051麥肯錫-公共電視運營模式

1、Developing a Sustainable Economic Model for Public Television,,May 29, 2003,CONFIDENTIAL,1,PROJECT ASPIRATIONS AND KEY QUESTIONS,,Identify and drive major changes that will put public television on a more sound economic

2、footing and ensure its future success,How severe and long lasting are the financial pressures on the system?,,How should we launch these initiatives and effect lasting change?,Which performance improvement opportunities

3、offer the most promise?,2,CHALLENGES: BOTH STATION ECONOMIES AND PROGRAM DEVELOPMENT ARE AT-RISK,* Excludes capital funding for digital upgrade. Revenues not adjusted for inflation**Growth rate from 1994-2001Source:

4、 CPB Audited Financial Reports (AFR), PBS analysis (dues), Appendix Q from PBS SG white paper (“Funding for PBS NPS Programming by Funder Category”),,$1.93 Billion,,$450 Million,2001 Local Station Economy,2001 National P

5、rogram Funding,Prospects for future revenue growth,3.5 % per year*,,3.1 % per year**,Historical growthin revenues (1990-2001),Currentsize,Decline in real terms due to falling net member revenues,A system decision,5.4 %

6、 per year,Flat to very slowly growing (1% above inflation),2001 Station Assessment,$107 M,3,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,

7、,,,,,,,,,,,,,,,,,,,,,,,,273.3,374.0,249.4,328.5,230.5,330.5,205.6,347.6,128.6,259.6,104.2,145.6,62.9,94.5,,Total PTV system revenue,* 1990 and 2001$ Millions,University,In-kind,Corporate and foundation giving,Unrelated

8、business,State and local funding,Federal funding**,Member giving,*Excludes capital funding for digital upgrade, additional capital fundraising, endowment, and interest **Federal agency grants for 2001 are estimated

9、(assumed 5% growth over 2000)Source:AFR; federal reports; PBS annual reports,$1.25 billion,$1.88 billion,CHALLENGES: ONLY GROWTH AREAS ARE UNRELATED BUSINESS AND UNDERWRITING,1990,2001,3.8,3.1,6.6,4.9,3.3,2.9,Annual G

10、rowth %1990-2001,2.5,Drivers of growth,,4,,CHALLENGES: HISTORICALLY, THE SYSTEM HAS GROWN THROUGH DIVERSIFICATION – NOW ALL REVENUE SOURCES ARE THREATENED,Source:AFRs; Team perspective,,Future Outlook,5,CHALLENGES: NET

11、 STATION MEMBERSHIP REVENUE HAS DECLINED IN REAL TERMS SINCE 1990,* All growth rates are compound annual growth rates.Source:AFRs; Bureau of Labor Statistics,Fundraising costs: 1.0%,Net membership revenues: -0.9%,$17 m

12、illion lost income,$ Millions, Adjusted for inflation to constant 2001 $,Gross revenues: 0.1%*,,6,CHALLENGES: DECLINES WILL CONTINUE IN NET MEMBER SUPPORT,Pledge, which is the engine of new member acquisition, has seen r

13、ising costs relative to new member yield in line with declining productivity trends outside PTV,,Net renewal revenue will not offset declining acquisitionStations already have among the nonprofit sector’s highest renewa

14、l ratesRenewal mail’s productivity is flat to decliningDeclining ratings increase stations’ challenge,Falling ratings likely contribute to the long term membership decline, both because the prospect pool with a connect

15、ion to PTV shrinks and because membership renewal is highly correlated with audience,With the number of nonprofits growing twice as fast as real household charitable giving, stations will be hard pressed to grow their sh

16、are of members’ wallets,Source:“Donor Centrics Comparison Report for Public Television, December 2000;” DMA Factbook 2001; Giving USA 2002,Audience Size,New Member,Renewing Member,Philanthropic Environment,Membership R

17、evenue Drivers,Outlook,,7,CHALLENGES: STATION HAVE MET THESE CHALLENGES IN THE PAST BY CONTROLLING COSTS ACROSS THE BOARD,1990,Underwriting,Program information,Fundraising,Management and general,Broadcasting,Programming

18、 and production,100% =,$1.80 billion,7.9,3.3,3.8,3.1,4.0,3.8,* Expenses do not include CPB or PBS overhead or CPB provided nonstation grantsSource:AFR; PBS annual report, 2001,Annual Growth Rate1990-2001,Stations exp

19、ense, 1990 and 2001Percent,100% =,$1.19 billion,2001,NPS dues and services,4.0,Nearly 1/3 of station programming and production costs are concentrated in producing stations for national programming,8,,2001 Actual,2010

20、Illustrative,Broadcast ops,Membership,Educ. / outreach,Other,CHALLENGES: REVENUE DECREASES WILL PROMPT REPEATED PAINFUL COST REDUCTIONS,Source:SABS; interviews,Station cost-cutting scenario:,,15% revenue loss,Acquisitio

21、n & scheduling,Prog. production,General & administrative,$10.7 million,Underwriting,Website,76,Reduce headcount by 26%, from 80 to 59Cut local production budget by 40%, reducing annual locally produced hours fr

22、om 109 to 65Eliminate the Program GuideMaintain or slightly decrease investment in website and education,76,,,$9.1 million,Illustrative expense budget for an average medium/large community station,100%=,9,,,CHALLENGE

23、S: CAPITAL INVESTMENTS MAY FURTHER REDUCE AVAILABLE FUNDING,Only $800 million of the estimated $1.7 billion goal has been raised,Plans are to replace current infrastructure by 2006 using CPB’s $177 million appropriation

24、request,Source:CPB; APTS Digital Clearinghouse; PBS estimates,Next Generation Interconnect,New Services,Planned capital investments,Potential strategic investments,Bringing the best of public television into a digital

25、 media world through the use of digital cable, VOD, PVRs and High Definition programming,Innovating and launching new services such as distance learning or new media services that may not generate income, at least in the

26、 near term,10,CHALLENGES: NATIONAL PROGRAMMING, LIKEWISE, FACES UNPRECENTED PRESSURES,,,,Unprecedented changes in audience demographics and viewing environmentIncreasing investment in programming and promotion from cab

27、le competitors,External Pressures,Internal Pressures,Little or no growth in traditional sources of revenueRising costs and new costs (such as HD production),Responses,Introducing new/limited series and specials to slow

28、 ratings declineIncreasing funding from CPB and PBS to cover rising per hour costsGreater reliance on fully-funded programsPeriodic cost reduction,NationalProgramming,11,CHALLENGES: NO RELIEF FROM TRADITIONAL PROG

29、RAMMING FUNDING SOURCES,*Includes government agencies such as NSF and NEH, but not CPB appropriationSource:PBS SG’s Environmental Scan of the PBS Sponsorship Sales Model August 2002; 2002 figures are estimates as of

30、12/12/02,Growth in total programming investment - NPS / Plus / SIP / Select (1991-2001)$ Millions,Corporate, Foundation, private producer, other*,Station, PBS, and CPB,,,,,1991-2001 Growth Rate,7.1%,5.4%,2.6%,266,301,

31、338,267,291,327,370,311,326,379,450,Prospects for future funding growth,Source,,1991-2001Growth RatePercent,,Future outlook,,PBS /,stations,,4,,-,impossible to increase assessments,absent very compelling case,,,,,,Corp

32、orate,underwriters,5,,Ability to join in recovery of TV ad market threatened by turnover of keyunderwriters and commercial competition,CPB,,3,,Federal deficits, fiscal environment,threaten requested increases,,Foundatio

33、ns,,9,,Slower growth likely as foundations,stabilize giving levels after rapid,increases in the late 1990s and,shrinking endowments since 2000,,Independent,producers,,8,,Continued growth uncertain,,Government,agencies,,9

34、,,Threatened by government deficits,,Other,,10,,Too small to make a difference,,,,,432,12,,CHALLENGES: INCREASINGLY, NATIONAL PROGRAMMING DOLLARS HAVE LESS LEVERAGE RELATIVE TO COMPETITION,,Growth Rate19.9%,Programming

35、 investment of 4comparable cable nets,Annual programming investment, 1993-2001$ Millions,Source:Kagan's Economics of Basic Cable Networks 2002; TV Program Investor; PBS,NPS original broadcast and re-up spending,,

36、Growth Rate4.7%,,,Average investment$41M/year,PTVinvestment$334M/ year,PTV investment$450M/year,Average = $183M/year,,8:1,,2.5:1,13,,CHALLENGES: INDEPENDENT COMMERCIAL BROADCAST STATIONS FACE SIMILAR PRESSURE AND AR

37、E RESPONDING WITH SIMILAR SOLUTIONS – INCREASE SCALE AND IMPROVE PRACTICES,Pressure on local news – the cash cow from:Audience fragmentationGreater competitionRatings for syndicated programming down while costs are up

38、Decreases/elimination of network compensationDifficult ad marketDTV mandatesThreat from more O&Os,Industry Pressures,,Acquisition/consolidation to achieve scaleProgram acquisitionTechnology investment (e.g. tra

39、ffic operations, sales systems, graphics)Shared services (e.g. accounting, HR)Upgrade of sales practices and systems (e.g. pricing),Industry Responses,14,,OPTIONS: WE BEGAN THE PROCESS BY DEFINING A SET OF CRITERIA,Cr

40、iterion 1: Likely, large, and near-term: represents >$10M net per year within 5 years, based on clear business case from compelling internal examples or relevant external benchmarks,,Criterion 2: Under PTV control: A

41、chieving the opportunity did not rely solely on a “happy accident” outside of the system’s control,,Criterion 3: No major strategic issues: pursuing this would not require major consultation to reassess/reaffirm the stra

42、tegy, mission, positioning of PTV,15,OPTIONS: A BROAD RANGE OF IDEAS WERE COLLECTED THAT WE BELIEVED MIGHT MEET THE CRITERIA,,,,,,Traditional Revenue Sources,C. Foundations,D. Local Partnerships,Ancillary Sources,Digital

43、 Television,B. Federal Support,,B. Collaboration,Master ControlCommercial PartnersMembership/Underwriting Sales,B. Change Programming Mix,,System Efficiencies,Programming,A. Improve Lower Performing Stations,16,,,,OPTI

44、ONS: WE ANALYZED THE IDEAS AGAINST EACH CRITERION,,,,,,,,,,,,,,,Criterion 3 - No major strategic issues,Criterion 2: Under PTV control,Criterion 1: Likely, large, near term:,Major giftsMember retentionMembership costN

45、ational underwritingLocal underwritingFoundation fundraisingCable ChannelDomestic windowingVOD/TIVONew digital servicesIncreased federal support for DTVRights managementSystem efficiencies,Need a strategic plan

46、to pursue,Cable ChannelDomestic windowing,Prepare for but avoid over- investment,VOD/TIVOIncreased federal support for DTV,,,Good ideas but insufficient to secure financial health,New digital servicesMember retention

47、Membership costLocal underwriting,,,,,,,,,,,,,,,Major giftsMember retentionMembership costNational underwritingLocal underwritingFoundation fundraisingVOD/TIVONew digital servicesIncreased federal support for

48、 DTVRights managementSystem efficiencies,Major giftsMember retentionMembership costNational underwritingLocal underwritingFoundation fundraisingNew digital servicesRights managementSystem efficiencies,,,,,

49、,,,,,,,Major giftsNational underwritingFoundation fundraisingRights managementSystem efficiencies,17,,OPTIONS: THREE POTENTIAL SOLUTIONS PASSED EACH SCREEN,Expand major and planned giving effortsPursue cost

50、 savings through station and system efficienciesImprove model for National Programming,18,,,*Based on case study stations, including KUED, OPTV, KNPB, and WGBH Source:Station interviews; McKinsey Nonprofit Practice

51、,Giving pyramid for typical station before launching major gift effort*,Giving pyramid for typical station after launching major giving effort,,,,,,Major giving revenue,6%,94%,13%,87%,,,SOLUTIONS: MAJOR GIVING HAS A POTE

52、NTIAL IMPACT – $20-$35 MILLION NET REVENUE,If all stations could see comparable improvements, system could raise $20-35 million net revenue,19,,SOLUTIONS: CASE STUDIES OFFER USEFUL ROLE MODELS FOR STATIONS LAUNCHING

53、HIGH TOUCH DEVELOPMENT EFFORTS,Source: Station data (KLRU, KNPB, Oregon PTV, and KUED),6.5,1.6,1.6,Cost per dollar raisedPercent,4.7,6.0,2.0,-17.2,.9,,,,KNPB’s major giving effort was successful because they aggressive

54、ly targeted high net worth individuals for large gifts$ Thousands,KLRU’s major giving effort grew ~3 times as fast as their regular membership efforts$ Thousands,Oregon has been successful because they expanded a full

55、 range of high touch development efforts, including major giving, planned giving, and an endowment fund$ Thousands,75,90,113,Number of major donors,27,47,71,106,25.6,Midlevel giving,Major giving,Planned giving,Endowment

56、,34,80,82,122,112,Number of major donors,7,63,85,N/A,95,127,33.6**,1,701,787,460,615,697,Cost per donor$,0,814,575,N/A,960,632,-10.4***,KUED’s long-term investment in major giving has led to a ten-fold increase in this

57、revenue$ Thousands,Growth Rate,25.5**,1,420,2,174,3,054,3,790,4,519,7,853,8,495,,Growth Rate,28.9,,Growth Rate,14.0,20,SOLUTIONS: SUCCESS REQUIRES SIGNIFICANT ACTION,* Defined as stations with no or limited major giving

58、 efforts or reporting, less than 6% of total member revenues from major gifts) ** Defined as stations where major giving revenues account for 6-13% of total member revenue ***Defined as stat

59、ions where major giving revenues account for +14% of total member revenueSource: SABS,Stations segmented by major gift efforts,Total=,176,$374M,Number of stations,Total member revenue,Strong major gift effort***,Limite

60、d major gift effort*,Some major gift effort**,Establish full range of high touch development efforts (i.e., major giving, planned giving, endowment development),Opportunity,Potential,$10-20M net revenue,Raise current eff

61、orts up to best practice (e.g., improve existing major giving, expand menu of high touch development offerings),$8-15M net revenue,Continue efforts to achieve full potential,Total unknown,,$20-35M+,,21,SOLUTIONS: MEMBERS

62、HIP STAFF OUTNUMBERS MAJOR GIVING STAFF OVER 6:1,Source: SABS,,Serve over 1.5 million members and over $120 million in revenue,,Serve 8500 major givers and over $40 million in revenue,,,22,SOLUTIONS: KEY ELEMENTS OF OUR

63、 PLAN WILL INCLUDE DEVELOPING CAPACITY AT STATIONS – WITH GMs AND BOARDS, AS WELL AS WITHIN DEVELOPMENT DEPARTMENTS,23,McKinsey Study,,,SOLUTIONS: SYSTEMWIDE OPERATIONAL EFFICIENCIES HAS THE POTENTIAL FOR $40 - $200 MILL

64、ION,Centralized Master ControlRegionalNationalConsolidated transmission facilitiesFully automated traffic management & schedulingCentralized IngestProducing centersInterconnection POPConsolidated archivingCe

65、ntralized/national purchasingConsolidated IT/Telcom functionalityAdministrative/Back office consolidation,= Opportunity Cost Savings $$,,,Booz Allen Study,Accenture Study,24,SOLUTIONS: BROADCAST OPERATIONS WORK FLOWS

66、PROJECT,,DECISION,,IMPLEMENTATION,,,ANALYSIS & PLANDEVELOPMENT,,COMMUNICATIONS,LAUNCH,25,,SG sells additional sponsorshipInventory,SOLUTIONS: NATIONAL PROGRAMMING’S OBJECTIVE – IDENTIFY IMPROVEMENTS IN VALUE CHAIN

67、(NEW PROCESSES, DIFFERENT ROLES),,,Set priorities/ agenda,Commission projects/ analyze results,Synthesize all findings,Share/ distribute findings,Set strategy,Define future schedule plan/goals,Devise metrics to measure s

68、uccess,Local underwriting spots sold,Distribution agreements made,Inventory/ manufactured stocked,Sales,Schedule and pop outs announced (Jun),Station “tool kits” assembled,Commission project,Green light for national sche