Odd pickups? It's the economy, stupid

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Sarah Connor might have the struggling economy to thank for not being terminated.

Industry observers say that the recent cluster of low-rated shows granted full-season orders might have something to do with network executives watching the plunging Dow rather than their shows' falling Nielsens.

No execs would talk on the record, but the economic crisis, combined with the cost of marketing a new series, the lack of new programming inventory because of the WGA strike and the anticipated difficulty of locking down new advertiser commitments, has networks inclined to play it safe.

"Most years there would be more cancellations than there have been to date," said John Rash, senior vp and director of media negotiations at Campbell Mithun. "But the dual dynamics of schedule stability keeping ad dollars in place is combining with delayed programming development from last season's writers strike."

NBC's "Knight Rider," ABC's "Private Practice" and Fox's "Terminator: The Sarah Connor Chronicles" recently received orders for an additional nine episodes apiece. Such a move typically indicates a network's confidence in a show's performance and signals the inclination to keep a series on the air for the duration of the season.

But all three shows have posted modest ratings in recent weeks, with "Knight Rider" and "Terminator" having numbers that in previous years would have resulted in cancellation.

The most obvious reasons for the pickups are that many series are doing poorly, and these shows are performing among the best of the worst. Networks are loath to exit the fall without at least one series to tout as a success. Plus, the writers strike, as Rash noted, has delayed quality midseason replacements. And with ratings declining overall because of DVR penetration and audience erosion to cable and the Internet, the bar for success keeps being lowered.

But the added element of economic worries this fall makes picking up low-rated shows potentially more attractive, too.

An August survey by the Association of National Advertisers reported that the majority of marketers expect their advertising budgets to be reduced in the next six months.

Once a show is canceled or moved, advertisers have the option of getting their investment back. So even if a drama series is pulling a meager rating, why risk having to resell a time period?

"The way the economy is going, there might be cutbacks in regard to advertising," said Brad Adgate, vp research at Horizon Media. "And there's always frustration from advertisers when shows get pulled too quickly, but if advertisers exercise their options to get out, it would be because of the economy."

Also, the economy directly impacts networks as well as advertisers. NBC Universal recently announced that it would trim $500 million from its budget. Given the cost of producing and marketing a new scripted series, NBC Uni might have a greater temptation to give a show like "Knight Rider" more time to find an audience.

"From the networks' standpoint, they're loath to cancel since the cost of finding something to replace a show may not be worth it," said Shari Anne Brill, vp and director of programming at Carat. "And advertisers still prefer to be in a quality scripted series to an inexpensive reality show," she said. "I'm in the camp that believes it's a mistake for an advertiser to disappear during a recession because you need the consumer awareness so sales won't grind to a halt."

So far, the networks' doubling down on the bubble shows has had mixed results. "Terminator" and "Knight Rider" hit season lows after their pickups. But last week, "Practice" showed some life, perking up 15%. (partialdiff)
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