Networks still wooing Letterman

And the battle for Letterman “custody” continues.

While CBS attempts to retain Late Show host David Letterman–who has been with the company since 1993–ABC is fighting hard to procure the comedian.

Salary, however, is one ball CBS has in its court…so far.

The Associated Press reports that as of Wednesday, talks have been heating up. CBS is said to have offered Letterman $31.5 million a year, in addition to various bonuses and salary increases in future years. ABC has offered only $31 million to date.

Production costs, on the other hand, are something both networks are willing to negotiate.

While CBS currently gives Late Show “substantial licensing fees” and refurbished the Ed Sullivan Theater for the show, ABC would be willing to cover the entire production cost–roughly $40 million a year–and give Letterman his own studio in the network’s Times Square complex in New York.

Network programming is another issue.

Reuters reports ABC is trying to lure Letterman with its more “synergistic” potential in shows like Monday Night Football and The Academy Awards, but CBS says it has a bigger empire with MTV and Nickelodeon both part of its parent group, Viacom.

Letterman, who has been unhappy with the older primetime crowd that CBS draws, has also been concerned about going to ABC if his show would push Ted Koppel‘s news program Nightline from its current late-night spot.