A week ago, it looked like AMC and Mad Men creator Matthew Weiner had finally reached a deal for a fifth season of the show. Today, multiple media outlets are reporting that the talks have fallen apart, and AMC is poised to cancel the show if Weiner doesn't agree to cut costs and explore ways to make the show more profitable.
The Daily's Richard Johnson writes that AMC's proposed "revenue enhancers" include cutting three minutes from every episode (this would allow the network to sell six more commercial spots) and firing two cast members. Deadline's Mike Fleming and Nellie Andreeva say the network is only asking Weiner to trim two minutes, and that they're demanding he "integrate product placement into the series."
Update: Deadline is reporting that AMC has exercised its option on the fifth season and is moving ahead with production, despite not having a deal in place with Weiner. The network used the same tacticd during the last round of negotiations, announcing plans for a third season in October 2008, even though Weiner and production company Lionsgate were locked in a contract standoff. The two sides reached an agreement in January, but not before reports surfaced the network was targeting Aaron Sorkin as Weiner's replacement.
Both negotiations underline AMC's struggles to make money off of the critical favorite. Ad Age noted last year that the show generated a meager "$1.98 million in ad revenue in 2009...In 2008, the show nabbed just less than $2.8 million, and in 2007, approximately $2.25 million...paltry amounts when one considers that a 30-second ad in an equally buzzy program such as 24 on Fox cost between $200,000 and $280,000 as the show, off its peak, headed into its final season." As the show's ad revenue has decreased, the licensing fees from Lionsgate have increased, rising to nearly $2 million an episode for season four, according to Variety. Each episode of the show, meanwhile, has an average budget of $2.8 million.
AMC previously attempted to increase the show's profitability by adding an extra two minutes of commercials in season three, a decision that displeased Weiner, ultimately resulting in a compromise where the commercials were added but none of the show's content was cut, bringing the running time up to 62 minutes.