ABC has given sophomore comedy hit “Home Improvement” an unprecedented three-year renewal–through the 1995-96 television season–in conjunction with an exclusive two-series deal with the producer trio behind the show.

As reported, under that deal ABC will deficit and jointly own the two new series, while the Walt Disney Studios–with whom Wind Dancer principals Matt Williams, Carmen Finestra and David McFadzean had been under an overall deal for more than three years–will syndicate both shows (Daily Variety, Nov. 30).

The idea is that Williams and company will seek to develop new sitcoms to air in a coveted time period adjacent to “Home Improvement,” and while nothing is formally guaranteed, ABC clearly has extra incentive in that regard since it will share in the longterm revenues. “That’s one of the more important parts of the whole deal,” noted Rick Leed, Wind Dancer president and Williams’ former agent.

Significantly, agreeing now on a fifth year of the Tim Allen sitcom also averts the prospect of acrimonious wrangling over renewal terms after the show has aired four years, in the process guaranteeing Disney–which owns and will distribute “Home Improvement”– the services of its co-creators and exec producers through the life of the show.

“The beauty (of the deal) is that it takes away any animosity that would come over that fifth year,” said Walt Disney Studios president Richard Frank.

Winners all around

The parties described the unusually structured arrangement as a “win-win-win situation,” since Wind Dancer gets greater autonomy, Disney receives a boost in its long-term sales effort on “Improvement” while maintaining ties to the producers, and ABC cements a relationship with Wind Dancer on both that show and future series.

The three-way pact also may point the way toward how agreements can be structured in light of an anticipated relaxation of the financial interest and syndication rules. Soon-to-be-elevated ABC Entertainment president Robert Iger said the deal fits ABC’s demonstrated desire “to own more of the product we ultimately schedule on our air.”

Both Frank and Iger acknowledged that the arrangement shifts the risk-reward ratio of a conventional network-studio-producer relationship: ABC assumes more of the risk by deficiting the show, and Disney reduces its upfront outlay but also its potentially lucrative back-end return by functioning solely as distributor, as opposed to owning the shows.

Though ABC also reportedly agreed to cover deficits under its multiple-series deals with producers Steven Bochco and James L. Brooks–in the form of loans that would be repaid in success–Iger noted that there’s “more of an up side” for the web here in that it could participate in the syndication windfall on a major hit.

Disney, meanwhile, now has the assurance that the show will reach the needed mass for syndication and the luxury of deciding whether it wants to premiere off-network episodes in 1995 or ’96, providing time “to analyze the marketplace, ” Frank said.

Iger wouldn’t discuss specific terms but said ABC has “paid in recognition of the success of the show” in regard to the renewal.

He added that ABC also holds an option on a sixth year of the series.

Fees extracted

While networks control a show through the first four years of its life, once that term elapses producers can extract major fees from a network to retain a long-running hit or risk losing it to another network.

ABC, for example, is currently paying an estimated $ 2 million per episode through 1993-’94 on fifth and sixth seasons of “Roseanne,” while NBC ended up shelling out that and more in past negotiations on “The Cosby Show” and “Cheers.”

Ample development time

By calling for two series over three years, the deal allows Williams, Finestra and McFadzean ample time to develop new projects, avoiding what Iger called “contractually related calendars.”

A new show will likely be developed for next season, but probably not in time for the fall.

Prior to “Home Improvement,” Williams, who established Wind Dancer in 1988, created “Roseanne,” co-created “A Different World” and co-created and exec produced the NBC series “Carol & Company.”

McFadzean exec produced that last show after writing for “Roseanne,” while Finestra worked for five seasons as supervising producer on “The Cosby Show.”

Good timing

Wind Dancer’s overall deal with Disney (which also included a first-look feature connection) lapsed in October–an extremely fortuitous bit of timing, giving the production company additional negotiating clout at the moment when it could talk to other parties.

Frank said that Disney wants to stay in business with the company beyond television but that other projects will be addressed on an ad hoc basis.

Because the ABC deal doesn’t include movies or miniseries, Wind Dancer hopes to use some of its money to act as an independent, developing alternate forms of television programming as well as feature film and theater projects.

Williams co-wrote and produced the Disney feature “Wild Hearts Can’t Be Broken” and he and his partners have remained active in theater, McFadzean having been a playwright and stage director prior to his entree into television.

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