Is the Jay Leno Experiment Imploding?
This Bloomberg story leads with bad news for the Jay Leno Show, but in the fragmented world of digital television and cable TV, even the network "winners" are treading water. Here are the hard numbers for the 18-49 demographic at 10PM:
-- NBC has lost 1.8 million viewers in the with the Jay Leno experiment (down 45%)
-- CBS has lost 162,000
-- ABC has gained 245,000
Worse, NBC's 10PM advertising rates are down as much as 70 percent:
Advertising rates for Leno range from $48,803 to $65,678 for a 30-second spot, according to Advertising Age. Last year, NBC was able to secure as much as $146,679 at 10 p.m., the trade publication said on Oct. 26.
GE (which owns NBC) is pleading with Leno critics to hold off judgment until next summer, when NBC would seemingly have an advantage over other networks' re-runs. Leno will be new 46 weeks per year, whereas nighttime dramas only produce 22 yearly episodes.
The Leno experiment isn't completely nonsensical for the network. NBC can withstand the lower ad rates because the show is so much cheaper to produce than the costly annual 10PM drama lottery, where NBC spends enormous sums of money of hour-long dramas that aren't guaranteed to run more than a few weeks. But for nationwide local NBC affiliates, the Leno experiment is already turning into "the Leno effect." Smaller Leno audiences lead to smaller local news audiences and bigger revenue headaches for affiliates. The LA Times reports that
NBC affiliates may not be able to tolerate the financial pain that Leno is causing to their late-night news programs -- and may be forced to consider their own program alternative for the 10 p.m. hour.
For now, the "let's wait until the CBS reruns" argument is working to stave off a mass affiliate revolt.
More broadly, NBC's Leno experiment is a fascinating harbinger of things to come. Fragmented TV audiences, especially in the 10PM slot, are a Catch-22 for networks. Keep the current hour-long-drama model, and they risk lose money. Or ditch the model for something with lower expectations and lower overhead, and they risk losing affiliate support. TIME magazine called Jay Leno the future of television. Everybody who works is television is probably hoping TIME magazine is wrong.