NEW YORK — Barry Diller and his new programming chief at USA Network, Stephen Chao, are preaching the sermon of breaking the cable mold with eye-opening original programming. But they’ve just ponied up more than $75 million for non-exclusive rights to reruns of one of the most popular family sitcoms on television, “Home Improvement,” beginning in June 2002.
Buena Vista TV, the distributor of “Home Improvement,” and USA declined to comment on the deal, but sources say USA outbid TBS for the second cycle of the series, which USA will end up sharing with TV stations in every market of the U.S.
The distributor is also in the midst of negotiating second-cycle deals on the show with broadcast stations in the top three TV markets of New York, Los Angeles and Chicago.
“Home Improvement” reruns presently air on Fox O&Os in those markets, but sources say it’s unlikely that the Fox outlets will renew the show at the price BVTV is asking. Tribune Broadcasting’s stations were thought to have the inside track, although sources indicate Tribune’s interest is strongest in Chicago.
The other logical station players in New York and L.A. are the Chris Craft/United Television-owned UPN affils, but that group has a virtually iron-clad policy against sharing programming with cable nets.
The USA cabler has agreed to pay about $375,000 for each of the 201 half-hours of the series for a five-year license term. Buena Vista is holding out the slim possibility that ABC will renew “Home Improvement” beyond the 1998-99 season. If that unlikely event comes to pass, USA won’t get the reruns until March of 2003, and it’ll have to pay an additional $8.25 million for the extra 22 half-hours that ABC will commission in 1999-2000.
One precedent-setting element of the deal, according to sources, is that USA has agreed to allow the distributor to keep the revenue from two 30-second spots in each “Home” cablecast. That barter arrangement is typical for TV stations in syndication, but it’s almost unheard-of for a basic cable network to hand over.
Buena Vista will give USA up to 15 runs of each “Home” episode, which will allow the network to run the show at least twice a day throughout the five-year life of the contract. That double-run is important for USA because it means the network won’t have to lay out big bucks for another high-visibility sitcom to pair with “Home” in a one-hour block.
A second unusual facet of the deal is that in the past USA has tended to steer clear of sitcoms. The one sitcom that drew solid Nielsen ratings for USA a few years ago was Paramount TV’s “Wings,” which the network was stripping four times a day at one point.
(Cynthia Littleton contributed to this report.)