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HBO Looks for Missing Link

7/07/2006 8:06 PM Eastern

With The Sopranos ready to finally sleep with the fishes and Deadwood set to fire its last shot in 2007, attendees of the Television Critics Association summer press tour in Pasadena, Calif., this week are expected to pound Home Box Office executives with questions about whether the premium service can — once again — come up with a groundbreaking hit.

CEO Chris Albrecht has seen this show before, though. “I’ve been answering the 'What’s next?’ question since the end of Sanders in 1996,” said Albrecht of the service’s first true breakout series, the sarcastic send-up of late-night talk shows, The Larry Sanders Show, which starred Garry Shandling.

Two years after that encounter, the network delivered Sex and the City; 12 months after that, it launched The Sopranos. This time the network’s future programming slate — which includes a new series from Deadwood creator/producer/head writer David Milch and 24 creator Joel Surnow — may have difficulties matching the brand-defining achievements that four sexually liberated single women and a ruthless mob family provided the premium TV leader.

THE STANDARD BEARER

HBO has long been considered the standard bearer of cable creativity and innovation. When launched in 1973, it was the first satellite-delivered premium channel to offer uncut, uninterrupted movie fare to viewer homes. Soon, it was the first premium cable channel to secure a national sports-rights deal, for early-round action from the Wimbledon tennis tournament in 1975.

In the 1980s, it was the first premium service to create original movies like 1983’s The Terry Fox Story. Later that year, it was the first to roll out an original scripted series: the sketch-comedy network news spoof Not Necessarily the News.

In the 1990s, HBO was the first premium channel to produce edgy dramatic series like The Sopranos and Sex and the City. It was also one of the first to take advantage of new distribution technologies such as video-on-demand when it launched the subscription HBO On Demand service in 2002.

But as the first decade of a new century winds down, where can — or will — the network go next? Will it move beyond being a flagship premium channel on cable and satellite into other forms of distribution like broadband video, as MTV: Music Television or ESPN have begun to do? Or will it continue to mine more creative programming ideas in search of the next big thing?

HBO executives aren’t showing their hand. But Syracuse University professor of popular culture Robert Thompson say it’s clear the network needs to begin placing its bets soon. Otherwise, HBO could become just another television network, rather than an industry trailblazer and TV fan favorite.

“Right this second, I think they’re still the most exciting place on television ... it still has some programming that isn’t going on anywhere else on television,” says Thompson. “I think HBO is still sitting in the catbird seat of that 'It’s not TV ... It’s HBO [slogan].’ But one could predict that if some new things don’t get into the lineup that could serve as a true anchor programming, within five years we could be saying, 'HBO ... It’s pretty much TV.’ ”

Indeed, with the looming departures of The Sopranos and Deadwood, the lineup of original series on HBO lacks a high-profile ratings champion. At the same time, the premium service faces increasing competition for writing talent and ideas from such networks as Turner Network Television and FX. These ad-supported networks have provided a one-two punch with their own scripted shows, such as The Closer or The Shield, that have knocked HBO against the ropes, rendering its once unchallenged domination of cable scripted fare as fragile as Janice Soprano’s psyche.

Albrecht’s HBO, though, is not ready to lay down: the network says its existing stable of series such as the polygamy-centered Big Love, Hollywood insider comedy series Entourage, the lavish period piece Rome and the gritty urban street drama The Wire will keep the network solvent creatively — and, more important, financially — for the near term as it looks to develop its next Sopranos or Six Feet Under, the acclaimed mortuary show.

The network has taken full advantage of such technological developments as HBO On Demand, and more recently wireless platforms, through its recent deal with cellphone provider Cingular Wireless.

The service also continues to increase annual subscriptions, from 27.6 million in 2004 to 28.2 million in first-quarter 2006. HBO last year filled the coffers of parent company Time Warner Inc. with $3 billion in revenue, according to Time Warner officials. And on the critical front, the programmer picked up 95 Emmy nominations last week.

Not bad for a network many critics consider to be in a slump.

VIEWERSHIP BLUES

Still, none of the network’s current shows have emerged as the heir apparent to The Sopranos, Sex and the City or, to a lesser extent, Deadwood and Six Feet Under — all considered revolutionary for their character development, story lines and willingness to push the creative envelope, relative to language and sex, as only a subscription-based service could.

From a viewership standpoint, however, HBO’s current crop of shows hasn’t attracted giant audiences.

Through the first four episodes of their current seasons (as of July 2), the average viewerships for the first-run episodes of Entourage (2.4 million) Deadwood (2.1 million) and sitcom Lucky Louie, an explicit version of The Honeymooners (1.4 million), combined are 5.9 million. That is 3 million less than the 8.9 million who tuned in on average to watch each episode of the sixth and arguably most disappointing season of The Sopranos.

The three series’ cumulative viewership of 13.2 million watchers — the network’s preferred audience measuring stick, as it includes the total number of viewers who watch a show over several repeat airings — are just equal to those generated by Tony Soprano’s near-death experience that punctuated season six.

The Sopranos numbers are even higher if you add viewership from the 10 million or so HBO subscription on-demand households. In fact, HBO executive vice president of program planning Dave Baldwin has said that once all on-demand figures are in, the season six Sopranos campaign will outperform the 14.4 million viewers from season five.

Even Big Love, the network’s highly touted dramatic series about the travails of a man with multiple wives, could only muster an average of 4.1 million viewers during this season’s Sunday night episode premieres and 7.1 cumulative viewers. Compare that to the 6 million viewers who, on average, watched the final season of Sex and the City.

The shows are the latest in a string of original series HBO has started over the last few year that have unsuccessfully filled the big Manolos of Sex and Six Feet Under. Remember the relationship comedy The Mind of the Married Man; the Lisa Kudrow-vehicle The Comeback; the obscure, 1930s Dust Bowl drama Carnivale, or the George Clooney-created, Washington Beltway-based K Street?

“HBO has had a lot of shows on the air, and some have been more high-profile than others,” acknowledged Albrecht. “But the job of HBO programming, including the movies, is to deliver value programming worth paying for [to] each subscriber. It has to deliver on the promise of distinct, unique quality and worth paying for.”

HBO should get credit for trying such new, innovative programming as K Street and Carnivale, even if those shows failed, said Tim Brooks, Lifetime Television’s executive vice president of research and a TV historian and author.

“They don’t have the mega-hit that they’ve had, but they continue to put things on,’’ Brooks said. “The creative community respects that, and everyone knows they’re only one hit away from being back in the glory days again.”

THE NEXT ONE

HBO is hoping one of its new projects will prove it has not lost its creative mojo.

The seamy side of surfing: Along with developing the final four-hour Deadwood movie for 2007, series creator David Milch will also bring out John From Cincinnati next year. The hour-long drama looks at the Southern California surfing underworld.

Everybody loves a dying rich man:24’s Surnow will help HBO create a series starring Ray Romano as a billionaire that has six months to live.

Therapist swapping: The network is developing a series with Roseanne executive producer Cynthia Mort about three couples with intimacy issues that share the same sex therapist.

But the ultimate question is: Can those, or any other as-yet-announced series, live up to the creative genius of Sopranos, Sex and Deadwood? Is it even fair to judge any new HBO show by the standards set by its predecessors?

No, says Thompson. But that’s the burden subscription-based HBO will always carry.

“When you get something as good as The Sopranos or Sex and the City, you attract a lot of subscribers because it’s a once-in-a-lifetime great show,” he said. “But what happens when that show isn’t on anymore? HBO has set a standard now that they have to turn around 15 once-in-a-lifetime shows to keep their base satisfied.”

So far, HBO subscribers are more than happy, Albrecht notes — and, more than ever, they are plunking down $10 to $15 monthly to watch the service.

Indeed, HBO has continued to grow its subscriber base sans Sex and despite the long breaks between new episodes of Sopranos and Deadwood.

Since Sex left in 2004 and Sopranos went on a 21-month hiatus before premiering this past March, HBO posted a 2.6% increase in subscribers to 28.2 million in the first quarter of 2006, according to Kagan Research.

Albrecht attributed much of that increase to diverse content ranging from theatrical movies from Universal Warner Bros. and 20th Century Fox to video magazine Real Sports With Bryant Gumbel.

The network’s World Championship Boxing and Boxing After Dark franchises are drawing hard-core and casual boxing fans to the network. HBO’s live WCB shows, featuring such fighters as middleweight champion Jermain Taylor, are averaging 2.5 million viewers in 2006, according to the network. And there’s soft-porn content, such as Real Sex.

More importantly, Albrecht says the network is making money. Although HBO would not disclose figures, executives close to Time Warner said the programmer earned more than $1 billion in profits through subscriptions and ancillary services, such as DVD sales, in 2005.

“If the proof is in the pudding, HBO has more subscribers than ever before, has more revenue and more earnings than ever before, and we’re executing a more complex business plan than ever before,” Albrecht said. “If we keep our eyes on the job that we need to do and not get distracted by people who mistake someone else’s business model for HBO’s model, we’re going to be in fine shape.”

HEIGHTENED COMPETITION

But as HBO tries to find the next water cooler show, ad-supported networks such as FX, Sci Fi Channel and USA have taken a page out of HBO’s playbook and created high-profile, quality original scripted series, narrowing the quality gap between HBO and the rest of the industry.

Showtime’s The L Word and Huff; FX’s The Shield, Rescue Me and Nip/Tuck; Sci Fi’s Battlestar Galactica; and USA Network’s Monk have generated the kind of ink from TV writers usually reserved for broadcast-network and HBO fare.

In fact, Los Angeles Daily News TV critic David Kronke believes FX’s The Shield and Rescue Me rival the quality of the edgy scripted fare that HBO pioneered nearly a decade ago.

“I think [FX’s] shows have an energy and a provocative nature that I find more intriguing than some of the more recent offerings that HBO has come up with lately,” he said.

“It used to be that HBO was the only show in town,” added Syracuse’s Thompson. “But now if you’re interested in doing a scripted TV series, you can take it to HBO, [Turner Network Television], FX or, depending what the show’s genre is, Sci Fi Channel or Comedy Central.”

Albrecht admits the competition has upped the ante for HBO. But he encourages the networks to take their best shots.

“We showed what was possible to do on television,” he said. “I think what that did was to bring more people into the category and to spend more money on original scripted programming. It’s good for everybody when the bar gets raised.”

HBO is holding up to the competitive shots. The audiences for the premiere episodes of Entourage and Deadwood are just below the 2.7 million viewers arrested by the FX’s highly touted edgy cop series The Shield earlier this year and the 2.8 million viewers on average drawn by the current run of Rescue Me, Denis Leary’s chronicle of the lives of dysfunctional firefighters — despite a 60 million subscriber disadvantage against the ad-supported basic cable network.

And while the The Sopranos saw a 9% dropoff in premiere installment viewership compared to its fifth season two years ago, its 8.9 million average series viewers still places it well above any scripted series this year.

That includes the 6.6 million viewers garnered by ad supported cable’s No. 1 show, The Closer, on the 89 million-subscriber TNT.

But HBO knows that isn’t enough to appease the critics. So what can it do for an encore?

NO BROADBAND PLANS

The network is providing short-form programming from the Sopranos and other original series to Cingular phone subscribers as part of a long-term deal. But the network said it has no plans to launch new, original series on the platform in the near future.

HBO executives also said there are no immediate plans to follow some of its cable brethren into the broadband video arena, for which new and unique original, short-form content is being developed. But the network owns all distribution rights to all of its original content, giving it carte blanche to put its signature programs anywhere it wants, without having to negotiate rights with a Hollywood studio or music publisher.

But don’t expect any big push outside the TV screen anytime soon.

“Right now, cable content for broadband is gaining prominence, but until [broadband] becomes more universally acceptable and affordable, TV will still be king,” Seattle Post-Intelligencer TV critic Melanie McFarland said. “Their future lies in finding that next hit, which is always around the corner.”

September