Mr. Draper Goes to Wall Street
AMC has undergone a dramatic transformation. As late as 2005, the cable channel was just another small fish in the large pond of television broadcasting with little more to offer than reruns of old movies. Although the channel made brief excursions into original content in the past, starting with the 1996 series Remember WENN, it wasn’t until the premier of Mad Men in 2007 that AMC hit paydirt. The next year saw the advent of Breaking Bad and suddenly the former American Movie Classics was rivaling HBO as the destination for quality programming. Even failures and missteps only seemed to add to AMC’s growing reputation. While not generating enough viewers to justify a second season, for instance, the 2010 conspiracy thriller Rubicon evolved into a critical darling, and when the 2011 murder mystery The Killing failed to identify the culprit in its final first season installment, the Internet exploded in an out-of-proportion fashion.
“Never mind who killed Rosie Larsen—the mystery I want solved is how AMC shows continue to have cultural footprints so much larger than their audience,” Mary McNamara wrote in the Los Angeles Times. “The hyperbolic outrage over The Killing seemed aimed at a cultural phenomenon like Lost or The Sopranos that had disappointed or confused its viewers with a strange or inconclusive ending.”
The Killing, of course, is no Lost or The Sopranos, but the perceived debacle of its finale inadvertently raised the general public’s awareness of AMC nonetheless. The cable channel, however, has taken additional steps that likewise enhances its “maverick” reputation, including a spin-off from owner Cablevision Systems into a publicly-traded standalone entity known as AMC Networks.
AMC is the flagship of the new company, which also contains IFC, the Sundance Channel and WE. The official formation also occurs on the heels of a forecast by media service company ZenithOptimedia which estimates that advertising revenue on cable will outpace those of network television for the first time in 2012, and the trend will then increase as the decade progresses. “Cable networks will continue to build momentum—especially those seen as alternatives to broadcast prime,” the report states. Given its lineup of critically acclaimed shows that also includes The Walking Dead, AMC is obviously poised to reap the rewards of these changing winds and will no doubt financially benefit even further when carriage deals on cable subscription services are renegotiated in 2013.
Still, AMC is venturing into foreign territory by breaking away from Cablevision Systems. Earlier in 2011, cable giant Comcast completed its merger with NBC Universal, and that is just the most recent example of a service provider swallowing the very television channels it transmits to subscribers. In 1989, for instance, Time Inc. merged with Warner Communications and the resulting Time Warner became a major player in both content and distribution, a situation which was only enhanced when Time Warner later merged with Turner Broadcasting in 1996.
“If Time Warner owned TNT, the Cartoon Network, or CNN, it could generate advertising revenues from the programs as well as subscriber income from monthly cable users, and gain leverage over other cable programmers since Time Warner could threaten to favor its own cable networks with lower and more desirable cable channel slots,” journalist Ken Auletta observed at the time.
Just as AMC embarked on a different path than most cable channels in terms of ownership, it also announced the formation of a digital production studio at the same moment that the networks were closing down their own. “The division serves as both a laboratory to develop future content for AMC TV and also a destination to produce webseries that have the same high-quality storytelling for which our television series have become known,” the channel said in the July 29, 2011, press release announcing AMC Digital Studios. A few weeks earlier, however, Comcast announced it was shutting down NBC Universal Digital Studios, which initially launched in 2008, while the Walt Disney Company and ABC bailed from the business of creating original online video content in 2009.
Comcast maintains that the decision was based on NBC currently being the last-place network from a ratings standpoint and the need to rebuild from top to bottom. NBC Universal CEO Stephen Burke and NBC Entertainment chairman Bob Greenblatt therefore decided that digital creation should be focused on complimenting and promoting NBC entities that already exist—such as the highly successful string of webisodes from The Office—and not generating standalone content.
Thus while NBC is retreating from the World Wide Web as a source of original entertainment, AMC is making a full-frontal assault on the medium. And while the failing NBC found safety in its merger with Comcast, the up-and-coming AMC has decided to break away from Cablevision in order to embark on a different trajectory. But just when it looked like AMC was about to trailblaze a new direction for quality entertainment, news of a more unpleasant nature unfolded in regards to at least two of its more prominent programs.
In late July 2011, executive producer Frank Darabont abruptly announced that he was leaving the successful series he helped launch, The Walking Dead. Shortly thereafter it was revealed that negotiations for a fifth season of Breaking Bad was going badly, with AMC requesting a shorter number of episodes and production company Sony threatening to move the show to a different channel. In both cases, the primary reason appears to be financial—despite huge ratings in its first season compared to other AMC programming, for instance, the budget for season two of The Walking Dead has been trimmed by $250,000 per episode.
“As a public company, the financials of AMC are gradually going to become much more apparent to investors,” Barclays Capital analyst Anthony DiClemente told the Los Angeles Times in August 2011. “There will be many more questions about programming expenses and margins.”
Adding to the situation is the large sum of money that AMC awarded Mad Men for a final two seasons of the Emmy Award-winning drama. It was Mad Men, after all, that initially put AMC on the map, and while the channel has nurtured additional critically-acclaimed series since, Mad Men is still the defining achievement of AMC. “We’re investing more than we ever have before,” AMC president Charlie Collier said in response to accusations that the Mad Men payday is being financed at the expense of other AMC properties. “The fact that future seasons of Mad Men were going to be expensive is not a surprise to us. We’ve taken some of the most expensive, riskiest shows around and nurtured them and managed to grow our network.”
Given the results of the four years that have passed since Mad Men first premiered on AMC, Collier’s statement is indeed accurate. Hopefully those words will be equally correct in another four years—making AMC not only a continual home for quality television programming but of quality webseries as well, not to mention an independent voice in the growing landscape of megamedia giants.
Anthony Letizia (August 8, 2011)
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