Fraiser case


2/9

BATNA

NBC To find another comedy that could provide a comparably sized audience To take in Dharma & Greg show from ABC Continue with Fraiser and use it as a tent pole

Paramount ABC if it was interested in the show and it gave more amount then NBC CBS takes the show

Its transaction of internal dollars It gets on CBS and becomes a tent pole Getting Fraiser would help CBSs political cause


3/9

Parties

The parties in the Frasier negotiation are the National BroadcastingCompany (NBC) and Paramount, the owner of the show.

While the National Broadcasting Company (NBC) wants to pay under $5million in order to make a profit on the show, Paramount seemed to bedemanding $ 6 million per episode. Paramount came down to $5.5 million

later


4/9

Interests

5% less than the current price i.e.$4.75 million per episode

Did not want to see Frasier go toanother network

Sustaining leadership in prime time

Owing to lack of new programmingsuccess, it is vital to hold Frasier

Wanted a short pickup

20% more than the current price i.e.$6 million per episode

3 year extension to the contract

Demanded the Thursday slot

Promoting Frasier as the #1comedy on television

Better recognition


5/9

Value

How can value be created? In this scenario, Fraiser is an important show that should be retained

by NBC. Also, the possibility of a bid war should be eliminated as that will be

detrimental for both the network and the studio.

As seen here, there is no ZOPA as of now which needs to be createdif a negotiation has to happen.

8 mn

5 mn


6/9

Barriers

A failed deal would lead to a bidding war in which all networks vied for each others programs Paramount could put their show immediately on CBS in case the deal with NBC fai led.

Institutional

GAP present in the price quoted by the two parties

Even after creative restructuring of the deal and parties giving up few things which were easier to give away,a $500,000 price GAP existed

Strategic

Paramount ready to go to another network in case the NBC deal fails. NBC was not sure if they should testthis.

Kelsey Grammer wanted to match the record for longest-running TV character James Arness, thus wanted a3year pick up period, which was not acceptable by NBC (This issue was taken up before the negotiationprocess begin)

Psychological


7/9

Power

Strength and weakness of BATNA as a measure of Bargaining Power

Selecting appropriate person to bargain with

Setting deadlines to make the communication effective like 1 st march being deadline.

Trying to worsen the consequence to get a winning bargain.

Knowledge and skill of the persons involved.


8/9

Ethics

NBC

Pro-Ethics

Willing to bid for Frasier at loss toavoid a potential bidding war

which could hurt the industry

Paramount

Pro-Ethics

Assurance that the showfor the sake of it during 3

Non-Ethical

Using the press to give bad publicityabout show

Non-Ethical

Bluffing that ABC was inshow to raise the stakes

Open to violation agreement with NBC

contact with CBS


9/9

Thank You

Documents

Fraiser case