February 26, 2016

Television Thriller: Broadcasting Industry Experts and Lafayette Alumni Susan Fox ’88 and Bruce Maggin ’65 Examine Current Challenges Facing Today’s Media Companies

Industry experts and Lafayette alumni Susan Fox ’88 and Bruce Maggin ’65 offered perspectives on trends shaping the broadcasting business, and how firms successfully adapt to rapid technological change, globalization, and competitive pressures at an open forum " in the Oechsle Center for Global Education on Wednesday night. Ms. Fox is Vice President of Government Relations for The Walt Disney Company and Mr. Maggin is the founder and a principal of the H.A.M. Media Group. He began his media and broadcasting career at the American Broadcasting Company (ABC). Their combined experience represents nearly half a century of continuous history at one of the world's great media companies. Fox and Maggin serve on the Lafayette College Board of Trustees. Douglas Kilpatrick/Zovko Photographic LLC

In a world of content streaming and low cost on-demand entertainment, how have longstanding media companies adapted in order to confront the rapid technological change, globalization, and competition? In February, media industry experts Susan Fox and Bruce Maggin spoke to a room packed with policy studies students eager to gain their perspectives on trends and pressures shaping the evolving broadcasting business.

With combined experience of a half century of continuous history affiliated with broadcasting giant American Broadcasting Company (ABC), the duo were uniquely suited to discuss both historical and visionary perspectives in the industry.

Fox and Maggin focused on two segments of the media business that are in constant struggle: content—representing the industry’s creative energy—and distribution—the rights to that content, an area that is by far the most profitable. The content itself is limited, but the distribution rights can take content programming to many different aspects of media, all of which generate profit.

According to Maggin, “This year, we’ll see 400 produced scripted shows, twice as many as five years ago, because of worldwide demand for product,” demand which has grown exponentially over the last 15 years and shows no signs of slowing down.

Today’s content has changed radically to an online model of production and distribution, where the profitability potential is staggeringly high due to comparatively inexpensive production costs. According to Maggin, an unprecedented 45 percent of all video consumption is streamed today.  Some YouTube users have earned millions of subscribers and dollars from their videos—with the production costs close to nothing.

In contrast, as production costs for traditional scripted television have risen, viewership has decreased. For traditional companies, high production costs make it unfeasible to produce an entire season of a series. Making a successful series is extremely difficult and more often than not, failure results in hundreds of millions of dollars down the drain. “Reality television and news programs don’t cost much,” says Maggin, “but there isn’t a lot of replay either.”

Content is always looking for an outlet, and in that regard, the business hasn’t changed, says Fox. What has changed is the big data, some 40 billion pieces of data generated by just 20,000 programs. For example, television data was once gathered by Neilson. Today, “Netflix guards data, both viewership numbers and demographics, with a vault. Who owns that data stream? And how regulatory can the government get?”

Fox and Maggin agree the industry is dynamic but risky. “No one knows what the next big thing will be. If we knew, we could plan. No one has the crystal ball. The world changes,” according to Maggin.

After the discussion, policy studies major Corinna Anderson said, “Fox and Maggin provided interesting insight into the industry and helped us to understand how the changing needs and desires of their customers create challenges for the broadcasters. It was also fascinating to hear individual accounts of how broadcasting has drastically changed since they each started working in the industry.”

As vice president of government relations for The Walt Disney Company, one of the world’s best known and most valuable brands and owner of ABC, Fox represents Disney’s operating divisions before the federal government, with a particular focus on global business, technology, and public policy issues that affect Disney’s diverse and wide ranging media interests. After graduating from Lafayette with a degree in engineering, Fox continued on to University of Virginia School of Law. Prior to joining Disney, Fox served as deputy chief of the FCC Mass Media Bureau and as then-FCC Chairman William Kennard’s senior legal advisor.

Maggin is the founder and managing partner of The H.A.M. Media Group, an international investment and advisory firm specializing in the media, entertainment, and communications industries. After graduating from Lafayette, Maggin went on to earn both his JD and MBA at Cornell University. In 1970, Maggin joined then-fledgling ABC, holding senior management positions in virtually every segment of the media and communications industries over the next four decades. During his tenure at ABC, Maggin directed the company’s digital activities, including the development and production of content for emerging platforms such as video games, online services, location-based entertainment, and video on demand, and he oversaw the creation and development of the Lifetime and ESPN networks.

Fox and Maggin serve on the Lafayette College Board of Trustees.