On Mon, Nov 2, 2009 at 9:37 PM, PGage <[email protected]> wrote:
>
> On Mon, Nov 2, 2009 at 9:13 PM, Kevin M. <[email protected]> wrote:
>> The reason NBC is confident in their all-Leno-all-the-time approach is
>> because NBC has made a sound economic choice (albeit a horrible
>> creative choice), and no affiliate can argue with fiscal strategy. NBC
>> has the affiliates by the short hairs. Let us pretend the affiliates
>> do demand NBC change. NBC can respond by stating they'll replace Jay
>> with five new dramas, but affiliates would have to be charged a
>> substantial fee to cover the cost of producing the new shows. NBC
>> would also have to buy out Jay's contract, the cost of which would be
>> absorbed by the affiliates, too. From the standpoint of profit versus
>> loss, the best thing NBC can do is to keep a low-rated Jay Leno on the
>> air. In every other aspect of the industry, the best thing NBC can do
>> is pull Jay Leno before he hits rock bottom. Which do you think NBC
>> will choose -- a wise fiscal choice or a popular creative choice?
>
>
> Have you seen the numbers on this, or just basing it on past
> assumptions? What I have been trying to find out, so far
> unsuccessfully, is some estimate of how many millions of dollars the
> affiliates would lose if The Leno Effect drags their ratings down X
> percent, vs the costs of shutting down the Leno experiment. I have
> been told there is a lot of money in the local 11:00 news.

I've seen the numbers you posted, but the ratings only tell a part of
the story. Assume Jay's show does, as the stories indicate, cost about
$300k per episode to produce (some say more, some say less, but that
seems to be the number tossed around more than any other). Compare
that to 5 shows costing anywhere from $1 million to $2 million to
produce. Then do the math on ad rates, which several of us posted here
a few weeks ago. Then look at 11pm newscast ratings from before the
most recent presidential election (Spring of 2007 maybe, since the
hype of "Decision 2008" overinflates more recent news ratings) and
compare those numbers to today's numbers. Then factor in the number of
people getting sports and weather info online who weren't doing so
three years ago. Now add into the mix the ratings for cable programing
like Daily Show and Adult Swim. Next factor in the devalued dollar,
and its effect on low advertising revenue. Then look at industries
that previously advertised heavily (credit card companies and auto
manufacturers) but have scaled back for both economic and public
relations reasons. And that is just a fraction of the math involved
here.

There is money to be made in local news, but Jay Leno isn't the only
reason there is money being lost in local news. Removing Jay Leno
might fix (and I emphasize the word might) one of NBC's problems, but
replacing him would be expensive, and assuming three out five new one
hour dramas would fail, a continuing costly downward spiral. If the
NBC brass is looking to unload the network to Comcast or whoever, they
will be strutting around, showing off the trimmed fat of M-F at 10pm.
-- 
Kevin M. (RPCV)

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