Lower 'Idol' Ratings Gives Fox More Leverage

Fox's American Idol Despite declining ratings, the company that owns production rights to "American Idol" expressed satisfaction with the refashioned show and expects interest to build. In a curious move, but a sign of just how much the show means to CKX, the company held an investor call Thursday to discuss the season to date.

Fox has not signed a deal to carry "Idol" beyond this season and negotiations on a renewal are set to begin soon. While there is little question that "Idol" will be on the air for years to come, Fox may have some more leverage with ratings drops and the coming new Simon Cowell-fronted "X Factor" that could impact CKX.

Still, a bullish CKX CEO Michael Ferrel said efforts to bring "revitalization" and "freshness" to the show this season have worked exceedingly well --even beyond Fox's expectations.



Efforts included, of course, selecting Steven Tyler and Jennifer Lopez as new judges, and a focus on the music and contestants. "Everyone feels the energy; I think the show looks very sharp," Ferrel said.

Much of the show's fate will be determined by how well the judges do during live broadcasts starting in March, and whether a breakout personality on contestant row emerges. But Ferrel said the season should be helped by the return of Nigel Lythgoe as lead producer after two seasons off and Universal record executive Jimmy Iovine, serving as mentor to the singers.

This season, "Idol" altered its schedule so its first weekly broadcast is on a Wednesday and the second on Thursday, compared to its usual Tuesday/Wednesday run.

By one measure, ratings for the 18-to-49 demo for the first night are down 15% to a 9.5 -- and total viewers have fallen by 11% to about 26 million. For night two, drops are 26% and 18%, respectively, but that is against stronger Thursday competition. (Also, the ratings cover three weeks for last season and two for this year, since the show started a week earlier in 2010.)

Still, ratings are strong versus all other shows, especially considering that it is in its 10th season. Headlines tend to emphasize decreases for such a high-profile show -- something Ferrel tried to emphasize to investors.

As CKX and Fox negotiate on a new deal, one component will be how much Fox is willing to pay to help with host Ryan Seacrest's massive salary. He is signed through 2012.

CKX unit 19 Entertainment owns the worldwide rights to the "Idol" brand. Over the first nine months of 2010, 19 Entertainment accounted for about 80% of CKX's revenues.

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