Charlie Sheen's $2M Payday, or Why Much Less Is More in Network TV

Last Updated May 18, 2010 12:31 PM EDT

Despite the expectation of big upticks in ad spending in this year's network-TV upfront sales market, there really isn't all that much to celebrate as the medium continues to shed viewers. But even better evidence of that principle came today in the form of Charlie Sheen. Word is out that the troubled star of the CBS sitcom Two and a Half Men will make almost $2 million per episode to star in the series for two more years. (He'd been making a mere $850,000/episode prior to this new deal.)

It just demonstrates that if you're the star of what qualifies as a hit show on network TV these days -- even if you've had some extremely unseemly marital and legal troubles lately -- you end up being worth a premium that no network would have paid (even adjusted for inflation), a decade, or even a few years, ago. The previous top-earner in sitcoms was Ray Romano of Everybody Loves Raymond, who received, per Variety, between $1.8 million and $1.9 million for the last season of the show in 2004-05. Two and a Half Men, network TV's top sitcom, reached 14.7 million viewers this year; according to The Hollywood Reporter, "Raymond" averaged 17.4 million viewers during its last two seasons.

Go back further, and the spread between viewers and salary gets even wider. Jerry Seinfeld "only" made $1 million per episode (not including other income from being the show's creator) in 1997, the last year of that show. Its last episode reached 76.3 million people; it averaged more than 21 million households (not individual viewers) during that last season. While it's a bit much to say "poor Jerry" about the pay discrepancy with Sheen, ask yourself, who should be worth more? Seinfeld or Sheen? Oh, and have salaries for most of us doubled in the last 12 years?

That said, there is some rational thinking at work here. CBS (BNET's corporate overlord) knows the chances of creating a hit on the (admittedly diminished) the scale of "Two and a Half Men" are pretty slim as people watch less network TV. Thus, rather than investing in producing something to replace that show if its star walked, it's putting the money into keeping him happy. Even with the expected uptick in ad rates this season, the Sheen contract probably isn't great for the show's margin, but it's a safer bet than the alternative. In the world of TV investing, it's the equivalent of investing in bonds rather than a start-up.

Previous coverage of this year's upfront at BNET Media: