(FORTUNE Magazine) – THE LATE NBC PROGRAMMING WHIZ BRANDON TARTIKOFF liked to say that television is a business of hits and stars. So it comes as a surprise that his most enduring legacy to television is a program that neither became a breakout hit nor created a major star.

Tartikoff put Law & Order on NBC in 1990, after Fox and CBS had turned down the police-and-courtroom drama from Universal Television. (CBS said it lacked star power.) The series got mediocre ratings for years. Worse, advertisers bolted when Law & Order dealt with controversial issues like abortion. But the program earned critical praise, and NBC showed patience.

"The only reason the show stayed on the air was Brandon," says Dick Wolf, the writer and television producer who created Law & Order and since then has built the show into a sprawling programming empire.

Who knew? Today Law & Order is a business that generates sales of well over $1 billion a year. It is a brand on which the fates of networks rise and fall. It is an addiction for some of the 100 million viewers who watch each month. It is the reason why Wolf, a 58-year-old former advertising man, has become the most valuable player in prime time. And it is an improbable success story built on strategic long-term thinking in a business--television--that is typically haphazard, fickle, and trendy.

This explains why it was Wolf who stood beside Bob Wright, the chairman and CEO of NBC Universal, when the General Electric unit announced the closing of its $5.4 billion merger with Universal last year. The deal brought NBC a movie and TV studio, a programming library, cable channels, and theme parks. Wolf and his Law & Order programs, all of them Universal properties, were not incidental to the merger. At the time, Wright joked that the newly formed conglomerate was thinking about adding a "Wolf Crime Channel" to its array of networks. It turns out that he meant it. The channel is called NBC.

Midway through its worst TV season in years, after losing Friends and failing to develop new hits, NBC needs Law & Order more than ever. In a typical week, NBC airs four new episodes and three reruns of one Law & Order program or another. There is Law & Order itself, a.k.a "the mother ship," which tells crisp, no- nonsense stories about detectives and prosecutors. Now in its 15th season, Law & Order will surpass Gunsmoke as the longest-running scripted program of all time if it can hang on for another five years. There is L&O: Special Victims Unit, about a sex-crimes squad, which is posting its best ratings ever in its sixth season. Then there's L&O: Criminal Intent, a more conventional whodunit inspired by, among other things, Sherlock Holmes, now in season four. And just last week, NBC introduced L&O: Trial By Jury, which looks at the criminal justice system through the eyes of judges, defense attorneys, and jurors, as well as cops and prosecutors. All told, Law & Order programming will bring in an estimated $800 million to $1 billion of the broadcast network's $3.8 billion in prime-time advertising revenues this year. NBC saves many millions of dollars more because it does not have to develop new shows for the time periods filled by Law & Order.

Is this too much of a good thing? Some critics say NBC's Law & Order addiction will only deepen the network's troubles. When NBC turned over 12 of its 22 prime-time hours to Law & Order during the first week in March, TV columnist Robert Bianco wrote in USA Today: "It's as if the network were purposely pursuing the TV version of the perfect storm, that fatal point where creative exhaustion meets audience ennui." Wolf and the network say that the audience will let them know when there's too much Law & Order on the air. Privately, Wolf has expressed concern to NBC about overexposure.

More than NBC's health is at stake. Reruns of Law & Order and L&O: SVU have become the mainstays of two cable networks, TNT and USA. Largely as a result, those are now the top-rated cable networks in prime time. (After A&E, another cable network, lost the reruns to TNT in a bidding war, its ratings fell.) For the obsessed fan, watching Law & Order and its spinoffs has grown into a full-time job. Together, NBC, USA, and TNT show about 40 hourlong episodes each week.

Naturally, NBC Universal generates profits from all this, although it's impossible to know how much. It sells the advertising on USA, which it owns, and collects syndication fees from TNT, which (like FORTUNE) is a unit of Time Warner. About 550 episodes of the Law & Order shows have been sold into syndication, generating revenues of more than $600 million so far. Overseas, the programs have generated another $300 million in revenues. The Law & Order brand also has spawned DVDs, a coffee-table book, a computer game, caps, and T-shirts, although all those are small businesses when compared to television. Wolf's people predict that the shows will generate $10 billion over the next five years if all four versions stay on the air, but that estimate seems high. Whatever the real number, it's a lot more than anyone would have guessed way back when.

ON THE WALLS OF DICK WOLF'S OFFICE IN the Universal City building where most of the Law & Order writers work are framed original letters from Dashiell Hammett, Charles Dickens, and John Steinbeck to their agents and editors, asking for money. They reflect Wolf's own literary ambitions: He once dreamed of writing the great American novel. They are also reminders, not that he needs them, that the writing matters. "The thing that determines the fate of a show is always the writing," Wolf says. Wolf showers praise on his top writers, who are among the most admired in television. They include Walon Green, who was nominated for an Oscar in 1969 as the writer of The Wild Bunch; Neal Baer, a Harvard-trained pediatrician who runs SVU; and Rene Balcer and Eric Overmyer, who have worked for Wolf since the beginning. So far as we know, they have not had to beg for raises; all are millionaires several times over.

If Wolf grew up wanting to be the next F. Scott Fitzgerald, fate had other plans. His parents met in 30 Rockefeller Center, where his father was head of publicity at NBC and his mother worked as a secretary. Little Dick was a fixture at tapings of The Howdy Doody Show,and he watched comedians Carl Reiner and Mel Brooks work at a recording studio owned by an uncle. Wolf went to prep school at Andover, where George W. Bush was a classmate, and drew upon his experiences there to write School Ties, a 1992 feature film with Brendan Fraser and Matt Damon about anti-Semitism at a New England boarding school.

Before making his way to Hollywood, Wolf toiled for seven years as an advertising copywriter. For National Airlines he wrote the ad "I'm Cheryl, Fly Me," a line so obnoxious that some flight attendants made buttons that said FLY YOURSELF. He also wrote "You Can't Beat Crest for Fighting Cavities" for Procter & Gamble. From P&G, he says, he learned that "the one thing that is anathema is to do a bad brand extension."

In 1985, producer Steven Bochco hired Wolf to write Hill Street Blues, the groundbreaking and gritty NBC police drama. "MTM [the studio that made Hill Street] was the Harvard Business School of television," Wolf says. "That was a watershed experience." Next came a stint with Michael Mann on Miami Vice, the sleek cinematic drama featuring Don Johnson. An overnight star, Johnson had the temperament to make life miserable for producers and the clout to demand a share of their profits. Over lunch at the Beverly Hills Hotel, I ask Wolf if the Miami Vice experience led him to design Law & Order so that it would not depend on any single performer. He smiles. "I'm a big fan of ensembles," he says.

This line of inquiry leads to a story. Years ago, Wolf created a cop show for Fox called New York Undercover. It was noteworthy as the only drama with minority leads in commercial television history to last more than one season. On the first day of the third season, Malik Yoba and Michael DeLorenzo, the lead actors, refused to report to work. "They made a series of demands, including better food and a gym," recalls Wolf. He pauses to let the sheer gall of their proposal sink in. "So we made a very simple statement saying that if they did not show up the next day, the roles would be recast." After one of the New York papers reported that their characters might be incinerated, tragically, in a fire, Yoba and DeLorenzo returned to work. "What they did was absolutely, totally wrong," Wolf says. "They had a contract."

Of course, many in Hollywood, especially those who have leverage, regard even a signed legal contract as little more than an inconvenience. Wolf is not among them. In fact, he is not what we think of as a Hollywood type at all. In an industry dominated by Democrats, he is a political conservative. (Duh. The shows are called Law & Order.) In a business that values people who are thin and discreet, Wolf is barrel-chested and blunt-spoken. He doesn't even live in L.A., preferring to work most of the time from his home near Santa Barbara. And while some television writers like to cast themselves as artists while deriding network executives as "the suits," Wolf enjoys talking business and shares credit for his success with people at NBC.

There was the time, for instance, when NBC honcho Don Ohlmeyer, a big fan of Law & Order, suggested that the show needed more emotion. As Wolf recalls, Ohlmeyer told him: "Sometimes it can be a little antiseptic, kind of like watching Christiaan Barnard do heart surgery. But if you put my kid on the operating table, the show runs forever." Ever since, there's a scene early in every episode with a friend or relative of the crime victim, designed to tug at viewers' heartstrings.

If you are getting a sense that making Law & Order is as much a matter of commerce as it is of art, well, that's okay with Wolf and his people. "We are manufacturing television shows," says Peter Jankowski, president of Wolf Films, Wolf's production company. "But they have to be manufactured at a very high level. They are not manufactured without inspiration."

Other TV dramas may be more original. Many pack more of an emotional punch. And writers like Bochco, David E. Kelley, and Aaron Sorkin have won more acclaim. But they are playing a different game. Most dramas--E.R., 24, NYPD Blue, West Wing--delve deep into the lives of their characters and tell stories that unfold over weeks, months, or years. Viewer involvement builds. So it becomes a big deal when, for example, the White House chief of staff on West Wing suffers a heart attack after a traumatic falling out with the President. The trouble is, those programs don't play very well in reruns, where big money can be made, because they are meant to be watched in sequence. They'll win Emmys, but as business models they are flawed.

The Law & Order programs, by contrast, are story-driven. Rarely do viewers go home with the characters. The scripts are fast-paced--a typical episode has about 40 scenes, while most hourlong dramas have 25 to 30--and even then, scenes are clipped in the editing room. (The head of postproduction, Arthur Forney, has been dubbed "the butcher of Burbank" by the actors, who would like more time to emote.) Most important, each episode is self-contained--a complete procedural. Never will a show begin with a summary of what happened in last week's episode, because it's irrelevant. "It doesn't matter if you haven't seen it in a day, a week, a month, or five years," Wolf says.

The formula has been embraced by, among others, Jerry Bruckheimer, the movie producer who oversees CSI, the top-rated CBS show about crime-scene investigators. Like Law & Order, CSI is self-contained. It has also spawned two spinoffs, CSI: Miami and CSI: New York. The game plan at CSI looks to be the same as the one at Law & Order--build valuable assets for a long life in syndication.

In a head-to-head showdown between CSI: New York and Law & Order this season, the CBS show has been winning, although the margins have shrunk lately. Wolf notes that Law & Order attracts a more upscale audience. "Look at the spots," the former adman says. "They have Budweiser commercials. We have Lexus." On Sunday nights, meanwhile, L&O: Criminal Intent has been losing a ratings battle with Desperate Housewives, ABC's red-hot soap opera.

But while the careers of network programmers can rise and fall with the Nielsens that are spit out of fax machines every morning in the tonier precincts of L.A., Wolf can afford to stay above the fray. After all, he has seen plenty of red-hot competition since Law & Order went on the air in 1990. Back then, Cheers was the No. 1 show on TV. It gave way to Roseanne, Home Improvement, Seinfeld, Who Wants to Be a Millionaire, and Friends, among others. All have come and gone. "Desperate Housewives is a cultural phenomenon," Wolf says. "But, in my mind, it's a sprinter. These shows are marathon runners. These shows are designed to run for unreasonable periods of time."

YOU CAN'T WRITE A STORY ABOUT LAW & ORDER WITHOUT visiting New York. Or in this case, New Jersey. Take the Lincoln Tunnel to a gritty industrial neighborhood in north Jersey, and you arrive at an old unmarked Adrienne Vittadini warehouse containing a warren of offices and a stage set that looks like the interior of a New York City precinct house. This is the home of L&O: SVU, and I've come to meet the closest thing to a star on any of Wolf's shows: Mariska Hargitay, the 41-year-old actress who plays Olivia Benson, the smart, brave, fiercely driven sex-crimes detective.

Much has been made by critics and fans of the frequent cast changes on all of Wolf's shows. Some actors leave on their own because there are only so many ways to say, "Where were you at 10 o'clock on Tuesday night?" But more often performers are dismissed because turnover keeps the shows fresh. Wolf jokes that "my reputation as a serial killer is unfounded," but the businessman in him is well aware that the supply of trained actors far exceeds even his ever-increasing demand for talent. "This isn't to put down what actors do, but there are 69,000 members of SAG [the Screen Actors Guild] in New York City," Wolf says.

Still, he is emotional when recalling the late, beloved Jerry Orbach, who worked on Law & Order for 12 years. He loves to hang out on the set and jaw about politics with Fred Dalton Thompson, the former Watergate prosecutor and U.S. Senator who now plays a D.A. on Law & Order and Trial by Jury. And he gushes over Hargitay.

Can you blame him? Hargitay is breathtakingly beautiful--no surprise, when you learn that she is the daughter of 1950s movie star Jayne Mansfield and Mickey Hargitay, a former Mr. Universe. What is unexpected is how brainy she is and how deeply involved she has become with her character and the issues explored on SVU. Hargitay describes Benson as an "emotional, passionate, compassionate, empathetic mother lion" and says that the show "has seeped into my heart and soul." Hargitay got certified as a rape crisis counselor so she could volunteer at phone banks; she raises money for groups that support victims of sexual assault; and she responds to hundreds of letters from sex-crime victims.

A UCLA grad who came east to do the show, Hargitay says, "The weather and the grit and the cars and the streets, they add a texture. L.A.--no offense--they don't know what grunge is or grime is, and they certainly don't know what weather is. There's a difference when you find a body in 80-degree weather with palm trees in the back or when you find somebody who's been thrown in a garbage can when it's freezing or snowy." New York actors are the real deal, she says. "Life in L.A. is easy. They're pansies. I was a pansy. I'm a tough girl now. I was not when I started."

Maybe the only star the L&O shows can't do without is New York City itself. All the shows are shot there, unlike, say, NYPD Blue and CSI: New York, which are mostly made in Southern California. (Law & Order and Criminal Intent are shot at Chelsea Piers, Trial by Jury at the Astoria Studios in Queens.) The L&O shows draw on stage actors and vice versa. When a revival of Twelve Angry Men recently opened on Broadway, every actor had Law & Order in his credits.

Wolf knows that his brand would be doomed--and his business model with it--if the shows ever were to go Hollywood. When I refer to Wolf as an ex--New Yorker, he corrects me. "There are no ex--New Yorkers," he says. "Just look at the number of Porsches out here that have P.S. 109 as their license plates."

Wolf now makes nearly 100 hours a year of television in his hometown. He says he loves the idea of painting on such a big canvas, as he works with his writers to try to capture the world of crime and justice in New York from a variety of perspectives, just as Dickens, his favorite writer, created a panoramic view of 19th-century London. Comparing Law & Order to Dickens? Well, maybe there's just a little Hollywood in Dick Wolf after all. ■

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