High noon for Fox, affiliates

Aug 5, 2002  •  Post A Comment

Fox’s plan to start the clock on the second season of “24” with a commercial-free hour has ticked off some of the network’s affiliates, some of whom are suggesting that if Fox doesn’t adequately compensate the stations for the time they will lose in the “event” episode, they might pre-empt the Oct. 29 debut.
The threat of pre-emptions has been raised by a handful of “really big groups” and there has been vague talk of stations covering other Fox national network spots with local spots to make up for revenue lost on Oct. 29 when Ford sponsors the show, said one executive familiar with the situation.
“It’s an issue,” said John Tupper, chairman of the Fox affiliates board of governors. He said there is “no accurate count” of groups or individual stations that might be considering 86-ing the “24” season-opener. “It’s a topic of discussion.”
“Any station that does that is in violation of their contract and is in danger of losing their affiliation,” said Fox Networks Group President and CEO Tony Vinciquerra.
The stations are not the only parties who stand to lose money on the season premiere.
Ford Motor Co. is sponsoring the second-season premiere for an undisclosed sum that will not, Mr. Vinciquerra said, add up to what the network or the Fox owned-and-operated stations might have expected to make selling the standard inventory of commercial spots.
Mr. Vinciquerra said the goal is to bring viewers into the series, whose viewership never equaled its glowing reviews and awards last season. The hope is that viewers will return for succeeding episodes, boosting the value of commercial time as the season progresses.
“The bigger the first-day audiences on the show, the better it’s going to play the rest of the season,” Mr. Vinciquerra said. “The only reason to do it is to promote the show. It is to help the network. It is to help the O&Os. It is to help the affiliates.”
The major points of contention involve repurposing and the value of makeup spots that are not available for sale until after the November sweeps and the political season are over.
Fox normally allots stations seven 30-second spots per hour in prime time. Last season, in what Fox considers a one-season handshake deal affiliates consider a precedent, the network turned over an eighth spot each week in “24” in return for the stations acceding to same-week repurposing of the action-drama on Fox-owned FX.
The network proposed in July that Fox give the stations one extra spot per week (and two spots in one week) over a period of six weeks to make up for the loss of “24” spots in the debut week.
Some affiliates think Fox should be making up eight spots for the premiere episode and should be giving the affiliates eight spots in each “24” episode because it is being repurposed again this season.
In addition, the affiliates are asking the network to toss in a couple of extra spots because, Mr. Tupper said, “We see that there’s a little value differential” between the heavily promoted season opener-some research suggests that the commercial-free element alone will boost “24” viewership by some 20 percent on Oct. 29-and subsequent episodes, when the viewing levels presumably would subside.
“A spot in a premiere is probably worth more than a spot in a regular week,” said one executive at a Fox affiliate, who did not want to be identified.
Ordinarily, this haggling would have begun and perhaps even been concluded before Fox announced the “24” relaunch stunt. But because the network wanted the plan to remain top secret until being announced to television critics assembled in Pasadena last month for previews of the new season, the network didn’t tell the affiliates what it had up its sleeve until the day of the announcement.
“Frankly, they did a good job of making a big splash,” the unidentified Fox affiliate executive conceded. He added that he does not think the situation will escalate into a cause celebre.
The negotiations may, however, have an effect on where lines are drawn in the sand when the network negotiates a new deal determining how much the stations must contribute to the network’s $450 million-a-year NFL costs. Under the deal expiring after this football season, the stations kicked in $50 million a year in return for restrictions on repurposing, including a prohibition on repurposing during prime time.
The prime-time ban creates another potential bone of contention surrounding Fox’s plans to aggressively relaunch “24”: how to schedule a marathon of all 24 freshman-season episodes rumored to be under consideration for FX.
Warner Bros. Television and Twentieth Century Fox Television retain repurposing rights for “Fastlane” and “Firefly,” respectively, two expensive hours the studios are producing for the 2002-2003 Fox lineup.
Affiliates already are unhappy that Fox, which reportedly lost money on “24” repurposing last season, allowed this to happen.
“That’s what is called operating with impunity and defining it any way you want to,” said Mr. Tupper, whose position is that if Fox cannot protect exclusivity of network programs it is violating the NFL agreement struck in 1998. The outcome of the “24” talks will “go a long way to dictating the provisions affiliates will find appropriate” on the new NFL agreement, the affiliate chairman said.
In one midsize market a Fox affiliate general manager wondered whether Fox expects affiliates to “roll over and play dead.” An executive at another affiliate, who estimated that “24” spots will go for $400 to $750 in his Midwest market, said, “It’s not going to set our business plan off by any great margin like it might in a large market. It’s not a battle I’m going to dig down into if it’s a one-time deal.”
Mr. Tupper, who became chairman of the 12-member affiliate board of governors earlier this year, has had two conversations with affiliate board members and one with the network. He was banking on patience paying off for the affiliates. “We are not in a particular rush,” he said. “Fox has shown themselves more recently to be more flexible than in the past.”
“Sometimes there are real divergent business interests,” Mr. Vinciquerra said. “This isn’t one of them. This is one where the goal is to not hurt anybody too badly and to help `24.’ We’re on the side of the angels on this one.”