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Jan. 8 2010 - 12:33 pm | 2,513 views | 4 recommendations | 35 comments

Leno move to late night a done deal –NBC risks going from bad to worse

conan_o_brien

Two very highly placed individuals in the television industry – a well known network executive and a lawyer in the television business  - tell me that NBC has made the decision to move Jay Leno back to 11:35pm.

However, Conan O’Brien’s situation remains fluid.

When Conan cut his deal six years ago to take over the 11:35pm show, he built in a large penalty payment –roughly $45 million – should NBC yank the show away from him before his contract was finished. O’Brien was worried that, based on NBC’s record of botching late-night transitions, he could suffer the fate of his predecessor, David Letterman.

For those who may not recall, the Leno-Letterman debacle followed Johnny Carson’s retirement as the long-time host of The Tonight Show. Letterman, who had the 12:35 time slot following Carson, was heir apparent to replace Carson upon his retirement. Leno, however, had been extremely successful as the guest host fill-in when Carson was away from the show and the network worried that Letterman’s edgy humor might not play well in the earlier time period. What ensued was one of the great dramas in television business history.

Leno won – Letterman left for CBS.

Stuck with this $45 million obligation to O’Brien, cost obsessed  NBC would like to not have to pay up on the deal. However, they cannot afford to keep Leno at the 10:00pm slot as their local television station affiliates are in open revolt over Leno’s weak lead-in to their 11:00pm local news broadcasts. Keep in mind that local news broadcasts is where your local TV station makes almost all its money and their ratings have plummeted due to Leno’s poor performance.

As a way out of all this drama, NBC has offered Conan the opportunity to keep The Tonight Show if he agrees to move to the 12:05 time slot with Leno doing a half-hour beginning at 11:35pm. Technically, this would keep NBC from being in breach of O’Brien’s contract. They have also told O’Brien that if he decides to leave for another network, NBC will allow it, despite having the right to prevent him from doing so – but he can’t take the large penalty payment with him.

At the end of the day, this is all about the $45 million. If NBC can get out of the payment, they’ll let Conan do whatever he wants as long as it doesn’t involve hosting the 11:35pm NBC show.

I’m told that O’Brien, who has experienced less than stellar ratings in his new time period, is seriously ticked off because he believes he has not been given a sufficient chance to build his audience. He might be right.

NBC would do well to remember part two of the Leno-Letterman story.

After Leno was given the job, Letterman went to CBS where he spent the first year beating Leno in the ratings. So serious was the situation that NBC considered pulling Leno from the show. Bear in mind that The Tonight Show is NBC’s largest cash cow and losing advertising revenues to CBS was serious stuff. Eventually, and some say thanks to an appearance by Hugh Grant after being busted for picking up a hooker on Santa Monica Blvd., Leno took over as number one and never gave it back.

However, there was more to the story. What you may not know is that Letterman’s decline probably had more to do with the decision of CBS’s largest affiliate group (the New World Television owned and operated TV stations) to pull their affiliation with CBS and became Fox affiliates. Virtually overnight, a large number of markets were either without a CBS affiliate or were in the throes of the confusion that results when a network switches to another station on the television dial. The change caused Letterman, along with the entire CBS schedule, to lose a serious share of audience.

I know the impact this had on the show as I was president of New World Domestic Television – the owner of the stations that made the switch to Fox.

From what I’m told, short of Conan deciding to leave the network entirely without his $45 million penalty payment, NBC prefers putting Leno into a half-hour show at 11:35am before turning it over to O’Brien.

Big mistake.

If there is one thing we know, late night television viewers are creatures of habit. They want Jay Leno in a format that allows him to do what they are used to him doing – and that simply cannot happen in a half-hour format.

If NBC goes this route, my prediction is that they will further tank their late night ratings – and wipe out hundreds of millions of dollars in profits in the process.

Jeff Zucker should wise up and try to avoid making another expensive mistake. It’s better to bite the bullet and take the loss on the O’Brien deal. It would also be better for Conan to find a new network home. Putting Leno in a half-hour format might very well turn out to be a terrible lead in for O’Brien, causing Conan’s ratings to sink further as Leno fans leave NBC after the half hour to catch Letterman begin the interview segments of his show.

Even worse, the audience is not likely to accept Leno in this half-hour format, creating an expensive disaster for everyone on the NBC late-night schedule.


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  1. collapse expand

    NBC’s poor business decision might be scrapping the 3-hour prime time network model and adopting the 2-hour model that Fox has. In the 2-hour model, only the 8-10 pm shows “count” in determining the network’s popularity – which gives Fox an advantage against the big 3.

    NBC gambled that Leno would stay “popular” against whatever CBS and ABC put up @ 10. Leno, however, is only “popular” when put up against other late-night talk shows.

    Who would want to watch a talk show if they had an alternative? I sure as hell wouldn’t. They are only good at putting someone to sleep.

    • collapse expand

      This could happen but likely would not.
      A switch resulting in NBC’s prime-time schedule ending at 10pm would be hugely disruptive to the news broadcasts that follow. in every market, there are 10pm news broadcasts that are firmly entrenched. Were NBC’s local news operations to make the time period switch, they would suffer an even greater hit in the ratings until they can take root – if they can take root. One of the most difficult challenges in television is changing viewing habits in local news. Once a local broadcast falls, it is not unusual for it to take 10 years to get back into a better position. WIth local tv stations already suffering dramatically, they could not possibly afford to take this hit. What’s more the affiliate agreements between NBC and their affiliates require NBC to provide programming until 11pm. WHile the NBC owned and operated stations (in the major markets) could be forced to make such a change, the affiliates that do not belong to NBC would go nuts and start looking for new affiliations. NBC couldn’t handle that.
      So – while anything is possible – it is highly unlikely that we will see such a change at this time.

      In response to another comment. See in context »
  2. collapse expand

    I was involved in launching both Leno’s first web effort and Conan’s first ‘real website’ in the late 90’s..

    This whole drama has been riveting to look at from afar (I’m back home in Canada now and working in radio) .. .especially as someone who had an inside view of the machinations of both shows.

    You know what they say, the view in the sausage factory is never pretty, but I enjoyed my time at both late-night programs and as a kid from Nowhereville Canada, it was fascinating and one helluva ride.

    I really feel for both these guys. Both were excellent comedians in their own right and fantastic guys to work with and for. Both Jay and Conan were such gentlemen to this kid who showed up one day with plans to take their comedy and put it on this thing called “the internet’.

    They both gave freely of their time and attention to make sure that the websites were a natural extension of their TV program. Any success those early web efforts achieved, were really a result of the tireless efforts of the two hosts and their directives to staff to help me however possible.

    The executive producers, Debbie Vickers at Tonight and Jeff Ross at Late Night were both amazing people. It was an education to watch them run those shows the way they did and despite being very busy professionals, they too made time for this ‘internet kid’ as I became known.

    And honestly same is true of the writing staff at both shows as well. Joe Medieros and Mike Colasuonno at Tonight really went out of their way to ensure the web stuff kept the right tone and flavor of the show.

    I really couldn’t, even if pressed, say anything negative about either man or their show or staff. I know, I’ll never write a tell-all expose with such non-explosive truths. (haha)

    It pains me to see that NBC has, in an effort to prevent a re-run of the Letterman/Leno debacle, created an even bigger mess. NBC seems to have an unmatched and uncanny ability to put the worst person possible in charge of the Peacock’s Entertainment Division and the decisions that flow unchecked from those folks sometimes just defy all logic and reasonable thought.

    I remarked to a friend who is a retail manager recently that he and I and a monkey could run the NBC Entertainment Division better than the last five or six people in that role, and that would be presuming we both reported to the monkey.

    Logistically, as I look at this, I think the smartest move is for Conan to walk. He’ll do better elsewhere at this point and has a good shot and helping the late night hours of Fox or ABC. He might be able to single-handedly create the late night block that Fox has tried and failed to create in the past. Conan at 11:35 and give Wanda Sykes the 12:35 slot.

    That could create a real horse race in late night and who knows, with the resources of Murdoch or Disney, Conan could possibly give Jay a run for his money.

    But this ‘compromise’ that’s been worked out with Leno at 11:35 for 30 minutes etc, Conan after that with the “Tonight Show” … I agree with the editorial above… that just feels wrong, and is likely to fail again.

    Just about as wrong as Leno was for ten pm.

    John Knox

  3. collapse expand

    Jon Stewart and Stephen Colbert could be the big winners here. Comedy Central should do a quick marketing campaign, and then keep feeding it while this late night war drones on. Also maybe an option for Howard Stern to finally enter the late night TV zone. His radio contract is up soon, the timing might be just right…

    • collapse expand

      Could be. However, Howard Stern’s efforts in television have been disastrous. ‘Common wisdom’ among programmers is that Howard is a voice best heard and not viewed.

      In response to another comment. See in context »
    • collapse expand

      If Stewart/Colbert ratings were factored in, the network’s offerings would pale in comparison. But since Stewart/Colbert are on cable, not networks, their ratings aren’t factored into the numbers.

      Ratings are a rigged system, designed to fool advertisers and audience members into thinking a show is “popular” when, in fact, it’s much less popular than (1) a cable show, (2) a dvd/taped show, or (3) people not watching television.

      In response to another comment. See in context »
      • collapse expand

        runaway –
        Actually, neither of those statements are true.
        Cable ratings are very much tracked and ‘factored in’. And network ratings do not pale in comparison. There are certainly examples of where cable numbers do beat network numbers but this is no secret. Further, it is clear to everyone in the TV business that cable ratings are on the rise as network ratings fall. However, for the most part, broadcast network ratings continue to outpace cable — but it is most definitely narrowing.

        Neilsen ratings are not rigged–they are simply not particularly well executed. They obviously take into account when people are not watching television. If you know how to read ratings, you will see two numbers- one is the percentage of people watching tv who are watching the show, the second is the percentage of all TV households watching the show. When you add up all the programs on at a given time period, we know how many people are watching tv and how many are not.

        As I say, the ratings system could be much better — but it is not purposely rigged.

        In response to another comment. See in context »
        • collapse expand

          Actually, they don’t do a true comparison. Instead they have one ratings list for the networks at prime time and another for non-prime time – and still another for cable – and hope the general audience doesn’t notice. But – for the first time – a late night show was placed on the same ratings list as prime time and people can see for themselves just how popular it really is.

          This isn’t intended to denigrate Jay or Conan, but it’s an example of what happens when suits start to believe their own press releases.

          In response to another comment. See in context »
          • collapse expand

            I don’t know who you mean by “they”.

            When I see overnight ratings, I see them across a time period line that includes everything on during the time period. network, cable, whatever.

            When I see weeklies, same thing. When I see the quarterly books, I look up shows and see what the numbers were during sweeps.
            Now, the people who re-print numbers (newspapers, etc.) may chose to present it differently, but that has nothing to do with Nielsen.

            And regular viewers don’t see Nielsen reports unless they pay $50k a year for the privilege – or read them in the local newspaper or the trade magazines.

            As for suits believing their own press releases, I don’t know how much experience you have in the television business, but this isn’t like politics. One thing ’suits’ don’t kid themselves about are ratings. There’s no spinning with ratings. They are what they are…and TV and ad execs. live and die by them.

            I’m afraid television is not quite the conspiracy you seem to think it is.

            Ratings are not done for the ‘general public’. Ratings are done for advertisers and the programmers who need to satisfy the advertisers. Advertisers are not people who are spun by press releases or anything else. Believe me.

            In response to another comment. See in context »
  4. collapse expand

    Rick – funny story.. we just missed each other – I *almost* got the job producing the web side of Access Hollywood and was kicking around the Burbank lot when the show launched.

    I managed to get Debbie and Jay to say “Yes” to a Tonight web project before Access got the green light and therefore, I got the Leno project.

    I forget who from our office took on Access.. for some reason I think it was a gal named Leslie.. but not sure now.

  5. collapse expand

    As a fan of BBC’s pop-culture/car show Top Gear, I was hoping Leno would do his own awesome car show in America. Imagine my disappointment when he debuted that stupid little gokart track on his new show.

    When is Letterman’s contract up? Wasn’t he a mentor of sorts to Conan?

    • collapse expand

      There was never a relationship between O’Brien and Letterman of which I am aware. O’Brien was previously a writer on The Simpsons without any real on-air experience. It was Lorne Michaels, producer of Saturday Night Live, who NBC had given the late night time slot to, who picked O’Brien.

      In response to another comment. See in context »
      • collapse expand

        Another thing that’s interesting lately is Jonathan Ross, who has a successful Friday night talkshow in the vein of Letterman in England, has not renewed his contract with the BBC. This comes in the wake of a scandal where he and Russell Brand – who also resigned from his gig post-scandal – left lewd messages on an old British actor’s machine. Brand is successfully launching a career in America, having starred in a hit movie and hosted the 2008 and 2009 MTV VMAs. It’s definitely a long shot, but I wonder if Ross thinks he can break into American late night.

        I doubt he could. Craig Ferguson, who does the best interviews on late night, is already too European for most Americans.

        In response to another comment. See in context »
  6. collapse expand

    Rick, you’re right about NBC not giving Conan enough time to develop his audience. I’m just curious why they think it’s so important to hang onto Jay Leno. It’s crazy that NBC feels the need to keep him on TV when he really should get back to doing what he loved and excelled at… stand up.

    • collapse expand

      I’m sure they are mindful of the fact that when they took Leno off he was in a very commanding first place in the late night wars. It’s hard not to want to return to that. There’s a very good chance that Leno would re-capture that position if they return him to the same format at 11:30. I never thought Conan would succeed in the time period unless he was able to make the subtle changes that Letterman did when he moved his show up to 11:30 from 12:30. So far, Conan is doing pretty much the same show as he did an hour later — and it doesn’t suit the audience. Much of this has to do with television, in general, refusing to accept that the demo has shifted. While they continue to sell advertising based on an 18-49 demographic, the simple truth is that audience today is older. Because advertisers want to buy 18-49, the networks try to pretend that they still reach that audience as their primary target – but its just not true any longer. Leno appeals to an older audience -and that is who is watching at 11:30. The younger audience is there after midnight.

      In response to another comment. See in context »
  7. collapse expand

    Rick,
    This is the best analysis of the Leno-OBrien hullabaloo that I’ve seen – and I’ve been clicking around pretty much all day (slow day at work)
    You ought to do more inside Hollywood posts.

  8. collapse expand

    Put Leno back at 11:35PM for an hour. Offer Conan $20M and his old show and slot. Experiment did not work out.

  9. collapse expand

    I think you have to decide who you want to keep most, and that instructs who you are prepared to loose. If you first want to keep Leno at 11:30PM, and second would prefer to have Conan back to where he was was, then Fallon is third. If one get their first two preferences, one must be prepared to lose Fallon, with the caveat that you do what you can to keep him in the fold and develop him further.

  10. collapse expand

    For those who are too young – or were too uninterested, at the time – to recall, it might help to get some background on this story. Read all about how Leno acquired The Tonight Show gig, back in 1993.

    http://bit.ly/6FjAQq (NY Times; 1994)

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    I am an attorney in Southern California, and a frequent writer, speaker and consultant on health care policy and politics. To that end, I am active member of the Association of Health Care Journalists. Based in beautiful Santa Monica, California, I'm very pleased to have the opportunity to be a contributing editor to True/Slant. I've recently finished a book designed to make the health care debate understandable to the average reader, and expect it to be out in the next five months or earlier. In my 'spare time', I continue to write for television and, occasionally, for comic books.

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