According to Broadcasting & Cable, CBS and David Letterman are starting negotiations that would keep him on the air after his current contract expires in August of this year:
The two sides are striking up talks as the 11:30 timeslot is about to undergo a sea change with Conan O'Brien taking over The Tonight Show and Jay Leno deciding not to jump to ABC and compete for those viewers.The story quotes an interview Dave did with Rolling Stone, in which he said, "The way I feel now, I would like to go beyond 2010, not much beyond, but you know, enough to go beyond. You always like to be able to excuse yourself on your own terms. If the network is happy with that, great. If they wanna make a change in 2010, you know, I'm fine with that, too."
Both CBS and Letterman could see that as an opportunity for Letterman to pick up some new eyeballs and potentially take over as the top host in late night with Leno out of the picture, as he moves on to start his 10 pm show on NBC.