A below-the-radar broadcast network called Ion TV is counting on the granddaddy of all medical shows, “ER,” the crime-solving team at “NCIS” and the nutty antics of William Shatner on “Boston Legal” to get some respect on Madison Avenue.
Burgess, who shows faint traces of a German inflection in his voice from his upbringing and education in Germany, is eager to get back into the competitive game after two years of what he calls “a transition strategy” at Ion (formerly Pax) of filling the network’s schedule with inexpensive older series including “Mama’s Family,” “Baywatch,” “Wonder Years” and “Quantum Leap.”
Not surprisingly, few people are clamoring for this programming lineup; for the first eight months of the year, only 444,000 viewers, on average, watched Ion TV, which dragged it below the ratings of such cable networks as Animal Planet and Lifetime Movie Network.
As of Sept. 8, Burgess says, Ion’s message to the industry is: “Hey, we’re turning the lights on,” thanks to reruns of “Boston Legal,” “NCIS” and “ER.”
The biggest marketing campaign in the network’s history also begins this month, spearheaded by Eleo Hensleigh, Ion’s chief marketing officer and former head of marketing for Disney/ABC. Ion’s catch phrase: Positively entertaining.
Ion’s sales force has scared up a batch of new primetime advertisers, including Honda, Western Union, Red Lobster, Walgreen’s, the investment firm Edward Jones, Expedia.com and Hotels.com.
“We think Ion will improve its ratings with these fresh off-network shows,” says Michael Parent, a top media buyer for TargetCast, which placed the ads for Expedia.com and Hotels.com. “And the price is affordable — it’s cheaper than the high-end cable networks like USA and TNT.”
Burgess makes no bones about trying to copy a page from the playbook of USA, TNT and other general-entertainment cable networks. The formula starts with recognizable reruns. If lots of people tune in, the blueprint calls for using those shows as a tool to promote original series, beginning with cheaper gameshows and reality programming. As the ad dollars roll in, Ion will take the biggest step of all, ordering scripted original series.
Burgess, who has a master’s from the Wharton School, lives with his family in West Palm Beach, Fla., where Ion has its headquarters. As beautiful as West Palm is, he’s itching to get back to New York. If the new strategy starts paying off, Burgess will pick up stakes, hire a top programmer or two, and set up an office in Gotham to house his key executives.
Ion was born in 2006 out of the ashes of Pax TV, whose guiding genius Bud Paxson spent the previous decade buying up UHF TV stations for use as the linchpin of a family-oriented broadcast network.
Burgess got involved with Ion in his previous job as head of business development and global strategy for NBC Universal. In 1999, NBC U bought a 32% stake in Paxson Communications, which consisted of Pax TV and the 60 Pax-owned TV stations.
However, Bud Paxson never saw eye-to-eye with NBC, which bought him out in 2005. Burgess took over for Paxson, and Pax TV became Ion TV, a private company, in 2006. The Citadel Investment Group funneled $100 million into Ion in May 2007 as part of a recapitalization that diminished NBC’s stake to non-voting securities and a minority interest.
Although burdened with $1.1 billion in debt (plus $1.4 billion more of debt that Burgess says is convertible to equity), Ion Media generated $98.3 million in cash flow last year, mainly because it kept costs down. Unfortunately, newer programming, even reruns, costs lots of money. Ion’s cash flow will engineer a nose dive this year, to only $10.4 million, because program spending will rise by $27.3 million and capital spending by $19.5 million, according to the company. “Boston Legal” alone will sock Ion with a tab of $20 million.
Burgess, soft-spoken but super-competitive, says “what keeps me awake at night” is that two other shows he’s pre-bought, reruns of current hits “Criminal Minds” and “Ghost Whisperer,” both from CBS TV Distribution, won’t be available right away. “I’ve got to wait until the middle of next year for ‘Whisperer’ and the fourth quarter of next year for ‘Criminal Minds’,” he says.
But Bill Carroll, VP and director of programming for Katz TV, which represents hundreds of TV stations, says Burgess may have lucked out because the 2008-09 season “will be last for both ‘ER’ and ‘Boston Legal’.”
The hoopla surrounding the departure of the two shows, says Carroll, may yield a halo effect that elevates the Nielsen ratings of the Ion reruns — and hastens the return of Burgess from the boondocks of West Palm to the hot center of New York.