News

Nick Bellies Up for Cheers

9/13/1998 8:00 PM Eastern

New York -- Classic television on Nick at Nite is getting
younger -- and much more expensive.

Last week, Nickelodeon confirmed that it had acquired
exclusive cable rights to Cheers, effective in the fall of 2001. Nick officials
wouldn't comment on the price tag for the acquisition, but published reports put it
at $69 million, or roughly $250,000 for each of the 275 Cheers half-hours.

That would make Nick's Cheers deal with sister
company Paramount Television the priciest one that it has ever struck for an off-network
show. And it adds another bidder, Nick, into cable's escalating competition for such
sitcoms.

"Now, there are more players in the market," said
Derk Tenzythoff, vice president of programming services for UVTV, the marketer of
Chicago-based superstation WGN, which itself has become an aggressive pursuer of sitcoms.

Nick's seven-year Cheersdeal was
disclosed last week, at the same time that Columbia TriStar Television Distribution was
weighing bids from cable networks for Seinfeld -- a show that could fetch anywhere
from $600,000 per episode and above for its second cycle of syndication, starting in 2002.
Turner Broadcasting System Inc. (and its TBS Superstation, in particular) was considered
the front-runner in the chase for Seinfeld, but USA Network and FX were also in the
game.

To date, the apparent record price per episode for cable to
acquire an off-network series was the $1 million that Turner Network Television paid for ER,
which just debuted on TNT.

The skyrocketing prices that cable is shelling out for
broadcast reruns concerned cable operators, which are trying to keep their program costs
and, therefore, their rates in check.

"A program like Cheers is going to drive some
ratings," said Jerry McKenna, vice president of strategic marketing at Cable One.
"I clearly understand why [Nick] bought it ... But programmers have to slow down:
Operators can't absorb rate increases."

Nick at Nite's purchase of Cheers -- which will
still air in syndication on broadcast stations when the cable network gets it -- marks the
next leg in the programmer's effort to bring newer "classic" shows to its
primetime lineup.

"Nick at Nite is looking at the situation that if they
don't start to take control of the next generation of programming, it will go to one
of the Turner operations," said Bill Carroll, director of programming at rep firm
Katz Television.

Added Tenzythoff, "It's not good enough anymore
to put on programming from the 60s and 70s."

The addition of Cheers to Nick's lineup is in
keeping with the evolution that the service is undergoing, one cable programmer said. He
noted that the service is now using the tag line, "Home of TV Hits," rather than
referring to itself as classic television -- a moniker that is now more applicable to
sister service TV Land.

"The Nick at Nite brand is changing," the
programmer said.

Diane Robina, associate general manager and senior vice
president of programming for TV Land, said Cheers will be a good companion show for
The Wonder Years on Nick at Nite. Cheers aired in the 1980s and early 1990s,
while The Wonder Years debuted late in the 1980s and aired into the early 1990s.

"I've had Cheers on my radar for 10
years," Robina said. "We at Nick at Nite are trying to go after shows that
resonate with our audience, 18- to 49-year-olds."

Nick will strip Cheers in primetime, Robina said,
and it will probably run back-to-back episodes each night.

The prices that cable networks have been paying for
off-network shows have been skyrocketing for several years, and the competition is as keen
as ever. WGN has become an aggressive bidder during the past year, for example, scooping
up various windows on shows such as Suddenly Susan, Home Improvement and Caroline
in the City
.

"It's a supply-and-demand business,"
Lifetime Television president Doug McCormick said.

McCormick sees Cheers as very compatible with Taxi
on Nick at Nite. But he questioned whether shows such as Seinfeld, at more than
$600,000 per episode, can provide a proper return on investment for a cable network.

"It certainly says 'loss-leader,'"
McCormick said.