Fox in discussions with Conan O’Brien

LOS ANGELES – Fox Broadcasting is inching closer to bringing Conan O’Brien back to late night.

Key Fox executives, including Rupert Murdoch, are on board with the plan and would like to finalize a deal in coming weeks so they can make a splash on May 17 when the network unveils its new fall line-up. Several significant issues remain and the Fox talks could fall apart, according to people close to the negotiations.

But people close to O’Brien are cautiously optimistic.

“We’ll get there,” one of them said Tuesday.

Fox executives have been huddling to figure out how much it will cost to mount a late-night talk show that would be profitable for Fox stations and affiliates. Stations, hammered by the advertising recession, rely on the profits generated by syndicated reruns such as “The Simpsons” and “The Office,” and it’s unclear how many stations would be willing to substitute those shows for a risky venture – even one starring a big-name host.

Fox realizes that if it ever wants to get into the late-night game, this is the time.

The network, owned by Murdoch’s News Corp., has had its eye on entering the late-night talk show wars for years.