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ALEX COHEN, host:

From NPR News, it's DAY TO DAY.

If you watch the NBC show, "The Office", you might have caught the episode where Jan, one of the top managers of the company, got ousted. Well, now life might be imitating art, as NBC says goodbye to one of its head honchos. Just a couple of years ago, NBC was a proud number one. Today it ranks behind Fox, CBS and ABC. So what are they going to do to turn things around?

Here to explain is John Dimsdale from MARKETPLACE. So John, it's sounding a little grim for NBC. What happened?

Mr. JOHN DIMSDALE (Writer, MARKETPLACE): Well, just like any company that's losing profits, you have to look at their products. And in this case, NBC's programs aren't attracting viewers. They haven't found a winning comedy yet to replace "Friends", and their popular flagship series, "Law & Order", is struggling to sound fresh and find new storylines.

NBC does have some programs that still win endorsement from critics, like "The Office" that you mentioned, but they're not delivering big audiences. During this past winter season, NBC's average viewership among the 18 to 49-year-old category was 3.8 million. That's a nine percent drop from the year before.

COHEN: And all of this is coming just after all of the TV networks unveiled their lineup for shows to advertisers for this fall; the upfronts, right?

Mr. DIMSDALE: That's right. Right. Just two weeks ago. The new shows from NBC include a remake of the 1970s show "The Bionic Woman". And there's one called "Chuck", a sort of comedy drama about a computer geek who accidentally uncovers government secrets. But NBC's executives are already worried that their shows are lackluster and will continue to lose ad revenue. And we're talking some big bucks here.

NBC earned nearly $2 billion from ads last year, but that income has dropped since their current programming chief, Kevin Reilly, took over two years ago. So the insiders say the time has come to replace Reilly.

COHEN: Who might take over for Reilly at NBC?

Mr. DIMSDALE: Well, the speculation is on Ben Silverman, who has a very successful string of hits on several different networks, including "The Office" and "Ugly Betty" on ABC. It's possible that Silverman will be given control over not just the network schedule, but also the TV production studio. And having one person in charge of both would supposedly speed up the process of getting new ideas on the air. And it gets rid of some of the in-house struggling that's going on between the creative staffs.

COHEN: You know, NBC isn't only one that's facing this issue of competition from the Internet, TiVo, other digital video recorders. Is this just a taste of what we're going to see for all of the networks?

Mr. DIMSDALE: I think so. This business is really changing. Networks are desperately trying to keep their audiences tuned to commercials. You know, nearly a fifth of households now have those DVRs which allow you to skip the ads. Programmers are experimenting with ways to embed commercial messages into the program or give viewers a reason to stick with the commercials. Other programs are trying to steer viewers to Web sites that have ads. So watching TV is going to become a whole new experience.

COHEN: We'll stay tuned. Thanks so much, John. John Dimsdale of Public Radio's daily business show MARKETPLACE. It's produced by American Public Media.

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