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Can Oprah carry her audience to a cable network?

Oprah Winfrey

TEXT OF STORY

Bob Moon: Oprah Winfrey has had an hour on television five days a week for 25 years. It's reportedly worth $150 million a year.

But in the coming year, the show will end. And this Saturday, Oprah launches OWN, the Oprah Winfrey Network, on cable. But here's the thing: Even if she succeeds beyond everyone's expectations, Oprah will probably never have as many viewers as she does now.

Marketplace's Jennifer Collins reports.


Jennifer Collins: On Jan. 1, Oprah goes from a one-hour talk show to a 24-hour network.

Oprah: What if I could take every story that ever moved me and give it to you?

Oprah, herself, has committed to only 70 hours on-air a year. She'll star in a reality series behind-the-scenes of her current show and host hour-long biographies of her favorite people. There'll also be shows for her regulars like Peter Walsh, the guy who helps you organize your home; a series for Oprah's best friend Gayle King; even a spin-off from one of her interviews, Duchess of York, Sarah Ferguson.

Sarah Ferguson: It's great. It's exciting to be part of OWN.

Cable analysts predict OWN will get -- at best -- a million people to tune in during prime time. That's a sixth of the audience for Oprah's talk show.

James Dix: That's, to some extent, the breaks of the game in cable or pay tv network television.

James Dix follows the cable industry for Wedbush Securities. Cable networks bring in other revenue -- fees that they charge providers like Time Warner and DirectTV for every subscriber that has access to a channel each month.

Dix: In cable, those affiliate fees are a very important part of measuring the success of a network.

The Oprah Winfrey Network is taking over an existing channel, Discovery Health. Right now, that brings in around seven cents a subscriber. Dix says Winfrey's network is looking to bump that to 20 or 30 cents. He says Spike TV was one of the last successful networks to launch. That was in 2003. Spike rebranded an existing network, too -- and targeted a younger, mainly male audience, with content like this:

Guy 1: Who's hotter: Eva Mendez or Eva Longoria?

Guy 2: Mendez. She's totally smokin'.

Guy 1: Really?

Several guys: Mendez, Longoria, Mendez...

Spike's been able to drive up its affiliate fees to around 22 cents a subscriber. Some say, there's a danger Oprah's new venture could go the way of another broadcasting legend, Howard Stern. Five years ago, Stern moved from commercial radio to Sirius satellite radio.

Joseph Priester, a marketing professor at the University of Southern California, says Stern has had trouble luring people to pay the subscriptions to listen to him.

Joseph Priester: Six months into Sirius, you couldn't find him in a newspaper. For Oprah, one of the ways to measure how successful she's been in this transition is just does she stay part of the cultural dialogue?

Priester thinks Oprah's fans will pay to keep up with her wherever she goes. Just look, he says, at the three million people who pay to subscribe to her magazine.

Nelson Gayton: I think when you have a brand like Oprah, expectations are going to be great.

Nelson Gayton teaches media management at the University of California, Los Angeles.

Gayton: But nonetheless, they're expectations that need to be managed. Because one thing is running a great TV show and the other thing is running a network.

The network's co-producers at Discovery have already tempered expectations -- saying it may take time for OWN to find its voice. Gayton says Oprah will have to be aggressive to find shows that work.

Gayton: It's her name on this darn network and that does wonders to motivate people.

And if that doesn't work, there are always 5,000 hours of reruns from her daytime talk show.

I'm Jennifer Collins for Marketplace.

About the author

Jennifer Collins is a reporter for the Marketplace portfolio of programs. She is based in Los Angeles, where she covers media, retail, the entertainment industry and the West Coast.
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I'm a fan of both Ms. Winfrey and Mr. Stern — and hate it that Mr. Stern always gets criticized in reports like these. When Stern went to Sirius, they had less than 600k subscribers and Wall Street had written Sirius off for dead. In less than five years, they grew to over 8 million subscribers on their own and added an equal amount with the XM buyout. Last month, they celebrated 20 million subscribers. While I know not everyone on Sirius/XM is listening to Stern, the growth of Sirius could not have been possible without him (when Winfrey began with Sirius, the subscription numbers hardly moved). Sirius can accurately track who is listening to what through their technology, and while their numbers are never made public, it is estimated in the industry that over 10 million people tune in to the Stern channel exclusively.

Stern produces more than 30+ hours of original content a week and fills a completely separate channel with "friends". Oprah does less than a half-hour a week of original content. It's unfair to compare someone on basic cable to a service which is the only outlet for the personality. In my book, Winfrey is consistently over-valued and Stern is worth every penny.

The most powerful piece of information in all of this article for me is 3 MILLION magazine subscribers! I recycle or reuse everything! How many TONS of landfill does that equal? Oprah has impacted many peoples lives but "she should refrain from using "the sky's the limit" as her get 'er done mantra because that sky up there and the earth down here, where her feet seldom touch, is in peril ! ! ! !

Oprah gets little more than a big yawn for me -- well, actually, she kind of creeps me out.

I remember once she wanted to do a story on fibromyalgia, so the word went out on the fibro forums that Oprah's staff wanted our stories. Several people I know wrote moving accounts of their illness on the Oprah website. Turns out all of the stories got rejected because we didn't think the disease is "a psychological problem" -- essentially all in our heads -- and that is the angle Oprah wanted for her show. As far as I know, she never has produced a fibromyalgia story.

Now I understand she's pushing fake gurus, like Gurumayi and John of God (and yes, I knew Gurumayi for 17 years, and lived in the "Eat, Pray, Love" ashram for 6 months as a devotee. I know whereof I speak.) Before that it was the "shaman" that ended up killing several followers. Yikes.

Like I said, she kind of creeps me out, and so do her sycophantic audience members who stand and clap and clap for her at every show. *shiver*

I had to watch my gag reflex when I heard Mr. Priester say:

"Six months into Sirius, you couldn't find him in a newspaper. For Oprah, one of the ways to measure how successful she's been in this transition is just does she stay part of the cultural dialogue?"

There has never been a more constricted media format than network TV. Which is why folks with some talent are getting out of it. What's hilarious is that newspapers watch TV and report on it like it was reality. (Media parasitic upon media = zero.) If this constitutes USia's "cultural dialog" you may keep it.

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