WGN Chicago’s purchase of the rights to the reruns of “Home Improvement” has potentially damaged the Nielsen value of the series to the USA Network, which laid out a total of $126 million in license fees and advertising time to buy the show earlier this week.
Although USA officials were unavailable for comment, one insider says network execs are rattled, because in every one of the 14,000 cable systems that carry the WGN superstation’s signal, the two half-hours of “Home” that will run each day on WGN will be competing with the same double-run schedule of the show on USA. WGN’s satellite-delivered signal reaches about 47 million cable homes outside the Chicago area.
USA had already conceded non-exclusivity by agreeing to share the second cycle of “Home,” which becomes available in June 2002, with TV stations that buy the show in rerun syndication.
Many TV stations are now double-stripping the series, which has racked up big Nielsens since it made its debut in off-network syndication in the fall of 1995.
WGN declined to comment on license fees, but one source says the station will pay about $100,000 a week over the five years for “Home” and also fork over two 30-second spots in each half-hour, which could be worth another $150,000 an episode to Buena Vista TV.
These sources say the current holder of the rights to “Home” in Chicago, the Fox-owned WFLD, paid about $125,000 a week for the 201 episodes (which will be the number of half-hours completed after the 1998-99 season).
But USA is paying a lot more than WGN. In license fees, sources say USA will pony up $375,000 a half-hour for each of the 201 episodes. The two 30-second spots Buena Vista is carving out of each USA run will end up funneling another $250,000 an episode into Buena Vista’s coffers over the five-year life of the contract.
While Buena Vista mints money from the USA and WGN deals, sources say the distributor might run into resistance from the incumbent TV stations being asked to pay big bucks to renew “Home.”
“TV stations have never considered ‘Home Improvement’ a must-buy for the second cycle,” says Bill Carroll, VP and director of programming for Katz TV, a rep firm that advises TV station clients about their program decisions. BV executives were unavailable for comment.
Buena Vista will be asking stations in cities that get WGN via cable satellite to share the reruns with both USA and WGN, beginning in June 2002.