Oprah Winfrey Network Hit With A $330 Million Loss

Television
by Sergio
May 8, 2012 10:38 AM
9 Comments
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I've said it before on S & A more than once, and I'll say it again. It ain't easy starting a TV network. It takes lots of time, patience and money. Lots and lots and lots and lots of money, as Oprah Winfrey is no doubt learning.

Even she herself was recently quoted as saying that if she'd known before what she was getting into starting up OWN, she wouldn't have done it.

Well she must be thinking about that even harder now, as it was reported just recently in Business Week magazine that OWN has lost as much as $330 million, and that industry insiders are quoted as saying that the network won't last unless it can find some hit shows and make a "dramatic turnaround."

The article even quotes one Wall Street media analyst calling OWN: "the most successful failure in television today."

Though, in fairness, it's still too early to say that.

Since 2008, the Discovery Channel, which has been underwriting all the costs of the OWN, has sunk almost $600 million in the venture, but has seen little in return; and according to the article, David Zaslav, the CEO of Discovery Communications, is getting fed up.

Another insider was quoted as saying: "I can't really see Zaslav losing this kind of money for much longer."

But is this really the end of OWN? Like I just said, it's too soon to tell, and I predict that both Oprah and Discovery are going to be in it for the long haul.

Though exactly what kind of time period constitutes a "long haul" is anybody's guess.

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9 Comments

  • Ava | May 9, 2012 8:24 AMReply

    It's not too late to forge that agreement with Google to bring OWN online, Oprah. The overall trend in broadcast/terrestrial TV has been downward. Most/all shows (save a few) are pulling in lower ratings numbers, especially now.
    I myself have cut the cable cord, so unless OWN becomes available as a streaming channel (e.g. through Roku, etc), I won't be able to watch. I refuse to pay a monthly cable bill for dozens of channels I don't watch. And as I understand, OWN is often placed on the highest (i.e. most expensive) digital tier.
    I respect what Oprah has done over the course of her career. I just wish she had gone a more innovative route with OWN and just gone online or made it available through streaming. Think of what further innovation she could've spurred toward improvement of the Internet! I wish Oprah well, though, she's probably only one or two good ideas away from recovering her mantle of 'where Oprah leads, people will follow'. I don't like that in various parts of the Internet (not here, of course) people with schadenfreude are gleefully attacking her as if she were Kony or something. How quickly people forget...

  • the black police | May 8, 2012 5:17 PMReply

    This is SAD

    What are yall doing to support this black sister?

  • sandra | May 8, 2012 2:08 PMReply

    No need to freak out! It's only been 1 and a half years in operation. Still no cause for alarm.

  • Kid chaos | May 8, 2012 2:03 PMReply

    She better try her hardest to get white women to follow her again

  • Phil | May 8, 2012 1:07 PMReply

    Unfortunately, Oprah's mistake lies in thinking that people are positive creatures and want to see the best of themselves reflected on television. No one wants to see 24 hours of positive messaging and success stories. It's boring. People want to see drama-filled catfights, crash-and-burn stories, and backstabbing. Here's the turnaround recipe, Oprah. A mediatakeout daily program in a similar format as that of TMZ's and 2-3 reality tv programs a la VH1...'Baddest Bitches of NYC' or a reality show around strippers from popular strip clubs (hmm, I need to pitch that one). Yeah, Oprah's going to have to completely abandon her values to turn this ship around.

  • Ernest Paul Jones | May 8, 2012 11:25 AMReply

    Actuarially speaking, this is not as bad as it looks!

    If Oprah had good investment advisors...which I doubt...that did not rely on Oprah making a profit...which they do...they would be selling her losses to major corporations. It coud be suggested as an investment in their Diversity Mission to aid the minority business man, or woman.

    Losses against profits always benefit the rich in lowering their profits. Since it was Oprah that has gotten Barrack Obama into office her losses could help the rich with great profits protect themselves against the Obama Tax Rules...But, ahm just sayin'

  • Rodney | May 8, 2012 11:50 AM

    ...and by the "Obama Tax Rules" are you referring to the extension of the Bush tax cuts? That's the only law on the books since the Buffet Rule was voted down by the Senate...

  • Rodney | May 8, 2012 11:48 AM

    Oprah has great advisors - she stands to make up to $400 million on account of a put right for her 50% interest in OWN that expires on Jan 1, 2016. Her Harpo Productions is not responsible for any cash funding of the business, that's entirely the responsibility of Discovery, and she has total operating control over the business. I'd say she made a better deal than Diddy or Magic.

  • Rodney | May 8, 2012 11:13 AMReply

    Things will get better. Starting next year, hefty increases in affiliate fees from cable and satellite operators that carry the channel will start kicking in...to the tune of $150 million annually. I don't think Discovery will give up on its investment just yet. It does take time and money for a new channel to find its groove.

    I find it interesting that Forbes believes Diddy will become a billionnaire on account of his Revolt network. I don't see any of those Comcast channels getting anywhere near the financial support of OWN or the distribution. While Comcast is the largest cable oeprator, you need much more than their subs. to make a channel a success.

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