A Costly Dose of Reality

Is reality TV pricing itself out of networks’ budgets? The genre, which went mainstream with the premiere of CBS’ top-rated Survivor more than 10 years ago, is in danger of falling victim to its own success.

As last week’s walkout by the Jersey Shore cast brought into focus, when a fledgling show becomes a hit, the “regular-people-off-the-street” see themselves as stars. And as stars, they command higher salaries, more perks, and fees for appearances.

Monday, the New York Post’s Page Six reported that bankrupt New Jersey housewife Teresa Giudice demanded $3,000 to attend a charity function.

The antics of reality stars are so costly that they’re starting to raise the bottom lines of the shows that made them famous. Reality television became a force because viewers liked it and because, without celebrities or big salaries, it was cheap, writes Brian Stelter in the New York Times. The shows can cost as little as $200,000 for a half-hour episode, compared with the $1 million or more typical for hourlong scripted shows.

“There can be a time when a show prices itself out of profitability,” Chris Linn, executive vice president for MTV production, told Stelter.

And while TV execs note that there’s a delicate financial balance between paying “talent” and generating enough advertising buzz that pays for the initial investment, reality stars can successfully create a lasting brand if they approach their shows as a business opportunity.

Like every entrepreneur, they should weigh the costs versus the payoffs. Drawing a lower paycheck that makes a show more attractive to advertisers can also lead to a longer run. A longer run could make a star a household name, and that could lead to lucrative endorsement and product deals. On the other hand, knowing that fame from appearing on such shows can be fleeting—who remembers the cast of The Real World, Miami which actually gave cast members a chance to start and manage their own business?

Fleeting or not, no one’s ready to declare the genre too expensive—yet. Although the major networks are infusing their fall schedules with more scripted dramas, comedies and sitcoms.

But reality lovers don’t need to fret. The Shore crew, and the Housewives are not going anywhere. Bravo will run it’s latest addition, The Real Housewives of D.C., featuring White House state dinner crashers Michaele and Tariq Salahi, on August 5, 2010. MTV fist-pumps its way to sure ratings gold with Shore on Thursday.