Studio betting on steady income
MGM has officially unveiled two new syndie TV projects, barely a month after a cash crunch forced the studio to bring a halt to its TV development activities.
The syndie strips “National Enquirer” and “Daily Edition” had been in the works for some time, but their future was uncertain with all the turmoil at the studio (Daily Variety, Aug. 6).
The Lion’s money problems were subsequently shored up, for a time, by an influx of cash from principal owner Kirk Kerkorian. Still, it was unclear if MGM’s TV division would be able to embark on the costly process of launching a daily strip, let alone two. Prospective station buyers voiced concerns about MGM’s long-term ability to deliver on two new shows. To MGM TV Group prexy John Symes, that’s an issue that the Lion had to overcome once before when the current regime took over in 1993.
“We wouldn’t be taking these shows out if we couldn’t produce them at the level that the marketplace has come to expect from MGM,” said Symes.
Indeed, sources say the TV development shutdown last month was reconsidered after a period of panic when the studio was running dangerously low on cash. TV production is more capital-intensive in the short-term than feature production, but in the long term, successful TV series provide a sure and steady source of income.
What’s more, the decision to channel MGM’s precious resources to the film side at the expense of TV was ultimately viewed as a bad move because TV has been the bright spot on the studio’s balance sheet in recent years. In the second quarter, the TV side of the Lion posted operating income of $4.6 million, compared with a heavy $15 million loss on the film side.
Symes has proved an innovator in the biz over the past few years by launching a string of sci-fi series with dual windows on the Showtime pay cabler and in firstrun syndication to generate twice as big a bang for MGM’s buck. The latest series, “Stargate-SG1,” bowed to solid Nielsen numbers in its syndie debut last weekend.
The TV division’s revenue will be boosted markedly this year by its re-entry into the network TV biz with the CBS series “Magnificent Seven” and made-fors such as the ABC miniseries “Creature.” The unit’s operating performance also will be buoyed by the mid-seven-figure fee it is collecting for the rights to the gameshow “Hollywood Squares,” which syndie distrib King World Prods. revived as a strip this month. (MGM inherited “Hollywood Squares” with its 1996 purchase of Orion Pictures.)
Production and marketing costs for a full season of each of MGM’s proposed half-hour strips will likely be in the $12 million to $14 million range. MGM plans to sell both shows on a straight barter basis, meaning that the distrib would get half (3-1/2 minutes) of the advertising time in each seg to sell to national advertisers, but it would not take in a cash license fee from its station affils.
The tabloid connection to “National Enquirer” will certainly be anathema to some big-ticket advertisers and stations. But MGM execs say they had no trouble selling spots in two National Enquirer-branded syndie specs last year that served as a test-drive for the prospects of a daily strip.
“What we are trying to do with both shows is bring into the marketplace shows that have information and entertainment value,” said Symes. “We’ve been able to affiliate ourselves with some of the biggest weekly publications in America.”
As with the specs, the “National Enquirer” strip will be hosted by Enquirer senior editor Mike Walker and produced by Bogorad-Wyler Prods. MGM TV prexy Symes says the show will be an “extension,” rather than a duplication, of the popular tabmag, which boasts a weekly readership of 17 million.
“Daily Edition,” the companion half-hour, will offer a TV take on selected articles from Rolling Stone, Us, Reader’s Digest, Travel & Leisure and at least two dozen other publications. Model Kim Alexis has been tapped as host. TV vet John Pike, an exec VP at MGM, will exec produce.