Hollywood’s major studios were confronted with a classic grow-or-die proposition when it came to the television production business in the early 1990s. Congress, the FCC and federal courts had been prodded through years of lobbying by the Big Three networks into phasing out the 20-year-old regulations that kept ABC, CBS and NBC out of the production, distribution and first-run syndication arenas.

By then, the "fin-syn" rules were a vestige of a bygone era, when ABC, CBS and NBC were practically the only game in town and the rules were adopted by the FCC as a check on their power in the overall television marketplace. Fin-syn ensured that the Big Three networks would have to turn to the major studios and more than a few independent production companies to supply the bulk of their primetime programming.

Today, a decade after the rules were rescinded, the most vibrant symbols of the post-fin-syn era are the studio-backed broadcast networks UPN and the WB Network, both of which are set to mark their 10th on-air anniversaries this month.

"Certainly with the entry of the Fox network, the substantial rise in the number of program producers, the dramatic increase in cable television stations and the development in the sophistication of VCRs, the competitive climate today would unfairly penalize NBC, ABC and CBS in the financing and syndication of off-network programming," Los Angeles U.S. Circuit Court Judge Manuel Real wrote in a pivotal November 1993 ruling that hastened fin-syn’s demise.

Bob Daly, who headed Warner Bros. from 1980-99, spent nearly as much time during those years representing Hollywood’s majors in the fight to maintain fin-syn restrictions as co-chairman (with the MPAA’s Jack Valenti) of a committee tasked with negotiating a compromise agreement with the Big Three as a means of avoiding government intervention in the matter. With the candor of hindsight, Daly admits his true goal was not to cut any kind of deal but to drag out the fight as long as possible.

"We knew that once (the repeal) finally came, the world would change," he says. "The networks and the studios would eventually get together, and the networks would produce a lot more of their own programming."

So Warner Bros. decided to fight fire with fire — and across town, Paramount executives were thinking the same thing. In fall 1993, the two majors set out on a race to line up affiliates, lure creative talent and, most importantly, persuade the American viewing public — or at least the arbiters of pop culture — that they were worth checking out.

"We decided it was a strategic imperative for us," says Kerry McCluggage, the former chairman of Paramount Television Group who spearheaded development of UPN for the studio. "The broadcast network was to be our big strategic asset as we faced the future of production in a post fin-syn world."

It was fortuitous that at the time Warner Bros. and Paramount got serious about launching networks, there happened to be two strong independent station groups with VHF outlets in crucial top markets such as New York and Los Angeles that were available to serve as those networks’ distribution backbone.

Like other indies that loaded up on movies, sitcom reruns and syndicated series, Tribune Broadcasting and Chris-Craft Television were open to the idea of aligning with a startup network after watching how the advent of Fox in 1986 had vastly improved the fortunes of dozens of once-puny UHF stations nationwide.

Warner Bros. already was in business with Chris-Craft and other indies on an ad-hoc programming venture called the Primetime Entertainment Network (PTEN) that aimed to bring uniformity to the scheduling and marketing of Warner Bros.’ first-run syndicated dramas. Paramount also had enjoyed huge success with such first-run dramas as "Star Trek: The Next Generation" and "Star Trek: Deep Space Nine."

PTEN and the station lineup that Paramount had in its "Star Trek" stable were a far cry from an bona fide network, but they did offer evidence that there were plenty of indie stations yearning for better programming options during primetime.

In the end, Warner Bros. partnered with Tribune Broadcasting, which now owns a 25% stake in the WB. Chris-Craft’s United Television subsidiary became the "United" in United Paramount Network.

UPN and the WB were born at a turbulent time for the network television business, and it wasn’t only because of the sea change from the end of fin-syn. Rupert Murdoch and Fox shocked the industry in December 1993 by snaring an NFL rights package away from CBS; five months later, Murdoch joined forces with New World Communications chairman Ronald Perelman to deliver another stunner by announcing plans to switch New World’s 12 Big Three affiliates en masse to Fox. That jolt to the old guard of the broadcasting business set off an unprecedented chain reaction of network affiliation switches among stations in markets large and small.

It was against this backdrop that Warner Bros. and Paramount executives headed out into the hinterlands to woo affiliate partners for their nascent networks. The battle between UPN and WB during their formative years was fought hardest in places like Buffalo, N.Y., Charlotte, N.C., Oklahoma City and Nashville, where there was often bruising competition between the two studios to sign up the strongest stations as their affiliates.

Daly says he and the Warner Bros. brain trust, including then-TV chief Barry Meyer (now Warner Bros. chairman and CEO), quickly settled on Jamie Kellner, the executive who helped launch Fox as Barry Diller’s right-hand man, as the only person who could successfully pull off such an ambitious proposition — especially because Kellner already had approached Warner Bros. about it after his resignation from Fox in January 1993.

"I made a determination with Barry (Meyer) that I would only do it if I could get Jamie to run it," Daly says. "A lot of people thought we were crazy, but I knew if I gave him a piece of the business, he’d work night and day to build this into a success. He certainly put together a very strong group of people to launch it."

At the outset, UPN had the stronger station lineup of the two networks, and it had an instant calling card with viewers by launching the network with the latest "Star Trek" spinoff, "Star Trek: Voyager." But there was tension behind the scenes between Paramount and Chris-Craft that began when Viacom wound up acquiring Paramount Communications just as the studio was hammering out final details of what originally was envisioned as a 50-50 joint venture with Chris-Craft.

Because of the bidding war in which Sumner Redstone’s Viacom had engaged with Barry Diller’s QVC, the company was strapped for cash, and Paramount brass hastily had to renegotiate its agreement with Chris-Craft. The station group became the sole owner of the network, with Paramount retaining an option to acquire a 50% stake in UPN after two years, which it exercised in early 1997.

By many accounts, the relationship between the UPN partners was consistently rocky until Viacom bought out Chris-Craft’s remaining 50% interest in the network in March 2000.

The WB trailed UPN in the ratings in the first two years of the baby networks’ life spans. But the WB leap-frogged ahead of its rival in 1997 and 1998 as the network solidified its affiliate base — most notably by recruiting five key Sinclair Broadcast Group stations away from UPN in early 1998 — and its schedule caught fire with such drama hits as "Buffy the Vampire Slayer," "Dawson’s Creek," "Felicity" and "Charmed."

From then on, WB has maintained a sizable advantage over the WB in one key measure of a network’s health: advertising sales. Last spring, WB booked an estimated $675 million in upfront advertising sales for the current TV season, compared with about $350 million for UPN.

Daly recalls that in the months before WB took flight, there were board-room battles with former Time Warner vice chairman Ted Turner about whether the media conglomerate should continue to invest in the WB.

"There was a lot of heat inside the company. Ted was very much against it," Daly says. "But eventually the board of directors supported us on it, and the WB turned out to be a very good asset for the company. I’m very proud of the fact that it’s 10 years old. I think it’ll be around for a long time."