Abc Television Network

ABC on Thursday became the second major broadcaster to combine its television network and production studio into a single unit, an acknowledgment of troubled economic times and changing viewer preferences. Walt Disney Co.'s ABC, like all television companies, is scaling back amid a deepening recession. Networks are particularly vulnerable now because their audiences are shrinking and their advertising revenues are falling but production costs for dramas and comedies are continuing to climb.

This year, Oscar is a little less golden. The ABC network, in a move that reverses years of escalating prices and underscores the worsening economy, has shaved the cost of a commercial for Sunday's annual Academy Awards show, one of TV's most-watched programs. Once considered invincible to downturns, big events such as the Academy Awards and the Super Bowl, which attract tens of millions of viewers, can no longer command automatic rate hikes.

For years, the ABC television network seeded its prime-time schedule with shows produced by the company's production studio. Walt Disney Co.'s "keep it in the family" approach aimed to ensure that if any of the shows hit it big, as "Lost" and "Desperate Housewives" have, the company would reap the financial rewards. But times are tougher, and the Disney-owned network is breaking with tradition. On Tuesday, ABC rolled out its slate of new shows -- and most come from outside suppliers.

With eight comedies and dramas premiering this fall -- seven of them in the next few weeks -- Walt Disney Co.'s ABC is making the unusual move of reducing the number of commercials in the premiere episodes of its new shows. Although that may seem an odd decision in a tough economy when networks are scrambling for every advertising dollar they can get, they are also fighting to hold on to every viewer. ABC hopes that fewer ads will prevent people from switching the channel to a rival network.

In the opening of ABC's new drama "FlashForward," the world's population blacks out at the same moment and has a vision of events on a day in April 2010. ABC executives, particularly Entertainment Group President Steve McPherson, may also be having visions of what the future will look like seven months from now. By then it will be clear to them whether the network's risky move to premiere twice as many new shows as its rivals this fall has paid off or not. The Walt Disney Co.-owned network, which last season ranked third in prime time, is facing its toughest programming challenge in years.

Call it the Marion Cotillard Effect. Few American moviegoers had heard of the French actress before she won the Academy Award last year for her performance in the art-house film "La Vie en Rose." That year also marked the lowest ratings ever for an Oscar telecast. Publicly, executives of the Academy of Motion Picture Arts and Sciences and ABC, which has broadcast the show annually since 1976, shrugged off the sinking ratings.

Walt Disney Co., seeking to broaden the audience for its broadcast and cable shows on the Internet's most popular video site, struck a deal Monday with Google Inc.'s YouTube to distribute short-form content from ESPN and ABC. The agreement would extend the Internet reach for ESPN's sports highlights and ABC News updates and provide another outlet for video snippets taken from the ABC broadcast network and ABC Family cable channel shows.