Entertainment Industry

Category: Television

CBS outlines post-CEO production deal with Leslie Moonves

MoonvesNAB2011

CBS Chief Executive Leslie Moonves has nearly three years remaining on his employment contract, and after that, he will be entitled to a lucrative CBS-financed television and movie production deal.

CBS and Moonves this week signed an agreement that sketches out Moonves' tentative producer agreement, according to a filing Friday with the Securities and Exchange Commission. 

The proposed arrangement borrows from a particularly rich production deal that former News Corp. President Peter Chernin exercised when he left the executive suite of Fox in 2009. Last week, private equity firm Providence Equity Partners invested $200 million in Chernin's company -- demonstrating the potential value of a company headed by one of the biggest names in the entertainment business.

But, unlike Chernin, Moonves may choose not to trade in his executive stripes to run a production company. The filing did not rule out the possibility that Moonves, 62, could extend his employment agreement with CBS, keeping him at the CEO controls beyond the current February 2015 expiration of his contract.

Last year, Moonves received compensation of $69.9 million for his CEO role, making him the highest-compensated executive in Hollywood.

Under the proposed contract, Moonves could trigger the production deal once he steps down. CBS would be required to finance the enterprise for at least four years and invest as much as $3 million a year to cover the operation's overhead for staffing and a development fund to buy projects.

CBS would be obligated to buy at least three TV series projects over the life of the deal. CBS would have to pay Moonves license fees for TV shows equal to the highest amount paid to other producers who do business with the network or with CBS Studios.

CBS also would be required to pay Moonves a guaranteed fee of $1.5 million a year.

"This fixed fee is offset and reduced dollar for dollar by all executive producing fees earned for shows ordered from Mr. Moonves," the agreement states. "Mr. Moonves will earn fees for each hour and half hour scripted series and for each alternative series that are accepted by CBS, subject to pre-defined terms and at rates generally consistent with those paid to other top producers with Mr. Moonves’ skill, experience and record of success."

CBS would also be required to pay Moonves a "penalty fee" if the network failed to order the agreed-upon number of TV shows.  Chernin's agreement with Fox contains a similar provision. 

Under the terms of the deal, CBS has a first look at all of his movie projects. If CBS gave its blessing to a movie, Moonves would receive a producer fee, plus "certain contingent compensation if, and only if, the film achieves profitability." He would be entitled to the same profit-sharing agreements that the company's current CBS Films extends to other producers.

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Photo: Leslie Moonves, right, president and chief executive of CBS Corp. at the National Assn. of Broadcasters convention in 2011. Credit: Julie Jacobson / Associated Press

Nielsen study finds 'second screen' viewing enhances TV experience

  TVscreenssatAtwaterVillageBestBuy

When viewers watch a TV program with a tablet device, they tend to check their email, hunt for sports scores or seek additional information about the show or a commercial they were watching on the big screen.

A new report by Nielsen Co., released Friday, underscores what network television researchers have been preaching for more than a year: that "second screen viewing" appears to augment the TV viewing experience rather than steal away viewers.

Nielsen's State of the Media: Advertising & Audiences report found that men, when watching TV and using a tablet simultaneously, were more likely than women to look for information related to a TV program they were watching (39% versus 34%). Women were more inclined to seek information related to a television commercial  (24% versus 21%).

Not surprisingly, teenagers with tablets were far more apt to visit a social media site while watching TV than were older baby boomers and seniors (62% versus 33%). 

The report also found cultural differences in TV watching and the use of digital video recorders. Nielsen said that white TV viewers use digital video recorders on a daily basis twice as much as any other group, while Asian Americans appear to spend a higher proportion of their overall TV time watching their previously recorded programs.

Adults age 25 to 54 appear to be heavily influenced by advertising. Nielsen said that demographic group was 23% more likely than the average U.S. Internet user to follow a brand through social networking sites, and 29% more likely to purchase a product online that had been featured on TV.

Finally, teenagers used a game console for eight minutes a night, on average -- more than twice as much as the general TV population.

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Photo:  Klarysa Clark, a teenager from Eagle Rock, checks out a 3-D television at the Atwater Village Best Buy in Los Angeles in June 2010.  Credit: Jay L. Clendenin / Los Angeles Times

Universal Cable Productions signs deal with Gale Anne Hurd

GaleAnneHurdwithWalkingDeadZombie

NBCUniversal's cable television production studio is partnering with Gale Anne Hurd's Valhalla Entertainment with the hope that the prolific veteran film producer will generate hits for the Comcast Corp.-controlled media company.

Landing a producer of Hurd's stature is noteworthy for the cable studio.  Hurd has made such blockbuster movies as "Aliens," "Terminator 2," "The Incredible Hulk" and "The Abyss." Hurd's first stab at cable programming resulted in "The Walking Dead," AMC's juggernaut series, which Hurd produces with filmmaker Frank Darabont.  (Last month's season finale of "The Walking Dead" drew 9 million viewers, an extraordinary number for a cable program.) 

As part of the deal, announced Monday, Valhalla will develop and produce projects for NBCUniversal's cable channels, including USA Network and Syfy, and the struggling NBC broadcast network. The companies may also sell their co-produced programs outside the Comcast family to networks owned by other media giants.

The Valhalla Entertainment pact marks the third "pod deal" for Universal Cable Productions. (Unlike a first-look deal, where a producer can shop a show around, a pod arrangement is more comprehensive because the studio takes an ownership interest in all projects.) The company has similar deals with Tagline, which produces the hit "Psych" for USA Network, and Hypnotic, which produces the dramas “Covert Affairs” and “Suits” for USA as well as the comedy series “I Just Want My Pants Back” for MTV.

The agreement does not include Valhalla television shows already on the air or in the pipeline, such as  "The Walking Dead" and "Port Royal," an upcoming show for FX.

Universal Cable is managed by a team of development executives that includes Richard Rothstein, Chris Sanagustin and Maira Suro. The three oversee development for USA, Syfy and external networks, respectively.

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Photo: Producer Gale Anne Hurd with a zombie head in March at her Valhalla Entertainment offices in Los Angeles.  Hurd is an executive producer of the AMC series "The Walking Dead."  Credit:  Anne Cusack / Los Angeles Times.

Teens not abandoning television for Internet

Teens still watch a lot of TV

Fear not television executives: Teenagers are not abandoning the tube for the Internet and cellphones.

In fact, teen television viewing is actually on the rise, according to a new report from Sanford C. Bernstein & Co. senior analyst Todd Juenger that is optimistic about television at a time when many media watchers fear new platforms are going to severely cannibalize viewers and advertising dollars.

The typical teen watches almost four hours of television per day. While that is two hours less than most adults, it is up from about three hours in 2004, and teen viewing has been growing at a rate of  2.5% per year. While teens are watching content on their computers and phone, most of their viewing is still done via television. Juenger notes that while the perception is that young people are abandoning television, "everybody over-reports usage of Internet and mobile video and under-reports usage of traditional television."

Although advertisers spend about $60 billion on television a year, there is concern that as consumers migrate to new media, the commercial dollars will follow. Juenger noted that, while newspapers have certainly taken a hit from the Internet both in terms of advertising and circulation, television viewing has not.

Furthermore, as people age they watch more TV. "So far teens are following historical patterns and in fact their usage of traditional TV is increasing," Juenger said.

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Photo: MTV's "Beavis and Butt-Head." Credit: MTV

Survey asks: 'What is your main reason for watching TV?'

LeadA new poll has uncovered a dirty secret. People watch television to be entertained and informed.

That's right. the majority of Americans who watch television are apparently hoping to be amused or perhaps even learn something. It doesn't even matter what one's political affiliation is when it comes to this topic. Republicans and Democrats feel the same about the small screen.

This startling information comes from Poll Position, which conducted what it called a "national scientific telephone survey." Participants were asked, "What is your main reason for watching television?" Poll Position surveyed 1,113 people to obtain this information. To be sure, there is a 3% margin of error.

While there is a natural "duh" response to most of the survey's findings, there were two nuggets of note. Of those surveyed, almost the same number (34%) said they turned on the tube for news. Surprisingly, only 12% cited sports as the primary motivation of their television watching. Given the high cost of sports programming and what that does to cable bills, that figure may bear watching.

No word yet if next month Poll Position will announce that a survey has revealed that people go to restaurants to eat food and socialize.

-- Joe Flint

Photo: Actor Bruce Greenwood handles a snake in the television series "The River." Credit: Francisco Roman / ABC

Lionsgate and Grupo Televisa to expand TV partnership

SoyTuDuena

Santa Monica-based independent studio Lionsgate and Mexico's programming powerhouse Grupo Televisa are expanding their budding partnership with a new venture that aims to create television shows for English-language audiences.

The move continues a trend of major media companies in the U.S. looking south to Latin America for programming concepts and business partners. Earlier this week, Rupert Murdoch's News Corp. said it planned to launch a new broadcast network this fall in collaboration with Colombian broadcaster RCN. 

Companies -- and advertisers -- are becoming increasingly interested in capitalizing on the growing clout of Latino consumers. They make up the fastest growing demographic group in the U.S.

Lionsgate and Televisa -- Mexico's largest media company -- said Tuesday that their new unit would tackle six to eight TV projects a year. The plan is to mine story lines from Televisa's vast vault of wildly popular telenovelas and adapt them into English-language comedies and dramas for U.S. broadcast networks and cable channels. Executives also intend to develop original concepts for scripted and unscripted shows.

The two companies first went into business in 2010 with a joint venture called Pantelion Films. Its purpose is to acquire and distribute feature films that appeal to Latinos in the U.S. 

The parties declined to disclose financial terms of their new TV arrangement. The soon-to-be-named venture will be managed by Paul Presburger, chief executive of Pantelion Films. Presburger helped put the TV entity together with Lionsgate on behalf of Televisa.

Televisa separately has an equity stake in Univision Communications, the largest Spanish-language media company in the U.S. Televisa's programming fuels the prime-time ratings on the flagship Univision network, helping to build it into the nation's fifth most popular network.

A handful of projects already are in development for English-language programmers, including a comedic adaptation of Pantelion's first film, "From Prada to Nada." The firm is working on a scripted drama for ABC based on Televisa's smash hit "Soy Tu Duena." The new show will be called "Badlands."  Walt Disney Co.-owned ABC Studios is collaborating on the series.

Until now, little of Televisa's programming was accessible to mainstream audiences. The new development, unveiled at the National Assn. of Television Program Executives convention in Miami, followed Univision's announcement that it would begin adding English-language subtitles through closed caption to its prime-time telenovelas

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Photo: Actors Fernando Colunga and Lucero in Televisa's telenovela "Soy Tu Duena," which produced huge ratings in the U.S. for the Univision network. Credit: Antonio Uribe / Univision

 

 

New NFL TV deals could hurt smaller cable channels

New NFL TV deals will change media industry

There has been a lot of talk lately about how the rising costs of professional sports -- particularly the National Football League -- will affect consumers.

After all, if the networks that carry football will all be paying roughly $1 billion per season (almost $2 billion for ESPN), then those costs will be passed on. The cable and satellite operators will be asked to pay more for those channels. The distributors will then turn to the consumers and expect them to chip in as well.

"There is no question bills will go up," Adam Chase, a lawyer at the Washington firm Dow Lohnes who specializes in sports media, said in a recent interview.

But other cable networks that don't carry sports or have huge audiences may also be hurt by the new NFL deals.

In a new report, Morgan Stanley analyst Benjamin Swinburne predicts that cable channels that don't air sports will see their annual distribution fees decline.

Many wonder whether the rising cost of sports programming will lead sports channels to be in separate packages.

Swinburne doesn't see that happening.

"To be frank, we see no easy path towards tiering or a la carte, short of a government mandate," he wrote in a recent report.

The challenge for cable and satellite pay-TV distributors though will be negotiating with companies that own sports and entertainment channels. In New York, Time Warner Cable is locked in a battle with Madison Square Garden Co., which owns two regional sports channels and a music channel called Fuse.

Time Warner Cable wants to sign new deals for the sports channels, but not Fuse. Madison Square Garden wants a new contract that includes Fuse.

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Photo: Panthers quarterback Cam Newton. Credit: Rick Havner / Associated Press

Local TV stations attacked by pay-TV distributors, advocates and unions

A hodgepodge of cable and satellite operators, public interest groups, unions and lobbyists has teamed up to accuse local broadcasters of violating government regulations and slacking off on serving the public interest.

At issue are partnerships between local television stations in the same city. Government regulations were relaxed many years ago to allow for two stations to be owned by one company, but special approval is usually required. In Los Angeles, for example, CBS owns both KCBS and KCAL. News Corp. owns KTTV and KCOP, and NBC owns both KNBC and the Telemundo station KVEA.

Nowadays, local television stations frequently team up to share resources -- particularly in news and sales -- even if the stations have different owners. Often these partnerships occur in markets deemed too small by regulators to allow for common ownership of more than one television station. They are commonly referred to as local marketing agreements.

Such partnerships, the group argued, are an effort to get around the FCC's rules regarding the ownership of local television stations.

"In some cases, one station may completely absorb another local station while purporting to remain independently owned and operated," said a Nov. 14 letter to the Federal Communications Commission co-signed by satellite broadcaster Dish Network, Time Warner Cable, media watchdog Free Press, lobbying group American Cable Assn., the Newspaper Guild and the National Assn. of Broadcast Employees and Technicians.

These practices, the newly formed group said, "are adversely affecting competition, journalistic independence and jobs." The end result is "layoffs of station staff, reduced journalistic independence, and diminished competition for audiences, advertisers and multichannel video programming distributors that carry these stations."

The letter cites partnerships between stations in Denver, Syracuse and Peoria, Ill., as examples. "The resulting news product is essentially a rerun of stories produced by another station, which reduces content diversity in term of viewpoints, substance and issue coverage."

"A truly independently owned and operated station does not 'outsource' its rights and obligations to its competitors," the group charged.

Not all the groups writing to the FCC about consolidation of local television stations share the same agenda. Free Press is concerned about what media consolidation means to the number of independent voices providing news, and the unions are trying to protect jobs. The multichannel video programming industry's worries are about dollars. Time Warner Cable and Dish fear the leverage that such local station combinations have when negotiating distribution deals.

"Available evidence strongly suggests that common control or ownership ... in a single DMA (designated market area) results in an increase in broadcast carriage fees by at least 21.6%. In charging higher rates to cable and satellite TV providers, these arrangements lead to increased rates to subscribers," the letter said.

The National Assn. of Broadcasters, the primary lobbying arm of the television industry, said in a statement that "evidence shows that when a strong local TV station shares resources with another broadcaster, the result is the creation of more local news, weather and sports."

The letter was sent as part of the FCC's quadrennial review of its media ownership rules.

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DVR usage grows, drives network ratings higher

The broadcast networks saw an almost 25% jump in premiere week ratings from viewers who recorded shows and watched them within seven days compared with the same week last fall.

According to the Nielsen Co., the number of people who recorded prime-time shows during Week 1 of the new season and then viewed them during the next seven days was 6.3 million. Last year, that number was 5.1 million.

The increase highlights the growth in popularity of digital video recorders and gives television networks more ammunition to make the case to advertisers that new technology means reassessing the heavy reliance on initial ratings in determining the popularity of certain shows.

For example, the audience for the season premiere of ABC's "Modern Family" grew almost 5 million when DVR usage for the seven days following its airing was included. CBS' "Two and a Half Men" saw its audience grow by over 4 million while Fox's "Glee" jumped by 3 million.

For decades, the networks have lived and died with Nielsen's daily ratings. However, as DVR growth continues -- currently about 42% of all TV homes have one -- the value of those daily ratings will wane. The media and advertisers rely on the next-day numbers to declare winners and losers, but that may have to change in the next few years when DVR penetration crosses the 50% mark.

Among the networks, CBS had six of the top 10 shows watched within seven days of being recorded.

-- Joe Flint

 

 

BBC plans to cut 2,000 jobs

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The BBC announced Thursday that 2,000 jobs, including 300 senior management staff, will be axed as part of the company’s aim to cut the annual budget by more than $1 billion in the next six years.  

Director General Mark Thompson unveiled details of a program titled Delivering Quality First announced  this year that aims to cut 20% off the corporation’s budget by April 2017.

No services would be cancelled but there would be more repeats on some TV stations, a reduction in broadcasting rights to sports events and fewer entertainment programs outside of Saturday night favorites, the plans revealed.

The BBC said that TV and radio flagship stations such as BBC 1 and Radio 4 would be the least affected and the news budget would be largely protected.

Summing up the new budget, Thompson told a BBC interviewer that “we need to come up with  BBC which is smaller … but really focused on giving the public the things they want most, above all quality and creativity.” 

The job cuts would come over the next six years, he said. Some savings would be reinvested in other areas such as dramas and new services such as BBC iPlayer to make it relevant “in this very different world of iPhones and iPads.”       

But the media and entertainment union BECTU slammed the budget plans in  a news release warning the proposals should be overhauled if the BBC wanted to achieve its aim. 

"The shocking eleventh-hour deal on the license fee which Mark Thompson agreed with the Treasury last October without any consultation at all, was hasty and will be the cause of regret for years to come," said BECTU General Secretary Gerry Morrissey. “The proposed salami-slicing cuts to services will destroy quality, destroy jobs and ultimately destroy the BBC.” 

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Photo: BBC sign. Credit: Carl Court / Getty Images.

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