The basic cable channel's recent purchase of rights to telecast edited versions of HBO's "The Sopranos" for a record-shattering $2.5 million per episode is the new year's most significant television deal. The reruns will start in fall 2006.
A rights deal for another one of HBO's crown jewels, "Sex and the City," has worked out well for TBS. But the price tag for "The Sopranos" has left many television executives wondering how A&E can possibly profit.
Court TV General Manager Marc Juris, who was outbid for the show, likened the deal to building a 10,000-square-foot mansion in a run-down neighborhood: "You will definitely impress a lot of the neighbors and make a lot of noise, but I don't think you'll get your money out of it."
A&E is staring down the naysayers.
"We don't do anything that doesn't make money," said Bob DeBitetto, A&E programming chief, "especially talking about that level of investment."
A&E is clearly in transition, although DeBitetto helped stop a long-term decline. Average viewership sank from 840,000 in 2000 to 622,000 in 2003 but rose slightly to 626,000 last year, according to Nielsen Media Research.
More importantly in the youth-obsessed TV industry, the A&E audience is getting younger: the median age dropped from 56 to 53 in just one year. "Growing Up Gotti," "Dog The Bounty Hunter" and "Cold Case Files" - which DeBitetto likes to call "cinema
verite docu-soaps" - have helped.
But to this day A&E has been haunted by losing the syndication rights to the immensely popular "Law & Order" in 2002, and its executives seemed determined not to repeat that mistake.
Acquiring the rights to "The Sopranos" - the last decade's most critically acclaimed drama - gives A&E instant cachet. Although HBO has repeated the episodes frequently, the pay-cable service reaches only about a third of the TV audience - meaning "The Sopranos" will be first-run programming for a large number of viewers.
A&E hasn't finalized its plans on how the series will be presented. In TV lingo, it's likely to be vertical rather than horizontal scheduling.
That means showing two or three episodes back-to-back on a single night, once or twice a week. A horizontal schedule would be airing a single episode at the same time five nights a week, which is probably how A&E will show "CSI: Miami" starting next fall.
"That makes the most sense," said Bill Carroll, a syndication expert for Katz Television. "Then it becomes event programming."
It also keeps the series from getting stale. A&E will probably have the rights to 78 episodes to air over a five-year period, more if HBO can persuade producer David Chase to continue beyond this planned last season. There's a risk fans could tire of it quickly if they are shown too often.
"We have no interest or desire in turning our network into the all-Sopranos, all-the-time network," DeBitetto said.
As a show rife with violence, sex and bad language, "The Sopranos" will have to be edited to meet basic cable standards. Some fans wonder how that can be done without stealing the show's essence; the image of Ralphie's head stuffed into a bowling bag will live forever in "Sopranos" lore.
DeBitetto is confident it can be done, and even turns the challenge around.
"Some people might like it because it has been edited for sex, violence and language," he said.
TBS has been quite pleased with how "Sex and the City," a series that faced some of the same issues, made the transition to basic cable last spring, said TBS chief Steve Koonin.
Three-quarters of the people who watch "Sex and the City" on TBS have never seen the series before, he said, and 25 percent of the show's viewers had never watched anything on TBS before - those are invaluable numbers for a cable network seeking attention in a crowded marketplace.
"It's been a very profitable venture," Koonin said.
He wouldn't predict how A&E would do. But he pointed out that, at $750,000, a "Sex and the City" episode costs less than one-third of "The Sopranos" in syndication.
"The Sopranos" is a serial drama, and these often have trouble getting ratings in reruns. "Law & Order" is a satisfying viewing experience in part because it doesn't matter if viewers watched the last episode.
Juris said he's not rooting for failure, but that he's spoken to many others in television and they're all wondering the same thing. "I don't see how the math works," he said.
A&E believes "The Sopranos" will attract advertisers, like movie studios and consumer electronics manufacturers, which have shunned the network in the past. A&E needs to keep getting younger, and "The Sopranos" will accelerate the process, DiBitetto said.
A&E is aggressively developing original programming, and "The Intervention," about friends helping real-life addicts, is already attracting attention ahead of its debut next month. But reruns of syndicated series are part of the puzzle, and A&E executives see nothing coming onto the market over the next several years that can even approach the impact of "The Sopranos."
While "Desperate Housewives" and "Lost" have helped revive network scripted series this season, they are years away from proving themselves in syndication, Carroll said.
The deal also adds some invaluable shine to his brand, DiBitetto said.
"It feels very right on A&E," he said. "It brings a real patina and the partnership with HBO helps reinforce A&E's premium positioning."
By David Bauder