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The Syndication Game

September 04, 1988|JOHN EISENDRATH

THE WORLD of syndicated television is one of long odds, but big pay-offs.

In syndication, a show is licensed station-by-station to run in individual television markets across the country. This process is quite different from the one-stop shopping of network television in which producers simply license a show to ABC, CBS, NBC or Fox and each network distributes it to its affiliates and owned-and-operated stations around the country.

For producers of first-run syndicated programming, the payoff is in talk shows such as "The Oprah Winfrey Show," game shows such as "Jeopardy!" and reality-based series such as "People's Court." These are produced inexpensively in studios--as many as six shows can be taped in one day--and offer wide commercial appeal for advertisers at non-prime-time rates.

For example, "Jeopardy!" has an annual production budget of an estimated $5 million (with close to half of that alloted for prizes) compared with around $20 million for a half-hour prime-time network show. Industry analyst Liz Baron of Baylis, Zorn, Gerard Inc. estimates that revenues for "Jeopardy!" last year were close to $50 million. Low-cost, studio-produced shows are the most likely candidates for syndication because they can turn hefty profits even outside the big-dollar advertising times, which are snapped up by network-produced comedies and dramas.

When they're scheduled to run daily, syndicated shows can sell a lot of commercial minutes per week and convert less-watched time slots into money-makers. (Competing for syndication with the in-studio productions are motion pictures, first-run series such as "Star Trek: The Next Generation," and reruns of prime-time programs.)

Syndicated shows mainly appear on cable or on stations not affiliated with a network. Independent station KHJ-TV in Los Angeles, for instance, has no network-supplied programming, and only produces news and public-affairs shows. The rest of its schedule consists of syndicated fare. Stations affiliated with ABC, CBS and NBC air about 12 hours of network programming each day. The rest of the time they also run news, children's or magazine-format programs and syndicated shows. On weekdays in Los Angeles, for instance, there are only 30 minutes of network programming between 3 p.m. and 8 p.m. KABC, KCBS and KNBC devote the rest of the time to local news shows sandwiched between syndicated programs.

ABC, CBS and NBC pay their affiliates to run network programs. In return, the networks keep all the money that advertisers pay to run commercials during those programs. Syndicated shows are often sold the same way. But, more often, producers of syndicated programs barter with the stations that carry their shows. The stations receive no fee, and most of the money from the commercial minutes is divided between station and producer. In the past eight years, the barter syndication market has boomed, going from less than $50 million in advertising in 1980 to $700 million in 1987.

This year, fewer new syndicated shows are getting on the air, and the reruns are not commanding as much money. So many syndicated shows are renewed each year that little time is available for new programs. And proven winners have a definite edge. For instance, in 1986, "The Cosby Show" was sold into syndication for a record per-show-price of $5 million. Some stations invested so much in "Cosby" reruns that this year they have little money to invest in other network reruns. Because of this, says Paul Isacsson, executive vice president for Broadcast Programming and Purchasing for Young and Rubicam, an ad agency, "syndication will not be growing as much as in the past."

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