Everyone knows that NBC ratings have been dreadful this season, and now from the NYPost’s Page Six comes a story that it’s Katherine Pope that is to blame for the recent failures of NBC’s Lipstick Jungle and My Own Worst Enemy not Ben Silverman:
With yesterday’s cancellation of two NBC shows produced by sister company Universal – “Lipstick Jungle,” which starred Brooke Shields, and “My Own Worst Enemy,” which featured Christian Slater -culpability falls on Universal Media Studio PresidentKatherine Pope, who oversaw both doomed series.
In the story, Silverman not only comes off without blame for the failures, but praised for increasing the profitability of the network:
But Silverman, 37, has been able to cut costs at the network and seems to be satisfying his bosses, particularly NBC chairman Jeff Zucker.
In fact, one network insider actually praised Silverman, saying, “The company is very happy with Ben. He is deep in negotiations to re-up his contract with NBC, and he has the network up 50 percent profit from year to year.”
I’d applaud too, if I were sure that claim were true. Problem is, the NBC network financial results are so buried inside the GE corporate results that it’s difficult to tell what the financial situation is at NBC, so everyone is reduced to relying on unaudited claims, whether from Zucker, Silverman or unattributed “insiders” like the NYPost.
Here’s an alternate explanation that fits the facts we know are true (falling NBC ratings, the early failure of two shows added under Silverman’s watch): Silverman *is* in trouble and he’s doing his best to wage a PR offensive on both the “it’s Pope’s fault” and the “but, our profitability is up!” fronts. I’d love to hear directly from someone who really knows the inside situation.
Reminds me of when President Bush said, “You’re doing a heck of a job, Brown” to his Fema director after Katrina.
whether he’s riding high or not, you must admit he is living the charmed life. After all, he’s a ROCK STAR! Self-proclaimed rock star, but still, he *did* have a cameo on Entourage. He’s obviously very good at spin and PR, even if Kevin Reilly always seems to skewer him in the battle of the barbs…
Edit: oh, and he’s just shifting blame. And for a while, it will likely slide off of him like a friend egg off of new teflon. But soon, Sunday Night Football goes away and NBC’s own USA Network might sometimes beat the mothership during primetime.
They’ve lost MOWE and LJ to ratings woes, and waiting in the wings are Knight Rider, Heroes and (though I hope I’m wrong) Chuck. That’s five shows in trouble. I don’t see how any amount of PR will stop the pointing fingers from finding him eventually.
The $hit is hitting the fan and he is stepping aside and letting it spatter all over her.
Yes, right now he is the golden boy but soon it is all going to come back and bite him in the ass.
Oh and FrankJ, Heroes is not in danger of cancellation…at least not yet. It is getting bad press, but it is still doing well in the demos.
NBC was so poorly run, I wouldn’t be shocked if it’s making more money now. However, the BRAND IMAGE of NBC is corroding away. I’m sorry but MOWE last week & KR last week pulled in CW numbers. That is bad no matter how you look at it.
One reason that NBC makes more money is they spend less. They aren’t promoting shows as much as they used to. Valuable advert spots are being kept to sell vs promote.
DD, the fear with Heroes is the continuing downward trend. At $4 million an episode, if this trend continues, it’s not going to be sustainable.
Until Heroes stops hemorrhaging viewers I’d say it’s in trouble, and is bound to be giving more than a few executives at NBC heartburn.
They have promoted the hell out of this week’s HEROES. There were commercials during nearly every break from the football game last night, and I’ve seen them all week not just on NBC but on USA.
I don’t think NBC/Universal made the changes in the Heroes writing staff to just cancel the show at the end of this season. If that were the case they would have left the show as is and canned it in May.
I strongly believe that NBC will give the show at least one more season to see if the “ship can be righted.” I mean, what else do they have that can even bring in the demos that Heroes does? New shows are often more misses than hits, would you really cancel something you can at least count on for the unknown quantity?
I could see if all the other NBC shows were doing fantastic, possibly dropping Heroes. But NBC is hurting, they won’t drop Heroes until they have to.
I see a lot of people mentioning the 4 million per episode price tag. I have it on good account that is the current cost of the episodes. Season 1 was roughly about 2.5 million an episode. MBC wants the style of the show to go back to season 1, which was more plot and character, less special effects. That formula worked well, no one complained about the lack of effects either. If they go back to that style of production the price per episode will drop a little, and these days every bit helps.
Max, they made the changes to see if this spring the numbers will stabilize. If they demos drop to sub 3.0, I can’t see them keeping it. I also can’t see how they can get it down to 2.5 million an episode, unless the actors and writers take pay cuts and they kill most of the cast off. Costs go up each season because actors and writers get raises.
Nick, we’ll see if all the promotion paid off, but I don’t think the problem is people forgetting Heroes is on.
Julia, I fully agree, but I did find it interesting in how hard they pushed HEROES this past week. Cross network massive promotion. The commercial even alluded to season 1 and hinted this would be like that. It was if anything good marketing, if the BRAND IMAGE of HEROES isn’t already crap to the masses that is. I guess we find out tonight.
I think it was good marketing too. Eclipse, eclipse, the glory of season one – remember season one? Come back and give us a try. Come on, you know you want too. The only thing missing was a “Save the cheerleader…” reference. I’m sure it will be effective enough that last week’s numbers will be improved, though that might have happened even by doing nothing. I’m very interested to see tomorrow’s numbers. Sadly, more interested than actually seeing tonight’s episode, but I will watch anyway.
Robert, right but they did a good job of showing Claire from season 1 (and about 15 pounds lighter, cough) instead of showing her now.
Personally i think Heroes has “lost” its way: After the “save the cheerleader, save the world” its been running amock through the centuries.
Chuck is still “mildly entertaining” totally gave up on pushing daisies. It’s plain boring!
I think NBC knows it is facing a rapidly diminishing Monday night audience. Chuck is kind of stagnant in the ratings, Heroes is still dropping despite demo numbers, and they just canned MOWE. NBC is scrambling to find the remaining viewers amongst it’s big draws that it knows may find it in their heart to tune back in. We’ll see if it works.
I can only hope Chuck does well tonight too, because with the push behind Heroes the show is basically on it’s own right now.
NBC is where CBS was until CSI was birthed…NBC does the same promtion and the same “style” of shows time after time…Gone are the days when comedy ruled…
Cosby, Cheers, Seinfeld…and drama was drama like ER…
NBC has garbage reality shows – stupid comedies and weak drama – except for the ‘LAW & ORDER” series(which have been messed up because of moving them all over the board & which I now watch in syndication on weekends because there are soo many of them.)
So NBC -sell your LAW & ORDER SHOWS to other network/ late night syndication world…and close your doors…
Or do something new – HEROES SEASON 1 was on the right track – but you became your old self too soon, too much!
FrankJ, the good news for Chuck (and TSCC) tonight is that the MNF game of Buffalo and Cleveland doesn’t seem to be a huge draw. The bad news may be that for all I know the game will air locally on the NBC affiliates in those markets.
I think that going back to Hero’s season 1 would be a mistake.
I was okay with very little use of powers in the begining because that is what always happens in Origins, but if they go back to plot with little to no powers, they may loose the comic book fan base which has been very loyal up to this point.
I said this in another thread but i’ll repeat here because it is pertinent. I think Chuck is going to basically tread water ratings wise with minimal gains until the Super Bowl. WHen NBC does the Super Bowl event with the 3-D episodes with alot of promotion during the SUper Bowl for it; I think than CHuck will see a significant gain with the 3-D episode.
I just checked, Robert. ABC has the game in Buffalo and FOX in Cleveland.
Nikki Finke reports that BS will be on Charlie Rose tonight:
http://www.deadlinehollywooddaily.com/
“The spin should be both nauseating and fascinating.” amen to that. Predictions on BS quotes (no pun intended, but if the shoe fits…):
1. ratings are obsolete
2. we focus on margins, not ratings
3. we do very well via online and DVR
4. we do very well with younger audiences
5. I WAS ON ENTOURAGE!
6. Our audience doesn’t watch TV.
NBC’s biggest problem is failure to think outside the box. In reducing profits, it also appears they are lacking any innovation.
7. Charlie, do *you* have any children I can date?
Julia, that was really the intent of number 3, though I skipped the “our audience is out at the theater and DVRing Knight Rider and The Biggest Loser!” BS-speak.
Bill, that only works if he says “…I want to date your children” and CR responds, “I have boys.” Indeed, the much better CR would be BS and Kevin Reilly on at the same time. I’d watch that five times.
Remember all the talk in 2007 about GE spinning off NBCU after the Olympics. I think if the the world economy hadn’t cratered, GE probably would have gotten a pretty penny for it.
Well have you heard Brooke Shields trying to get LSJ another season?
She is claiming “they aren’t canceled,” and is pulling a push for pickup. Kind of like how a certain ABC producer is doing.
“FrankJ, the good news for Chuck (and TSCC) tonight is that the MNF game of Buffalo and Cleveland doesn’t seem to be a huge draw.”
YAY.
… Sorry, had to get that out there. I’m burdened with school work at the moment so any small ounce of hope/happiness needs to be celebrated.
Re: NBC profitability being up 50%
I guess the question here is, how do they account for the Olympics?
Is the rights fee amortized over several years? Are sales are all booked to 2008?
I find it extremely hard to believe that NBC profits are up 50% (or at all, for that matter) if the Olympics are taken out of the equation.
And of course, in an article about Ben Silverman, factoring out the Olympic impact would be entirely appropriate.
Mikey,
According to GAAP guidelines and the principle of matching revenue with expenses, I would imagine that the licensing fee for the olympics is recognized as an expense in the year that the Olympics are aired. Even if they paid the licensing fee in a prior year, it would be considered a prepaid expense on the balance sheet until they actually aired the games.
I read a while back that despite a licensing fee of around $650 million, NBC was looking at a net profit of around $90 to $100 million from airing the Olympics in 2008, so if that is the case, it is very possible that 2008 could have seen a 50% jump in profits.
JT, my understanding is the rights just for the summer games (TV & Digital)were close to $900 million. They did claim over a billion in advertising revenue for the games, so even after production costs, they made at least a little money.
still, even if both the licensing fees and the revenue were booked in the current year, I think Mikey’s point that it’s hard to believe NBC’s profits are up 50% (or at all) with the Olympics taken out of the equation is valid.
The real question is to compare 4th quarter 2008 to 4th quarter 2007. Is there any possible way NBC could be up 50%?
The reference to the “up 50%” in that Page Six article is so vague that even if we did have the numbers to compare (which short of an NBC accountant dropping us an email we will not) we might not be able to claim foul.
According to one of the media news sites, Silverman claimed The Office as his baby, attended some of the early shootings, made it a hands-on project, and is still living off the cachet from that reputed success. He’s a Defamer regular, appears to be a proficient schmoozer and may well be the Teflon Suit who survives while NBC devolves. Ironically, I’ve been seeing reports that if the recession gets bad enough, cable subscriptions will suffer and in spite of their patent mediocrity, the nets, including feckless NBC, will end up benefitting. One wonders if the suits didn’t factor all this in during their tough guy stance during their negotiations with the writers.
Robert, on these comments:
1. ratings are obsolete
2. we focus on margins, not ratings
3. we do very well via online and DVR
4. we do very well with younger audiences
I somewhat agree. I think Ben Silverman may be the innovator who’s pushing too far, too soon. I don’t appreciate the blame-shifting to Universal and Katherine Pope, though.
Perhaps the struggle at NBC resides in the infighting – innovator versus Nielsen-clinger. The latter are of the “Must-See-TV” days; they are also responsible for the over-population of Law and Order variations. “L&O works in Nielsen…so keep going with it until it doesn’t.”
Along the lines that R.G. pointed out in earlier comments, CBS in the 21st century very much reminds me of NBC in the 80’s and 90’s. Take whatever works, make as many carbon copies as possible, and repeat until the river runs dry. If the cycle holds true, in a few years we’ll be saying the same things about CBS as we are about NBC today!
Clutz, measuring eyeballs on your advertising will never be obsolete. The business model may change somewhat, but at the end of the day, what drives the business is advertising and the number of eyeballs on it. The current means of measuring things may change a lot, but…ratings aren’t obsolete until advertising is obsolete. Period. I conclude that advertising isn’t obsolete any time soon, but that it will change quite a bit.
There may certainly be a division at the networks between old guard and new and it may play out in public, but in private it does not matter. That’s just background noise and drama for folks like us to ponder. Realistically, the only place an old guard and new guard would matter is if it happened with the advertisers themselves. And as always, there will be a new guard and old guard even among advertisers, but the chances of either guard declaring that measurement doesn’t matter? I have them at zero.
Knight Rider just got their back nine: http://www.nbcumv.com/entertainment/release_detail.nbc/entertainment-20081021000000-nbctopickupnine.html
Heroes is SAFE!
I would bet Zucker needs Silverman around.
Ben’s tour at NBC make’s Jeff’s tenure look like the Golden Age, despite its rapid descent from #1.
The real problem, as I see it, is that Ben has no real ideas going forward — except to cannibalize old or foreign shows, get upfront money from advertisers for embedded plugs, and make shows more cheaply.
That will have an effect on the bottom line for a while. Until virtually no one has any reason to tune in to NBC any more.
One of the major reasons for the multi-billion dollar Olympics buy was to showcase NBC programming — especially to women. Well, NBC accomplished that, and to what purpose?
It will be interesting to see if Charlie Rose asks Silverman any tough questions tonight on PBS.
DD, Knight Rider got its back nine weeks ago.
Robert,
I agree that ratings are not obsolete. Nielsen ratings, in their current form, are en route to obsolescence though. TNS/DirecTV are offering second-by-second DirecTView data on every DTV channel, no matter how small. Advertisers are buying. The system is clearly in its infancy, so it’s a “wait and see” as to whether DirecTView can be catapulted into a cable/satellie STB data system on a competitive level with Nielsen. Still, it’s proof positive that advertisers are asking a for a little more detail before they plunk down the hard cash.
And as network television is a business, returns and profits are the true bottom line. Nielsen ratings are one of many factors that affect that bottom line. What’s more successful to the network – a show that garners 5 million viewers and costs next-to-nothing to produce (Big Brother springs to mind), or a show that garners 15 million viewers and costs, say $8 million per episode? Judgment calls must be made – dollars over viewers, and vice versa.
So I guess that’s what I meant by “somewhat agree;” I wasn’t taking the comments 100% literally.
Clutz, some are buying set top box data, because more data is better than less data. However, until they get some sort of technology that shows who was watching (gender, age, and a slew of other data Nielsen tracks like, do they own a pickup truck or video game console) Nielsen will rule the roost. When all (or even most) set top boxes can do that, Nielsen is in trouble. However, for a variety of reasons too long for a comment, set top box data will have a difficult time advancing out of infancy.
We disagree on the relative importance of the ratings data. While it’s true many factors drive bottom line profits, the only thing really driving *top line revenue* is the number of viewers and what kind of viewers they are.
The Biggest Loser is cheap to make, and it does reasonably well in the demos and I’m sure its profitable. But it has zero syndication and DVD potential. More expensive shows that do have such potential may not yield the same first run profits, but may be more profitable in the longer term (at least if the network’s own studios are producing it — and if not, I don’t imagine they pay the full freight of production beyond the first years of shows anyway).
Great thread with a lot of good points. I am on the NBC viewer panel and faithfully fill out those huge surveys they send out regularly. I got several about Lipstick Jungle early in the season and they just don’t seem to understand why people aren’t tuning in. I have an answer for it- you need to move it to cable! Why isn’t NBC just shifting the series to Oxygen and letting it grow a huge cable following?
Now on to Heroes- I say get rid of half of your cast and force yourself to tell stories that engage the viewers and make them care!
I believe the NBC profits include The Olympics- that was their cash cow along with a lot of Nascar.
Kate, maybe a series like LJ could have *started* on cable, with no name actresses, but Brooke Shields and gang are much too expensive for Oxygen as is likely the entire production.
Kate, you make a good point with cable. If expense can be trimmed, as Bill notes, LJ might have a great following on Oxygen – or other cable outlest (USA Network?) owned by NBC Universal. As for big names and big salaries, cable is somehow managing to pay some of them – Holly Hunter (Saving Grace) and Kyra Sedgwick (The Closer) cannot be cheap. I doubt Minne Driver (The Riches) was cheap either – but FX only kept that show for 2 seasons I think.
Perhaps LJ could find some revenue-sharing outlet too. FNL seems to be doing okay by their DirecTV/NBC route. Maybe a cable net geared toward women would be willing to split the costs, in order to get first run of the episodes?
As for NBC’s profits, NFL football is likely to figure in there too. With NFL, Olympics and Nascar, is NBC becoming a bit of a sports “niche programming” network? Or are sports bringing the net enough profits to be more experimental in their scripted programming?
I agree with you on Heroes too BTW. I quit watching this year.
The Olympics wasn’t a big profitable venture for NBC. They made some money, but not good money. I can’t see how profits are up 50% unless the profits were so horrible before.
The olympics were profitable for NBC. A $900 million investment yielded them $1 billion, which is a 12% return on their investment. Not a bad return at all. For their profits to be up 50% from the previous year, that means that their ‘07 profits were roughly $200 million.
JT, none of those Olympics numbers bandied about are in any way auditable/reviewable by anyone publicly, so while I don’t doubt their possible general accuracy, drawing any conclusions based on them is silly. All they are is “what Jeff Zucker said”.
The $894 million for broadcast and digital licensing rights to the Summer Olympics was bandied about so much, I’d be surpised if it is way off except…given that NBC purchased rights to more than one games and paid significantly more than 900 million for all of them, it’s definitely impossible for anyone without access to NBC’s/GE’s books (AKA everybody commenting here, including us!) to exactly know the allocated costs per games.
But given the federal governments rules around finacial disclosures, I don’t think listening to what Zucker says is “silly”. Now whether a billion is 900 million or 1.1 billion is another story. You can make a case for even rounding 800 million up to a billion! But since NBC is on record saying it generated more than a billion in revenue for the games, I think that it isn’t silly to assume that’s true. But any profit analysis, even if the $894 million games is correct, is silly. Because we have no idea what those games cost to produce! It wasn’t nothing, that’s for sure.
Interestingly though — and this hasn’t been written much about is that were I at NBC I wouldn’t look at cost and profit analysis so simply, I’d prattle on about what a wonderful promotional opportunity it was for NBC and how much better off all the other shows are as a result of that promotion.
Except…that doesn’t seem to have remotely happened. For all the good it has done NBC’s fall lineup, the Olympics might as well have aired on CBS!
Robert, I’d guess that production of the Olympics was 50 Million at the very least. I’ve heard talk from people that would know and have no reason to lie that said NBC did profit from the Olympics but “barely.” How they define that word is the real question. It most definitely was not a big earner for them.
It also did nothing for their fall lineup as you mentioned. I’d call the Olympics for NBC a giant failure.
Few were surprised when NBC axed Lipstick Jungle , figuring that if a brutal, Project Runway -assisted title indoctrination couldn’t help it gain a ratings foothold, nothing could. But wait! insists star Brooke Shields to Us .