Tribune and Turner Broadcasting’s Atlanta superstation WTBS last week managed to buy “Friends” and infuriate enemies.
They teamed to make a massive preemptive strike for off-network rights to the hit NBC sitcom from Warner Bros. Domestic Television Distribution.
The deal, which puts reruns of the series on track to earn as much or more than the estimated $3.8 million per episode garnered for the cash-plus-barter sitcom “Home Improvement,” gives Tribune the series for seven of its stations (including New York, Los Angeles and Chicago) beginning in fall 1998. WBDTD’s deal with WTBS takes effect in 2001.
The huge off-net sale – the earliest in syndication history for a major sitcom – represents a big gamble for Tribune and WTBS, the latter of which could soon be under the same corporate umbrella as WBDTD if regulators approve Time Warner’s merger with Turner.
It comes with “Friends” barely halfway through its second season. Most off-net sales campaigns begin during a network show’s third season.
That makes the early big money deals risky for the stations in the event NBC shifts “Friends” to a new night or the show experiences ratings declines down the road.
Further, all of “Friends” cast members have movie deals, which has created some fear that one or more of the principals could walk within the next few years. But Warner Bros., realizing it had a runaway hit on its hands, went back to the negotiating table and locked up the cast with sweetened long-term pacts.
Trib’s deal sends a clear signal to network affiliates interested in buying popular off-net comedies. With government restrictions now lifted, affiliates in top-50 markets can buy reruns of network shows for the hour before primetime known as access.
That is of great concern to station groups such as Tribune, Chris-Craft and Fox, which rely heavily on sitcom reruns in the critical daypart. Tribune’s move no doubt tells affils that if they want the shows, they had better be prepared to move fast and dig deep into their wallets.
With the agreement, Trib has wrapped up “Friends” for WPIX New York, KTLA Los Angeles, WGN Chicago, WPHL Philadelphia, WLVI Boston and KWGN Denver. If the company’s acquisition of KTTY San Diego closes, it will get the sitcom there, too.
Separately, WBDTD also sold the show to the powerful NBC affil in Sacramento, KCRA, as well as CBS affil WCPX Orlando and Renaissance Communications-owned indie WXIN Indianapolis.
With the early clearances, WBDTD has sold “Friends” in almost 26% of the U.S. without ever officially rolling out the series.
Tribune alone will end up paying more than $1 million per episode for the show in its markets, according to industry sources. That is right at, or perhaps 5% above, the price obtained by Buena Vista TV’s “Home Improvement.”
Warner Bros, and Tribune execs declined to comment on the terms of the deal, but WBDTD president Dick Robertson said the price tags are “the highest price ever paid for a comedy” in the markets.
Others, however, expressed doubts that “Friends” surpassed “Cosby.” And they noted the syndicator is offering 720 extra plays of “Friends” to Tribune for free (giving stations the option to double run the show in the first two years of syndication).
WBDTD’s key to maximizing license fees for “Friends” is the WTBS deal, and keeping 90 seconds of national barter time.
The cable web is understood to be paying about $300,000 per-episode for “Friends,” a record for a program sharing a window with broadcast syndication, according to industry sources.
Among individual markets, Tribune is estimated to have paid $275,000 per episode in Gotham and L.A., $200,000 in Chicago and $100,000 each for Philadelphia and Boston.
WBDTD also had talks with Chris Craft and Fox about “Friends,” but those groups were said to be displeased about the terms of the deal.
Some industry sources speculated other stations could also have problems with the marketing plan, particularly the cable involvement (BVTV was the first to introduce the broadcasting-cable hybrid with “Empty Nest”).
The 90 seconds of barter that WBDTD is retaining to sell during the weekday run of “Friends” could add more than $1 million onto the cash license fees for each episode. In return, the syndicator won’t take any barter time on the weekends.
Consequently, industry sources said WBDTD could end up meeting or beating the per-episode price of “Home Improvement,” but come in under the record $4 million-plus Carsey-Werner and Viacom collected for “The Cosby Show.”
The deal angered some station execs who claimed they were misled by the syndicator. They contend they were told that it would not open the market for “Friends” for another year.
Others wondered why Robertson chose to ink a deal now instead of waiting, since the show’s ratings are still growing and WBDTD could have created a big buzz for the off-network launch. “It is selective, preemptive bidding,” a station rep groused. “It’s a pretty chicken way to do it.”
“What would you do if you had my job?” Robertson responded. “Blow the top-three markets…. The fact is these stations are very big customers of ours. It made eminent sense.”
For Tribune, the deal makes sense, particularly in Chicago, where Fox keeps outbidding it for A-list sitcoms. In Los Angeles and New York, Trib owns “Seinfeld” and its WPIX New York recently ponied up as much as $125,000 per week for Paramount’s “Frasier.”
“We looked at the crop of shows from last year that will be out in 1998, and from this year for 1999, and this was far and away the best,” said Marc Schacher, programming VP for Tribune Broadcasting.
As for potential down-sides, Schacher said, “We would not have bought the show if we thought there were great risks.”