TV shows are getting rocked by a drop in viewership, according to a new report by analysts at Pacific Crest.

The “golden age” of TV shows might appear to be in full swing still, and it certainly is in terms of output. The industry is on pace to handily beat the 409 scripted shows released in 2015, continuing an upward trend.

But there’s a problem: people aren’t tuning in, at least in the same numbers. For new episodes last quarter, “average viewership for the top 200 general entertainment series declined 20% year-over-year,” according Pacific Crest (using the L+3 measurement, live plus three days). Networks are still pumping out shows, people just seem to have lost a bit of interest.

It’s even worse with kids’ shows, which saw the top 500 series take a 30% viewership dive in Q3 versus last year, the analysts noted in the report.

This downward trend has been bad for advertising revenues this quarter. “Outside of NBC [and the Olympics bump], advertising results were at or below expectations in aggregate, likely driven by weaker-than-anticipated viewership at most networks,” the analysts wrote.

In the report, Pacific Crest pointed out a few media companies that have suffered recently:

    "More competition in serialized dramas has led to ratings declines at key originals for AMC." "Weaker engagement with key movie titles has negatively impacted Lionsgate." "Subscribers moving to packages without ESPN has negatively impacted Disney." "Kids' content is secularly challenged, which continues to affect Viacom."

AMC's woes

TV network AMC is a particularly instructive example when it comes to the TV industry, and high-quality dramas.

AMC built its recent success out of high-quality dramas like "Breaking Bad," "Mad Men," and "The Walking Dead." But now the rise of streaming services like Netflix, and the insane amount of shows being produced, might be bringing AMC down.

"Average audiences for almost every returning AMC original in 2016 are down double-digits versus 2015," Pacific Crest analysts wrote last month. "This highlights the increase in competition for viewer time. In particular, the explosion in high-quality original dramas driven by [streaming video on demand] companies [like Netflix] has commoditized an area of programming that AMC helped popularize and represents the core of the network's brand."

With the amount of good shows increasing and the amount of people watching decreasing, something likely has to give, eventually.

Peak potential

Perhaps we will see the "peak TV" moment that FX boss John Landgraf has been talking about for awhile.

Landgraf had previously predicted we'd see the peak number of scripted shows in 2016, but then revised his estimate to "by 2019 at the latest," after seeing how much money Netflix was investing in original content.

"I'm not saying that I believe we are in a bubble, which is going to pop, causing us to go from 500-plus scripted series to half that number," Landgraf explained in August. "Rather, I think we are ballooning into a condition of oversupply which will at some point slowly deflate, perhaps from 500-plus shows to 400 or a little less than that."

There might be diminishing returns for producing beautiful, moving, and expensive TV shows - if you can't cut through the noise.

Regardless, Pacific Crest says something needs to change for media companies to hit their numbers next year. "Viewership trends will likely need to reverse for 2017 estimates to be attainable," the analysts wrote.