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Tough economy hits TV production, too

“Saving Grace” is an unusual, quirky police drama that stars Academy Award winner Holly Hunter as a damaged Oklahoma City police detective. It’s been a critics’ darling since it debuted in 2007, and last season drew an audience of 3.7 million viewers to TNT every week. Yet the show's cancellation was announced in 2009 and it is now airing its final season, in large measure a victim of the
/ Source: msnbc.com contributor

“Saving Grace” is an unusual, quirky police drama that stars Academy Award winner Holly Hunter as a damaged Oklahoma City police detective. It’s been a critics’ darling since it debuted in 2007, and last season drew an audience of 3.7 million viewers to TNT every week. Yet the show's cancellation was announced in 2009 and it is now airing its final season, in large measure a victim of the bad economy.

Ironically, “Saving Grace” wasn’t cancelled by the network; it was shut down by Fox, the studio that produced the series. Artie Mandelberg, an executive producer of the series, said that TNT wanted “Grace” to continue, but wasn’t willing to increase the licensing fee it paid Fox.

Under normal circumstances, the studio might have been willing to absorb the additional costs, hoping for a larger payoff in ancillary sales. But DVD and foreign sales have been “generating far less money,” Mandelberg said, leaving the studio with little choice but to pull the plug.

“The economy has always dictated this business,” Mandelberg said. “Maybe more so now. Everyone is cutting back.”

He’s right. The tough economy hasn't left the glitzy world of television untouched. People are being laid off. Some shows have to do more with less. And cheaper-to-produce reality programs continue to be mainstays of network schedules.

Searching for savings

The problems the broadcast networks, particularly, have faced are not new. Cable programming has not only cut into their ratings, but increased the competition for advertising dollars. The nation’s economic problems have exacerbated the situation as corporations cut ad budgets.

Lately, the networks have begun to search for alternate revenue sources. The recent confrontation between ABC’s New York station and Cablevision is an example. Before this year, cable companies carried the broadcast networks’ signal for free; but WABC New York wanted to be paid a per-subscriber fee. When no progress was made in the negotiations, on March 7 — Oscar night — the station cut its signal to 3 million Cablevision subscribers in the New York metropolitan area. It wasn’t until the first 15 minutes of the Academy Awards telecast was broadcast that an accommodation was reached and the signal turned back on.

Additionally, the networks have cut budgets everywhere. ABC, for example, announced plans to axe as much as 25 percent of its news staff. And at least three networks asked shows teetering on the cusp between renewal and cancellation to reduce their licensing fees if they want another season.

‘No one is in it for the art’

The most public example of that was NBC’s “Chuck.” “We said (to the producers) we’d like to keep ‘Chuck’ on the air,” said Marc Graboff, co-chairman of NBC Entertainment and Universal Media Studios. “It made sense for us to be able to come to a compromise.”

“Compromise” meant doing more with less. Though Graboff and other NBC sources don’t offer details, there were published reports that the show was renewed in exchange for a cut in its licensing fee.

(Msnbc.com is a joint venture of Microsoft and NBC.)

Speaking off the record, a studio executive said that while “Chuck” was the most publicized of these programs, “24” and “Bones” on Fox and “Cold Case” and “Without a Trace” on CBS were similarly on the cusp and either already have or soon will be faced with hard choices. (“Bones” was renewed and “24” canceled shortly after the interview took place.)

“The financial end has trumped the creative end for a long time,” one studio executive said. “The bad economy has exacerbated that more and more until it’s become a chronic problem. The problem is that (networks are) under pressure to hit a home run every time. So instead of airing good shows, something with an edge, they go for something that appeals to the lowest common denominator.”

Said another: “The networks are determined to cut the cost of their (scripted) programs or put on some more stupid dancing competitions.”

A third studio exec added: “At the end of the day, no one is in it for the art. If you want art, you should do independent films.”

The recent Jay Leno situation is widely considered a prime example of cost-conscious programming. Graboff said the decision to switch the talk-show host from “The Tonight Show with Jay Leno,” airing at 11:30 p.m., to a primetime talk slot at 10 p.m. was “first and foremost a programming decision.” But most observers disagree.

At the time of the announcement, it was widely reported that one of the network's considerations was the fact that “The Jay Leno Show” was so much cheaper to produce than scripted fare. An hour-long drama can cost as much $3 million an episode; the Leno show — even with the star's reported $30 million contract — cost only $500,000 a night. NBC Universal president and CEO Jeff Zucker said Leno would have at least a year to prove himself and ratings would not be an issue.

However, despite a strong opening week, Leno's ratings fell rapidly in the weeks to follow,  averaging only about 5 million viewers — often less than shows on cable he was competing against. Network affiliates threatened to revolt, blaming the low ratings on their profitable 11 p.m. news shows on the diminished lead-in ratings Leno provided. Within a matter of months, Leno was back at the helm of the “Tonight Show” at 11:30 p.m.

More recently Zucker told the New York Times, “At the end of the day Jay at 10 o’clock didn’t work, and I take responsibility for that.”

Changes to come?

But some improvement is on the way, fueled in part by programming inroads made by the cable networks. Michael Lombardo, president of HBO programming, said that because the network has seen a slowdown in the number of new subscriptions, “our programming budget hasn’t ballooned. But the good news is that it still remains prior to the economic downturn.

“You have to say no to things you like,” Lombardo said. “There are more quality programs that you’d like to pick up than you have the dollars to pay for. But I think relative to the rest of the entertainment landscape, we’re very happy where we are now.”

Some of the same executives who were quick to decry many recent programming decisions now point to “Glee” on Fox and “Modern Family” on ABC, both quirky shows audiences have responded to, as the type of programming and risk-taking networks should be doing more of.

NBC’s Graboff agrees. “We are trying to run a business, as is every other network,” he said. “But we know that a quality show drives value to the network. We don’t want to be pennywise and pound-foolish. NBC has committed itself to expensive and high quality development. We know that’s what it’s going to take to get our ratings up.”

Graboff’s team has approved approximately 20 pilots — about 60 percent more than in previous years — and is working on projects with “Lost” creator J.J. Abrams and producer Jerry Bruckheimer.

“We have a lot of work to do and we are putting a lot of resources and attention into our development efforts,” Graboff said.

That’s a welcome relief to producers — and viewers — alike.

Curt Schleier is a writer in New Jersey.