Academic journal article Atlantic Economic Journal

A Fable for Prime Time: The Fox and the Peacock

Academic journal article Atlantic Economic Journal

A Fable for Prime Time: The Fox and the Peacock

Article excerpt

As recently as 1978, the three major television networks commanded more than 90 percent of the prime time viewing on any night. However, by 1990, the competition from cable and the new Fox network had cut their combined share to 63 percent. At the end of the 1996-97 season, it was less than 50 percent. The differential impact Fox has had in competing head-on with ABC, CBS, and NBC in prime time (Monday through Saturday, between 8:00 and 11:00 p.m.) has not, however, been the same for all three networks.

A regression of each network's prime time ratings [Nielsen Media Research, 1997] from 197879 through 1996-97 against a time trend (YEAR) and a binary variable (FOX) (equal to 1 since the 1990-91 season) produced the following results:

[Mathematical Expression Omitted]

[Mathematical Expression Omitted],

[Mathematical Expression Omitted]

where absolute t-ratios are in parentheses. While all three major networks' prime time ratings have decreased since 1978, only NBC has been negatively affected by Fox[prime]s entry into the television viewing market. …

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