Fixing HBO

September 21 was a great night for the Federalist party. HBO’s epic miniseries John Adams swept the Emmy awards, taking home a total of 13 trophies. Unfortunately for HBO, the approval ratings for its show about the second president of the United States have not carried over to the rest of the network. Renowned as the creative nest of hits like The Sopranos and Sex and the City, the cable network is in a funk. Vampire drama True Blood debuted on Sept. 7 to a paltry 1.4 million viewers; ratings for the premiere of Entourage declined 27 percent from the year before, to just 1.6 million viewers; and series like In Treatment and Flight of the Conchords charmed the critics but won tiny audiences. In the last year, HBO’s subscriber base grew by a mere 0.1 percent to 29 million, while rival Showtime posted gains of nearly 10 percent, from 14.4 million to 15.8 million. And expectations are low for upcoming shows like The Life & Times of Tim and Little Britain USA (both debuting Sept. 28).

”They are facing challenges, and not finding an easy way out,” says Harold Vogel, a veteran media analyst. ”It takes a long time to develop new and exciting programming. They have a high bar to match with The Sopranos and Sex and the City, and it doesn’t seem likely they will be able to exceed the ratings and popularity of those shows any time soon.”

Historically, HBO (which is, like EW parent Time Inc., owned by Time Warner) has typically developed just three to four series a year. That seemed like a fine strategy — until those series turned into high-profile clunkers like David Milch’s incomprehensible John From Cincinnati and Louis C.K.’s painful ”comedy” Lucky Louie. Throw in a very public shake-up in the executive ranks (CEO Chris Albrecht left in 2007 after he was arrested for assaulting his girlfriend; entertainment president Carolyn Strauss stepped down 10 months later), and HBO clearly needs a makeover — as even its own execs admit. ”A lot of our [most successful] shows have matured or gone off the air,” says Michael Lombardo, who together with the network’s former PR chief Richard Plepler took over programming after Albrecht’s departure. ”We need to increase the number of shows we take chances on. We need to build a new lineup for a whole new generation.”

That job falls to Sue Naegle, 39, who was appointed entertainment president in April. The pick was widely seen as risky, given that the well-respected former talent agent has zero experience running a network. But Naegle has built her impressive career around finding exactly what HBO needs: fresh and exciting writing talent. Married to ex-Simpsons scribe Dana Gould, Naegle used to rep clients like Jenny Bicks (SATC), Pam Brady (South Park), Charlie Kaufman (Eternal Sunshine of the Spotless Mind), and Alan Ball, creator of Six Feet Under and True Blood (which was developed by Strauss). Naegle’s challenge is simple: Make HBO special again. ”We want writers who can deliver us an interesting take on a new world,” she says.

Naegle’s off to a quick start. In just a few months, she bought six projects, including the comedy Hung from Dmitry Lipkin (The Riches), about a well-endowed high school basketball coach (Thomas Jane); the comedy Bored to Death from novelist Jonathan Ames, about a depressed alcoholic (Jason Schwartzman) who emulates his favorite heroes from Raymond Chandler and Dashiell Hammett novels; a post-Katrina drama called Tremé from David Simon (The Wire); and a period drama about Atlantic City titled Boardwalk Empire that’s exec-produced by Martin Scorsese. Naegle’s also not above pandering to the old Sex crowd: She picked up a comedy from Sarah Jessica Parker called Washingtonienne, about young women dating and working in Washington, D.C., as well as a new comedy dubbed How to Make It in America from Mark Wahlberg’s production company, about three twentysomethings who hustle their way through New York City. In all, HBO has 10 pilots in various stages of development right now — far more than it’s ever had at any one time.

Naegle has also revamped the old slate. She quickly halted production on a second season of Tell Me You Love Me, a downer (if risqué drama about three couples in various stages of their relationships. She has, however, signed on for a second season of Blood, whose ratings in week two jumped 24 percent — although it still didn’t perform as well that night as AMC’s Emmy fave Mad Men, a show HBO famously passed on. So she’s counting on Blood, Big Love, Conchords, Entourage, and In Treatment to see her through till at least mid-2009, which is when some of her new projects will likely start to air. (Because of Larry David’s film schedule, Curb Your Enthusiasm isn’t expected to return until late next year.) ”The one thing I’ve always loved about HBO is that they take their time to get it right,” she says. ”That’s the blessing in this situation.”

In fact, Naegle is under less pressure to turn things around quickly than that other agent-turned-network programmer, NBC’s Ben Silverman. ”If we were selling commercials per minute, we’d have different issues and challenges,” says Plepler, who points to the many viewers tuning in via DVRs and On Demand. ”Over 60 percent of our audience is not watching on premiere night. If you’re selling subscriptions, you just want people to enjoy your product when they want to.”

Sounds fine, but it’s Naegle who really understands the challenge. ”The line is more fine between what distinguishes an HBO show from an FX, Showtime, or even an AMC drama,” she confesses. ”I would like to get back to the point where we are more distinctive again.” Until she does, the network slogan, ”It’s not TV, it’s HBO,” may well ring hollow.

HBO Ratings

2002

The Sopranos
11 million Viewers*

Sex and the City
7 million Viewers

Six Feet Under
5.6 million Viewers

2007-2008

True Blood
1.7 million Viewers

Flight of the Conchords
976,000 Viewers

In Treatment
278,000 Viewers

*ALL FIGURES REPRESENT SEASON AVERAGES FOR FIRST-RUN BROADCASTS. SOURCE: NIELSEN.