[phrelin]

In an article about the battle over NBCU channel Bravo's lost show "Project Runway" is the first quote I've seen confirming my suspicion about the network's new take on programming:

Is NBC ready to pay up? According to some reports, the network is all about profit margins, not ratings. "Normally, the licensing fee we paid would total 50% of a show's budget, but now we are paying on average about 25%," Marc Graboff, co-chairman of NBC Entertainment told the New York Post.

This means that the production company is gambling on 75% of the cost. Good scripted programming is far more expensive than "reality" and game shows. If the network doesn't share at least half the risk, producers inevitably will reduce the amount risked.

So here comes more low cost "reality" and game shows as all NBCU channels have to do is pull enough audience to sell ads representing more than 25% of the show's cost. Heck, they can sell time at a "Vegematic" ad price and make that.

The other co-chair Ben Silverman confirmed this organizational philosophy in an interview with TV Week in which he describes his greatest accomplishment after one year:

I think restructuring our organization and re-engineering how we approach the business. It's been transformative. Clearly the success of our "in-front" and how we go about engaging our advertising partners is an obvious place that's delivered bottom-line success. And then the reorganization of how we apply our costs against our programming has been an unbelievable win for us to the financial bottom line.

 

[Doug Brott]

In the end, the market forces will win .. If it's dreck folks will find another channel. Besides, perhaps there are enough programming sources today that we can have some niche channels that actually work .. although we can still complain about them