Turner Heads Into Upfront Bristling With Programming and Ad Sales Innovation

How 3 execs are reinventing the home of TBS and TNT

Headshot of Jason Lynch

April 4 was a day that Turner president David Levy had been looking forward to "for many, many years," he says. For the first time in television history, his networks TBS, TNT and truTV carried the NCAA Men's Basketball Championship Final. The game did not disappoint, as Villanova's Kris Jenkins sunk a game-winning three-point shot at the buzzer to secure the win. Afterwards, a jubilant Levy and his team gathered at their Houston hotel. "There was this feeling of, let's always remember we crowned a champion after what is probably the best championship game in the history of the tournament," says Levy. "It meant a lot to Turner to have this type of game forever be in the history books, and that it happened on TBS."

A 30-year veteran of the company, Levy hopes the March Madness final isn't the only thing that will put Turner in the history books this year. Turner's entertainment networks are heading into the $18 billion-plus upfront marketplace amidst more significant innovation than at any point in their history. Levy is taking ambitious, game-changing swings on multiple fronts, and setting some major initiatives in motion that will not only change the company forever, but could also significantly alter the future of linear advertising.

Photo: Sasha Maslov

In the company's two biggest moves under Levy, Donna Speciale, president of Turner Ad Sales, is spearheading a significant reduction in ad load on truTV's prime-time lineup this fall, as well as on three new TNT dramas debuting this year. At the same time, Kevin Reilly, president of TNT and TBS and chief creative officer for Turner Entertainment, has unveiled a stunning content overhaul of two of basic cable's biggest networks—some of which is already drawing attention the networks haven't seen in years.

Levy has been laying the groundwork for these changes since he was promoted to president in 2013 and given oversight of Turner's seven entertainment networks (TNT, TBS, Cartoon Network, Adult Swim, truTV, TCM and Boomerang). While his channels are generally holding up against their competition—TBS has been the No. 1 basic cable entertainment network in the 18-49 demo for three years, TNT remains a top 5 network in the 25-54 demo, and Adult Swim has been basic cable's No. 1 in 18-34 in total-day for a decade—Levy could sense that a major shakeup was needed. Ratings were trailing off, and the company's longtime strategy of providing what Levy calls "broadcast replacement shows" to advertisers had been disrupted by new rivals like Netflix and the rapidly changing viewing habits of audiences.

To resuscitate TBS and TNT, Levy brought Reilly on in November 2014, wooing him soon after he left Fox that May. After a disastrous end to his Fox tenure (though one of his last acts was to order Empire), Reilly says he was "pretty determined" not to run another network. "I feel like Al Pacino in The Godfather: When I think I'm out, they pull me back in," he quips. While Reilly also considered some Silicon Valley options, he continued having long, frank talks with Levy and Turner chairman and CEO John Martin, who he says "were looking for a pretty big injection of fresh positioning to the brand."

To get there, Martin has committed to doubling Reilly's original programming budget to $1 billion by 2018. Levy says that outlay is vital to allowing Turner to own its own content and leverage its assets across SVOD, international, digital and mobile platforms.

Armed accordingly, Reilly has put together a compelling slate of new series. That includes seven fresh-feeling TBS comedies such as Angie Tribeca, The Detour and new late-night entry Full Frontal with Samantha Bee, which has become one of this year's most buzzed about shows. He's also moving TNT away from safe procedurals and toward the edgier fare along the lines of what he green-lit at FX: Animal Kingdom (starring Ellen Barkin, based on the 2010 Australian film), Good Behavior (starring Downton Abbey's Michelle Dockery) and miniseries The Alienist (from True Detective Season 1 director Cary Fukunaga).

Realizing that audiences might be slow to embrace his new direction for both networks, Reilly says it will take three years to fully realize his vision. Levy offers Reilly his full support, but the programming veteran knows full well that if his shows are flops, "nobody, including me, is getting three years' worth of failure." At this early juncture, he shouldn't worry: TBS' first two comedies, Angie Tribeca and The Detour, have already been renewed for second seasons, while Full Frontal has been extended for 26 more episodes.

But Levy defines success at Turner as much more than just linear ratings. "We're also talking about conversations in the social marketplace. People sharing content on the internet. New viewers to the network. Buzz factor. New York Times' front page for Samantha Bee. Things that we weren't getting in this company since Conan [O'Brien] came on board five years ago," he says. (Indeed, 25 percent of Angie Tribeca and Full Frontal's audience in the 18-34 demo are new to TBS.)

Buyers see promise in Reilly's new slate. "It seems a bit edgier, more up to date and it's definitely got more of an original perspective than it's had in a while," notes Chris Geraci, president of national broadcast at OMD. While some buyers privately worry that his shift to edgy content could alienate some advertisers, Geraci adds, "If it does a good number and becomes popular, advertisers will be there. I don't think the guys at AMC have any trouble selling out every episode of The Walking Dead."

"Right out of the gate, these are exactly where I'd hoped we'd be," says Reilly of the new shows, but he faces a "tricky pivot" as he tries to also retain the audiences of legacy TNT procedurals like Major Crimes and Rizzoli & Isles (which is ending after its upcoming seventh season). He says the first wave of "noisier" series, designed to get people talking about his bold new direction, will be followed by some shows that might be more palatable to the Rizzoli viewer.

The process has reinvigorated Reilly, after his run at Fox, where "I felt I was really just trying to hold on and usher in a decline to a certain extent, not just at Fox but in broadcast in general," he says. "Now our goal is not to hang on, but to actually be one of the guys who plays through and figures out how to rewrite some rules in the process."

That includes quick decision making, like giving O'Brien an instant go-ahead to take advantage of a short window and bring his late-night show to Cuba ("he is doing this thing that nobody else is doing," Reilly says)—or Levy signing off on Reilly's plan to pursue The Daily Show correspondent Samantha Bee for a late-night show, starting negotiations just a week before Jon Stewart announced his departure as host. "You can't wait, not in this landscape. We have to be able to react, and getting Samantha Bee that way was a great example," says Speciale.

The company pooled its efforts to retain the big audience that turned into its March Madness coverage, airing The iHeartRadio Music Awards in between the Final Four and Championship games on TNT, TBS and truTV, previewing The Detour's pilot after the Final Four and Championship games and heavily promoting the other upcoming shows. "This is about leveraging the entire portfolio and using it better," says Levy.

And while those NCAA final ratings were down significantly from last year's game on CBS (they averaged 17.8 million total viewers across TBS, TNT and truTV, a 37 percent drop from last year's 28.3 million, which was the most-watched NCAA final in 18 years), Levy isn't worried. "We look at this holistically as a company. This is not just a television product," he says, pointing to record social and digital numbers, as well the millions of viewers exposed to promos for its new fare.

Turner will have several more years to better that number: Its joint March Madness deal with CBS, where the networks will alternate airing the Final Four and National Championship each year, was expanded just last week to run through 2032. And its sports deals for NBA and MLB playoff games extend through 2021 and 2025, respectively. Levy boasts that all of Turner's premium sports deals turn a profit in their life cycle, which is why he bowed out of talks with the NFL about the next Thursday Night Football package once it became clear the league wanted only a one- or two-year deal. "We needed a more long-term deal for the cable operators, our cable contracts, hiring talent and production people," he explains. "How do you hire all that for one season? It was unattainable for us." 

Ad sales Revamp

While Reilly has been revamping TBS and TNT, Speciale has been devising equally seismic changes on the advertising front. Last October, she announced truTV will cut its prime-time ad load in half, a reduction of up to nine minutes each hour, beginning this fall. The early news gave truTV's showrunners enough time to plan for several additional minutes of content in each episode. In January, those plans expanded to include TNT's three new dramas, which will incorporate 8-10 minutes of additional program time per hour.

The goal, Speciale says, is to "give the consumer more of a great experience with better storytelling, which will translate then if you apply native ads into that experience." That, ideally, will lead to longer tune-in, which will increase ratings and CPMs. But those ads will also be priced higher to reflect their "premium environment," so that Turner doesn't lose any money with the approach.

Not surprisingly, advertisers are thrilled about that less-cluttered environment—but less excited about the prospect of paying a premium for it. "Our advertisers and clients all want [less clutter] from a quality perspective, but how do we translate that into our plans when all the CPMs go up and the price goes higher?" says Steve Kalb, svp, director of video investments at MullenLowe Mediahub. "I definitely applaud them for going down that route and seeing how it goes. Does it impact the ratings overall? Does it impact the effectiveness of the spots? It's all things that we're very interested in learning."

So is Speciale, who is still testing out various options for pods under these reduced ad loads, determining where local ads and native ads fit best into the mix. "Should it be five breaks? Three breaks? Should the breaks be longer, shorter? That's what we're testing, because I don't think anybody really knows," she says.

She's also looking to expand Turner's Audience Now data product, which would move advertisers away from CPMs and into audience-based targeting. Speciale has been beta-testing this with four clients this season—including General Motors and Kellogg's—and plans to expand that over this upfront. "It literally means changing behavior. There are no dayparts, no adults 18-49 CPM based on Nielsen," she says. "Half the battle right now is, they don't even know who they want to target."

While Speciale estimates that data targeting could represent up to 50 percent of her upfront talks, Levy knows some clients will be wary of pulling the trigger. "It's going to take time for people to get comfortable with daypart-agnostic and network-agnostic," he says. "But if the data is correct and we guarantee the target audience, not the CPM, that's going to be a whole evolution."

Buying Into the Future

Not content with just upending its ad sales and TNT/TBS content, Turner is also focused on growth investments that Reilly predicts "are going to really change the complexion of what it is to be a network today," building on the success of its 2012 acquisition of sports digital media company Bleacher Report. The company has acquired a majority stake in livestreaming company iStreamPlanet—"That's going to be a big part of our play in the future, the livestreaming business, and it's nice to have that organization in our company," says Levy. It also launched Super Deluxe, a mobile-first digital content venture.

Turner has particularly high hopes for ELeague, the professional eSports league (competitive video gaming) it is launching next month in partnership with WME and IMG. The league, which Turner owns and is building from the ground up, will feature 10-week seasons, digital livestreaming and live competitions on TBS. "This space is so vibrant right now," says Reilly. "This is embracing the digital platform where it's lived, and trying to introduce the linear on top."

Last month, Turner led a $15 million investment round in Mashable, where the companies will collaborate on video content and cross-platform ads. Reilly, who will join the Mashable board as part of the deal, sees it as a way to amplify Turner's data capabilities through Mashable's tools like Velocity, which helps predict which stories will resonate with Mashable's audience. (While Mashable-produced content won't appear on Turner's linear networks "in the short run," Reilly says the platform may "ultimately be a feeder.")

Ultimately, these moves—in the upfront and beyond—are about making sure that Turner is perfectly positioned no matter what direction the industry heads in over the next several years. "You have to keep innovating in this business, and if you don't, you're going to be left behind, or not be around for that long," says Levy. "This is the most exciting time to be in the media business and the scariest time; there's just so much change going on. The winners are going to be the ones who have the strong brands and have adapted to the new world."

This story first appeared in the April 18, 2016 issue of Adweek magazine. Click here to subscribe.

@jasonlynch jason.lynch@adweek.com Jason Lynch is TV Editor at Adweek, overseeing trends, technology, personalities and programming across broadcast, cable and streaming video.