CKX Revs Dip as 'Idol' Loses Luster

FOX's American Idol

CKX, the company behind "American Idol," saw operating income drop 50% to $11.0 million in the third quarter -- mostly from weaker advertising sponsorship.

Revenue dropped 10% to $87.4 million, from $97.0 million.

Its main business -- 19 Entertainment -- took in $71.4 million revenue, off 9.4% from $78.8 million. This includes "Idol" as well as Fox show "So You Think You Can Dance." Profits from the division dipped almost 50% to $11.2 million.

CKX's Elvis Presley business -- which includes the Graceland location -- grabbed $14.7 million, down 17.3% from the same period in 2008. CKX is starting up an Elvis-themed Cirque du Soleil in Las Vegas in first-quarter 2010.

For the most recent nine months, there was a $7.4 million revenue decrease at 19 Entertainment -- revenue losses mostly attributable to "Idol," due to lower foreign syndication revenue and weaker on-air, off-air and tour sponsorship revenue.



Regarding "Idol"'s three main sponsors -- Ford Motor, AT&T, and Coca-Cola -- Robert F.X. Sillerman, chairman and chief executive officer, said those advertisers have never advertised or promoted the show off-air. Estimates are that each of those companies spend about $50 million a year in advertising/marketing with the Fox network show.

But Sillerman says those three sponsors gave CKX an uptick in introductory marketing efforts in non-traditional, off-air promotion and advertising areas, especially as it relates to future "Idol" touring events.

CKX said it will benefit from extra hours in the "American Idol" cycle starting in 2010, as well as from the additional fall cycle of "So You Think You Can Dance." "Dance" also airs on Fox.

In regard to two editions -- fall and summer -- of "So You Think You Can Dance," Sillerman is unsure whether that will occur next year. "It was never our plan to have two versions," he said.

He added that Fox wanted to grab older-skewing 18-49 viewers with a fall version of "Dance." Fox's Major League Baseball playoffs have disrupted some of the show's performance. Sillerman says it turns out the show is doing better among 18-34 viewers than 18-49 viewers.

He expects Fox to make a decision on whether to keep the show's two-a-year editions next January.

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