Q&A: Marc Graboff on Peacock's fall challenges

It’s game-time for NBC Entertainment/Universal Media Studios co-chair Marc Graboff.

As Graboff, co-chair Ben Silverman and their team sit down with buyers May 4 as part of the Peacock’s “infront” presentation, they face a bigger job than most.

It figures to be a rough upfront for all of the networks, as broadcasters hone their pitches to cash-strapped advertisers in a down economy. But unlike the other guys, NBC must also sell the buyers on the net’s 10 p.m. Jay Leno gambit.

The Peacock is ending the year once again in fourth place, and like virtually everyone, with quite a few bruises — thanks to disappointments ranging from “My Own Worst Enemy” to “Kings.”

But NBC also enters May with a rare reason to crow: The launch of John Wells drama “Southland.”

Although the show has seen some erosion in subsequent weeks, it’s still seen as enough of a solid new player for the Peacock that it earned an early sophomore season pickup May 1.

This being NBC, even the “Southland” success story has a flip side. The cop drama will soon be bumped out of its 10 p.m. timeslot by Leno, and forced to re-establish itself in another slot.

Still, compared with last year, and despite the 10 p.m. move (or maybe because of it), Peacock execs say they’ve got a bit more clarity about where they’re heading.

After nonstop speculation about his fate, Silverman is expected to remain at the net. And Monday’s slate reps the first to come out of the newly merged network/studio development team led by entertainment prexy Angela Bromstad and alternative topper Paul Telegdy.

With decisions looming — such as whether to pick up “Chuck” and “Law and Order,” or where to squeeze in new shows — Graboff talked with Variety about the state of the Peacock:

VARIETY: When you sit down with the advertisers next week, what is the message?

GRABOFF: We know what they want from NBC, as do the viewers: Quality, smart programming that we have not been as good at delivering to them as we need to be, and we’re hopefully on the track toward bringing that to them again.

V: Last year you came out of the upfront sealing deals with GM and Ford, but now we’re in a different advertising climate.

G: The advertising environment is going to be tough in the upfront for everybody. Including us. It’s not going to be a growth market. (But) we provide a unique message for advertisers that will connect them with viewers in a way that others will not.

V: How are you going to position the Leno show? And how do you think the advertisers are going to treat it?

G: It’s a comedy show, at 10 at night, when there’s no comedy on anywhere else. It’s TiVo-proof for the most part because it’s topical. It’s joinable in progress at 10 p.m., which has become the DVR viewing hour for most people. Look at the track record of trying to launch dramas at 10 p.m. over the past few years. Think about how many hundreds of millions of dollars have been spent by all the networks trying to launch them. It’s been tough, even for “Southland,” and assuming “Southland” comes back, it will obviously not be a 10:00 show for us, and that may not be a bad thing.

V: But will advertisers pay primetime CPMs for Leno?

G: When they see what the format is on the show, when they hear from Jay what the show will be, the advertisers and our affiliates will be more comfortable that it is not a talkshow, that it is not a latenight show, that it is a comedy show. We expect the CPM to be definitely not a latenight CPM. We hope it will be as close, if not at a primetime CPM level. But again, they need to see what the show is before they’re comfortable committing their dollars to it.

V: Do you know what the show is yet?

G: It’s evolving. We know what the show needs to be. It needs to be a strong comedy hour, leading into the 11 p.m. news.

V: Any second thoughts on giving up the 10 p.m. slot for Leno, especially now that “Southland” is looking good?

G: I really think we need to focus our programming in the 8 to 10 p.m. hours, especially where we are right now, where we have to rebuild our schedule. Unlike Fox, which doesn’t own that hour as a network, we still own 10 p.m. and intend on programming that hour for the foreseeable future. In five years form now, would I love to have the luxury of having so many phenomenal scripted shows that we have no place to put them but 10? I’ll face that problem when we come to it. But as far as this where this business is going right now — 22 hours a week of original programming a week, 52 weeks a year, is not a sustainable model.

V: But is there a contingency plan if it doesn’t work? Is the next step getting out of 10 p.m. all together?

G: We have no intention of returning that hour to the affiliates. We don’t have a contingency plan because the entire resources of NBC Universal are behind making this work. Never underestimate Jay Leno. That guy will do whatever it takes.

V: How will we know if the Leno model is working or not?

G: (CBS President and CEO Leslie Moonves said) he’d bet that their 10 p.m. crime drama would beat Leno head-to-head in ratings. “CSI: Miami” in an original will indeed probably win. But “CSI: Miami” is only on 22 weeks a year in originals. Jay’s going to be on 46 weeks a year in originals. You take a repeat of “CSI: Miami” against an original Leno and I don’t know he’d be willing to make that bet again. You take profitability in the time period, I don’t know if he’d be willing to make that bet either. “CSI: Miami costs CBS many millions of dollars for an original episode. The cost of one episode of the Leno show is 10% of that. Our ratings don’t have to be as high for us to drive revenue.

V: Jeff Zucker usually touts his cable portfolio before ever mentioning the broadcast network. How do the folks at NBC feel about that?

G: We know we have a job to do. For the last several years, NBC has not delivered the type of content that viewers expect it to deliver. With a new team in place and the combining of the network and studio, we’re all on the same page. When the cycle comes back and we’re the No. 1 network again, which we will be, will we be the fair-haired child of the NBC Universal portfolio? Maybe. We’re the workhorses of NBC Universal.

V: You guys hired a consultant to come in and figure out NBC brand. Any conclusion?

G: That’s still in progress, but we know that there is an NBC brand. We have been good about delivering programming on brand in the past, but we’ve been really bad about missing the boat more recently. We need to be true to the brand; we’re starting to really crystallize what that is. Would a show like “Fringe” work on NBC? I’m not sure. We know that shows like “The Office,” “30 Rock” and “The Apprentice” are right on brand for us.

V: Was there a moment where you realized NBC was heading down the wrong path?

G: I think a show like “Book of Daniel” — serialized, dark, not positive, and not really human — that’s not on brand for us.

V: Last year at the upfronts, Turner used NBC as the punchline, in order to tout itself as more network-like than you.

G: There’s no doubt NBC has been the pinata of the television business. Some of that is self-inflicted and we know that. We have not been perfect in messaging and in programming for a number of years. We get it. It’s a cyclical business and we’re in the down cycle; we’re in the rebuilding phase. In the Turner comments, if you look at what generates profitability or the ratings success of a cable network, 80% is off-network programming. Turner should thank us for “Law and Order,” which put them on the map, and not knock a studio that has delivered a lot of their ratings success.

V: Up until January, there was a lengthy
period of executive shuffling and instability. Is that all done now? Is the new structure working?

G: I judge it by the number of hours a day I spend in dealing with personnel issues, and that has disappeared, where last year it was consuming a huge part of my day. We’ve accomplished clarity, stability and accountability in the organization. People here want to know what’s expected of them, who their boss is. Everybody knows the final arbiter of scripted programming is Angela Bromstad. And everybody knows that the final arbiter for the unscripted programming is Paul Telegdy. Ben and I have a lot of input as does Jeff Zucker, as does sales, research, affiliate relations, the station group, marketing, scheduling. But the people who are going to make the decision are Angela and Paul. We’re sick of being the pinata.

V: Does that clarity extend to Ben Silverman’s role?

G: I think the town gets that Ben is a very big picture guy. Loves to think strategically where we’re heading in terms of our advertiser relationships and, as Ben likes to say, “creating culture.” Angela and Paul are really great at the day-to-day programming of a network. Developing shows, producing shows, keeping them strong. Ben is flying at 50,000 feet looking at the big picture. He’s got a great international network of relationships, and has an uncanny ability for spotting a trend overseas that could translate to the U.S. We take advantage of that.

V: Do you think you’ll be working next to Ben six months from now, a year from now?

G: I do think so. And I gotta tell you, I hope so.

V: There are plenty of arguments not to merge the network and the studio; why did you do it?

G: When I was first looking into the network-studio merger two years ago, the thing I heard most from everybody was that they were sick of the layers, they were sick of getting noted to death by myriad executives, and they wanted a streamlined process. We spend so much money buying the vision of showrunners, and then an army of people spends a lot of time shaving it down and rounding out the edges of it. In a world where there’s an 80% failure rate, why not have as little interference as possible.

V: Every network seems to have a different way of keeping costs down; what’s NBC’s strategy?

G: Unlike some of our competition, we’re not dictating anything particular to our shows. We’re giving targets to all of them and telling our showrunners that they’re the CEOs of their little businesses. You need to deliver a show that’s either flat budget-wise, or in some cases we’re saying, we need you to find X dollars, X percent of your budget. And however you do it is up to you, whether that’s asking your cast members not to take an increase or to have less cast members come back, or have a smaller writing staff or less outside days.

V: The pressure to lower license fees appears to be critical this year.

G: It’s case by case. We’re not as focused on nickel-and-diming anybody on the license fees. But to the extent that a show is on the bubble and they say ‘we can cut the cost of the show,’ yes it absolutely is a much more attractive proposition for us to bring it back. But there’s no mandate.

V: At the same time, you’ll have fewer timeslots next year.

G: The bar is higher for what will make it on the air and what will stay on the air. Sometimes with the tried and true you know what the ceiling of your ratings is going to be, and you’ve got to go with the complete unknown because you have potential upside.

V: Will you be sharing time periods? Picking up shows with fewer episodes?

G: Those are potential alternatives.

V: Did things get out of control with costs? How did that happen?

G: Through all of our faults. I don’t blame the agents or the talent for this. It’s their job to ask. We’re the ones who should have been saying no, and we didn’t. Big staffs, expensive budgets, 10-day shoots, big effects, those are sometimes great on a tentpole show. But a show that doesn’t have that kind of ratings potential — a serialized show, a family drama — for those shows to cost north of $3.5 million an hour, that’s craziness.

V: Is there still a backend, given the collapse of syndication?

G: I don’t think the syndication market has collapsed. I think in the advertising downturn, it’s definitely challenged. But there’s such a lack of product in the marketplace in drama, the cable networks are dying for shows. That’s why a show like ‘Southland’ for Warner Bros., if it stays on our air, could be a real asset for them in the aftermarket. Foreign is pretty robust, especially in this economy. The question is, in this world of Hulu and iTunes, is there a marketplace in the free TV syndication world, especially with the stress that local TV groups are under. The day of $4 million-an-episode “Seinfeld” and “Friends” deals is probably gone. The job for guys like me is to figure out how to replace that revenue in the digital age with digital revenue.

V: The report card for international co-productions is spotty so far; are these deals here to stay?

G: Ben Silverman saw this before anybody else did. Even though it didn’t work with “Crusoe,” the model is a great one. The downside of doing it, is that when you have four or five broadcasters around the world that partner on production, does it become a show by committee? The other risk is, when “Heroes” hit, our international sales team was able to go to the U.K. and sell it to the highest bidder and get a record license fee from the BBC. That’s not a license fee we would have gotten as an international co-production.

V: Is there a danger of the networks putting on too much fare that’s there because they got it at a discount?

G: I think other networks are falling into the trap that, frankly, we fell into. There is some capacity on your schedule for deal-driven programming. But not a lot. If you buy a show purely because the economics on it are great, ultimately it won’t be a good thing.

V: Scheduling wise, with just two hours a night, you’re going to have to consider putting shows like “SVU” at 8 p.m. Isn’t that a problem content-wise?

G: In this day and age, we can put edgier fare at 8. Cable has created the acceptance in the marketplace for edgier fare at an earlier time period. Of course we’ll be cognizant of the audience. If “SVU” were to be at 8 or “Southland” at 8, you can do that. But you have to be a little more careful than if it were at 9.

V: What does NBC need the most?

G: The No. 1 thing that we’re lacking is a broad, big-tent female-skewing reality program. What is ABC without “Dancing With the Stars”; what is Fox without “American Idol”? If you look at their ratings without those shows, they look a lot like NBC. We also need another signature drama, like “West Wing” or “ER.”

V: What’s going to be deemed a success in the upfront?

G: We don’t get to dictate the market this year, so it’s hard for me to predict. I think everyone’s just holding their breath and waiting.

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