A tale of two Simons

Last weekend was an especially busy one for Simon Cowell. The talent show judge with the razor-sharp put downs, V-neck sweaters and high-waisted trousers capped weeks of wall-to-wall newspaper coverage of his ITV show The X Factor by taking on the UK Border Agency. “Simon: My fight for Gamu” screamed the front page of last Saturday’s Sun. The story told of Cowell’s attempt to stop former X Factor contestant Gamu Nhengu being deported to Zimbabwe. That evening as many as 13.5 million viewers sat glued to the live X Factor finals, ready to discuss in minute detail the two evictions and the perennial “style feud” between judges Cheryl Cole and Dannii Minogue.

To say The X Factor dominates the national conversation would be an understatement: like it or loathe it, the show is the national conversation. It has turned Cowell into a kind of reality TV superman who lives in an orbit of media stardom somewhere between David Beckham and the Queen. His views are in such demand that the Conservative-backing Sun ran a front page interview with him days before the general election in which he laid out his support for David Cameron.

Normally at this time of year Cowell would be shuttling between London and Los Angeles, wrapping up The X Factor in the UK and preparing for his role as a judge on the next series of American Idol, the show that made him a star in the US. But not this year. Following a split from his on-off friend Simon Fuller – the man who created Idol and the brains behind the Spice Girls – Cowell is going it alone. Next year, he launches X Factor in the US, where it will compete directly for advertisers and sponsors with Fuller’s Idol – the biggest programme on American television for the past eight years.

Taking X Factor to the US will stoke a simmering rivalry between the two Simons. Idol has made them both fabulously wealthy. With a fortune according to The Sunday Times Rich List of £165m, Cowell is the world’s best-paid TV star after Oprah Winfrey, while Fuller sold his company, 19 Entertainment, a few years ago, for £100m and made millions more producing Idol. He is worth £350m.

But despite the two men’s riches, they remain fiercely competitive with each other. “Their relationship is the weirdest I’ve ever seen in this business,” says a senior TV executive who worked closely with the two on Idol. “They’ve known each other for 20-plus years and there will be periods of time when they will be close and confiding in each other. But three weeks later they will be trying to kill each other. And then, after that, they will suddenly be back together again.” This time, though, the split looks definitive. Each man refuses to talk about the other. Indeed they rarely talk at all: turning down interview requests from publications including the FT. The secrecy that surrounds their relationship, I discovered, after spending weeks talking to friends and colleagues, shrouds a complex web of connections, rivalries and alliances.

It’s a relationship that will be put to the test when The X Factor comes to America next autumn. Cowell’s US push – along with the start of a new Idol series in January – is likely to redefine the US television landscape, shaking a hierarchy that has existed unchallenged since 2002. Some of the biggest media companies in the world have come to depend on Cowell and Fuller, with News Corp, Sony and Universal Music Group among those jockeying for position. The question is: which Simon will come out on top?

They may be best known for their television work but both Fuller and Cowell got their start in the music business. Fuller grew up with dreams of forming a band but soon realised his skills lay off rather than on the stage. He spent the late 1970s as a concert promoter in Hastings before becoming a music manager. His first number one came in 1985 with Paul Hardcastle’s anti-Vietnam war classic “19”. But Fuller became a real music force in 1995 when he began managing the Spice Girls. Victoria Beckham said at the time she wanted “to be more famous than Persil Automatic.” Fuller saw to it that her dreams came true, turning the Spice Girls into pop’s biggest global act.

Cowell has a similar pop pedigree. While working for Sony BMG (now known as Sony Music) he oversaw the careers of boy bands such as Westlife and Five but also created novelty hits spun out of television programmes such as Power Rangers and Soldier Soldier stars Robson & Jerome. “I was never snobby about the music business, unlike 90 per cent of the people who work in it,” he told me in a 2007 interview.

As media moguls go, they are an unlikely couple. Fuller, 50, has spiky hair and a boyish face, and despite his Hollywood clout is shy and quiet. Cowell, meanwhile, has embraced the Los Angeles lifestyle. At 51, he may continue to smoke menthol cigarettes, but he has a buff physique, a permanent tan and recently claimed he thinks Botox treatments as normal as “cleaning my teeth”.

The two men had known each other several years when, in 2001, Fuller sought Cowell out to be a judge on Pop Idol, the British precursor to American Idol. “I felt I could probably do a better job judging than anyone else,” a characteristically modest Cowell told me three years ago. “Because I knew more about pop music than anyone else.”

On the surface, they do not have much in common. Fuller, a Manchester United fan, shuns the limelight while Cowell is brash, confident and excels in front of the camera – particularly when he is ripping a useless contestant to shreds. He copes with the pressures of fame in his own way: the waiters at his lavish 50th birthday party last year all wore Simon Cowell masks.

And yet despite their differences – or because of them – their relationship has served them well. Albums released by Idol alumni such as Carrie Underwood and Chris Daughtry have, in good years, made up a large chunk of Sony Music’s annual sales. Susan Boyle shot to fame when she appeared on Cowell’s Britain’s Got Talent show: her debut album broke records for sales by a solo female artist.

The philosophy behind the Fuller and Cowell shows is simple: Idol, X Factor and the others pull in viewers of all ages, the aspiring singers get to perform in front of the biggest audience on television, and the winning stars sign to labels affiliated with Cowell and Fuller – thus creating an endless stream of cash and chart-topping success.

But behind the scenes the two men have often been at each other’s throats. Five years ago they were embroiled in a legal battle when Cowell launched The X Factor, which Fuller claimed was a blatant copy of his own Idol format. The case was later settled out of court with the pair effectively dividing the biggest broadcasting markets between them, preventing Cowell from launching X Factor in the US. Their work resumed – only to disintegrate when Cowell left Idol and the deal lapsed.

It was no surprise when Fox quickly moved to snap up X Factor. From next year the network will broadcast both shows with Idol running from January to May and X Factor from September to December. Rupert Murdoch, News Corp’s chairman, knows the value of Fuller and Cowell. Someone with knowledge of News Corp’s accounts told the FT that Idol contributes $200m-$300m to the company’s bottom line every year.

It also turned Fox into the leading network on US television. “Idol has really been transformative for Fox,” says Anthony DiClemente, a media analyst with Barclays Capital. While television advertising has been in decline since the advent of digital video recorders, Idol ad spots attract hefty premiums. “Fox was able to negotiate advertising rates of $700,000 for a 30-second spot for Idol,” he says. “These are numbers that you would previously have only associated with the Super Bowl.” Idol also re-introduced product placement to US television, with Coca-Cola paying an estimated $35m a year to have its logo prominently displayed on the show.

Fox’s deal with Cowell means the network could have the two biggest shows in the US next year. Yet it is unclear if Idol’s success can be sustained without Cowell: his frankness and candour when judging contestants was a huge hit with US audiences more used to cheesy, sycophantic TV hosts. Replacing him and maintaining ratings, which had already begun to decline in his final year as a judge, will be difficult, if not impossible.

The music industry has already realigned around the separation of Fuller and Cowell. Following Cowell’s exit, Fuller arranged a new distribution deal for Idol performers with Universal Music Group (UMG), the world’s biggest music company. Sony, and its chief executive, Sir Howard Stringer, meanwhile, have lined up squarely behind Cowell and will distribute albums released by singers discovered on the US and UK versions of The X Factor.

Lucian Grainge, the co-chief executive of UMG has found himself in the middle of the shifting Cowell-Fuller relationship. He is friends with both men: his London home is near Fuller’s and he has holidayed with Cowell and Sir Philip Green at Sandy Lane, the Barbados resort frequented by millionaires, media moguls and sports stars.

Still, when the opportunity came to strike a deal distributing Idol acts he did not hesitate. “Idol is something that has worked,” he says, adding that he is not alarmed by Cowell’s departure. “I wake up worried,” he admits, “that’s what drives me forward. But I’m not worried about [Cowell leaving]. We’re comfortable that we can do something different.” Certainly the show has an unrivalled record in moulding stars: since Idol first aired in 2002, its acts have gone on to sell more than 120m singles and albums.

But it is also because of an enhanced role for UMG. Jimmy Iovine, the chairman of Interscope-Geffen-A&M Records – a division of UMG – and the producer of albums by U2, Stevie Nicks and Patti Smith, will play a pivotal role “mentoring” finalists. “There will be more focus on the craft and beauty of the artist development, songs and arrangements,” claims Grainge. “We’re going to have a competition different to anything, anywhere.”

Whatever Fuller’s intentions, with Idol now entering its eighth year it was hardly a surprise that he moved to freshen things up by changing the format and bringing in new judges. Ratings for the most recent series had slipped and the series needs a lift.

But some in the Cowell camp question whether the changes will achieve the desired effect. “Idol will be wearing bell-bottoms next year,” says one, who is involved with the US version of X Factor. “It will feel so dated.” Cowell, he adds, “will never admit it but he buried Idol [by leaving]. It was a passive-aggressive thing: ‘I know what we need to do to make this better, but I’m not going to do it’.” The US version of X Factor, on the other hand, “will be totally fresh and totally new. And it will have Simon Cowell”.

Last year, Cowell tweaked the format of X Factor, allowing thousands of people to attend auditions (which had previously been held behind closed doors). The result was a surge in ratings: this year the programme has had its most successful start ever, averaging more than 11.4m viewers in the first 10 weeks – with some nights peaking at 16.2m, according to ITV.

For Idol, it may be that no amount of tinkering can halt the decline of a show that has topped the ratings for so long but has lost arguably its biggest star. “Last season was so boring,” says a senior media executive who worked closely with Fuller and Cowell on the programme. “It’s inevitable that some people are going to get sick of it … Cowell was the heart of it. His leaving will have a big impact.” The bigger question, adds a person close to the Cowell camp, is how Fox treats the two programmes. “They have more upside with X Factor than with Idol,” he argues. In other words, the network has less to gain from Fuller’s show.

Idol’s ratings success over the years strengthened the hand of Fuller and other producers when negotiating with the network for programming that went beyond that contractually agreed. This meant Fox often had to pay top dollar for additional hours. All that could change, though, thanks to X Factor – particularly if the show is a big hit. “The best thing that is going to happen to X Factor is that Idol negotiates for additional hours,” says the source. “The stronger X Factor is, the more negotiating leverage you have with Idol.” Fox, he says, “will make X Factor a priority and Idol will become something to fill out the schedule”.

Fox declined to comment on its plans for X Factor, or how it would allocate resources. But a source familiar with the production process pointed out that the company had put its money where its mouth is to get Hollywood actress and singer Jennifer Lopez and Aerosmith front man Steven Tyler on board as judges. “Fox is paying what it paid to Cowell,” the source said, pointing out that Cowell was one of the best paid stars on US television. “Why pay so much if they expected it to fail?”

But the new judges have big shoes to fill – and it is unclear if they will be as big a hit with viewers. “I don’t get the new judges,” says the media executive who worked with Cowell and Fuller on Idol. “In almost all of these shows, celebrity is not the dominant factor. What matters is how good they are in front of the camera … the idea that getting some has-beens in as judges will work is totally wrong.”

The source with ties to the new US version of X Factor agrees. “The new Idol line-up sucks. Steven Tyler was a huge star, but my kids don’t know who he is. And J-Lo can’t get arrested these days.” Publicly, Fox has been very enthusiastic about the new Idol series. But word is that behind the scenes Peter Rice, entertainment chairman of Fox Broadcasting, has cooled on the show. “He wasn’t as enthusiastic about it as he was when he first came into the job,” a TV executive told me.

Like Cowell and Fuller, Rice is British, but has spent most of his career working in the film business. He won the respect of Rupert Murdoch when he led Fox Searchlight to Oscar and commercial success with films such as Slumdog Millionaire, Juno and Little Miss Sunshine. He moved over to the Fox network at the beginning of last year, tasked with ensuring the broadcaster maintains its number one position. That means either Idol or X Factor – or, both – have to succeed. But keeping Cowell and Fuller happy and not favouring one over the other will be tricky. “Murdoch has given him mission impossible,” the television source said.

If the new incarnation of Idol doesn’t work, Fuller has plenty of other things to keep him busy. He no longer owns Idol and five years ago sold his company, 19 Entertainment, to media group CKX Inc. He recently negotiated a lucrative exit to start a new company, but will continue to work for CKX as a consultant on Idol and So You Think You Can Dance – pocketing 10 per cent of profits into the bargain. And as a result of the court settlement with Cowell, he also earns a fee from X Factor in the UK.

Fuller’s new entertainment company will focus on sport, music and television. He has already signed one new investor: Patrick McKenna, chief executive of London-based film group Ingenious Media, which struck gold last year when it invested in what turned out to be Fox’s $3bn blockbuster movie Avatar. A deal for a minority stake with US brokerage house Cantor Fitzgerald is also close to being agreed. Steve Kantor, the firm’s executive managing director and global head of investment banking, says Fuller compares with the biggest names in film and TV. “He doesn’t just create content, he creates brands. Idol is not just a TV show … it’s a brand. Steve Jobs created a brand, Jerry Bruckheimer [movie and TV producer] creates brands, David Geffen [movie and music producer] created brands … these guys are geniuses, and I would put Simon in the same category.”

Fuller is involved in a head-spinning a number of projects. Sanela Diana Jenkins, a former Bosnian refugee and the wife of Roger Jenkins, the ex-head of Barclays Capital, has enlisted his help with Neuro, her line of energy drinks (which include Neuro Gasm, a drink whose website claims is designed to “promote better sexual health”). Fuller is also a partner in Victoria Beckham’s new fashion line. And after masterminding her husband David’s transfer from Real Madrid to the Los Angeles Galaxy, the two men are now working on a Beckham-branded male underwear range, likely to launch next year.

On top of that, 15 years after he formed the Spice Girls, Fuller is about to give the group a second life after striking a deal with Judy Craymer, the producer behind Mamma Mia!, the biggest theatrical smash of the past decade. The musical, titled Viva Forever will open in 2012. “Mamma Mia! turned musical theatre into something lighter,” says Craymer. “Audiences needed something more entertaining … and with his shows Simon has been ahead of the curve too.”

Fuller has the Beckhams, Cantor Fitzgerald and Patrick McKenna in his corner; Cowell has Sir Philip Green. Over the years, the retail billionaire behind Topshop has become one of Cowell’s most trusted confidants. Last year their friendship became a formal business arrangement when Green began advising Cowell on negotiations with Fox, Sony and ITV. This culminated in the two men forming a company with Sony which will hold the rights to all of Cowell’s TV shows, including the US version of X Factor.

Like Cowell, Sir Philip declined to comment. However, executives working with the two men said Sir Philip’s no-nonsense north London style had rattled a few egos in the rarefied offices of Hollywood studio executives. “He’s a piece of work,” says one Hollywood executive who met Sir Philip. “He’s a schmatta guy, but he talked to us as though we didn’t know what we’re doing.” Still, the ambition Sir Philip has for his venture with Cowell has impressed those who have heard his plans. “He told me he wasn’t going to go out there and build a company if it was only going to be worth $500m.”

This weekend, Sir Philip, like most other people in Britain, will probably be watching Cowell pulling the strings on X Factor. Also closely monitoring the show’s performance will be Rupert Murdoch who, perhaps more than anyone else, has an interest in it succeeding when it airs in the US next year on Fox.

Murdoch, like many others in the media industry, has done very well out of his association with the two Simons, two middle-aged Englishmen who share an uncanny ability to market and sell commercial pop music. Those pop sensibilities have taken them both a long way. Which one will go furthest is up for grabs.

Matthew Garrahan is the FT’s Los Angeles correspondent

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