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Chelsea Handler and E! Brace for Contract Wrangle

UPDATED: E! will not comment on the future of its signature latenight show “Chelsea Lately” on the heels of Variety’s Friday report that the show’s host, comedienne Chelsea Handler, and the NBCUniversal-owned network are grappling over the terms of her contract, which could result in the end of the only female-led program in the ever-splintering wee-hours landscape.

Handler is in the last year of her contract, and her show, “Chelsea Lately,” is slated to run on E! until the end of the year. Yet it is unclear whether she will want to continue after that date , according to people familiar with the situation. Another factor in the talks is likely to be the cost of the show, which debuted on E! in 2007, versus its ratings and advertising base, some of these people said.

“Chelsea has nine months left on her contract, and E! will not comment on the future of ‘Chelsea Lately’ at this time,” an E! spokesperson said in a statement.

Stephen Huvane, a spokesman for Handler, confirmed that Irving Azoff, Handler’s manager, indicated the celebrity plans to leave the network once her contract ends in 2014. An earlier call to Azoff was referred to Huvane. Inquiries to Handler’s agency, CAA,were not returned.

The comedienne fueled speculation about the coming discussions during a recent appearance on Howard Stern’s XM Sirius show, telling the satellite-radio host that she may well leave E! after the end of her contract and seek out a new option, like Netflix.

A parting of the ways could be detrimental for both sides. The show keeps Handler in the public eye, which fuels interest in TV projects as well as  her series of bestselling books. Her most recent effort, “Uganda Be Kidding Me,” about her humorous travels abroad, recently hit bookstores. Handler has set up a production outlet,  Borderline Amazing, with longtime collaborator Tom Brunelle.

At the same time, “Chelsea Lately” is one of E!’s truly signature programs, alongside various shows  featuring the Kardashian family, and “The Soup.” In recent months, the NBCUniversal-owned network has experimented with a number of now-canceled attempts to start a new franchise, including reality series  featuring the family of actor/director Clint Eastwood; athlete Ryan Lochte; and Kevin Jonas, the eldest of the Jonas Brothers, and his new bride. Under president Suzanne Kolb, the network has slowly dipped its toes into scripted programming, with a new show,”The Royals,” slated to debut in early 2015, and another, “Songbyrd,” in development

If “Chelsea Lately” were to go off the air, E! would have to come up with a new way to stay relevant in the late-night space, particularly as NBC’s “Tonight Show Starring Jimmy Fallon” and ABC’s “Jimmy Kimmel” make a play for younger audiences it also seeks and Bravo’s “Watch What Happens Live” aims to attract a female demographic similar to the one Handler wins on E!.

In recent years, ratings  for Handler’s show have dipped. In 2010, “Chelsea Lately” attracted an average audience of 839,000 overall; an average of 563,000 people between the ages of 18 and 49; and an average of 369,000 women between 18 and 49, according to Nielsen. In 2013, the show attracted an average of 572,000 overall; an average of 329,000 between the ages of 18 and 49; and an average of 219,000 women between 18 and 49.

Ad revenue from the show has also tumbled. In 2011, advertisers spent $159.8 million on “Chelsea Lately,” according to data from Kantar, a tracker of ad spending. In 2013, sponsors put $135.4 million behind the show, representing a dip of about 15.3%.

Could a replacement program be in the pipeline? On its recently announced development slate, E! said it was preparing a show called “After Party,” a 30-minute daily program that recaps the best of the past 24 hours in television and pop culture news, “including the good, the bad, and the ugly.” Plans call for the program to be hosted by “a panel of television and pop culture experts.” The show is produced by Wilshire Studios, NBCUniversal’s unscripted production arm.

(Updated Sunday, March 30 at 2:26 PM PT)

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