David Letterman near new CBS deal

Network set to re-sign 'Late Show' host through 2011-12

David Letterman is near a deal to read Top 10 lists on CBS for another three years.

The network is about to re-sign the Emmy-winning talk show personality to continue hosting "Late Show With David Letterman" through the 2011-12 season, sources said. The agreement would mark a two-year extension of his current contract, set to expire in 2010.

The decision comes as NBC makes dramatic changes to its late-night lineup, moving top-rated host Jay Leno to 10 p.m. in the fall and installing Conan O'Brien behind the "Tonight Show" desk. O'Brien bested Letterman in the ratings during his first week on "Tonight," but the gap narrowed as the frame progressed.

Given the economic climate, CBS was able to negotiate a lower license fee with "Late Show" production company Worldwide Pants. Previous agreements gave the host a salary of around $30 million per year. It's not clear if the fee cutback impacts Letterman's salary, or just production costs.

Letterman, 62, has been on CBS since 1993, when he joined the network after leaving NBC's "Late Night" (where he was replaced by O'Brien). Since September, "Late Show" has averaged 3.8 million viewers and a 1.1 rating in the adults 18-49 demographic. That is up 6% in viewers from the same period a year earlier and steady in the demo.

The host is repped by CAA and attorney Jim Jackoway.

CBS would not comment Monday.
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