Seth MacFarlane’s $2 Billion Family Guy Empire

By: Josh DeanMon Oct 13, 2008 at 5:45 PM

photograph by Jill Greenberg

Family Guy creator Seth MacFarlane nabbed a record $100 million deal with Fox and is teaching Google new ways to exploit the Web. Could this crude frat-boy cartoonist really be a model for business in the postmodern age?

Enlarge

Photo by Jill Greenberg | Clothing: Boss by Hugo Boss (henley), Joe's Jeans (pants), Jockey (T-shirt)

Enlarge

Photo by Jill Greenberg

Related Content

Fox brought the show back in a big way, ordering 35 episodes (22 is typical) and handing over the Sunday-at-9 slot, where it boomed. The 100th episode aired in November of 2007, pushing the show into syndication. Though schedules vary, Family Guy airs up to 27 times a week in a single market, with reruns on Fox, TBS, the Cartoon Network, and in 20 major markets on channels owned by Tribune Broadcasting.

"Animation is something that, if it works, it's more profitable for a studio than any other show," MacFarlane says. People don't buy Everybody Loves Raymond T-shirts, but they do buy shirts bearing the devious visage of Stewie, as well as action figures, stickers, posters, and video games. Increasingly, they also buy song clips and ring tones. And Fox, which owns the show, also owns the intellectual property (but kicks a percentage of sales back to MacFarlane). Reports have valued the Family Guy franchise at as much as $1 billion. Though neither Fox nor MacFarlane's team would confirm that number, a little back-of-the-envelope math indicates that it is overly conservative. At a reported $2 million per episode, Family Guy has garnered at least $400 million up front from syndication. DVD sales have totaled almost another $400 million, while 80 licensees have contributed at least $200 million from sales of various clothing and baubles, actual and digital. Fox's ad revenue off Family Guy can be estimated at at least $500 million over the years. "Suffice it to say, with it being a studio-owned show, and being on the Fox network, it's of substantial value," Newman told me. And none of this figures in revenue from MacFarlane's other hit product, American Dad.

Team MacFarlane, of course, also recognized the value of what MacFarlane has brought to the network. By the time negotiations on a new contract began more than two years ago, the challenge for both sides was how to put a number on MacFarlane's worth, considering that he isn't just a writer-producer but also an animator and actor. MacFarlane's team felt the need to let his contract expire, "to have him on the open market," explains one of his representatives. For more than two years, MacFarlane worked on Family Guy in good faith, without a contract. "There were a couple days when I was 'sick,' " MacFarlane says. "At times, that helps bring the negotiations back when they're stalled."

When the writers strike broke out last year, he sided with the guild and walked off the set. Fox decided to go forward and edit episodes without MacFarlane's participation -- they did own them, after all. MacFarlane called it a "colossal dick move." When asked about it now, he says it's a sore that's been salved ($100 million has a way of doing that). "They gave us money to go back and edit the shows the way we wanted, and we made nice."

One Fox-inflicted bruise that has yet to fade involves shots taken at Family Guy by The Simpsons, a show that MacFarlane says he admires greatly. Most famously, in an episode called "Treehouse of Horror," Homer creates a sea of clones even dumber and more dim-witted than himself. One of these is Family Guy's Peter Griffin. MacFarlane decided to return fire. He wrote a joke in which Peter's perverted friend Quagmire attacks and molests Marge Simpson. Fox, he says, nixed the idea. "They said, 'We want the feuds to end.' I thought it was very conspicuous that this came about only when we decided to hit them back."

What did he do? He left it in anyway, and delivered the edit to Fox, which then edited it out. "It's still a sore point," MacFarlane says. "It's still this wound that has never quite healed that says, 'We don't value you quite as much,' which I can't imagine is true, but ..." The thought trails off and, perhaps realizing that it's best not to follow this logic, he turns a corner. "To be fair to Fox -- for the most part, creatively they have been a very easy company to work with. This was kind of a rare lapse in judgment."

*****

MacFarlane's contract hiatus didn't just buy him leverage with Fox; it was an expansion opportunity. While the studio was noodling on the deal, MacFarlane's management team went out and signed him up with Google. The resulting "Cavalcade of Cartoon Comedy" is outside the bounds of the Fox relationship. "In a completely perfect world," Dana Walden, chairman of 20th Century Fox Television, has said, "he wouldn't be able to do that."

He did. The idea stemmed from conversations between MacFarlane's lawyer and agent and representatives of Media Rights Capital, an L.A.-based multimedia financier. Loosely tied to the talent agency Endeavor (which reps MacFarlane, naturally), MRC partners with content creators -- whether that's director Alejandro González Iñárritu on Babel; or Sacha Baron Cohen on his next film, Bruno; or MacFarlane -- giving them funding and a share in ownership, plus creative control.