The War for Late Night (16 page)

 

Jeff Zucker had always emphasized the importance of the transition process at NBC and took pride in how he handled each one. When he ran the
Today
show, he steered the onetime dominant anchor of the morning, Bryant Gumbel, to the sidelines, replacing him with Matt Lauer, who became even more dominant. More prominently, he helped smooth the reset in an area long afflicted with contentious changes of ownership: the evening news anchor chair. Brian Williams bloodlessly took over for Tom Brokaw on the
NBC Nightly News
in December 2004, with Tom still ruling in the ratings.

The success of those decisions reinforced Zucker’s philosophy on big changeovers: You didn’t wait until the incumbent leader had slid into second place; you made your moves when he was on top.
The Tonight Show
should be no different.

By 2005, transitions were much on Zucker’s mind, because he had every reason to expect he himself would be part of one. The long and hugely successful tenure of Bob Wright as chief executive of NBC Universal—Wright had skillfully orchestrated NBC’s acquisition of Universal in 2003—was winding down. Zucker, now president of the NBC Universal Television Group, clearly sat in the successor seat. This, despite a record in his previous posting as chief of the entertainment division that even friends labeled mixed and detractors labeled mucked. While it was true that with Zucker at the helm NBCʹs prime-time fortunes collapsed after a long run at the top, his defenders cited his efforts to shore up what had already been a sinking sand castle of programs when he arrived in Burbank in December of 2000. Still, by his own acknowledgment, Zucker had not won any congeniality awards in Hollywood while he was there. With his journalism background he simply didn’t take to the place, its pretensions, its posturing, its moguls, its agents, or its style; and Hollywood returned the sentiments. Still, Zucker retained the respect and support of the only mogul that counted, Jeff Immelt, the chairman of GE, NBC’s corporate boss.

The network entered 2005, however, beset by a precipitous downturn in its prime-time ratings and profits. Having tumbled from first place to last in the space of one season, NBC’s take in that year’s annual upfront ad sales, which determine the bulk of revenues for each network, would plunge by a staggering $1 billion.

Fortunately its portfolio of cable networks was proving to be a cash fountain, and increasingly Zucker would point to them as the future—and even the present—of the company. Even with prime time in free fall, the big profit areas of morning and late night seemed secure because of the steps Zucker had taken to facilitate the big transitions. If the
Tonight
transfer of power worked as well as the
Today
one had, NBC would maintain ratings dominance even as a new face replaced the old. This strategy would also likely please GE, famous for its corporate personnel policy that demanded successors always be identified.

As one of the midlevel executives under Zucker explained, “Jeff tends not to project very far into the future and he likes to be a can-do guy. He looked at late night and asked, ‘What’s a win-win scenario where I can put this off, but on paper it looks very smooth and I’m going to keep everybody locked in?ʹ GE loves transitions, so this was going to be a very big thing on the scorecard.”

Another West Coast executive, unsurprised by Zucker’s heavy emphasis on transitions and lines of succession, described his policy as “Jeff always likes to carry a spare.”

But moving executives in and out of position was one thing; playing chess with the future of performers was a completely different game. According to one experienced developer of entertainment programming, “Jeff got everyone signed on—it will be a baton handoff. On paper that sounds great, and it sounds very GE-like. Except there are human beings involved, and human beings who are talent, who never, ever go the way you want them to go.”

Zucker, confident of his abilities in most areas of management, was especially convinced of his skill in talent relations. Throughout his history at
Today
, he exhibited a deft hand at massaging the egos of big players like Gumbel and Katie Couric (who didn’t much like each other) and later Matt Lauer. All of the stars of
Today
grew close to him, trusted him, relied on his counsel and advice. In Hollywood Jeff believed he had connected equally successfully with important NBC stars, like the cast of
Friends
.

But as he climbed he seemed to tip toward talent himself, at least as some saw it. One NBC executive heard Zucker complain about how his contract situation had been handled, compared to what the network had done for Lorne Michaels in his latest
Saturday Night Live
deal. “I don’t think Jeff got it,” the executive said, “that Lorne is talent.”

The executive, who liked Zucker generally, suggested that Jeff and other top leaders across the entertainment industry shared a common genetic trait: “They have narcissistic personalities. Almost every conversation will eventually be about them. But maybe that’s what it takes to be in jobs like that.”

The personal quality most often cited by Zucker supporters and detractors alike was his high intelligence. But as much as that impressed many, it gave others more reason to question how effective he had actually been as CEO. The knock was that he didn’t delegate well, mainly because he always seemed certain he could do the job as well or better himself.

“Sometimes it’s a curse to be too smart and think you can do too much,” said an NBC executive who worked closely with Zucker for a time.

The area that clearly needed the most attention at NBC was its crumbling entertainment division in LA. When Zucker left Hollywood in 2003 to return to New York and his new corporate assignment, he had hired Kevin Reilly to rebuild the foundation of the prime-time lineup. But it wasn’t as though Reilly had free rein. “Jeff ran every scheduling meeting,” said one of the lower-level development executives. “Kevin didn’t handle Jeff well, and Jeff didn’t handle Kevin well.”

Reilly and others in the entertainment division felt ping-ponged at times by Zucker’s rapidly changing assessments of shows, trends, the business in general. His strongest leadership quality, his total sense of confidence, had a downside in what staff members came to identify as “Zucklamations.” As one longtime NBC executive—and Zucker backer—acknowledged, “Jeff does have a thing for proclamations and pronouncements.”

These could deal with smallish details, like the breakdown of a show’s format “It was like with the show
Las Vegas
,ʺ said the development executive, citing an NBC drama of this era that starred James Caan. “According to Jeff, that could be 85 percent self-contained and 15 percent serialized.” At other times the proclamations could affect weightier issues. At one point, several NBC executives recalled, Zucker decided that no single-camera comedy—shows like
Scrubs
or
30 Rock
, which were shot on film like little movies with no laugh track—could ever be a hit. NBC should therefore lean toward three-camera comedies—shows like
Two and a Half Men
and
Friends
, shot on tape like little plays in front of studio audiences whose laughter accompanies the jokes.

That decision almost cost NBC the one new breakout comedy of Zucker’s tenure,
The Office
, which Jeff did not initially embrace. After its first six episodes aired to minimal impact in the ratings, Zucker pushed for the show to be canceled, announcing during an NBC program strategy meeting, according to an executive who was there, “The audience has spoken—it’s outright rejection.” But Kevin Reilly liked the series a lot—as did Bob Wright (and even Jeff Immelt). The show hung on, and then took off, at which point Zucker, too, finally came around.

In private conversations with colleagues and friends, Zucker would occasionally open up about the economic squeeze he was feeling from GE. What was clear from staff meetings was that he was under constant pressure to “make the quarter,” as he would put it. Somehow NBC’s balance sheet needed to tip upward for each three-month period, which led to budget-tightening measures aimed at tiding the network over for a quarter, but they only seemed to increase the problem in the following quarter. As one entertainment division executive explained, “It always involved cutting. ‘Maybe if we start this pilot later we can make the quarter. We gotta make the quarter.’ It seemed we were always shoving problems off to the next quarter.”

In early 2005 one major financial decision in particular was generating significant fallout for the entertainment division. Ebersol had put NBC in position to grab the prime-time NFL package, and move it from Monday to Sunday night, where it would steer clear of interrupting NBC’s lucrative late-night lineup. But Ebersol gave it to Immelt straight: The deal, if the network could step up to it, would provide a huge, dependable audience that could be introduced to NBCʹs other shows, but it would mean a $150 million loss on the books every year.

Immelt told Ebersol that wasn’t tolerable. But Dick said he had a way to account for $100 million of the annual loss. He explained that he had worked it out with Zucker that the entertainment division would give up $100 million a year out of its program development budget. The rationale: With twenty weeks worth of four-hour-long football coverage every Sunday in the fall, NBC would not need nearly as much money to develop shows for the rest of the week.

Immelt agreed to accept the deal (and the loss of $50 million) as long as the entertainment division was audited every year to make sure it was cutting that $100 million from its budget. Although Zucker was thrilled to get a Sunday night of guaranteed huge ratings every week, some of his West Coast executives worried about how starved they were going to be for development funds, especially at a time when NBC desperately needed to find hits to drag itself out of the ratings basement.

But by then Zucker was convinced that NBC wasn’t really a network-based company anyway. With a portfolio of assets that included the USA Network, Bravo, MSNBC, and CNBC, Zucker pushed for a new emphasis. “We’re a cable company,” he began to proclaim, with more and more frequency—and to more and more dismay among those trying to revive that network business. Or star in it.

 

Jay Leno certainly fit that description. To him only the network business really mattered. The game that ultimately counted was the daily comparison between network late-night shows. He knew he was number one; then came the other guys. Few if any other late-night hosts broke down the numbers—and every other clue to potential adjustments they might provide—the way Leno did. He knew what percentage of his audience stayed only for the monologue, when exactly they left, how many people he retained for each of the bits in act two (the comedy act after the monologue). He broke it all down to the minute.

“He’s a real student of this stuff,” said one of the principals at a competing show, who marveled at the detailed analysis Leno could offer for every one of the network late-night shows. “He loves the game. He really understands the ratings. He knows the lead-ins and how they affect his audience.”

Leno found it amazing that he was considered some kind of oddball or sellout for paying attention to the minutiae of the ratings. He had spoken to at least a half dozen hosts of late-night shows that had failed since he’d won the job in 1992, and invariably they told him the same thing: “We just do our shows. We don’t look at the ratings. We don’t even want to know.” To Jay that attitude meant you might be able to develop a niche audience, but there was no way you were going to grow to be widely popular.

For years Leno brushed off the plaints coming from the camp of his main competitor, David Letterman, about how Dave was losing chiefly because he suffered under the handicap of dreadful lead-in ratings from CBS’s woeful lineup of shows at ten p.m., while Jay was able to bask in the reflected glory of ten p.m. NBC blockbusters like
ER
and
Law & Order
. But as NBC’s prime-time fortunes melted away in mid-decade, and CBS came on with a rush thanks to powerhouse ten p.m. shows like
CSI: Miami
, Leno pressed on, undiminished and (virtually) undefeated. The arguments for Dave’s secret superiority became muted.

Soon the comparisons delivered by the Letterman camp took a different tack, such as “Dave is a four-star French restaurant; Jay is McDonald’s.” What Jay knew about McDonald’s was he liked to eat there occasionally, and that many more billions of meals were served there than at Le Bernardin. He would even make the analogy himself, describing his comedy as “good food at reasonable prices.”

Still, Letterman mattered to Jay. Like no one else on television, no one else in show business, no one else even in his life, Letterman mattered. The two comics had been linked since their earliest days as stand-ups in LA; they also broke into television at about the same time, with Letterman opening the way for Jay to emerge into public consciousness by having him as the most frequent guest on his
Late Night
show.

And of course they came together like estranged princes in a Shakespeare history play, each seeking to succeed the departing king. When NBC anointed Leno the host of
The Tonight Show
in 1992, it first played as a usurpation, as Letterman had for far longer been the presumptive heir. Later, when NBC came close to ousting Jay in favor of Dave, it turned into a Restoration drama—but only in one act. Leno survived, and rewrote the ending, but only at the cost of seeing his rival installed in the castle next door. And there they sat for sixteen years, separated by the narrowest of channels. Dave’s realm enjoyed a brief giddy reign before the size and strength of Jay’s historic empire of the night gradually overwhelmed him, leaving him permanently the lesser power.

By 2005 the outcome was routine: Jay supreme; Dave suppressed. Mercurial and moody in the best of times, a perpetually frustrated Letterman tipped often toward maddening to both his always admiring but usually cowed staff and to any executives at CBS who came into contact with him. Apart from the big boss, Leslie Moonves, whom Dave grew to respect and would sometimes chat with playfully by phone on the air, network interaction tended to be minimal. Little good usually came of any request or suggestion from CBS. Letterman never deigned to try to enhance his position by making some effort to help out affiliates or cater to advertisers—no upfront appearances for him—and he certainly had no interest at all in speaking to the press, even when advantageous moments for publicity arose. Virtually every interview request was declined, unless there was an element of duty involved—paying back guests like Ted Koppel at
Nightline
, Regis Philbin on his morning show, or Oprah Winfrey on her afternoon show. To even innocuous appeals for his reaction to some development, significant or trivial, Letterman would tell his press representatives, “What I have to say I say on the show.”