From Conan to Cable? Fans Could Make Switch

Surprise.
Last fall I came home dog-tired. Those of you who think advertising is all fun have it all wrong. Anyway, I changed into my sweats, plopped down on the couch with my favorite beverage (you're wrong again, it's diet root beer) and turned on the TV. There, in high-definition glory was Jay Leno starting his monologue.

Panicked, I looked at the clock. Wait a minute. It was just 10 p.m., but there he was anyway, before the news. I wasn't even in bed yet. This was weird … out of order … wrong! It might have been a little disconcerting to me but this heresy set in motion one of the more significant developments in late night for some time and ushers in changes that will affect viewership and advertising dollars across a number of networks.

VIDEO: NBC confirms an agreement of departure for Conan OBrien.
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A Short History
It started out back in 2004 as a seemingly logical decision. NBC wanted to plan a peaceful transition between Conan O'Brien and Leno by announcing five years early that Leno would retire and O'Brien would seamlessly slip into the chair at the "Tonight Show."

Fast forward five years (they do move quickly, believe me) and Leno wasn't quite ready. Now the decision making gets a little "quigley" (don't bother trying to look it up, my 5-year-old niece invented the word -- it means the situation got a little uncomfortable) and NBC decides to move Leno into a prime-time talk show slot (10 p.m.) as O'Brien takes his seat at the "Tonight Show."

At this point they calculate they'll be fine. Leno is cheaper than scripted TV. They only need to pull a 1.5 (about 1.7 million viewers) to break even. Leno was pulling about 5.7 million viewers as host of the "Tonight Show," leading late night for 11 straight years.

What Happened
First, advertisers balked at paying prime-time prices for a late night show. Turns out they were right. Leno's prime-time show averages a 1.4 share or less. Secondly, affiliates complained the show is a poor lead-in to the local news, causing many of them to drop in the ratings.

Meanwhile, O'Brien was losing ground like the New York Giants lost field position this season (it hurt -- I've got to tell you). O'Brien lost a significant lead and was caught and passed in the ratings by David Letterman's "Late Show" by the late fall of 2009.

Conan vs. NBC: Now That's Entertainment

Now It's a Mess
O'Brien is getting out of his contract and away from NBC. Leno's reportedly moving back to the 11:35 p.m. slot. Late night hosts everywhere are having a field day. And by the way, this could not come at a worse time for the network.

The late-night talk show universe is expanding. George Lopez, Mo'Nique and Wanda Sykes have all launched talk shows aimed at a younger, more diverse audience and in the more important 18-34-year-old segment of the 18-49 demographic used to measure success, compare and set ad rates they are making progress.

Lopez and Sykes have posted respectable numbers. Lopez has pulled as high as 1.7 among 18-49-year-olds. The battle is being fought with skits and jokes, but make no mistake -- it's a war. The skirmish that started between Leno and O'Brien could change late night forever.

What the Future May Hold:
Smaller shares as consumers have more choices and the ratings show more parity. Younger audiences moving away from network TV. O'Brien's audience is eight years younger than Letterman's (46.9 to 55.5) Jimmy Kimmel's audience on ABC averages 52.2 years of age.

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