The CW Floats $1M An Episode License Fee For Drama Series As Studios Wait For Clarity On New Business Model
Not counting the series that are officially ending this season, the oldest scripted series on the air at the CW is flagship All American, currently in its fifth season. All other shows are three-years-old or younger. That is significant as series tend to get more expensive as they age.
And, as the new owners of the CW, Texas-based Nexstar Media Group, have demonstrated, cutting costs is a key element of their plan to make the independent TV network profitable, which involves reducing the volume and price tag of original scripted series and ramping up cost-effective unscripted fare.
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As part of the cost-cutting efforts, I hear Nexstar executives have been looking to restructure the agreements with the CW’s current scripted series suppliers, CBS Studios and Warner Bros. Television, floating a target license fee for drama series of $1 million dollar per episode going forward. That is significantly lower than the current license fees the CW pays for its dramas, which I hear range from low-to-mid-one million to high one million dollar/close to $2M an episode. (I hear the CW had previously employed $1M an episode license fee years ago but the network had to step up as production costs started going up and competition for talent drove actor prices up.)
I hear that idea has been met with resistance, with sources telling Deadline that it is not feasible to produce an hourlong series at that license fee, taking on additional deficit, under the current model of the CW getting first run and the studios trying to find domestic off-network and international buyers.
“It is challenging,” one industry source said.
Another observer noted that the new regime’s drive for cheaper, broader programming with an emphasis on reality could push down the value of a CW scripted series internationally, making them more difficult to monetize.
“Where it was the network of DC and interesting dramedies and YA fare, now it is going to be lower-cost alternative shows with no brand that makes sense. So if you are selling a show internationally, the buyers will be far less interested in paying much for the shows,” the person said.
If the new CW leadership is open to creative arrangements, like taking series in second window or agree to a shorter in-season window, making out-of-season rights more valuable, I hear studio executives may be willing to listen.
There has been chatter that some studios other than CBS Studios and WBTV, which had not done business with the CW, have been exploring deal templates with the network but most sellers are taking a wait-and-see approach until a new top CW programming executive is named. (Deadline identified former Pop TV chief Brad Schwartz as leading contender for the job.)
From what I hear, there have been a handful of sales at the most in October, following the exit of CW’s longtime chairman and CEO Mark Pedowitz who was replaced by Nexstar’s Dennis Miller as network president, and at least some were pitched directly to the network and are yet to be laid off at a studio as the network’s financial model remains unclear.
Deadline revealed in August that the network had reached out to the creative community and highlighted that it plans to broaden its slate by adding procedurals and other older-skewing dramas as well as half-hour comedies including multi-camera sitcoms.
I hear some of the projects bought over the summer remain in development while others have been rolled. It is unclear yet whether the CW will go through a normal cycle and order pilots or switch to a less expensive development model that involves straight-to-series orders and/or international co-productions. (With the network looking to reduce its scripted footprint and increase unscripted fare, its needs for new scripted series for 2023-24 season are not going to be as big as previous years.)
“They’ve been increasing conversations about Canadian content and co-financing,” one industry insider said. “They’ve done it before, the CW, with the Canadian acquisitions, but I think it’s more co-financing now versus just straight up acquisition, which is interesting and different.”
This is an area Miller is well versed in, and someone like Schwartz would also fit into that lane as the Canadian-born executive orchestrated multiple Canadian co-productions at Pop, most notably hit Schitt’s Creek.
The fate of the CW’s current scripted slate is unclear beyond the recent announcements that four shows are ending this season, The Flash, Riverdale, Nancy Drew and Stargirl, and freshmen Waker: Independence and The Winchesters are not getting back orders.
Because of the CW’s carriage agreements, the network cannot make a complete 180 with a brand new programming identity, so the consensus is that it will likely keep some of the existing scripted shows — at least in the short run.
“I do think they want to maintain some consistency; I think it would be very hard for them to maintain a relationship with the existing viewer base — which I would think is meaningful — if they literally shut off the lights and turn them back on as something entirely different,” an industry source said. “I would think that it is smart business to try and maintain a through-line, keep the customers you have and move them over to new programming.”
Lynette Rice contributed to this report.
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