In Depth

ABC's Main Man McPherson

Network Entertainment Boss Steve McPherson on Why He’s Optimistic

Steve McPherson is fired up.

Steve McPherson

Along with the rest of the TV industry, Mr. McPherson, president of the ABC Entertainment Group, has struggled through tough times during the past 18 months. He’s had to try to develop new hits while slogging through the twin terrors of a writers strike and a collapsing economy.

But just as the White House is starting to see glimmers of hope on the horizon for the national economy, Mr. McPherson is feeling optimistic about where ABC is headed. The buzz around Hollywood is that the network’s decision to double down on development may have paid off with a bumper crop of new shows.

In his only extended interview prior to this week’s upfront presentation to advertisers, Mr. McPherson seemed to confirm that speculation. In fact, for an executive known for being cautious in his public pronouncements, his assessment of ABC’s pre-upfront condition sounds almost giddy.

“We had one of the best development seasons ever,” he said, adding that the debate inside the network is not whether to pick up the new shows, but where and when they should be scheduled.

Mr. McPherson also confirmed that he’s upbeat about the network’s half-hour prospects, calling ABC’s comedy development “the strongest it’s been in years.” He talked about his new role as head of both the ABC network and Disney’s TV studio operations, and he took aim at Nielsen, calling the ratings giant’s flaws “more troubling than ever.”

A complete transcript of Mr. McPherson’s dialogue with TelevisionWeek follows:

TelevisionWeek: What’s your basic message to advertisers going to be this week? Other than, “Hey, those clips look really good”? What do you want ad buyers thinking about ABC as they walk out of your upfront?

Steve McPherson: I think we really want them to know that our commitment to quality content will never take second place at ABC. Bob (Iger, CEO at parent company Disney) has made it clear that nothing is more important to the Walt Disney Co. than its creative engines, and that couldn’t be more true for us. We invested more man-hours and more money in development than anybody, and I think it shows in what we will screen this week.

TVWeek: You made more pilots than any other network, and the early buzz is that you really like how most of them turned out. In this economy, can you afford to pick up everything you like? Or are you going to have to pass on good shows?

Mr. McPherson: I am so proud of my development team, especially coming off a year of such turmoil with the strike and the tough economy. We had one of the best development seasons ever, and I think the tough discussions will be about when and where stuff goes, not if. The fact that we have a lot of options is a luxury.

TVWeek: You’d have more room for all of these shows if the summer months were available for high-quality scripted programming. TNT and USA will have packed summer lineups, and even the broadcast networks are putting on more original scripted fare this summer, albeit mostly lower-cost fare. Are we any closer to a true 52-week season?

Mr. McPherson: We actually do have a 52-week season; we do have new shows that launch in every season of the year. Our strategy for summer has been fun, lighthearted fare, and last summer it worked pretty well, so this year we’re going for it again. We’re coming back with a strong core and hoping to build on that.

TVWeek: Why did you pick up “Flash Forward” and “Modern Family” so early? What about those shows allowed them to stand apart from the pack and earn an early nod?

Mr. McPherson: We believe we have something special in both these shows. The screening and testing confirmed our gut, and we wanted to get going quickly on both. Specific to comedy, it’s been a priority to us to deliver on that front, and we hope picking up “Modern Family” is a statement that reaffirms our commitment to comedy and the level of quality we’re aiming for.

TVWeek: The advance word this spring is that you’re finally ready to make a move on comedy, maybe even pulling a “Lost” or “Desperate Housewives” by launching a completely new comedy block that’s not supported by an existing lead-in or hit, as you did with those dramas. Do you have the goods to make a big comedy play next season?

Mr. McPherson: Well, I’m not sure what we’re going to do scheduling-wise just yet, but I’m very happy with our comedy development this year. It was the strongest it’s been in years, with a number of shows that have unique voices, starting with “Modern Family” and Courteney Cox. We’ll see how it all comes together, but like I said, it’s nice to have options.

TVWeek: There have been a lot of good shows on the networks in the past three years, but very few hits. This has always been a business where 80% of new shows fail. But now it seems that, unless you have a really compatible lead-in, it’s almost impossible to break through. Have the networks just not come up with the right shows? Or is something else going on?

Mr. McPherson: Well, I know I’ve taken some heat for my belief that part of the problem is how shows get measured—but now even Nielsen is admitting that they’re not accurate.

That part of the equation is more troubling than ever at this point. On the one hand, more people are watching television than ever before, so there’s something of a disconnect between what really seems to be happening and the Nielsen measurements. And on the other hand, monetizing various platforms has been challenging.

In any case, without a doubt the biggest factor is having the right show to break through with. We’ve had a really tough 18 months as an industry, but I firmly believe that a show that captures the imagination will still draw an audience.

TVWeek: Does the new environment suggest it might be better to stick with low-rated shows you believe in rather than making repeated attempts to launch a lot of new shows? Does part of you wish you had just kept “Dirty Sexy Money” or “Eli Stone” on all season long—despite their undeniably bad ratings—rather than try quite as many shows in the spring? Or would that have been throwing away good money after bad?

Mr. McPherson: The decision of when to have patience and when to cut your losses is the toughest one a programmer faces. Instant hits and clear failures are easy to program. With the rest, you just have to do the best job you can as a programmer in understanding potential and opportunity. There is something to be said for giving a show time to build, but there’s a point where, if it just isn’t happening, it doesn’t make economic sense to continue.

Certainly, I wish we hadn’t had a strike and had been able to keep those shows on without starting and stopping like that, and in that case I think we would have picked them up for this year. I think we realized that viewers have lots of other things they can be doing and once you lose them from a particular show, it’s really hard to get them back.

TVWeek: I know you won’t talk specifics about the executive restructuring in the works now that ABC and ABC Studios are both under your control. But what’s your goal with this reorganization? What will this mean for how both units operate, as well as for your 2010-11 development?

Mr. McPherson: I think the most important thing is that it ensures a single vision from a creative, economic and business standpoint for the entire group. Given that we’re charged with strengthening our position as a quality content engine for the company, supporting that with a viable business model and a structure that aligns the organization to effectively do that is what we’re looking for.

TVWeek: Every day seems bring news of more cutbacks on shows and at networks. Writing staffs are getting pared down. License fees, and thus budgets, are being slashed. Are you worried some of these cuts are going to hit bone? Are we anywhere near the point of “penny wise, pound foolish”?

Mr. McPherson: We certainly have to be strategic about managing our costs. We don’t ever want cost-cutting to affect the quality that viewers see on-screen, so that means taking a closer look at literally everything. I think there are many areas where we can and have cut back, and there are others where we still like to have little more leeway. It’s about managing all of it effectively and efficiently and making sure you never see anything less than great quality on the screen.

TVWeek: Late night is heating up again. How do you think Jimmy Kimmel will do opposite the second half of the new “Tonight Show”?

Mr. McPherson: Is it heating up, or is someone trying to move it earlier in the night?
I think Jimmy will be great. He has really hit his stride and come into his own in the last couple of years and he has a strong core following. I think Jimmy’s show will continue to grow no matter who he’s up against.

TVWeek: Are you OK with “Lost” ending next year, and airing only in winter? In other words, are you going do something with “Lost” in the fall?

Mr. McPherson: As a fan, it’s incredibly bittersweet. Pronouncing an end to a show that’s doing really well for you is really gut-wrenching on a number of levels for any network executive. But it provided Damon and Carlton with the ability to end the show and also allowed us to truly respect our audience. And honestly, I’m very proud that we took that step.

TVWeek: Is the job still fun five years later? How does it compare to making wine?

Mr. McPherson: On the “fun” meter, it’s not really a fair comparison. That said, it has been fun to get back to making TV after the last two years have been so troubled. The cliche is true: This is the best and the worst job in TV, all in one.