Jay Leno's Primetime Show, By the Numbers

(MoneyWatch)  On Friday, The Wall Street Journal published the first story I've seen that puts relatively hard numbers, in terms of ad dollars, production costs and viewers, around "The Jay Leno Show" which debuts tonight at 10 p.m. on NBC, and will air every weekday night this year. (Note: the story is behind the WSJ's firewall.)

Here's the rundown before I explain why this math bodes well for the show:

• Commercial time has been going for between $55,000 and $75,000 dollars per 30-second ad, as compared with $137,000 for "Law & Order: SVU" at about this time last year.
• Production costs for the show will be about $100 million as opposed to $300 million to fill those slots with scripted programming.
• NBC execs claim that the show will have a third fewer viewers than the dramas which had tended to be in the 10 p.m. time slot before.

Now, let's look at the return on investment based on the numbers above. If you take the mid-range figure for a 30-second spot on "Leno" -- that is, $65,000 -- and compare it, on a percentage basis, with the $137,000 NBC could charge last year, you come up with commercials that have 47 percent of the value of the ones that aired in the same time slot last year. But, the cost of the series is only 33 percent of what it used to be, giving "Leno" a much higher profit margin than the shows it's taking the place of, even if the amount of money coming in the door is roughly half of what it was.

Here's where it gets more interesting: despite NBC's claims that the show will have about one third of the viewership of what it replaced, no one has the slightest idea of how "Leno" is going to do. Thus, that ad price in all likelihood errs on the conservative side, and so, probably, does NBC's viewership estimate. The network would have been foolish to charge more for the show in the early offing, and advertisers would be foolish to pay more. They don't know what they're getting into. But, if ad rates were simply based on the numbers above, NBC theoretically could have argued that rates should be one-third less, not one-half less. Therefore, if the show only does as well as NBC has predicted, it should be able to raise rates a bit, increasing the show's ROI even more.

There are many wild cards here, of course. One is whether ad rates will be different for this show, even if its numbers stack up favorably against the competition. Will advertisers value viewers of dramas more than viewers of a comedy show that airs every night? Will the demographics of this show be less favorable? Whatever the case, don't put it past advertisers to do what they can to continue to turn the screws on NBC's little 10 p.m. experiment.

(BTW, it just so happens that one of Leno's guests tonight is this guy named Kanye West. So, Leno already has his Hugh Grant "What the hell were you thinking?" moment all queued up.)