Warner Bros. Launching TV Unit to Produce Lower-Cost Programs

In a nod to the changing TV economics, Warner Bros. Television said Wednesday that it was launching a new label that would produce lower-cost shows and expand the duties of its longtime president.

The move consolidates responsibility for all of Warner’s prime-time programming under Peter Roth, president of Warner Bros. Television for the last seven years.

Separately, Warner signed Roth to a new five-year contract, keeping him entrenched at the prolific TV production studio, which boasts such hits as “Two and a Half Men,” “Without a Trace” and “Smallville.” Financial terms of Roth’s deal were not disclosed.

Roth, 55, also will run the company’s new production arm, Warner Horizon Television. The label is intended to make shows that cost less than what has become the norm in Hollywood: about $2 million for an hourlong episode. Since that price tag is beyond the budgets of most cable channels, Warner Horizon will develop lower-cost scripted shows as well as reality shows.

The formation of Warner Horizon represents a shift in the Burbank studio’s strategy.

In the past, Warner Bros. Television has aimed at developing big-budget scripted fare, such as “The West Wing,” “Friends” and “ER,” for the major broadcast networks. Swinging for the fences was hugely profitable. “Friends,” for example, turned into a juggernaut worth nearly $2 billion throughout its network and syndication runs.

These days, home runs are harder to hit. The Big Four broadcast networks -- ABC, CBS, Fox and NBC -- have relied more heavily on their in-house production studios to try to capture more of the profits. What’s more, in September, Warner Bros. will shut down its struggling WB network -- leaving fewer slots on prime-time broadcast networks to fill.

Enter Warner Horizon.

“The cable networks have expressed a great hunger for original programming,” Roth said.

He said his studio unexpectedly found a niche when it made “Nip/Tuck” for the FX cable channel. The creator wanted to develop “Nip/Tuck” for cable so the show could be provocative without dealing with the decency rules imposed on broadcasters. So Roth found a way to make the show within a smaller budget.

“ ‘Nip/Tuck’ was an anomaly that became the strategy,” Roth said. He added that his studio followed that with “The Closer” for cable channel TNT, a sister company to Warner Bros.

Roth also will expand into a new genre for him: developing prime-time reality shows.

“It made sense to consolidate all of those areas, and under Peter we will be able to magnify our success,” said his boss, Bruce Rosenblum, president of Warner Bros. Television Group.