American Idol host Ryan Seacrest’s fat contract with CKX — the quirky company that owns the rights to the show — seems to have done a number on Idol’s profits. Despite all the upbeat talk about Idol’s ratings resurgence so far this year, the show’s 1Q operating profit for CKX of $13.6 million was down 17% vs. the same period last year on revenues of $28.4 million, down 2%. Publicly traded CKX breaks out results for Idol because it accounts for about 53% of the company’s revenues, which also include licensing income for Elvis Presley and Muhammad Ali. The report is as good a barometer as you’ll find for Idol‘s economic performance: CKX collects a license fee from Fox, as well as revenue for Idol-related syndication, sponsorship deals, merchandise and its concert tours. But CKX’s 48% operating profit margin for Idol in the three months that ended in March was the lowest 1Q result for the show since 2006, when CKX began reporting the show’s finances. CKX says that its Idol-related expenses came to $14.8 million. That’s up 17% from last year — and 260% from two years ago. The biggest change appears to be the $45 million employment contract that CKX struck with Seacrest in 2009 that locks him in through 2012. CKX has already paid Seacrest $33.5 million; Fox, in turn, pays CKX $5 million a year for Seacrest. Another change: Fox used to pay $5 million a year to Idol creator Simon Fuller’s 19 Entertainment for its relationship with Sony Music; CKX bought 19 in 2005. Sony used to release recordings from the American Idol winner and any other finalists Fuller wanted to sign. But Fuller’s doing business now with Universal Music. He switched sides after Simon Cowell, who’s a producer for Sony, left Idol to launch a U.S. version of The X Factor — a rival talent contest he introduced in the UK. CKX says that it’ll do just fine without Fox’s $5 million check: Universal will provide a “significantly higher” payment to CKX for each Idol-related recording it sells. Fuller left CKX last year but serves as a consultant and collects 10% of its Idol-related net profits.
CKX will discuss Idol’s performance and other financial matters in a conference call with analysts Tuesday.


The negotiations with the Idol folks from two years ago were a lesson in what NOT to do. First they played hardball with Adbul causing her to walk and leaving the door open for her to enter X-Factor when then going on to pay J-Lo a huge amount compared to what Kara or Ellen had earned. Quick note, Ellen was an epic mistake to even put on the show. The amount they pay Seacrest is a waste. Idol made Seacrest and not the other way around. Granted Seacrest has been very successful and intelligent in where he’s taken his career but had they lost Seacrest when Cowell was still there it would’ve allowed the audience to welcome a new host before the loss of Cowell.
The money is made off of viewers, the viewers do NOT tune in because of Seacrest, the cost associated with him financially moronic because he does not return the investment. The longer he stays the stronger his stranglehold and more jarring a change for viewers when/if he does leave.
Idol’s best bet is to hire Dermot O’Leary and have him be a second host for behind the scenes and a new After Idol show and slowly and then have take the show over in 2012 after Seacrest’s contract isn’t renewed.
You’re looking at 10 of millions in savings and returning to profits!
Also…do NOT renew Steven Tyler, he’s useless.
Good try, Dermot O’Leary.
Dermot O’Leary??? What the hell? We really don’t need every American show to be hosted by an unknown (to us) Brit. Cat Deeley is the exception, not the rule– And O’Leary is no Cat Deeley.
How much are they paying Lopez and Tyler — because I don’t get how they could be making less if they don’t have to pay Simon the 50 million plus per year?
Yes, ryan is worth it, he makes the show worth watching
And i was not a fan of Tyler joining the show, but I think he has been great.
Wow JJ! I’m hoping Simon and Nigel both read the comments section so they can learn a thing or two from someone like yourself. Answer the questions you’re used to answering like,”How would you like your burger cooked?”.
…and yet you didn’t say what you disagree with. If you’re going to try to insult someone at least be good at it. I give you credit for not going with the tired “Do you want fries with that?” attempt but your variation was actually weaker. Sure I firing Seacrest is a bad idea and will court bad press but point that out so that person can see how it would drive the company to bankruptcy if you can’t insult properly. Amateurs.
JJBAG thank you responding. Please read the latest info http://www.deadline.com/2011/05/american-idol-owner-ckx-sells-to-financial-firm-ending-bob-sillermans-dream/ and see that my ideas were at least forward thinking in fixing a problem instead of sell and run. The burger joke shows your limits and makes me wonder if you’ll truly be able to pass your GED equivalency exam. Best of luck though.
The chemistry with the judges & host really worked this year and the talent is – for once – outstanding!
That there is some serious F-U money! Good for him.
I just do see it. Ryan is OK but I think he is over-rated. However, He is obviously a very very good business man with a very very good agent.
Did you actually read the earnings filing.
For the three months ended March 31, 2011, revenue was $53.3 million, a 20% decline from $66.6 million in the prior-year period. Revenue at 19 Entertainment decreased $10.6 million reflecting lower revenue from music and artist management due to the expiration of the Company’s long-term contract with Sony Music Entertainment following the 2010 American Idol broadcast season, the impact of the closure and sale of non-core businesses and fewer broadcast hours of American Idol in the first quarter of 2011 compared to the prior-year period. Revenue at the Presley Business declined $2.7 million as a result of decreases in royalty and licensing revenue and revenue from Graceland operations, including the impact of the “Elvis the Concert” series which performed in Europe during the first quarter of 2010.
I don’t think people realize how important Ryan is to the success of Idol. No – I’m not his agent or him… But I know how difficult it is to be a live television host and there are few people who can do it well. Seacrest uses his radio experience, and balances professionalism with a great ability to adjust and react to the flow of a live TV show. The guy is just a pro. I actually think he is the one part of the Idol machine that could not be replaced.
Ryan does do a great job, I seriously think he deserves an Emmy. No joke. He is the Dick Clark of our generation. I don’t know if he does something that someone else couldn’t do though and that amount is pretty extreme especially when this story says the company lost money. Maybe it’s time for him and Idol to part ways because he’s grown out of this show? It’s been 10 years afterall.
J Lo got $12M, plus development deal, plus free exposure for her crappy music. But she’s still hot to look at. Tyler’s probably overpaid as well.
the show is awful this year. simon kept the tension going, added legitimacy and kept it real. seacrest’s constant put downs were uncalled for and infantile. j-lo is an egomaniac and totally uninteresting – but she really lights up when she is being worshipped!!! disturbing. all the critiques were the same and man did that get dull fast. and this whole casey thing…..saving him? when pia was voted off that show died
I’ve never liked Ryan. He is annoying.
The show sucks this season. The judges don’t judge. Half of the contestants wouldn’t have made it on the show if Simon was still there.
Seacrest is a good businessman, but he is highly overrated. His work in Idol this year is better because less is more.
Seacrest out
I agree that this season has been terrible; marginal talent, Tyler and JLo are a waste…but Randy is a complete embarrassment as well.
Ryan is actually the best thing about the show; I agree that hosting live teevee is much more difficult than it looks…uh, James Franco and Anne Hathaway, anyone?
Additionally, Idol’s relationship with him bring cross-promotion on not only his nationally syndicated radio show but also E! News.
Dump ALL judges, bring in folks with some shred of credibility…
Plus, from the guest judges who show up on Idol, I would say Ryan has input on that aspect of the show. His relationship with some artists also establishes a level of trust that brings them to the show. I know some people will say that the exposure the show provides is a draw all by itself, but it’s also an opportunity to look bad. Artists trust Ryan to help make them look good, because he is sympathetic to them.
I’ve found the current season of “Idol” more entertaining than than the last few years. Steven Tyler and Jennifer Lopez have injected a new enthusiasm and Randy Jackson acted convincingly as the show’s anchor. I agree with a previous post that the chemistry seems right this season. I’m not a huge fan of uber-ego-driven Ryan Seacrest, but there’s no denying that the guy is part of that chemistry. If “American Idol” can survive after the departure of Simon Cowell and Paula Abdul, I doubt audiences will be deterred should Seacrest make an exit. It may actually be a good time to start grooming another host via post-performance interviews so that audiences can become acclimated to an eventual new ringmaster. In my opinion, “American Idol” is still one of the most entertaining hours of television each week. There’s no contest between NBC’s abysmal “The Voice” and Fox’s music juggernaut.