You'd think with recently disposed former NBC talk show host Conan O' Brien possibly headed to Fox, you think the news would thrill affiliates, right?
Well, think again.
With news yesterday of Fox and O'Brien negotiating a deal to host a late-night talk show - something the network hasn't had on a nightly basis since the debacle of Chevy Chase's ill-fated gabber in 1993, Fox affiliates will be wrestling with a dilemma - whether to clear a new talk show featuring one of the hottest names out there right now - or stick with the current first-run and off-network fare they're currently airing.
In some cases, they may not have a choice but to stick with the syndicated fare.
Several syndicators may hold Fox affiliates contractually bound to the time period clearances for their shows - just one of the many hurdles O'Brien faces as he tries to seal a deal with Fox. In some markets, O'Brien show could be delayed from its regularly scheduled time (which hasn't bee set as of yet) due to existing contracts to syndicated fare.
When David Letterman moved to CBS in 1993, there were many affiliates who had to delay his show because of a similar scenario (after all, Letterman did replace a bunch of low-budget first-run crime dramas and repeats in late night, which were not widely cleared on the network.) CBS was flexible, allowing stations to delay Letterman a half-hour to carry first-run programming and off-network sitcoms airing on many CBS affiliates at 11:30 p.m. (10:30 p.m. Central) .
For example, WUSA-TV in Washington D.C., delayed Letterman until 12:35 a.m. because of Paramount's The Aresnio Hall Show airing an hour earlier, which was very popular among Washington viewers. As a result, WUSA got an exemption from CBS to delay Letterman an hour. Had WUSA moved Aresnio from its 11:35 p.m. time slot, it would had to pay Paramount through a "liquid damages" clause, which could have cost WUSA hundreds of thousands of dollars (when Arsenio Hall's show was canceled in May 1994, WUSA cleared Letterman in-pattern, at 11:35 p.m.)
In nearby Baltimore, then-CBS affiliate WBAL-TV (now an NBC affiliate), who also carried Arsenio, tried to get the same exemption WUSA got, but was turned down by the network. Instead, CBS cleared Letterman on independent WNUV-TV until May 1994, when Arsenio's departure led CBS to finally move Letterman to WBAL (that is, until January 2, 1995 when the CBS affiliation left for WJZ-TV, which the network now owns.)
But even the "liquid damages" clause didn't protect Arsenio's Hall show when Fox mandated its affiliates to clear Chase's talk show at 11 p.m. Eastern/10 Central with no exemptions - forcing Arsenio to air at midnight on those stations, which made up roughly half of his affiliate base. The move to the later time slots and Letterman's success ultimately led to his late night show's demise.
These days, it'll be even harder to move syndicated programs to accommodate Conan O'Brien. The one difference between 1993 and today is syndicators are now owned by bigger conglomerates, as they can wield considerable clout and power. Fox doesn't want to undercut rival studios, which its own O&O group often does business with - that's why you won't likely see the mandated time period clearance this time around. Another difference: today, almost all off-network fare is sold on a barter or cash-barter basis, as opposed to mostly cash deals (no barter) back then. And with the all-barter shows, those programs will take a hit if they are moved to a later time slot, where HUT and CPM (cost-er-thousand) rates are lower.
One syndicator that could lose big is NBC Universal, which sold 30 Rock on an all-barter basis for 2011. The manner the show is sold in means the program's revenues (in broadcast syndication) are totally dependent on barter revenue.
As for existing shows, O'Brien's arrival could cause some headaches, for Fox affiliates and O&Os. In Chicago, WFLD-TV's late night lineup consists of The Office (which they canceled a 10 p.m. newscast to make room for), The Simpsons, and repeats of TMZ and The Wendy Williams Show from earlier in the day. In the nine markets where Fox owns a Fox-My Network TV duopoly (including New York, Los Angeles, Chicago, and Dallas), there is an option to move some of the fare forced out by O'Brien's show to the My Network TV affiliate. But it could come at a cost to the shows' ratings and revenue as most of those MNT stations have very low viewership. In Chicago, WPWR-TV finishes behind independent WCIU-TV and PBS station WTTW in the ratings, while New York's WWOR-TV usually comes in behind the market's Univision and Telemundo stations.
As for Fox affiliates, they would lose ad revenue if they are forced to clear O'Brien's show at either 10 or 11 p.m. Usually, stations would have 12 minutes per hour to sell per hour in late night. With O'Brien's show, the number would nearly be cut in half.
For the competition, Tribune stations and CBS' CW and independent stations would benefit as they could be the only games in town if the Fox station (who isn't in a duopoly with a My Network TV affiliate) gets out of the sitcom business in late fringe. This would certainly be the case in Philadelphia (#4 market) since Tribune owns the MNT affiliate (WPHL-TV) and CBS owns CW affiliate WPSG-TV. Fox O&O WTXF currently airs a sitcom block from 11 p.m. -1 a.m. consisting of Seinfeld, Malcolm in the Middle, and two episodes of King of the Hill. O'Brien's show would push those shows to later time periods.
Weigel Broadcasting, owner of WCIU and WMLW-TV in Milwaukee, also stands to benefit from the possible flood of syndicators knocking on their doors for product in late-night, as is Sinclair's CW and MNT affiliates.
Overall, if Conan O' Brien lands on Fox - or even in first-run syndication itself (a long shot), the syndication landscape will change significantly.
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