The War for Late Night (61 page)

That quickly proved a prodigious challenge.

Though Fox in earlier years had a clause in its contracts mandating that its affiliated stations take any late-night show Fox decided to program, that clause had been dropped from more recent agreements. With the network never having made a dent in late night, the stations loaded up on syndicated reruns of recent sitcom hits like
The Office
and
Family Guy
, along with perennials like
Seinfeld
, which always rated well. The shows were expensive and, making the issue even more complicated, the stations, short of money during the recession, had secured what were known as barter deals for many of them. That meant that instead of dealing in cash, the stations offered the syndicators big chunks of commercial time in each show.

In order to insert Conan at eleven p.m., after the late local news on the Fox stations, the stations would have to relocate the sitcom reruns; in doing so, however, the barter deals would become far more complex. If the sitcoms slid back past midnight on the schedule, the prices of the commercials would change. All the deals would likely have to be renegotiated.

Peter Rice was undaunted by this prospect. By his calculation, Fox would have to buy the stations out of their expensive barter deals at a cost of something approximating $100 million. That didn’t include the start-up costs for a new late-night show, which could run to another $70 million. Rice and Reilly still wanted to do it. The word from the advertising executives was positive; they had already started to receive calls from big clients like Intel, Ford, and American Express. They all wanted in on a Conan late-night show on Fox, convinced it would be a demographic home run.

Even so, the stations remained cool, approaching icy, to the idea. Like NBC’s station group, Fox’s tended to be led by men in their fifties and sixties—a Jay crowd. If Jay had come on the market instead, Reilly and Rice knew they could have signed him and simply flipped a switch: The stations would easily have lined up. But Conan was again proving to have a narrower appeal to station owners.

Reilly and Rice knew there was another reason they faced such a high degree of difficulty in completing a Conan deal: Fox and its stations were already on the brink of a civil war of sorts. Nationally, broadcasters had finally reached a point where they were uniting in demanding compensation from cable systems for the right to retransmit their programs onto cable. Retransmission rights suddenly became a path of survival for the struggling networks, most of which were projecting losses in their network business. (According to one inside estimate, NBC was looking at about a $300 million loss.)

Subscription fees from flush cable operators could change all that. The problem was, networks themselves could not extract sub fees from cable systems. Local stations controlled the rights the cable operators would pay for. Even though the vast majority of programs viewers wanted to see were being supplied (and paid for) by the networks, the local station was in line to claim the $1.50 and up per subscriber that the cable systems might be compelled to pay.

Fox’s plan was to negotiate tough deals with its affiliates, pointing out that the leverage they had over cable systems mainly came from the programming on Fox: NFL football,
American Idol
,
House
, and
Family Guy
. The Fox network shelled out the big bucks to acquire that programming; why should it not command the largest piece of the retransmission money?

So just as Rice and Reilly were contemplating pitching the stations on the merits of removing those high-priced and high-rated sitcom repeats in favor of the guy who just disappointed NBC on
The Tonight Show
, the Fox network was readying an onerous demand on retrans fees. If a station was able to get $2.00 per subscriber from a cable operator, Fox intended to skim $1.75 off the top—that was the price for obtaining all that great network product. But Fox’s executives didn’t kid themselves that the stations were simply going to bend over and take this spanking without a whimper.

When Reilly and Rice had a chance to sit down with Conan’s group, the message back sounded beyond promising. The other options Conan’s people mentioned seemed like posturing to the Fox executives. They became convinced it was their deal to lose. In direct meetings with Conan and with his representatives, the Fox team laid out the issues clearly. Initially, the signs pointed to a heavy lift. The number of stations willing to go along would be limited for maybe two years, as the syndication deals worked their way through the system. Rice and Reilly explained that they could not be sure they could get this deal through the News Corp. hierarchy: They wanted it badly, though, and they would work at it over a period of months to see how far they could get.

Conan, naturally, expressed reservations, given what he’d just been through, largely due to pressure from NBC’s stations. “I’d want to be with you,” Conan said. “But frankly, I don’t want to be in a place that has to jam it through.” If Kevin and Peter couldn’t look him in the eye and assure him this was going to work, he didn’t know if he wanted to pursue it.

They all agreed to keep at it.

Reilly did have a recommendation he wanted to run by Gavin Polone: Put Conan first on Fox’s sister cable network, FX, an ad-supported entertainment channel on the basic cable tier. Maybe after a year or so there, they could make a shift over to Fox on broadcast. Reilly couldn’t actually guarantee that would happen, but he thought FX would be a good home for the show, and having it in the Fox family would certainly make a transfer easier. For Polone that was a nonstarter; they were not going to entertain offers from basic cable channels.

 

The biggest player on the other side of the retransmission issue happened to be in the process of acquiring its own broadcast network. But even though Comcast’s top executives were making the rounds in Washington that winter, shaking hands, giving public testimony, doing the whole regulatory dance, their opinions on the current NBC leadership remained opaque.

Media analysts on Wall Street, in the press, and online believed one coming decision was totally transparent: Jeff Zucker had to be a dead man walking. How could he hope to survive with his GE patron, Jeff Immelt, going out the door and two media professionals like Brian Roberts and Steve Burke coming in? Surely the latest NBC misfire, this late-night fizzle—purely Zucker’s handiwork—could only have hardened the resolve that big changes had to be made in the new Comcast-led NBC Universal.

But if the Comcast executives had a judgment to make about Zucker’s fate or the late-night train wreck they had at least partially witnessed, they did an exceptional job of keeping it to themselves.

Although no one admitted it directly, more than a few NBC executives welcomed a management change, because GE’s parsimonious ways, especially as NBC was being readied for sale, had squeezed the network dry. Gaspin believed NBC’s entertainment properties simply had no future without significant new investment. He conveyed that opinion to Zucker, and the CEO approved a plan to spend much more freely, acquiring new programs from some of the top television creative talents.

That seemed consistent with Comcast’s message to Washington: They wanted to be in the business of content. They signaled that they knew that took money.

What most NBC executives presumed was that Comcast had a plan; they just didn’t know what it was or who would be affected. Upon examining the broad spectrum of NBCU, they would have seen cable channels running at high efficiency, a news division that remained a dominant leader, theme parks that seemed about to post big results thanks to a new Harry Potter attraction, and a broadcast network on the skids but showing a few glimmers of financial turnaround.

How any of this would affect Zucker’s future, no one inside NBC ventured to guess. Jeff himself seemed serene; he spent a lot of time with Roberts and Burke, selling NBC’s strengths—and by extension his own.

 

Two weeks before the end of
The Jay Leno Show
, Debbie Vickers returned to her office after completing a taping and found a message waiting from Rob Burnett of the Letterman show, simply stating, “It’s not bad.” Vickers had remained an unabashed admirer of Dave, through all her years of work with Jay—but then again, Debbie knew, as others on the show did, that deep down Jay himself remained an unabashed Dave admirer.

“Dave has an idea,” Rob said when Vickers returned the call; and he presented it to her. When Debbie finished laughing, which required several minutes, she took the idea directly to Jay—in private. She was already on board with the need for total secrecy.

“Remember the Super Bowl ad that Dave did with Oprah?” she began, as she outlined Letterman’s concept for Jay.

They were back on the phone with Burnett within five minutes.

On Tuesday, February 2, 2010, Jay Leno boarded NBC’s jet for New York. He had run the idea past Jeff Zucker, who embraced it just as quickly and enthusiastically as Jay had. It did mean canceling that night’s edition of the ten p.m.
Jay Leno Show
, which nobody gave a second thought.

Jay landed at Teterboro in New Jersey. A waiting car contained a disguise that a Letterman producer had prepared for him: fake mustache, glasses, hooded sweatshirt. They had worked it out that Jay would arrive at Letterman’s theater when Dave was in midshow so no audience hopefuls would still be lingering outside. Jay was escorted in through the Broadway entrance, under the big marquee, because crowds always lined up across from the entrance on Fifty-third Street, in case the show did some bit out on the street.

Jay was reasonably sure nobody saw his arrival; if they did, all they noticed was a guy in a hoodie. The producers brought Jay upstairs immediately, stashing him on the thirteenth floor in an unused room where he relaxed and snacked for about thirty-five minutes, listening to the distant laughter down in the theater. Then the door opened and Oprah Winfrey walked in. This was less than a week after Jay had sat down with Oprah for his much-talked-about interview, and they greeted each other warmly. Now all they had to do was wait for the show to end.

When it did, and every audience member had been cleared from the theater, Rob Burnett appeared and greeted his guests. He led them out and down to a secluded area of the building where a fake living room had been created on a set that the show used to pretape segments. And here was David Letterman. It was the first time Dave and Jay had laid eyes on each other in person in eighteen years.

The greeting wasn’t exaggerated or grand, but routine, like two guys who used to hang out a bit now happening to run into each other at somebody’s party. Handshakes, not hugs.

The conversation didn’t even touch on the issue that had dominated entertainment news for the previous month, nor the transcontinental punch lines they had exchanged. Instead it was all “Have you seen this guy and that guy from the old days at the Comedy Store?” To Jay it seemed he was picking up with Dave exactly where he had left off in 1992—and that this Dave, though a bit older and grayer, was still the exact same guy he had always known.

Right away Jay fell into the pattern he had always followed with Letterman: He tried to make him laugh. He knew Dave’s formal way with language and how certain turns of phrase amused him, so he pulled up a line that had worked on Dave before, saying, “The old Manson place has really changed.” The interaction felt so right to Jay that he relaxed totally—this was going to be a snap, just like the old days on Dave’s show.

Dave’s idea was simple: a fifteen-second segment, a promo designed to run in the second quarter of the game that Sunday night. The concept was the worst Super Bowl party ever.

They arranged themselves on the stage couch: Dave far right, Oprah in the middle, Jay far left. It would start with a one-shot of Dave complaining about the party, expand to a two-shot to show Oprah, and then the big reveal with Jay at the other end of the couch. Jay’s line: “Oh, he’s just saying that ’cause I’m here.” And Oprah would tell them both to be nice.

Dave asked for input. Jay suggested Dave not have his arm around Oprah in the first shot, because that might make it seem that he was complaining about her being there.

They shot it, needing only a couple of takes. It seemed to play perfectly, with both Dave and Jay looking miserable on either side of Oprah.

“Jay, you happy with this?” Dave asked. “You want to do this again?”

“No, looks good to me,” Jay said.

And then the two rivals stood and exchanged another handshake. Dave thanked them both for being so generous to show up and do this for him. He hoped it would have the impact they all expected.

Dave and Jay talked just a bit more, nothing of consequence, two comics shooting the breeze. Then they said their good-byes. Jay was back in Teterboro and on a plane in time to get into LA for a late dinner.

The circle who knew the secret was small and tight at both networks. Still, somehow the same Web site that had gotten wind of the change coming for Jay’s ten p.m. show, FTV Live, posted news of some kind of “secret taping” that had taken place at Letterman’s studio. One of the writers on Jay’s staff approached him at rehearsal with the rumor about the taping. “Why don’t you try to find out more?” Jay said, enjoying the tease.

The night of the game, those in on the secret were barely distracted by the action on the field. They knew the promo was set for the first commercial break in the second quarter. Even Jay, who didn’t give a hoot about sports, was at home glued to the set.

As soon as the spot appeared—Dave, then Oprah, then . . .
Jay?
—phones began ringing and e-mails began flying. Jay was contacted by e-mail from the White House—David Axelrod, the senior adviser, wanted to know, was that real? He had been watching with the president, and they all had instantly asked themselves:
Could that possibly have been real?