In the course of one weekend I mounted defenses of lefty comic-book writer/artist Joe Sacco and Jay Leno.
Unsaid in the Leno piece is that I think you can make the case that NBC's own decisions in the Tonight Show debacle are minimally defensible: That is, they might not be optimal--and you or eye might have made different ones--but taken as discrete decision points, each one is not crazy. It's just the totality of the decisions which lead to corporate madness.
Consider the entire episode from NBC's point of view, with a series of if/then propositions:
If Conan demands the Tonight Show, then you can either give him the show and displace Leno, or lose Conan. I would have told Conan thanks for your service, good luck on future endeavors. But it wasn't totally crazy for NBC to think that, with five years of breathing space, they could figure out a way to finesse the situation.
If you've given Conan Tonight, then you can't let Leno out of his contract. You have to keep him off of the air for Conan's sake--you've just decided to hand O'Brien the franchise, you have to protect him in the time slot and keep Leno from setting up a competing franchise somewhere else and eviscerating Conan's early ratings.
If you're keeping Leno at NBC then you can either pay him between $14M and $18M to do nothing, or you can try to find a spot for him to do a show.
If you're committed to putting Leno on the air, a cheap, low-ratings, high-margin primetime show is a viable possibility.
If Leno's low-ratings show angers affiliates so much that they're willing to preempt network content, then you have to make a change somewhere to get Leno's prime-time show off the air.
If pulling Leno's prime-time show costs $80M, and pulling Conan's Tonight costs $60M and--most crucially--Conan still hasn't proven he can find an 11:30 audience, then you have to push Conan aside and reinstall Leno.
2 hours ago