Jon Stewart redefined late-night and helped give Comedy Central new influence when he joined the "Daily Show" in 1999. The network had been gaining momentum since debuting "South Park" a few years before, but it was Mr. Stewart's fresh take on both news events and the late-night format that opened the door to a different audience, and as a result, new advertisers.
Now, as Mr. Stewart prepares to leave the talk show, shortly after Stephen Colbert and Jon Oliver made their own exits, Comedy Central is tasked with revamping its late-night programming block and convincing advertisers it can continue to attract the younger, male audiences on which it has built its business.
"It's pretty monumental," said David Campanelli, senior VP-director of national broadcast, Horizon Media. "He basically created a whole new genre, or at least sub-genre, and put Comedy Central on the map in a whole different way than they had been before."
"That said, Leno replaced Carson, Conan replaced Letterman, Colbert is replacing Letterman again, and on and on," Mr. Campanelli added. "So this isn't the first time a host is being replaced. But it's going to be really hard to replace Stewart. And the double whammy of Colbert and Stewart gone in about a year is tough for Comedy for sure."
Mr. Stewart announced during his Tuesday night show that he will depart later this year after a 16-year run. While no date for his exit is set, his contract is due to expire in September.
Doug Herzog, president, Viacom Entertainment Group, said "The Daily Show" will continue with a new host. Mr. Stewart himself inherited the talk show from Craig Kilborn.
"'The Daily Show' is going to endure, it is going to go on, it is going to evolve," Mr. Herzog said. "It was built to do that." It won't be the same show as it is now, he added, but will fundementally have a similar format.
While "The Daily Show" doesn't draw as large of an audience as its broadcast counterparts, averaging 2.1 million total viewers this season compared to about 4 million for NBC's "Tonight Show Starring Jimmy Fallon," it does bring in a younger, male audience that's highly attractive to advertisers.
It may not be an ideal situation for Comedy Central, losing both Mr. Stewart and Mr. Colbert over the course of a year, but Daniel Cohn, client director-investment, Initiative, said the network has other strong programming that keeps it a must-buy for advertisers targeting millennials.
Shows like "Key & Peele," "Tosh.0" and even the now long-running "South Park" skew younger and more multi-cultural than programming on many networks, Mr. Cohn said. And Comedy Central expanded its late-night block in 2013 with "@midnight," a game show hosted by Chris Hardwick that taps topics from social media.
The rise of "Daily Show" performers such as Mr. Colbert, Mr. Oliver and Steve Carell has been widely noted, but Comedy Central more broadly has also become known for building comedic talent. Access to its stars for custom content makes Comedy Central attractive to marketers, Mr. Cohn said.
Last year, Comedy Central created content for movies like "Non-Stop" and "Neighbors" using Key and Peele and stars from its show "Workaholics."
Mr. Herzog said the "Daily Show" record of finding and building up talent is one reason to be confident in its future. "This is what we do," he said. "We find new voices; we find talent and we give them a platform to do their thing."
Of course, Mr. Stewart's departure leaves a major hole in Comedy Central's late-night programming and comes as the network is still trying to rebuild its 11:30 p.m. time slot, which was vacated by Mr. Colbert late last year.
Larry Wilmore's "Nightly Show" replaced the "Colbert Report" last month, debuting to 963,000 viewers. It averaged 835,000 viewers in its first five February episodes. "Colbert" had averaged about 1 million viewers and its finale attracted 2.5 million.
Mr. Cohn said it's too soon to tell how the "Nightly Show" will fare with viewers and that Comedy Central is still tinkering with formatting, but he has high expectations.
Still, the "Nightly Show" will face a potential new challenge when its "Daily Show" lead-in loses Mr. Stewart.
Mr. Stewart's successor will certainly be a hot topic during the upfronts, when TV networks look to sell a bulk of their ad inventory in the upcoming season.
Mr. Herzog said the network has been internally preparing for Mr. Stewart's departure and is looking both internally and externally for his replacement.
Outside of late-night, Comedy Central's ratings have been struggling in prime time.
In the TV season from September until now, the network's core 18-to-34-year-old demographic has declined 16% from the equivalent period a year earlier while total viewers have fallen 17%.
What Mr. Stewart's announcement does achieve is keeping late-night a major talking point among advertisers. The last year alone has seen Jimmy Fallon taking over for Jay Leno on NBC's "Tonight Show"; Craig Ferguson departing from CBS; Chelsea Handler moving from E! to Netflix; Jon Oliver getting his own HBO series; and Mr. Colbert set to replace David Letterman.