NBC’s late night issues not cleared up yet

You may have heard about the problems NBC is having with its late night programming and how it seems that no matter what they think of doing to fix it, the situation seems to only become more of a scandal. In some ways, this is a lesson for all businesses even small companies. This past fall, NBC decided to give Jay Leno a ‘Tonight Show’ style show in prime time and replace him as the host of the Tonight Show with Conan O’Brien. Ratings for the Tonight Show did not fare very well, but the new Jay Leno show completely tanked. I am a viewer of the Tonight Show and I actually like it more than before, but I can definitely see why Jay Leno’s new show is not doing well. I won’t get into why in this post as this is a business blog after all.

One of the main reasons NBC decided to do this was because they thought they can cut corners and still be successful. The business lesson is that doing this is a recipe for disaster, especially when you have strong and capable competitors. Producing late night talk shows are far less expensive than actual scripted shows. In an effort to save money, they figured that they can have three late night shows, including Late Night with Jimmy Fallon in consecutive time slots (actually four if you include Carson Daly), while their competition has no more than two. The 10pm time slot that now has the new Jay Leno show is considered to be prime time which means that this is one of the most important time slots for TV channels as this is when the most viewers tune in and thus, can demand a higher price from advertisers. You will notice most of the flagship shows air during prime time hours. NBC spent about 1/3 in producing the Jay Leno show as they would for a conventional scripted show and the results have been brutal.

Now, NBC is in the middle of some very difficult decisions. They have to decide if they should keep Conan O’Brien as the host of the Tonight Show or risk the fallout of going back to Jay Leno as host for it. Then, they have to figure out what to do with the 10pm prime time slot. They could try out some pilots and hope something sticks, but even in that case it would still end up having to pay for production of a new show on top of the production costs they already invested in the failing Jay Leno show. In other words, they tried to save some money but instead, they will end up paying even more than normal.

There is some good news for NBC in this whole ordeal though. Since this scandal broke out, the ratings for the Tonight Show have been very strong. Ironically, Conan O’Brien is easily beating David Letterman (main competition) in the ratings battle. It is unclear how long this trend will last though. For the majority of people out there, who are TV watchers, there will certainly be changes coming to late night soon. I hope Conan O’Brien stays where he is and although I am a fan of his, I hope they let Jay Leno ride off into the sunset and try out some good pilots for the 10pm time slot. I am sure Jay Leno will get an entertaining show of some sort on the Speed Channel or something (he is a huge car buff for those that don’t know). I would watch that.