Struggling VH1 Seeks New Tune

After dating-show tragedy, network hopes new shows will reverse slide 12/20/2010 12:01:00 AM Eastern

Thanks in part to Snooki taking her talents to
South Beach, MTV greatly overshadowed sister network
VH1 in 2010. Which was a good thing for VH1.
That’s because while Jersey Shore made MTV hip again,
VH1 was having a worst year ever, suffering through three
quarters of sharp ratings declines to end up off 31% in both
total viewers and adults 18 to
49. It got to the point where
Viacom rarely mentioned the
network in presentations.

But ad buyers have noticed.
“It’s a challenging time for
them right now,” says Francois
Lee, VP/activation director at
MediaVest. And on Wall Street,
where slow growth of Viacom’s
domestic ad revenue has been
a concern, Michael Nathanson
of Nomura Securities estimates
VH1’s problems resulted in a
2% hit to the company’s ad
revenue this year.

The situation could have been very different: Jersey Shore
was originally developed by VH1, but wiser heads decided
MTV had more need for the show.

VH1 has had ups and downs before. President Tom
Calderone thinks the network is ready to rebound, as it
did when it aired Behind the Music, or I Love the ’80s, or The
Surreal Life
. “The channel has always reinvented itself every
five years or so,” Calderone says.

With the success of Surreal Life, VH1 aired a gaggle of
dating-competition shows populated by dubious characters.
Ratings were great, but it led to tragedy in 2009 when
a contestant on Megan Wants a Millionaire was charged with
killing his model wife. The show was canceled, along with
I Love Money 3

Calderone says VH1 was already looking to diversify its
mix, but the Megan incident prompted a “soul-searching
moment…how can we move on from these competition
dating shows and be more diverse in our storytelling.”

Critics say the network became timid. Calderone confi rms
“we shelved some shows that came out of that same voice,”
and that too many times lots were filled with therapy shows as VH1 started a new round of development.

The ratings plunge wasn’t a surprise. “When
you are taking a network and shifting it into a
new direction, there’s going to be bumps in the
road. Internally, everybody knew this was going
to happen,” Calderone says.

Many executives who helped VH1’s ratings soar
left before the ratings tanked, including Brian
Graden, president of MTV Networks Entertainment,
and former VH1 program chief Michael
Hirschorn, once dubbed “Mr. Bad Taste” in a
newspaper story.

But Calderone notes that Jeff Olde, the current
executive VP for programming and production, remains
from the good times, providing continuity. VH1 also had
been getting dozens of shows under a deal with 51 Minds,
creator of Megan, Flavor of Love and Rock of Love. After reevaluating
that relationship, Calderone notes VH1 gets its
shows from a wider circle of producers these days. The
network also lost its head of
ad sales as MTV Networks
restructured the department.

Calderone says he sees
signs VH1 is coming back.
With the returns of Basketball
, Brandy and Ray J: A
Family Business
and Celebrity
, ratings turned up in
the last weeks of the fourth
quarter compared to the beginning
of the quarter.

There are new shows in the
pipeline, including Mob Wives
from Harvey Weinstein and
Ben Silverman; an Audrina
Partridge project produced by Mark Burnett; and Saddle
, set in the Sunset Strip bar, produced by Bunim Murray.

VH1 is also jumping into scripted fare with Single Ladies
from Queen Latifah. A movie and the series are both set to
premiere next July.

While analyst Nathanson is expecting a rebranding effort
from the network, Calderone says it only needs “tweaks.”
Audience research shows people are still checking out VH1,
but coming up with a new slogan would be hard. “Certainly
music, pop culture and storytelling are the tenets of what
we do, but I don’t think that makes a great bumper sticker,”
Calderone says. “If we keep to those beats while always being
original, we’ll be in good shape.”

Wall Street and Madison Avenue will be watching.
“Sometimes programming doesn’t work out,” says Media-
Vest’s Lee.”As long as they work with us to deliver the deal,
and look for a solution, we have some tolerance. After
knocking off 30%, hopefully there’s no way to go but up.”

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and follow him on Twitter: @jlafayette


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