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Analysis: Conan a Tricky Fit for Fox

Late-night option looks promising for network, but may make stations see red 1/14/2010 06:30:00 PM Eastern

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In the wake of what could be Conan O'Brien's departure from
NBC, Fox is forced to make a decision: does it make sense to spend some $70 million
to launch O'Brien in late night, or should Fox leave the Tonight Show
host alone and stick with the syndicated programs and local news the Fox
stations are currently airing?

Earlier this week, O'Brien rejected NBC's plan to move the
iconic Tonight Show to 12:05 in an open letter to the public.

For the Fox owned and affiliated stations, picking up
O'Brien would appear to cause far more pain than gain. The performance of the
stations in the Top 10 markets at 11:30 p.m. is largely equivalent to NBC's Tonight
Show
ratings in the same hour. But the stations keep far more ad inventory
in that hour now than they would if they were forced to give it up to Fox.
Every half-hour syndicated show offers stations as much as six minutes of
advertising inventory to sell, while a half-hour of network inventory typically
offers only about a minute.

Sources say Fox brass has asked the Fox-owned stations to
run the numbers, and stations have responded that they expect they would lose
millions if the local outlets had to give a late-night hour back to the
network. The Fox affiliates fall somewhere between lukewarm and intrigued about
the notion of O'Brien shifting to their late night air, perhaps at 11:30. Some
wonder why he should expect to do better on Fox after posting lagging ratings
during his Tonight Show run, while others say he's a rare bankable
talent that may be a free agent.  

One Fox affiliate insider warned that Chevy
Chase also seemed to be a good fit for Fox in late night some time
ago: a household name that matched up well with the Fox demographic. Chase's
Fox show of course flamed out quickly in the early ‘90s. "They thought there
might be some flow there, but it just didn't happen," says the affiliate. "It's
like drilling for oil--you just don't know what you're going to get."

Fox affiliates board chairman Brian Brady says
O'Brien-to-Fox is at least worth noodling. "It's an interesting proposition,"
he says. "The affiliates will work closely with Fox to explore the
possibilities."

Addressing reporters at TCA last weekend, Fox Entertainment
President Kevin Reilly acknowledged that a host of issues would have to be
worked out with affiliates to pave the way for a late-night show, and said the
network would keep in mind the economic struggles affiliates have been through
of late. One Fox affiliate manager said "additional inducements" would have to
be made to get stations on board with the plan.

But for Fox, now might be the perfect time to make O'Brien a
deal. If he elects to depart NBC, he has nowhere else to go if he wants to
remain a late-night host on broadcast TV. ABC has stated that it isn't
interested in him, and CBS' line-up of David Letterman and Craig Ferguson is
full and clicking along nicely.

Fox executives have stated that building the late-night
franchise about which they have long dreamed (and often tried, with the likes
of Joan Rivers, Chase and Spike Feresten) probably has the best shot with the
experienced and well-known O'Brien behind the wheel. And what better time to
stick it to struggling NBC?

Ultimately, Fox must decide what's in its better
long-term financial interest: a late-night franchise with Conan O'Brien, or
healthy--and happy--TV stations?

Related

Could Next Week Be Conan's Last?

Want tix to The Tonight Show With Conan O'Brien? After next week you are out of luck. Read More

Analysis: Many Fox Affiliates Lukewarm on Conan

Amidst the speculation that Tonight Show frontman Conan O'Brien might shift to a similar role on Fox, multiple managers at Fox affiliates say they're lukewarm on the idea.  More

PEJ Quantifies 'Leno Effect'

Study shows late local news on NBC affiliates fell almost 20% in November ‘09  More

NBC Affils Chairman: Yanking Jay Was ‘Best Decision They Could've Made'

The stations spoke out, the network listened  More

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