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Lessons From NBC's Train Wreck

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Watching NBC implode must be great fun to Jeff Immelt and his colleagues at GE. Probably not so much fun for Brian Roberts and Comcast. I know the deal was about long-term strategy for both companies, but I'm sure a small ancillary benefit for Immelt and Co. was the satisfaction that, as they looked up from signing the contracts with Comcast, they saw the inevitable train wreck about to occur at NBC primetime (the train was powered by a GE engine ... but that's someone else's problem now)!

But to misquote Shakespeare, I come to praise NBC, not bury them. Now, I will not defend the majority of NBC's actions. The mismanagement of Jay Leno and Conan O'Brien (no relation, which should be obvious by his height and, some might say, talent) is of Olympian proportions. Come to think of it, it makes NBC's expected $100+ million loss on the Winter Olympics look like a molehill. They've alienated Conan to such an extent that he has announced he will not move to 12:05, but would rather leave his network home, where he's been for 17 years.

I'd argue that Conan should have left as soon as NBC announced that, desperate to keep Jay away from ABC or Fox, they were giving him the 10pm slot. This alone made Conan's success almost impossible. Jay would always get first crack at the best guests, first crack at the days events to riff on in his monologue and Jay would take his loyal viewers with him. When Johnny Carson retired, a sizable number of his loyal viewers watched Jay -- they had no choice. Sure, they could watch Letterman but that's not the same ... it's not The Tonight Show! Many became loyal Jay fans. In fact, Carson basically disappeared when he retired, making sure that he didn't rain on Jay's parade. With the Jay-Conan transition, Conan had no such help ... Jay's loyal fans just watched him at 10.

Then there's the abysmal performance of Jay at 10. That was predictable to everyone, except, perhaps, to NBC's programmers.

But give credit where's credit is due. Jeff Zucker and Co. did one big thing right -- they acknowledged, and acted to deal with, the fact that doing 5 nights of hour-long dramas in prime-time on a broadcast network is no longer financially tenable. The math just doesn't add up. Faced with this reality and others, the reaction of most network executives is to 'manage decline' and hold on as long as possible. At least NBC took a shot, even if they executed poorly (to put it kindly).

Lots of old media companies will draw exactly the wrong lessons from this debacle. They'll be convinced that radically re-imagining their business plan based on current realities carries undue risk. They will say "See what happened to NBC when they tried to do it differently?" It's the same thing people say when discussing Katie Couric at CBS. In the early days of her tenure, she and producer Rome Hartman began experimenting with re-formatting The Evening News. They failed, and critics had a field day, saying that Katie was trying to turn the show into Today at night. She wasn't ... and while you can argue with the how ... they should be lauded at least trying. They tried to breathe new life into a dying institution. Tried to bring in viewers that have been inaccessible to them.

Another example that people use is TimesSelect. "You can never charge online for content ... didn't you see what happened to the New York Times with Times Select?" But the fact is, the Times executed a poor plan poorly, probably at the wrong time. That doesn't mean that the Times should just continue on indefinitely with the status-quo. Because it will bankrupt them if they do (unless Carlos Slim takes full control of the paper and bankrolls it as a vanity project).

It's hard to guess where Conan will go next. Perhaps he can go to Comedy Central, airing after the Daily Show and Colbert. It would certainly free him creatively, and give him, finally, strong lead-ins from shows with similar demos. Perhaps NBC's new masters at Comcast will let him out of his contract for such a move -- it's not a direct competitor like ABC or Fox, and their main business is cable, after all, where the Comedy Central airs. Viacom probably couldn't afford Conan's current rates ... but it's no longer about the money. Conan is now faced with rehabilitating a career that has been badly damaged through no fault of his own -- rather, it's been damaged by the network he made hundreds of millions of dollars for.

One other interesting note. Conan's press release named two late-night personalities by name -- David Letterman, the man he revered for so many years (also a man who, foreshadowing his own fate, was mistreated by NBC) and Jimmy Fallon. He didn't mention Jay by name, only referring to The Jay Leno Show. I think it must be particularly galling for Conan to be supplanted by a man who, I suspect, he thinks is a hack.

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