NBC Universal Truths

May 30, 2005  •  Post A Comment

The merger of NBC and Vivendi Universal’s U.S. entertainment assets a year ago made Jeffrey Zucker captain of one of the biggest ships in show business, supported by a 3,000-strong crew that emerged from consolidating the television divisions. There is progress, but the merger also masked some problem areas. In a special team report, TelevisionWeek goes behind the scenes for a look at how the people and parts are still coming together.

Jeffrey Zucker became captain of one of the biggest ships in television on May 12, 2004.

That’s when General Electric-owned NBC’s deal to acquire the U.S. entertainment assets of Vivendi Universal closed, NBC Universal Television Group was formed and Mr. Zucker was named president of the new TV division. Since then, the 40-year-old executive has been responsible for all programming across the companies’ merged television properties with the exception of NBC Sports and Olympics.

A prototypical overachiever, Mr. Zucker-who less than five years ago was executive producer of the NBC morning news show “Today” and who, by the way, skipped second grade-had his crew assembled and organized the day the new group sailed.

“We had really been preparing for it for almost a year,” Mr. Zucker said earlier this month during an interview in his Burbank office. Though he’s based in New York, he spends about five days per month on the West Coast. “That’s one of the hallmarks of a GE company-that integration doesn’t begin on day one,” he said. “It goes into effect on day one.”

During its first year, however, NBCU TV Group, comprised of roughly 3,000 employees not including the NBC owned-and-operated TV stations, has continued to evolve.

For example, the program development staff at the NBC Network was split into two groups, one dedicated to developing in-house product, the other to taking non-NBCU pitches. NBC Universal Television Studio Co-President David Kissinger has left his post. Also, the company’s combined broadcast and cable advertising sales unit at NBCU has standardized significant elements of selling broadcast ads. (Stories about how the acquisition is panning out among the group’s divisions appear throughout this report.)

More changes are on the horizon. “I don’t think we are done yet,” said Randy Falco, who in May 2004 was named president of NBC Universal Television Networks, overseeing the commercial and operational organizations throughout the company. Mr. Falco’s duties include sales, affiliate relations, cable distribution, production operations, research, information technology and Telemundo.

Mr. Zucker told TelevisionWeek he plans to review his group’s structure during the next couple of months. “Now that it’s been a year, we’ll take another look and make sure that we do have the right structure, and if we don’t we won’t be afraid to step up and fix parts of it,” he said. (Speculation came to a boil last week that changes at the top of NBC News were imminent.)

Top priorities for the coming year are improving the prime-time performance of NBC, which sank from first to fourth among adults 18 to 49 this season, and turning around cable business network CNBC, said Mr. Zucker, whose responsibilities include the company’s entertainment, news and cable properties as well as the its TV studio, first-run syndication and global distribution efforts.

Operations and information technology departments are still in the process of merging, Mr. Falco said, adding that the company also still has to “look at real estate issues to see how efficiently we are utilizing all of the space we have in New York and Los Angeles.”

Future Fortunes

Any further changes should be made while keeping in mind the greater corporate goal of getting all of NBCU’s TV parts-including NBC, NBC News, the NBC owned-and-operated stations, NBC Universal Television Distribution and NBC Universal Television Studio, Telemundo, Bravo, CNBC, MSNBC, Sci Fi Channel, Trio and USA Network-working for one common good, industry observers from both inside and outside the company agreed.

“Big doesn’t always mean better unless all divisions cooperate and don’t need to compete,” said one producer who has worked with NBC for many years. “All have to be rowing the boat together or they may have to break off and separate.”

Mr. Falco said a clear corporate vision was in place when the acquisition closed. Leading up to the deal NBC’s leadership had considered the idea of getting into the cable systems business. But the company ultimately decided to stick with the program, literally. “We are focused on being a content company,” he said.

The TV group also became focused on taking a “company view” toward programming decisions, Mr. Zucker said.

“All I care about is how it comes out for the company, not necessarily just one individual unit,” whether the program in question is a potential syndicated series in development for the O&Os or a prime-time series that NUTS is developing for NBC, he said.

In the case of prime time, “I want [NBC Entertainment President] Kevin [Reilly] to look at it from his unit’s point of view and [NUTS President] Angela [Bromstad] to look at it from her unit’s point of view,” he said, “but I’ll look at it from the whole company’s point of view.”

Indeed, while other entertainment conglomerates such as Clear Channel, Time Warner and Viacom have had an apparent change of heart since amassing size and have decided to reorganize back into smaller units, NBCU remains committed to making consolidation work. To that end it is making a point of working as a single unit, perhaps more so than any other large media conglomerate.

“I can’t imagine any other company in town being this collaborative,” Mr. Reilly said. “Anytime you have smart people communicating and working on a common goal it will pay dividends. There will be some tangible creative product that comes out of it.”

But always focusing on the bottom line does not necessarily make for the most creative environment, the producer warned, adding that according to word from colleagues within NBCU, “It’s so big, it’s not fun anymore,” and, “It’s more GE than ever before. There are more people counting beans.”

Still, the new corporate siblings provide a sort of buffer to NBC by taking some of the pressure off the broadcast network to be the primary breadwinner. Insiders said that buffer could actually help the creative process by taking a psychic load off NBC executives and easing the fear and professional paralysis often associated with a ratings free fall.

“You have to wonder what NBC would look like without the merger,” media analyst Larry Gerbrandt said. “The merger with Universal has masked some of NBC’s problems. You can see why they needed to do the deal. NBC needed to be part of a larger media entity.”

Mr. Zucker is, by many accounts, built for his current gig, overseeing such a vast operation. He’s known to require little sleep-around five hours nightly-and has developed a professional style that can be applied with relative ease to additional responsibility. He stays aware of what his reports are up to (he is in touch with every division virtually every day by phone, e-mail or BlackBerry) but also doesn’t mess with success, he said.

“Hiring good people is really the key, and then trusting them to do it,” he said of his management philosophy. “And then parachuting into places where there are particular problems.”

While Mr. Zucker has been one of the quickest-rising executives in the television business, he said he’s looking no further than the jobs at hand for now. “I’m very happy doing what I’m doing and I’m totally content to keep doing this,” he said. “There’s nothing else I’m thinking about.”

Whether he’s thinking the staff at the network or at recently reshuffled CNBC-the two areas Mr. Zucker has identified as being in need of improvement in the coming year-are in for further shake-ups remains to be seen.

Media buyers have offered positive r
esponses to some of NBC’s upcoming series, particularly the comedy “My Name is Earl,” the drama “E-Ring” and the reality series “Three Wishes,” all of which the network unveiled during its upfront presentation earlier this month. And industry perception is that Mr. Zucker will watch and wait to see how the new schedule performs before making any major changes to Mr. Reilly’s area. While prime time needs work, Mr. Reilly’s job is not in jeopardy, NBC sources said.

“I bet [Mr. Reilly] gets one more schedule,” the producer said. “But come November sweeps we’ll know the future of all the execs. By Thanksgiving the Peacock will be happy or sad.”

Michele Greppi, James Hibberd, Christopher Lisotta and Jay Sherman contributed to this report.