NBC Says Goodnight to Conan

Conan O'Brien has agreed to a $45 million deal that will end his reign as host of the Tonight Show on Friday, allowing Jay Leno to return to the show, NBC announced Thursday morning on the Today Show.

Of the $45 million, O'Brien will pocket about $33 million, with the remaining $12 million to be dispersed to his staff for severance packages. Leno will make his return to the Tonight Show on March 1, the network said.

The deal ends a very public battle for the late-night slot at NBC.

O'Brien, who was pegged to succeed Leno as Tonight host in 2004, took the reins seven months ago. Leno was given a talk and variety show at 10 p.m., but the show's ratings, while appeasing the NBC brass, were not satisfactory for local affiliates, who were claiming that the Jay Leno Show's poor ratings were negatively impacting their 11 p.m. newscasts. O'Brien also was pulling down shaky ratings, allowing David Letterman and CBS to ascend to the top of the late-night scene.

NBC said January 11 that it would end Leno's show after the Winter Olympics, and that they wanted to shuffle the late-night lineup, giving Leno a half-hour show after the 11 p.m. local news and bumping Tonight to midnight. After consideration, O'Brien shot down the idea, issuing a statement saying "the Tonight Show at 12:05 simply isn’t the Tonight Show."

It is unclear where O'Brien will end up. NBC said O'Brien will be free to look for another job in September. At the time of his statement rejecting the NBC late-night shuffle, O'Brien said he had no other offers from other networks.

Since the battle over Tonight started, Fox has been rumored to be a potential suitor for O'Brien, as the network does not have an established late-night franchise, and the network could potentially start a show at 11 p.m., giving it a half-hour jump on the Tonight Show, Late Show with David Letterman, or ABC's Nightline.