The decision to axe Paul Holmes' show on Prime was made jointly by Holmes and the channel's chief executive and head of programming.
Holmes - believed to be on a three-year contract worth up to $1 million a year - will stay at Prime but his show finally succumbed to the battle to attract viewers last night, six months and one day after it began on February 7.
Ratings have slumped as low as 16,100 viewers on some nights and the average nightly audience has gone from an opening night high of about 150,000 to just over 40,000 in May to about 27,000 in the most recent 6pm slot.
The axe fell despite claims as recently as last month from Prime's chief executive, Chris Taylor, that he was committed to sticking with the show for the long term.
In June, Prime moved the show to 6pm, citing competitive pressure in the previous 7pm slot and the need to have its news show as a lead-in.
Paul Holmes was taken on by Prime in an effort to bolster its audience share - currently at 6 per cent - and help reverse the network's losses, totalling $66 million.
But Holmes' demise proves commentators were right in saying Prime could not succeed against TV One's well-established Close Up and TV3's Campbell Live.
Yesterday Mr Taylor said the decision to end Holmes was agreed on unanimously by himself, Prime's head of programming, Andrew Shaw, and Paul Holmes.
"There's a lot that goes into making a decision like this. We unanimously decided it was just proving too difficult to change the habits of viewers," he said.
He had no regrets about signing up Paul Holmes last December.
"It's a game of taking chances and we took a chance with this - an educated one. It was successful in generating advertising revenue for the whole station. So we have definitely benefited from it.
"We are disappointed we couldn't make more of an impact at either 7pm or 6pm. But not for one second have I any regrets about the programme or about bringing Paul over. He's done a lot for this network and will continue to do so."
He said Holmes would begin work on a new hour-long current affairs show, which would screen once a week, and other one-off specials, such as election debates.
News of the show's demise attracted mixed responses from those who had predicted its end.
TVNZ chief executive Ian Fraser said the show had had a "fair innings" in which to prove itself.
"But failure hurts and I don't really see there's any real profit in putting the boot in at this point."
TVNZ head of news Bill Ralston has previously termed Holmes' defection to Prime a "suicide mission".
He later said if he were Mr Taylor, "I'd be pouring petrol over myself and throwing myself off Auckland's tallest building."
Yesterday he said he did not want to sound "too cock-a-hoop" but it would be a wake-up call for Prime.
"It is highly competitive with three current affairs shows. I always thought this would eventually be the result and that TV3's Campbell Live was a tougher proposition for us. One down, one to go."
TV3 head of news and current affairs Mark Jennings said he hoped to welcome Holmes' audience to TV3.
"I thought Prime would keep it until the end of the year, but I'm not really surprised because no programme can sustain that level of ratings and survive in commercial television."
Christchurch Broadcasting School head Paul Norris said it was a gamble and a risk that had not paid off.
The Prime News audience, usually between 100,000 and 150,000, had not stayed on to watch Holmes.
Michael Carney, of media agency Mediacom, said: "I'm impressed Prime have seen the wisdom in removing the dead horse rather than simply flogging it. It's not that there's anything wrong with either Prime or Paul Holmes."
Mr Taylor said Holmes was "naturally disappointed".
"But this isn't a decision which has been thrust upon him. This is a decision he's been a part of."
Mr Taylor said Prime would try to reabsorb as many staff as possible from the Holmes team of about 15 staff into Holmes' new weekly show or Prime's news, but he could not rule out redundancies.
He said Pip Keane - who left her job as executive producer of the TVNZ Holmes show to follow the broadcaster to Prime - would stay on and Alison Mau would continue to front documentaries and would host a new NZ on Air-funded show, Top 100 History Makers, due to screen in October.
The fate of other staff, including reporters and producers, would be decided this week.
Holmes backs decision to axe his show
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