After one more night in Melbourne, Simon and his party flew back to Los Angeles, bringing with them Adam Baldwin and Valéria Golino, the leads of Batman who had been in Australia for some time. Principal photography on Batman would not begin until early the following year, and the remaining months of this year would be taken up with casting supporting roles, auditions, rehearsals, and other preparations in Los Angeles all of which required the two stars' participation.
Simon's group boarded their return flight from Melbourne on the morning of September 14.
One day earlier, in North America, NBC's Survivor had premiered at 8:00 p.m. on Monday, September 12, local time. By the afternoon of September 13 Melbourne time, preliminary ratings were already available.
New York.
Robert Iger was just as anxious about Survivor's performance as everyone else, but when his phone rang shortly after one in the morning, he was still surprised.
It was Robert Wright, CEO of NBC, calling personally. His voice betrayed a tangle of emotions surprise, excitement, and more that he could barely contain. After relaying the initial ratings data for Survivor, Wright proposed they meet for breakfast to discuss production of a second season.
Out on the West Coast, Amy Pascal received the same premiere numbers around midnight, and word reached Simon in Australia soon afterward.
Early on the morning of September 13, North American time, NBC eagerly released Survivor's ratings to mainstream outlets like The New York Times and The Los Angeles Times. Headlines across the board proclaimed it "another phenomenal hit."
Why "another"?
The reason was obvious. Who Wants to Be a Millionaire had already ignited one phenomenal ratings storm. Now Survivor appeared to be even stronger.
More detailed figures showed that the premiere episode had opened with 17.8 million viewers, climbed to a peak of 22.65 million, and settled at an average of 20.95 million—far exceeding NBC's pre-launch expectation of around 15 million.
Anyone in the industry understood the difference between a show that drew 10 million viewers and one that drew 20 million. It was not merely quantitative; it was a qualitative leap.
Although Survivor's premiere did not surpass the previous night's Who Wants to Be a Millionaire in total viewership, it unexpectedly edged ahead in the all-important 18–49 demographic.
Sunday's Millionaire had drawn 23.7 million total viewers and an 11.1 rating in the 18–49 group. Survivor, with its lower overall total of 20.95 million, nevertheless posted an 11.5 in the same demographic—13.8 million core viewers compared to Millionaire's 13.3 million.
The gap was only about half a million, but the context made it staggering. Millionaire had enjoyed months of summer buzz and massive promotional spending from ABC. Survivor was merely debuting, and NBC had not thrown anywhere near the same marketing weight behind it.
To outperform an established juggernaut on its very first night meant Survivor's future episodes were all but guaranteed to climb higher.
NBC's only regret now was that a season of Survivor contained just thirteen episodes instead of Millionaire's sixty-nine.
To minimize risk, the network had initially signed with Daenerys Entertainment for only the first season.
At the current pace, season one would wrap before the winter hiatus. If NBC wanted a second season to launch smoothly in the spring, it would soon find itself in the same uncomfortable position ABC had faced—forced to pay Daenerys a fortune.
NBC was impatient. Robert Iger, by contrast, grew more cautious. In his entire career he had never overseen two consecutive phenomenal hits. After breakfast with Robert Wright, he boarded the first flight west.
The final terms would have to be decided by Simon himself, now on his way back from Australia.
Following an urgent internal meeting, Robert Wright also headed for Los Angeles.
Thanks to the eighteen-hour time difference, Simon's plane left Melbourne at 10:00 a.m. on September 14 and, after a sixteen-hour flight, touched down in Los Angeles at 8:00 a.m. on the same calendar day.
Wright did not want to appear overly desperate, yet he still joined several Daenerys executives at LAX to greet the arriving party in person.
Simon had intended to return to Malibu and rest for the morning, but with everyone assembled, he changed plans. He sent Janet home ahead of him and traveled with Amy, Iger, Wright, and the others to Daenerys Entertainment's headquarters in Santa Monica.
In the conference room, once everyone was seated, Robert Wright wasted no time.
"Simon, I spoke with our parent company yesterday. NBC would like to secure the next three seasons of Survivor in a single contract. We're prepared to match the two million dollars per episode we pay for Millionaire."
Simon accepted a cup of hot coffee Jennifer handed him from behind, took a sip, and straightened. "Bob, Survivor's numbers are stronger than Millionaire's. Do you really think the same rate is fair?"
"This is only the first season," Wright replied, shaking his head. "No one can guarantee a reality show will hold this level of popularity across multiple seasons. Typical rating curves trend downward after the premiere. At two million, we're still taking on considerable risk."
Simon noticed Iger open his mouth as though to object, then hesitate. Simon gave him an encouraging nod.
Iger spoke up. "Bob, hit series usually follow a parabolic curve over the long term, not the decline you're describing. As word of mouth builds, future seasons of Survivor could rate even higher."
Wright had momentarily forgotten Iger's background, but he showed little embarrassment at being contradicted. "Simon, two million per episode is already an extremely generous multiple of Daenerys's production costs."
"In Hollywood," Simon countered, "cost and return are rarely proportional. Two million simply will not do."
"If the price goes higher, NBC cannot absorb the risk," Wright said. "We're not like ABC or the others. NBC has been performing strongly these past few years. Losing Survivor would not cripple us."
Simon smiled. "Bob, if you insist on treating me like an amateur, we might as well end this meeting now."
Competition among the Big Four networks was brutal. Standing still was the same as moving backward.
NBC might currently lead the pack, but without Survivor, ABC—riding the explosive popularity of Millionaire—could surge past them and claim the top spot in short order. NBC could not afford to let the show go.
Wright exhaled, a helpless expression crossing his face. "Very well. What number do you have in mind?"
"For future seasons Daenerys can extend the episode count to around fifteen. If NBC wants all three seasons locked in now, I can offer a package: fifty million per season, one hundred fifty million total."
Wright blurted, "That's impossible."
He wasn't exaggerating. NBC understood that Daenerys had spent roughly five million producing the first season. Fifty million per season after retaining domestic ad-insert rights, syndication, and international format sales would yield the studio profits exceeding ten times their investment. Pure robbery.
"Let's run the math," Simon said, easing his tone. "Based on the premiere, future seasons could peak at an average of thirty million viewers an awards-show level. The Grammys this year drew about that, with thirty-second spots selling for three hundred thousand dollars. Fifteen minutes of commercial time per episode would bring NBC nine million in ad revenue alone. Daenerys would take home just over three million by comparison."
"Have you factored in operating costs?" Wright countered. "Running a network is extremely expensive."
Simon cut him off. "Bob, if we're talking costs, Hollywood's are higher still. Over decades the major studios have reported almost nothing but losses on their films."
Amy and Iger both let out quiet laughs.
It was a standing industry joke and essentially true. To minimize taxes and union payouts, most studio films were structured to show losses on paper, even when they made money.
Network accounting was, if anything, even more opaque.
Wright's point about high costs was valid, but Simon also knew that in the previous fiscal year NBC had posted net profits exceeding $380 million far ahead of its rivals.
Securing Survivor would cost dearly, yet it would cement NBC's lead and keep ABC, CBS, and FOX at bay. Losing it could see ABC overtake them by the end of the fall season alone. Advertisers favored the market leader; once displaced, catching up became exponentially harder.
Wright tried a few more angles, but Simon held firm. Eventually Wright asked for a pause to make a call.
Simon knew he needed to consult Jack Welch, chairman of parent company General Electric. He had Jennifer escort Wright to a private office nearby.
GE was still far from its internet-bubble peak a decade later. Recovering from the previous year's market crash, its market cap hovered below fifty billion. The acquisition of NBC's parent company, RCA, two years earlier had cost $6.5 billion more than a tenth of GE's current value and NBC remained a direct-report division to Welch himself.
Simon spent the ten-minute break chatting quietly with Amy and Iger about recent company matters. When Wright returned, his demeanor had shifted.
"Simon, I just spoke with Jack. We can accept fifty million per season—provided Daenerys agrees to several conditions."
Simon gestured for him to continue.
"First, Daenerys must substantially increase production spending. We all saw rough edges in season one—clearly the result of cost-cutting. At this price level we expect higher polish. Future seasons must carry a minimum production budget of ten million dollars each."
Even without the demand, Daenerys planned to raise quality to sustain audience interest. Simon controlled costs but never at the expense of the product itself.
"That's entirely reasonable," he said. "Agreed."
Wright went on. "Second, each future season must contain at least sixteen episodes, not fifteen. And Daenerys must allow NBC personnel to participate in production."
Sixteen episodes instead of fifteen would bring NBC's effective per-episode cost down to roughly $3.125 million. Simon glanced at Amy and Iger; neither objected.
"Acceptable," Simon said.