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Mort Marcus: More Syndie Cancellations Loom

The syndication business is broken and Mort Marcus, co-president of Debmar-Mercury, has some definite ideas on how to fix it. Marcus has some weight: he formerly ran syndication for Disney and Miramax, and now he and business partner Ira Bernstein have successfully struck out on their own with game-changing shows such as South Park, House of Payne and, next summer, Wendy Williams. What Marcus has to say may not make him the most popular guy in town, but it certainly makes him the most honest. Marcus recently shared his – occasionally controversial -- views with B&C contributing editor Paige Albiniak. 

What does the state of the economy mean for syndicators and stations?

The departure of [Warner Bros.’] The Tyra Banks Show actually relieves syndication because it opens up one to two hours in some markets. Right now, you have a very complicated and difficult marketplace. I honestly believe that in a month you might read that five more shows are being cancelled. Why should syndicators, who are already struggling, take a deficit in this marketplace?

I think the state of the economy is affecting [sales of shows] quite a bit. If anyone says any differently they are lying. 

What’s your strategy for managing your business in this market? 

When we did Wendy Williams that was a six-week, 30-episode test.  We aren’t trying to sell stations a show based on a four-minute tape, which is what usually happens. We literally have 30 shows for you to watch and we have ratings information from four cities where we’ve tested it. You can make a rational decision of whether you like it or not. 

People really like it, and sales of that show are going spectacularly well. But we’re still not getting anywhere close to the cash licenses that we were expecting to get. Stations are afraid and I don’t blame them.

But you have to live in the marketplace that you happen to be in. We believe that Wendy is still a bet worth taking. 

I understand that many syndicators are having problems renewing out some of the more expensive shows because stations just aren’t able to come up with the license fees in this environment. 

I don’t understand why any stations would renew out at those license fees. If I were running a station, I would keep every show on a short leash. You shouldn’t be doing five-year deals with anyone. I have to imagine that any station that is a current owner of a show with declining ratings like, say, Dr. Phil—who I don’t mean to pick on, because this applies to everyone—can’t be happy with the license fee they are paying. 

I don’t understand why stations would do a two-year deal on anything new. Well, if you told me that you wanted to extend [CTD’s] Wheel of Fortune and Jeopardy! for two more years, I would say ‘get it, you should do that.’ But if you are telling me you want me to renew a fourth-place show in a market for four years like stations have been doing, why would you want to guarantee four years to remain in fourth place? Look, I’m only referring to first-run here because off-net and library series have ratings histories and shows to look at, and those are different business decisions. 

The problem is that syndicators come in with a four-minute sales tape and then the stations buy it for two years. If you were running a network affiliate, by example, and your prime-time network committed to some show for two years based only on a pilot that quickly died after going on the air but you were still forced to air it at, say, 8 p.m. Tuesday, you would fly to L.A., go directly to the head of the network and demand that he be fired.

But that’s what people do in syndication.  

And it clogs the drains. Hollywood would so love to play in the syndicated marketplace but only four series, not counting court shows, were sold this year. Meanwhile, at least 40 new shows aired on the four broadcast networks alone.

Syndicators need more at-bats. Every single commitment should be a test with options for the stations. All the other distributors are going to hate what I am saying and say that ‘he is he an idiot’ for saying it, but I believe that it’s better for everyone if the marketplace is healthy and dynamic. We would all have a better chance to get a hit if we had more at bats.

The right model has syndicator taking a little bit of risk and stations taking a little bit of risk. 

Do you think Oprah departs first-run syndication in 2011? And if so, what does that mean?

I have no clue if she’s going to go. From a syndicator’s standpoint, I hope she leaves. Imagine this: All the syndicators did tests starting now for the next 18 months and we really tested 20 shows. You might find that Oprah replacement. But if we only do three shows, which is likely, do you think we are going to find it? I don’t think so. If you do tests I realize you might lose money but in this marketplace you might lose a lot more if you sign the show for a year. I personally think all year long, every year, shows should run with commitments for four weeks or eight weeks – like cable or network prime. Even if a network is working with the best show-runner of all time, it doesn’t give him or her more than 13 episodes. And those shows are deficit-financed. Why is that not okay in syndication? 

You won’t see us do that, by the way. We are in the test business.