Jay Leno is going back to his 11:30 PM time slot, and it's looking like Conan O'Brien is the odd man out ...Jay's 10:00 PM show will go on hiatus February 1. After the Olympics, Jay will take back his 11:30 PM time slot. What has not been decided -- whether Jay's show will be a half hour, followed by Conan, or whether Jay's show will be an hour and NBC says sayonara to Mr. O'Brien.

NBC has given Conan O'Brien the option to either do his show from midnight to 1 or leave the network...after the Olympics, Jay Leno will get his 11:30 PM time period back. We're told network execs have told Conan they will let him decide if he wants the midnight to 1:00 AM time slot. If he does, Leno's show will only be a half hour. If Conan walks, Leno will get a full hour, informed sources tell TMZ.
Our sources say Conan has not decided what he wants. We do know he's pissed, because he was given no advanced warning this was coming. Conan's people told NBC they are considering the offer. Translation: Mr. O'Brien -- I have Rupert Murdoch on line one, Stephen McPherson on line two, John Landgraf on line three, Jeff Wachtel on line four ...

We're told if Conan gets another offer, even though NBC could block the move, they will let him go and give Leno the full hour.

In the last few days, I’ve been getting a lot of sympathy calls, and I want to start by making it clear that no one should waste a second feeling sorry for me. For 17 years, I’ve been getting paid to do what I love most and, in a world with real problems, I’ve been absurdly lucky. That said, I’ve been suddenly put in a very public predicament and my bosses are demanding an immediate decision.

Six years ago, I signed a contract with NBC to take over The Tonight Show in June of 2009. Like a lot of us, I grew up watching Johnny Carson every night and the chance to one day sit in that chair has meant everything to me. I worked long and hard to get that opportunity, passed up far more lucrative offers, and since 2004 I have spent literally hundreds of hours thinking of ways to extend the franchise long into the future. It was my mistaken belief that, like my predecessor, I would have the benefit of some time and, just as important, some degree of ratings support from the prime-time schedule. Building a lasting audience at 11:30 is impossible without both.

But sadly, we were never given that chance. After only seven months, with my Tonight Show in its infancy, NBC has decided to react to their terrible difficulties in prime-time by making a change in their long-established late night schedule.

Last Thursday, NBC executives told me they intended to move the Tonight Show to 12:05 to accommodate the Jay Leno Show at 11:35. For 60 years the Tonight Show has aired immediately following the late local news. I sincerely believe that delaying the Tonight Show into the next day to accommodate another comedy program will seriously damage what I consider to be the greatest franchise in the history of broadcasting. The Tonight Show at 12:05 simply isn’t the Tonight Show. Also, if I accept this move I will be knocking the Late Night show, which I inherited from David Letterman and passed on to Jimmy Fallon, out of its long-held time slot. That would hurt the other NBC franchise that I love, and it would be unfair to Jimmy.

So it has come to this: I cannot express in words how much I enjoy hosting this program and what an enormous personal disappointment it is for me to consider losing it. My staff and I have worked unbelievably hard and we are very proud of our contribution to the legacy of The Tonight Show. But I cannot participate in what I honestly believe is its destruction. Some people will make the argument that with DVRs and the Internet a time slot doesn’t matter. But with the Tonight Show, I believe nothing could matter more.

There has been speculation about my going to another network but, to set the record straight, I currently have no other offer and honestly have no idea what happens next. My hope is that NBC and I can resolve this quickly so that my staff, crew, and I can do a show we can be proud of, for a company that values our work.

Have a great day and, for the record, I am truly sorry about my hair; it’s always been that way.

Yours,

Conan

Sources close to former 'Tonight Show' host Jay Leno tell me he is furious with the way NBC has treated him and Conan O'Brien and is considering walking away from the entire mess with his head held high. "Now that Conan has made it clear he is leaving the troubled network, Jay is considering doing the same. They have put Jay in a terrible position. It looks like he is the reason that Conan is now without a job. Jay is a great guy and it's not fair that due to NBC's stupidity he looks like the bad guy," a TV insider tells me.

Jay Leno has made a new deal with NBC, which gives him "The Tonight Show" from 11:35 - 12:35 ... sources tell TMZ.
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So Conan O'Brien is out, and Jay is restored