part if the problem with the niche celebrity mentioned is not that they don't appeal to broader audiences, butt hat they have shown no interest in doing so. If you are making fun of people outside you're core demographic, then you can't expand your demographics. When thrust into the spotlight, they will flip the channel.
you have to have someone that's, foremost, going to entertain, not going to pursue an agenda. Rosie O'Donnell, for all who will complain about her, had an entertaining show in NY, revived Broadway, brought our culture to the country ... Until she had Tom Selleck on her show. She thought her popularity meant people would automatically agree with her. Instead it was the beginning of the end.
As for Colbert, I think this is great. the Colbert Report will go off the air. His "character" will have to "die" maybe to be briefly resurrected in 5 minute segments, and he'll have to be himself, if we can figure out who that is. The guy who was on Whose Line, maybe? I predict massive ratings, like whine letterman first went up against Leno. And I predict that Fallon's slow and steady course will win the race, like when letterman went up against Leno? Colbert will fail miserably, after a fashion, and leave or be dumped in about 5 years.
A better model might be Howard Stern's popularity before and after going to satellite radio. That will be colbert's future. the big fish in the small pond will disappear in the ocean of late night.
Stern made his living by pushing the envelope.....In Satellite Radio, there's no more envelope to push.