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NBC Finds Wolf at Door

Jun 16, 2003  •  Post A Comment

The reality show that Hollywood insiders will follow most avidly over the next few months won’t play out on TV. Instead, it will unfold in the privacy of tastefully appointed offices as wunderkind Jeff Zucker faces the most complex test of his 21/2 years as the fair-haired NBC Entertainment president.
His challenge: to keep the trio of “Law & Order” dramas that are the workhorses of NBC’s prime-time schedule without giving away the Peacock store to Dick Wolf, who created them, and Universal Network Television, which owns them. Universal is seeking some $8 million per hour, or a grand total of $1.6 billion over what is expected to be a three-year contract.
“This is the biggest negotiation in the history of television,” said one observer who knows the companies, the players, their strategies and the possible fallout no matter which way the negotiations, first detailed two weeks ago in The New York Times, are resolved. “You are really talking about one negotiation that could swing the whole balance of power from one network to the other three.
Neither Mr. Zucker nor Mr. Wolf was available for interviews, but sources familiar with the situation agree that NBC made the first move last fall. It made a preliminary offer to bundle all three “Law & Order” hours into one renegotiation and to leave separate plans to develop a fourth “Law & Order” for the 2004-05 season.
No one doubts CBS and ABC would pounce on the shows if they became available and strip them inventively and effectively. The deal for the first spinoff, the 4-year-old “Law & Order: SVU,” is up at the end of the 2003-04 season, while the deals for the 13-year-old original and the 2-year-old spinoff, “Criminal Intent,” aren’t up until 2005.
Likewise, no one would be surprised to see NBC schedule the original and still most powerful “Law & Order” opposite “SVU” in a gambit to kill it.
“That would be almost as stupid as moving an aging `Home Improvement’ to try to blunt `Frasier,”’ which happened to the detriment of both ABC’s and NBC’s hits, an observer said.
One source characterized NBC’s opening bid as “ridiculous” and evidence that Mr. Zucker, like his network bosses, is infatuated with younger-skewing shows, such as “ER,” for which NBC pays from $8 million to $10 million per hour, or “The West Wing,” which earned a two-year renewal worth some $6 million per hour, despite plummeting ratings this season, or “Friends,” which is coming back for a 10th season, after NBC agreed to pay $10 million for each of the 18 episodes in the 2003-04 season.
Wolf sympathizers say NBC’s tendency to lavish praise and attention over those cooler shows has made the talks, which are still in the preliminary stage, as much about respect and ego as about money-which, of course, are sometimes one and the same. The irony in the TV Guide cover story, `Why Law & Order’ Rules!” hitting newsstands the same day of the Times story does not escape Mr. Wolf’s fans.
They say the network seems unable to properly appreciate the shows, which skew more toward the 25 to 54 demo that local stations prize for their late local newscasts even as the franchise consistently wins each of its hours and helps the network win each of its nights no matter how many times it runs or repeats to fill weak spots on the NBC schedule.
During the May sweeps, for example, the “L&O” trio racked up 27 hours of network airplay and averaged 12.22 million viewers. That’s higher than the overall prime-time average of 11.5 million viewers during the May book for NBC , which, of course, maintains that the only races that count are for younger and upscale viewers. CBS won the May viewership crown with an average viewership of 12.9 million viewers.
Most Profitable
Morgan Stanley analyst Richard Bilotti has analyzed prime-time programming costs and tagged the original “Law” as NBC’s most profitable scripted show. Mr. Bilotti has estimated the first show accounted for nearly 15 percent of the network’s total gross profits from series in the 2001-02 season. The three shows together add up to more than 25 percent, say insiders.
As further evidence of the power of the franchise’s unique halo effect, Mr. Wolf’s fans cite the collapse of A&E’s prime-time ratings after it lost its lock on “Law & Order” repeats in mid-2001 and the double-digit improvement for TNT since it gained exclusivity on the same well-played archive.
There will, of course, be those who will follow the negotiations with less-than-businesslike interest, because Mr. Zucker, who put himself on the fast track as the successful executive producer of “Today,” the cash cow of the NBC News division, is brash and not at all coy about his eagerness to earn his entertainment merit badge as briskly as possible and to get on with his straight-up ascent at network headquarters back East.
“The whole industry is going to be watching,” agreed an executive at NBC.
“This puts them in a precarious position in terms of [prime-time] profitability,” suggested an executive at a competing network. “To do this deal is going to significantly elevate programming costs for NBC.”
“Jeff has no choice. His hand is forced,” said an NBC insider, who, like some others in the industry, is betting that Mr. Zucker will find a way-with the help of lots of hidden clauses-to renew the shows at a price that satisfies the needs of Universal and Mr. Wolf without appearing as extreme as the published target and that also enables Mr. Zucker to appear the resourceful hero.
“He’s brilliant at that,” said the NBC insider.