With Kimmel move, ABC aims to copy morning success late at night

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(Reuters) - After toppling NBC's "Today" show in the morning show ratings for overall viewers for the first time in 16 years, ABC is now taking aim at NBC's iconic "Tonight Show" franchise.

The network, owned by the Walt Disney Co, launches on Tuesday evening its most ambitious - and riskiest - effort to grab a slice of television's late-night audience, moving "Jimmy Kimmel Live" to the 11:35 p.m. time slot and displacing the hour's top-rated show, news program "Nightline."

Pushing Kimmel's show to 11:35 p.m. from its usual midnight airing puts the popular and pudgy young host in direct competition with Jay Leno's "Tonight Show" on NBC and "The Late Show with David Letterman" on CBS Corp, not to mention Comedy Central's "The Colbert Report," hosted by Stephen Colbert.

Moving "Kimmel" earlier may help ABC capitalize on both advertiser demand for entertainment programming and provide a boost to its prime time schedule. Late-night shows, like morning news programs, are among the most profitable for networks because they cost less to produce. Their ratings are also steadier than prime time shows because there are fewer repeats.

The network calculus goes like this: Advertisers will pay higher rates for entertainment shows at that hour compared with news programs. Plus, more regular "Kimmel" viewers means more people will see promotions for ABC's prime time slate, driving a bigger audience there and potentially boosting the network's overall financial performance.

According to Jason Maltby, lead TV ad buyer at media buying firm Mindshare, late-night is one of "two areas where (ABC) can make more money." The other is early morning, where its "Good Morning America" usurped NBC's "Today" show in ratings.

"The Tonight Show with Jay Leno" currently leads the late-night broadcast comedy race with 3.4 million viewers on average, according to Nielsen. "The Late Show with David Letterman" pulls in 3.0 million, while "Jimmy Kimmel Live" grabs 1.9 million.

In 2011, companies spent $425.8 million to advertise during Leno, Letterman or Kimmel, according to the most recent yearly data from Kantar Media. Leno's show led the pack, grabbing $160.8 million. Letterman brought in $157.4 million, while Kimmel earned $107.7 million. "The Colbert Report," which runs for 30 minutes starting at 11:30 p.m., collected $41 million.

"Nightline," the 33-year-old newscast that began as a daily update during the 1980 Iran hostage crisis, actually draws more viewers than all of its entertainment-focused late-night competition, averaging 3.9 million viewers nightly. The 30-minute "Nightline" will move to 12:35 a.m. and also will air in a new one-hour prime time slot on Fridays.

Although "Nightline" attracts more viewers than "Kimmel," ABC says switching the two shows will allow it to secure higher ad rates, known as cost-per-thousand viewers or CPMs, because advertisers prefer an entertainment audience over a news audience at 11:35 p.m.

YOUNGER AUDIENCE

At 45, Kimmel is two decades younger than Leno, 62, and Letterman, 65. ABC believes that fact coupled with his younger, tech-savvy audience will make his show more appealing to advertisers. The network's marketing blitz features ads with the tagline: "Younger. Smarter. Funnier. Earlier." Kimmel has been making the media interview rounds and exposed his butt crack for a Rolling Stone magazine cover story.

"Jimmy attracts a really fantastic demo," ABC Entertainment President Paul Lee said in an interview. "He will start to make the audience younger and, because it is entertainment, he will bring in higher CPMs."

Maltby agrees, saying Kimmel's show gives ABC "the opportunity to get a larger audience, which means more revenue."

Kimmel is kicking off the time shift with big-name guests, including Jennifer Aniston and Ryan Gosling. The comedian said he will continue to experiment with new segments on his show, but he does not plan any changes based on the earlier start.

"It will pretty much be the same show that we've been doing," he told reporters during a December 19 conference call.

Advertisers will watch Kimmel's ratings over the next few weeks to see if the initial audience sampling generated from the hype leads to viewers sticking with the show, said Jackie Kulesza, video activation director for Starcom USA.

NBC executives expected initial interest in Kimmel's move to impact Leno's ratings, although they declined to be specific.

"The reason we're not that concerned is because of Jay's legacy all these years," NBC Entertainment Chairman Robert Greenblatt said at a Television Critics Association meeting.

With the "Nightline" move, "there's going to be some viewers freed up and I'm not sure they're going to go to Jimmy Kimmel necessarily."

ABC OVERALL

As it shuffles the late-night schedule, ABC is experiencing mixed results in other time periods. "Good Morning America," the network's marquee morning show, knocked NBC's "Today" show from the top ratings spot it held for 16 years. In 2012's fourth quarter, "Good Morning America" ranked No. 1 with an average of 5.1 million viewers, ahead of the 4.6 million for "Today," according to ABC.

It is unclear how the ratings victory has impacted the "Today" show's historic lead in the race for morning-show ad dollars. The first two hours of "Today," from 7 a.m. to 9 a.m., collected $278 million in ad revenue in the first half of 2012, according to Kantar Media. "GMA" took in $167 million during that time period. Full 2012 data is not yet available.

In prime time, ABC is staring at a year-over-year ratings decline that also hit rivals CBS and Fox in the fall.

ABC's prime time lineup fell 6 percent among viewers 18 to 49, the age group prized by advertisers, according to Nielsen measurements of viewing on the day a show airs. CBS dropped 13 percent and Fox slumped 23 percent. NBC, boosted by "Sunday Night Football" and singing competition "The Voice," gained 22 percent.

From the start of the fall season through the end of 2012, ABC and Fox were roughly tied for third place among broadcasters, with an average of 3 million viewers each based on same-day viewing.

During the fall, ABC canceled new dramas "666 Park Avenue" and "Last Resort." The network ordered full seasons of alien comedy "The Neighbors" and musical drama "Nashville."

Lee noted that ABC finished first among 18- to 49-year-olds for non-sports programming on a ratings measurement known as C3, which captures viewers who watch a recorded show and its commercials within three days. C3 is the metric advertisers use when they buy and sell commercial time.

"We did what we were trying to do," Lee said. "We were number one in C3 for entertainment."

This week, ABC will highlight upcoming mid-season shows in front of reporters at a Television Critics Association meeting. They include drama "Zero Hour" starring Anthony Edwards and "Red Widow," about a woman who hunts for the truth behind her husband's death.

(Reporting By Lisa Richwine in Los Angeles and Liana Baker in New York; Editing by Peter Lauria and Andre Grenon)

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