Network pays $6.7 million for reality hits

TV Guide Channel has engineered the biggest programming deal in its 19-year history, ponying up about $6.7 million for a three-year license term to reruns of a batch of VH1 celeb-reality series, led by “The Surreal Life,” “Flavor of Love” and “My Fair Brady.”

Debmar/Mercury, the distributor of the package, has sold TV Guide a total of 135 off-VH1 episodes of the various shows (encompassing more than 100 hours of programming) for a license fee of $50,000 an episode.

TV Guide, which has secured exclusive cable TV and satellite rights to the VH1 series, will be able to start scheduling the episodes in July in a latenight block, aiming to appeal to young viewers, hordes of whom stay up late and watch television.

The episodes move to TV Guide after a two-year exclusive run on VH1. During TV Guide’s three years of exclusivity, VH1 will not be able to play those reruns.

Debmar/Mercury bought distribution rights to the various shows from 51 Minds Entertainment and MindringProds. last August, picking up both cable/satellite and TV syndication rights. VH1, 51 Minds and Mindring are all profit participants in the sale of the reruns.

TV Guide’s exclusivity doesn’t extend to TV syndication. But, in a case of bad timing, Debmar/Mercury’s attempt to get TV stations to take “Surreal Life” and the other shows for a fall start in latenight was dealt a severe blow by NBC Universal’s offer of reruns of “Law & Order: Criminal Intent” — also for a fall start — to the same stations in the same time periods.

Debmar/Mercury needed an 11 p.m. time period to make “Surreal Life” and its siblings work financially, because stations don’t pay license fees for these kinds of reruns. In lieu of cash, the distributor gets seven commercial minutes within each hour to sell to national advertisers. But these minutes would be virtually worthless if the only time periods available were well past midnight, when TV viewership falls to its lowest level.

The plan now for Debmar/Mercury is to go back to some of the interested TV stations and sell the reruns for cash. As many as 15 stations could be paying license fees for “Surreal Life” by the fall; with cash on the line, these stations presumably would give the shows better time periods. If the shows draw an audience, Debmar/Mercury would venture back into the syndication marketplace next winter to go for the full national rollout.

In the TV Guide deal, other VH1 shows that eventually will become available include “Strange Love,” “Fame Games,” “I Love New York” and the forthcoming “Flavor of Love Charm School.”

The executives who put the deal together are Ryan O’Hara, president of TV Guide Channel, and the co-presidents of Debmar/Mercury, Mort Marcus and Ira Bernstein.

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