From Times Online

January 22, 2008


NBC Universal to cut costly pilot shows


NBC aims to save $50m a year by ditching pilots of new series which are traditionally produced at great expense by US broadcasters

Dan Sabbagh

NBC Universal, the American broadcaster behind Law & Order and Heroes, aims to save about $50 million (£26 million) a year by scrapping pilot programmes for drama series because they have become too expensive to make.

The cost of one-episode pilots — which supposedly are designed to avoid flops mid-series — have soared in the past three years from $3 million to $7 million, according to Jeff Zucker, the NBC Universal chief executive.

“You put in loads of extra money and special effects, but not producing the series you get,” he said, adding that even if viewers liked the pilot produced the result was “a totally false positive”, which did not insulate the network from subsequent failures.

Speaking at a round-table event in London, Mr Zucker said: “Three to four series are returning from last fall. How many pilots were made? Around 75. If pilots were meant to stop shows that shouldn’t be airing, well, we went ahead anyway.”

Instead, NBC plans to begin transmitting entire series at normal production budgets, although it can still act quickly to eliminate a flop.

Mr Zucker estimated that the annual profit improvement he could achieve was about $50 million, because some of the money saved from making the annual crop of eight to ten pilots would be spent elsewhere.

Separately, Mr Zucker played down the prospects of a bid for ITV, as it announced the $150 million acquisition of a 26 per cent stake in NDTV, the Indian entertainment broadcaster.

He said: “We’re admirers of ITV, admirers of Michael Grade, but it doesn’t mean we want to spend $8 billion — and I’m aware the figure can change — to acquire ITV.”

Although the company was careful not to rule out the possibility, NBC Universal is under pressure to find assets that will deliver “double-digit growth”.

ITV is contending with declining audiences and a subdued advertising market, with analysts expecting little or no growth in revenues or profits in 2008.

NBC has been cost-cutting over recent years, after the long-time leader sank to fourth of four among the big US networks.

It has cut back the amount of prime-time programming it makes from three hours to two — although in recent months a mini-revival has placed it on a par with Disney’s ABC, CBS and Fox, which is owned by News Corp, parent company of Times Online.

NBC Universal is 80 per cent owned by General Electric, with the remaining 20 per cent held by Vivendi, of France.

Profits last year totalled $3.1 billion, up 6 per cent, with the contribution from NBC’s prime time estimated at 5 per cent of a group that also includes the Universal film studio and the CNBC financial news channel.

Mr Zucker also said he believed that the three-month-old writers' strike would be over “in two weeks”.

Edited January 24, 200817 yr by Sylph

NBC's Zucker to Drop Pilots


A.J. Frutkin

JANUARY 23, 2008 -

Prompted by the Hollywood writers strike, and several years of underperformance, NBC is doing away with pilot season. The New York Times reported today that NBC Universal president and CEO Jeff Zucker made the announcement during a videoconference with the company's international employees. With many pilots costing anywhere between $3 and $7 million, Zucker reportedly said the move would save the company as much as $50 million a year. Zucker also said the broadcaster still occasionally might produce a pilot, but not on a regular basis.

NBC's announcement comes after CBS announced last week that it would drop approximately 20 drama scripts from its pilot orders made earlier this season. The release of those scripts was seen largely as a result of the writers strike, which has prohibited networks from moving forward on development for the 2008-09 TV season. On Tuesday, The CW dropped about a dozen development projects, while Fox released about two dozen scripts. ABC has yet to announce its plans.

Still, NBC's move is the most severe so far, suggesting the impact of the writers strike will extend far beyond the current season. The development process has long come under attack for the bloated budgets of those pilots, as well as the byzantine casting process, which seems to tie up all of Hollywood during first and second quarters, when most projects get produced.

But even though many pilots--which get the thumbs up both from advertisers and critics--fail to catch on with viewers, they remain the clearest indicator of a series' chances--especially for advertisers buying into a network's schedule. So, what will replace NBC's pilot production process is sure to be of concern to the buying community.

Edited January 24, 200817 yr by Sylph

NBC mixes messages



Network won't cancel previous pilot orders

By JOSEF ADALIAN



What the Peacock giveth, it also taketh away.

NBC said on Wednesday it had no plans to cancel any of its orders for 2008-09 pilot scripts -- but that it was dramatically cutting back on future pilot production.

Over the past few days, CBS, Fox and the CW all said that the strike --and its expected impact on pilot season--- had forced them to renege on previous script orders. Dozens of scribes were told that the ideas they had previously sold to the nets, but never delivered because of the WGA walkout, were no longer needed.

NBC, however, has decided to do just the opposite, confirming Wednesday that it will not cancel any of its previous script orders. The majority of the net's 2008-09 development is at sister company Universal Media Studios, but the commitment to stick by script orders also applies to projects set up at outside companies.

Move is a rare bit of good news for striking scribes, who in recent weeks have seen studios slash more than 75 overall deals and watched as numerous networks opted to trim their script orders.

NBC U boss Jeff Zucker told the New York Times Wednesday that his broadcast network was largely abandoning the decades-old tradition of ordering numerous pilots each year. He said the net will still order a couple each year, but would shift more toward a system of straight-to-series orders.

Peacock execs stressed that the net would still order dozens of "first episode" scripts each year, and that it would continue its recent shift toward rolling, year-round development of projects.

Zucker told the Times the move was a result of the WGA strike and the economy.

"It's clear we are in a recession in the United States, and we're going to have to manage our business accordingly," he said.

NBC Entertainment exec VP Teri Weinberg and UMS prexy Katherine Pope said Zucker's pronouncement, and the decision to stick by its script commitments, were both part of the net's desire to shake up the development process.

"With the kind of money we're spending on pilots, we'd like to see that money amortized better (over the course of a series), and also not feel rushed," Weinberg said. "We want to really nurture that development."

Because NBC won't be locked into a traditional pilot season this year -- but instead will greenlight projects when they're ready or when they need them -- it didn't make sense to try to save some short term coin by cutting back pre-strike script orders.

"Given where we are, given that we're trying to look at everything on a per project basis...we wanted to say, 'Let's wait and get these scripts'," Pope said.

Added Weinberg, "We (wanted) to give the writers a chance to deliver."

While Weinberg and Pope argued that Zucker's comments on pilots weren't that radical, others around town were surprised by his words.

Other nets, including Fox, have been dropping hits about reducing pilot orders this season in favor of more straight-to-series orders. But Zucker's pronouncement that he was killing pilots, save for "one or two" a year, seemed a bit dramatic to rivals.

"He is basically saying to the entire town, 'We are not in business'," one senior exec at a rival company said. "It's so short- sighted."

But Pope said Zucker's declaration was simply a much-needed change to a broken system.

"People are still going to have to write pilot scripts" before series are ordered, she said. "This is just about not wasting money on production. It's about taking our bets and being smart on the front end."

The biggest losers in the process could be helmers and thesps, who make millions each year shooting pilots that never go to series.

Read the full article at:
http://www.variety.com/article/VR1117979542.html

Edited January 24, 200817 yr by Sylph