Execs grow sweet on cable jobs

Turner's Kellner, USA's Herzog are living proof

NEW YORK — Back in 1992 Barry Schulman engineered an unusual career move: He quit as chief programmer of one of the most lucrative TV stations in the country, WBZ Boston, to join a rookie network called the Sci Fi Channel as VP of programming.

Broadcasters tended to look down on cable at the time as the equivalent of a rundown trailer park, a place for executives with unbounded aspirations to steer clear of.

As Schulman remembers it: “People would try to buck me up by saying things like ‘Don’t worry, the cable job is only temporary — you’ll get back into broadcasting real soon.’ ”

Schulman, who never looked back and has since left Sci Fi to become VP of programming for A&E, says those hidebound attitudes have long since disappeared.

“The dividing line that once existed between broadcast and cable has evaporated,” he says.

If proof of Schulman’s analysis is needed, a series of personnel changes announced earlier this month showed how unremarkable it is for executives to move back and forth between the two:

  • Jamie Kellner, the executive most responsible for the success of the Fox Network, took over as chairman and CEO of Turner Broadcasting. While continuing to run the WB — his job after he left Fox — Kellner will assume responsibility for some of the most powerful cable networks in the U.S., including TBS, TNT, CNN and Cartoon Network.

  • By joining USA Network in the new post of president, Doug Herzog has become the poster boy for weaving one’s way between broadcast and cable.

    From segment producer of the syndicated “Entertainment Tonight” two decades ago, Herzog moved to MTV, where he rose to head of programming. After 11 years at MTV, he relocated to Comedy Central and the even bigger title of president and CEO.

    His stewardship of such hit series as “South Park” and “The Daily Show” eventually landed him the job of president of entertainment for the Fox Network.

  • Jeff Gaspin’s career pilgrimage was a little more circumscribed than Herzog’s. After serving nine years at NBC, he journeyed to VH1 for five years as executive VP of programming and production. NBC has just lured him back to supervise original movies and reality series aimed at the adults 18-to-49 demographic.

The seduction of such high-powered creative talent as Kellner and Herzog by Turner and USA “is a real compliment to cable, which is still growing by leaps and bounds,” says Carole Black, whose job before she became president of Lifetime two years ago was president and general manager of KNBC Los Angeles.

Black says she can’t stop pinching herself over “the fact that Lifetime’s ratings and revenues are up for 19 months in a row.”

Broadcast networks can only dream of such a windfall these days. As Black puts it, “Broadcasting is a mature business,” which, by definition, means that growth curves will stay relatively flat.

But even though cable’s profits keep inching upward, the salaries of top cable executives still fall short of their counterparts at the Big Four broadcast networks. For example, Herzog will pocket less as president of USA than he raked in as president of entertainment for the Fox Network.

As a general rule, the revenue base of the broadcast networks still exceeds that of the cable networks, resulting in bigger paychecks for the broadcasters, according to the chief of one of the top showbiz executive-recruitment agencies.

Abundant wage packages aside, “it must drive broadcasters crazy that many cable networks have evolved into multibillion-dollar assets despite averaging only a 1 rating,” says Lindsay Gardner, executive VP of affiliate sales and distribution for the Fox Cable Networks.

Cable-network values have soared throughout the past decade, to the point where mass-circulation networks are worth between $5 billion and $10 billion apiece, says Larry Gerbrandt, senior showbiz analyst for Paul Kagan Associates. ESPN, he continues, “is worth as much as, if not more than, ABC,” its sister network.

This success spills over into the executive ranks. “Longer-tenured executives in cable are held in equally high esteem as their broadcast counterparts,” Gerbrandt says, citing Tom Freston, chairman and CEO of MTV Networks.

Freston rules an empire that funnels more profits into Viacom’s coffers, by far, than any of the company’s other divisions, including the CBS Network and Paramount Pictures.

Cable is enticing so many of broadcasting’s innovative executives at least in part because of a two-pronged revenue stream that keeps cable-network ledger books filled with black ink.

While advertising continues to be the sole source of income for broadcast networks, their cable competitors collect money from another lucrative fountain: the monthly license fees ponied up by cable systems, which mount up to about $6.5 billion a year. That figure comes on top of the $10 billion that cable networks harvest, collectively, in annual ad revenues.

And Stephen Chao, president of USA Cable, says he and his cable-network rivals are putting that money to good use. “Smash hits are coming out of cable that rival what the broadcast networks are doing,” Chao says, citing such recent blockbusters as TNT’s original Tom Selleck movie “Crossfire Trail,” which delivered a record 9.6 rating in cable homes on Jan. 21, and USA’s four-hour “Attila” miniseries, which averaged a robust 5.9 rating on Jan. 30 and 31.

With USA set to ramp up its original-movie schedule to 24 titles a year while the broadcasters contemplate deep reductions in made-fors, Chao says that cable is sure to keep making inroads on broadcast’s traditional Nielsen ascendancy.

And this message is obviously getting through to the small army of executives like A&E’s Schulman, who don’t give a second thought to decamping from broadcast and pitching their tents in cable.

For broadcast-network executives looking to change jobs, what’s not to like about cable?

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