Do the NBC executives use OR?

People of earth:

I always thought that the television networks used OR/MS to manage the uncertainties inherent in running a television network.  Now I’m not so sure.

I have been following the late night changes with the Late Show.  Last week, NBC announced that they are moving Jay Leno’s prime time show (that airs at 10pm) to 11:35pm by moving the Tonight Show with Conan O’Brien from 11:35pm to 12:05pm.  In response, Conan O’Brien announced that he will quit if his show is moved from 11:35pm to 12:05pm, and a deal is in the works for Conan to leave NBC.

There are two aspects of NBC’s move make me uncomfortable.  The first is that NBC was seemingly unprepared for the the uncertainty surrounding Leno’s primetime experiment.  I find it hard to believe that radically changing the late night schedule was the best contingency plan NBC could have formulated.  It is particularly puzzling, since uncertainty is a large party of television programming.  After all, most new shows are not picked up for season-long contracts.  How could NBC be caught so off guard?  To be fair, prime time shows switch time slots frequently, whereas the scheduling in late night are effectively set in stone, so the expectations are different.  The fact that NBC lags in ratings is a symptom that they are not handling uncertainties well.  I expected NBC to have used more advanced analytical methods to plan for these uncertainties.

My second concern deals with the ethics of such a decision.  Maybe ethics is the wrong word here, since NBC may be legally justified in moving the Tonight Show.  However, it is not the right thing to do. The option to change O’Brien’s time slot should have been immediately ruled out as an infeasible alternative.  The ethical concerns weigh on me as a professor.  The academic analog of the NBC-Conan-Leno fiasco are troubling (my take: NBC is the unethical professor and O’Brien is the bewildered graduate student whose expectations have abruptly changed, and Leno is a graduate student who is benefiting at O’Brien’s expense). In my opinion, students should not be punished because they have not been given clear expectations.  Instead, professors should tell students what they expect.  As a result, I strive to convey my expectations for students–particularly student researchers–because students and professors should be on the same page.

Bottom line: despite what was in O’Brien’s contract, NBC should have laid out their expectations more clearly before making any big changes in his show, since the expectation was clearly not to change the time slot.

To be honest, I don’t have all of the facts, or even most of them.  As a result, it’s hard to say how OR could have been used to manage some of the uncertainties and to make better decisions.  Maybe it’s presumptuous for me to rush to judgment, but it is clear that something is rotten in the state of late night decision-making at NBC.  What do you think?

8 responses to “Do the NBC executives use OR?

  • Laura

    Just after posting this, the WSJ reports that Conan will sign a $40M deal.

  • Greg

    Wasn’t NBC a finalist for the Edelman prize a few years ago? A quick search found this story on INFORMS Science of Better website, along with a link to the article in Interfaces: Increasing Advertising Revenues and Productivity at NBC

  • Laura

    Thanks for digging this up, Greg. Maybe there is hope for NBC after all!

  • Sanjay

    The much-celebrated ad revenue management application was a tactical decision-support tool. I see no evidence of NBC, or any comparable media network, using OR tools for strategic decisions. Even though such questions seem perfectly suited to DA and game theoretic analysis.

    On the question of ethics, it boils down to whether one considers it desirable, or even possible, for a corporation to be consistently ethics-influenced. Business decisions driven by the goal of shareholder value-maximization don’t typically result in highly moral consequences. (The documentary “The Corporation” makes the case that if the corporation were a person, s/he would be a psychopath.) In fact, though subjectively controlled and unscientifically run, in their extreme point-seeking behavior, corporations are paragons of OR in action!

  • Patricia Randall

    In his “Super Crunchers” book, Ian Ayres talks about the company Epagogix that uses neural networks to predict box office success from movie scripts. You would think that a similar analysis could be done for TV shows.

  • Bob Gremley

    I’m amazed that NBC didn’t just do a test by putting Leno on at 10 pm Eastern one day a week and measuring whether he deliver the ratings for the local news. If he did, you shift more shows to the earlier time slot. If not, everything goes back to the way it was and no one gets their feathers ruffled too much. Instead they went “all in” and got burned.

  • Revenue Management for Online Newspapers « Reflections on Operations Research

    […] about this change, as well as the Punk Rock Operations Research post by Laura McLay about whether NBC executives are using OR in their decision making, makes me wonder […]

  • Paul Rubin

    I think that TV programming is an odd mixture of analytics, creativity and unscientific wild-assed guesswork. Networks (and maybe production companies?) seem to do a lot of audience testing, but at the top levels it seems that programming executives’ careers are made or unmade by judgment calls. Newsweek ran an article on Bonnie Hammer of the USA Network highlighting how she picks shows (she appears to be on a winning streak). I confess that I found it odd that NBC would try to run the same variety show five nights a week (and odder still that they’d pick the 10:00 p.m. slot, pushing more “adult” fare into earlier slots) — but then again, this is the network that canceled the original “Star Trek” series, so what do they know. 🙂

    One other factor to keep in mind is cost. Leno’s prime time show was massively cheaper to produce than a traditional hour-long drama series, so it did not need to win its time slot in the ratings war. I heard somewhere that the big problem wasn’t NBC’s reaction to the ratings, it was the reaction of local affiliates (who were losing audience share in their 11:00 p.m. local news).

    As far as the ethics of pushing Conan O’Brien’s time slot back, I don’t know whether it was Leno’s idea or NBC’s idea to move him to prime time. If it was the network’s idea, it seems to me trying to squeeze them both into the late night slots, while dopey, would exhibit more loyalty (I’m not sure it’s really an issue of ethics) than hanging Leno out to dry.

    In NBC’s defense, at least they didn’t give us five nights a week of some annoying reality show.

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