October 26, 2012

THE SKED: Ad Age Shows Us the Network Money – Part 2: The Shows

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Written by: Mitch Salem
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Yesterday we did our homework and reviewed the groundrules for calculating the meaning of primetime network ad rates listed by Ad Age in its yearly survey.  So… all that being said, where are the networks making their money this season?  Or not?

A quick refresher on some critical numbers:  the typical 1-hour TV episode has twenty 30-second commercials (a half-hour has ten), so that’s the multiplier to use with Ad Age‘s surveyed rates.  And a network typically pays $2M for each episode of a brand new 1-hour show, $1M/ep for a single-camera sitcom, and $750K /ep for a multi-camera sitcom (all these numbers being broad approximations), which rise with each additional year the show is on the air.  (Note:  reality series, while usually less expensive than scripted 1-hours, are less easy to generalize, because budgets can vary greatly based on the concepts and talent involved, and because reality shows can’t be repeated and have limited aftermarket value.)

  • Comedies:  The bulk of the network’s revenue comes from its half-hours.  THE BIG BANG THEORY, unsurprisingly, leads the pack, with $275K per 30-second ad (we’ll round-off these numbers to the nearest $5K), translating to about $2.75M per episode.  That may not be tremendously more than the network pays as an episodic license fee for the series, considering its age and success, but the show’s frequent reruns are extremely lucrative for the network.  2 BROKE GIRLS is right behind Big Bang, bringing in about $2.7M for the initial airing of each episode at much lower cost.  However, while Big Bang is certainly meeting its rating guarantees, it may be a closer call for Broke Girls, which is more than a rating point lower than Big Bang and could be in a make-good situation if its numbers continue to slip.  On that subject,  there’s a very good chance the network will need to shell out make-goods for PARTNERS, which is charging rates just below HOW I MET YOUR MOTHER and MIKE & MOLLY (revenues of $1.6M/ep vs $1.9M/ep), but bringing in much lower ratings.
  • Dramas:  NCIS is earning about $3.3M/ep for an initial airing, which for such a senior (in more ways than one) series is again likely not to be hugely profitable for that run, but this is another show that can air lucrative repeats forever.  The problem of airing scripted programming on Fridays is demonstrated by the fact that CSI NY and BLUE BLOODS are bringing in only $1.2-$1.5M per initial airing, probably considerably lower than the shows’ license fees. (In both these cases, however, the network’s corporate affiliate takes in additional revenues from syndication, foreign distribution, etc, making them worthwhile in a larger sense to keep on the air.)  It’s particularly instructive to compare the Friday dramas to THE GOOD WIFE on Sundays, which has a much higher ad rate (resulting in $2.2M per initial airing) despite not dissimilar ratings, because Sunday is a better-watched, more desirable night for advertisers (in addition, one can assume that Good Wife appeals to a better-educated, more affluent audience, making it more advertiser-friendly).  VEGAS is probably the CBS drama most in danger of being in a make-good situation, with this past week’s ratings only half of the NCIS level but an ad rate set at 2/3 the older show’s number.
  • RealityTHE AMAZING RACE and SURVIVOR take in a robust $2.5-$3M per episode (although neither is inexpensive to produce), while UNDERCOVER BOSS, airing on Fridays, makes only half as much.

  • Reality:  About 2 1/2 hours of each SUNDAY NIGHT FOOTBALL game airs in primetime, which means each game would bring in around $13.6M/ep (plus lesser amounts for non-primetime periods)–but anyone who’s watched football on TV knows each game has more commercial breaks than any scripted show could survive, so the numbers are probably significantly higher.  That’s a ton of money–but football is also the most expensive programming on television, due to the giant license fee the network pays to the NFL, and NBC probably doesn’t much more than break even.  (Beyond the dollars and cents, of course, there are obvious promotional and other advantages to having such huge audiences tuning in.)  Nothing else on the network’s air comes close to football in terms of gross revenue, but as far as profitability goes, THE VOICE is, for now, printing money, earning $10M for each 2-hour episode at what should be a vastly lower episodic cost.  Adding an additional 2-hour Voice episode to a week, as NBC is doing at the end of October, provides a flood of much-needed cash for the network.
  • Comedies:  After that, NBC’s prices jump off a cliff, with the highest revenue being about $1.4M per initial airing of THE OFFICE, a show that certainly costs far more than that after so many years on the air.  Other sitcoms, with the healthy exception of GO ON, are earning under $1M per initial airing and breaking even at best.  The only good news for NBC is that its shows have been low-rated for so long that its ratings guarantees are probably quite reasonable, meaning it doesn’t have to worry much about make-goods.
  • Dramas:  Revolution is a show that should be able to reap additional revenue from the scatter market, boosting its current value of $2M per initial airing.  The importance of aftermarkets when the network’s own studio owns a show is best demonstrated by SVU, which has to be spouting red ink at revenues of $1.5M per initial airing after 12 years on the air.

  • Dramas:  ONCE UPON A TIME and REVENGE should be very profitable for the network, with around $4M and $3M in revenue respectively per initial airing.  GREY’S ANATOMY earns more than $4M per episode, but as a senior show top-heavy with well-compensated cast and writer/producers, that number is squeezed by rising costs, as ratings steadily decline (this is another case where the network’s parent company owning the show helps).  PRIVATE PRACTICE is a good example of a show that was still doing decently in the ratings but became too expensive to survive, even with revenues of $2.7M per initial airing.  The network’s new dramas may be holding their own for now, but there could be a serious make-good problem if the ratings guarantees for NASHVILLE, THE LAST RESORT and 666 PARK AVENUE were too generous.  ABC also has a problem with its reliance on serialized dramas, which have little rerun value.
  • Comedies:  MODERN FAMILY has terrific $3.3M earnings per initial airing, but again, costs are rising and this time Disney doesn’t own the show.  However, Family is enormously valuable to the network as a launching pad for new sitcoms, so it doesn’t need to turn a huge profit on its own.  (That was the case for the latter years of Friends on NBC as well.)   The network’s other comedies are mostly earning $1.2-$1.5M per initial airing, putting them in pretty good shape.
  • Reality:  DANCING WITH THE STARS still brings in $4.5M per week to the network with its Monday and Tuesday installments, but as ratings continue to shrink, it could be hitting a make-goods wall.

  • Reality:  The network’s cash cow, of course, is AMERICAN IDOL, which despite last year’s declines will still earn $6M per hour this season.  Even if the latest judging changes wreak further havoc, the show has a long way to go before it stops being hugely profitable for the network.   X FACTOR makes about 2/3 of Idol‘s take, a very solid amount.
  • Comedies:  FOX’s not-so-secret weapon is that its hit shows like NEW GIRL and GLEE have a particularly youthful audience within the 18-49 demo, for which advertisers are willing to pay a handsome premium.  This allows those two to earn $3.2M and $4.5M per initial airing respectively.  THE SIMPSONS and FAMILY GUY are earning plenty of revenue, over $2.5M per initial airing, but also have cost issues, which is why The Simpsons (additionally complicated by aged rights deals that limit what FOX can earn from the episodes as a studio) is likely in its last few seasons.  BEN AND KATE may be scraping against its ratings guarantees, but for the most part FOX has a good comedy business going.
  • Dramas:  What dramas?  Apart from Glee, a comedy for Emmy purposes although it runs 60 minutes, the network is riding out the end of FRINGE (for which it reputedly pays a very low license fee), while MOB DOCTOR, one assumes, won’t last too much longer, as it has to be below its guarantees.  The only issue the network has is BONES, which makes a very handsome $3.3M per initial airing, but which is getting elderly and costly.  In a perfect world, FOX would probably put it up for retirement, but right now it has no other reliable 1-hour to use as a base for launching new dramas.

  • Dramas:  With the exception of THE VAMPIRE DIARIES and the new hit ARROW, no show on the network even earns $1M per initial airing, and the serialized nature of its series make reruns problematic.  It seems as though Netflix is keeping the network’s programming (barely) afloat.

About the Author

Mitch Salem
MITCH SALEM has worked on the business side of the entertainment industry for 20 years, as a senior business affairs executive and attorney for such companies as NBC, ABC, USA, Syfy, Bravo, and BermanBraun Productions, and before that, at the NY law firm of Weil, Gotshal & Manges. During all that, he has more or less constantly been going to the movies and watching TV, and writing about both since the 1980s. His film reviews also currently appear on and In addition, he is co-writer of an episode of the television series "Felicity."