retransmission Fees: A Crumbling Lifeline Local stations today depend more on retransmission fees than on advertising. These payments from cable and satellite operators now make up more than half of station revenue. But the system is collapsing under their feet: Pay TV households are dwindling, and by 2030 fewer than six in 10 homes will still pay for a bundle. From 2020 to 2023, local TV stations’ distribution revenue from MVPDs and vMVPDs rose 22.5%, from $12.3 billion to $15.1 billion; however, growth is expected to flatten through 2028 as cord-cutting reduces the base of paying households, creating a dual challenge of declining viewership and stagnant retransmission revenue — with no clear supplement or replacement strategies. |
