The business that built independent stations and launched cable empires is facing a crisis. Off-network programming is entering an uncertain era as stations experiment with platforms and content, especially with strips, now that much of the once-steady pipeline of comedies from the broadcast networks has dried up.
While independents carve their niches with a variety of concepts from nontraditional sources, stations are facing the choice of paying more for the rights to air upcoming popular network series in syndication or watching them fly to cable exclusively and erode ratings even more.
Both prospects have left station managers and syndication executives tense. Numerous sources on both sides of the business noted that a fine line is being drawn in the sand to determine what is considered a network hit and thus deserving of A-level money.
“Broadcast stations can’t afford to sit back on their laurels,” said one executive who didn’t want to be named in this report. “They don’t look at it as a competitive marketplace, but the truth is that if a group’s bid is underpriced, a show is going to go straight to cable. Much of the industry is built on the back of off-broadcast network series, and broadcasters aren’t willing to step up.”
In response, one station manager pointed out, “Some of these syndicators truly believe that a marginal show is going to be `Seinfeld’ and they expect us to pay them like we would for `Seinfeld.’ It doesn’t make financial sense for us to do business that way.”
The result of this standoff is that stations are experimenting with a variety of formulas, especially facing a potential 2008 season with the potential for no new off-net series debuts as a result of a plethora of reality and drama series that temporarily dried up the sitcom library.
NBC Universal cleared “Law & Order: Criminal Intent” as a strip, something generally reserved for sitcoms, on the Fox station group. A number of cable first-run series, including Comedy Central’s “Reno 911!” from MGM and Debmar-Mercury’s VH1 “Surreal TV” block, are in discussions for strip runs as well.
“When you have a marketplace cluttered with sameness, procedural dramas become a very hot commodity,” said Sean O’Boyle, senior VP and general sales manager for NBC Universal Television Distribution. “The timing is right for a show like `Criminal Intent’ and stations are responding very well, especially as broadcasters are nervous about the thin amount of offerings for 2007 and 2008.”
That said, even syndicators are on a public mission to remind stations why traditional off-net sitcom programming has had a long history of success as a key ingredient of station programming as a strip. One doubter of the potential of “Law & Order: Criminal Intent” as a strip is John Nogawski, president and chief operating officer of CBS Television Distribution Group, which is heading to NATPE for the first time since essentially merging its King World and Paramount syndicators into one entity.
“We’ve already seen that stations are not hungry for the serialized drama, as witnessed with the lack of sales for `Desperate Housewives,’ and of course `Lost’ hasn’t been sold yet,” Mr. Nogawski said. “I’m also not convinced that the `Law & Order’ shows are cut out for the strip business. I’ve seen too many fail.”
Other syndicators will be out to drive home the importance of daily sitcoms on the stations.
“Off-net programming will always be a valuable staple and reliable source of revenue for local stations,” said Bob Cook, president and chief operating officer of Twentieth Television. “Firstly, the programs have a built-in audience base that can attract and build viewership; and secondly, stations can create an off-net platform to promote other programs, dayparts and local news, while also providing advertisers with a must-buy.”
Twentieth enters the 2007 season armed with the demo-friendly “Family Guy.” The series joins traditional off-network fare next season that includes Warner Bros.’ top-rated comedy “Two and a Half Men” as well as “George Lopez” and the second cycle of “Friends.”
Warner Bros. Domestic Television Distribution President Ken Werner agreed that traditional off-net series should continue to play a prominent role in programming strategies.
“Off-network programming has always delivered a reliable audience, and there is no reason to think that they would not be able to provide that audience in the future,” he said. “Programming that has been provided by a commercial network has great vitality and long legs that supports the others businesses. We at Warner Bros. are dedicated to making it available for our television stations.”
Mr. Werner noted that some shows are still bringing in the dollars from stations, including “Two and a Half Men,” which he said was generating A-show prices from its stations because “It’s going to deliver just like the other `A’ sitcoms.”
With no sitcoms officially on the slate for 2008, NATPE will find executives warming up buyers for likely 2009 contenders, which could include CBS’s “Everybody Hates Chris,” Twentieth’s “My Name Is Earl,” “American Dad,” and “How I Met Your Mother” and NBC Universal’s “The Office.”
Among weeklies, buyers could see CBS’s “Criminal Minds,” “Ghost Whisperer” and “Numb3rs,” Twentieth’s “Bones” and “Prison Break” and Buena Vista’s “Grey’s Anatomy.” Of course, for the weeklies, cable will continue to drive profit margins.
“Cable is where a syndication unit will maximize its revenue,” Mr. Nogawski said. “There is a lot of failure out there and I’m pleased to be amidst a luxury of riches with these types of shows. Off-net series will continue to play a strong part in our operations, and smart stations will continue to see value in that.”