OWN Increases Reach, Gets Fees in Comcast Carriage Deal
The new distribution deal comes as Oprah Winfrey goes public about the struggles of her nascent cable network.
NEW YORK -- OWN, the Oprah Winfrey Network, is expanding its footprint with a new distribution deal with cable giant Comcast Corp., which will bring the struggling cable network into 3 million more homes.
Comcast also has agreed to begin paying subscriber fees for OWN, according to a report in The Wall Street Journal, a boost for the 15-month-old network that has been suffering poor ratings and management turmoil. It didn't specify how much fees OWN would be getting from Comcast.
The deal will bring OWN into 17 million Comcast subscriber homes, up from 14 million currently, it said. Overall, the network will now be accessible in 83 million total homes.
"Discovery does not discuss the nature of its agreements with distributors, however we are pleased by OWN's momentum in the marketplace and appreciate the support from our affiliate and advertiser partners who recognize the brand strength we are building in OWN," a Discovery spokesman said. "Ratings were up double digits in the first quarter, and through the recent restructuring of operations and all of our work creating value with affiliate and advertising partners, the venture is accelerating its cash flow and continuing to build long-term value."
News of the deal comes after OWN laid off 30 people in a network restructuring two weeks ago. The move to redistribute responsibilities of these staffers to venture partners Discovery Communications and Winfrey's Harpo Studios came on the heels of the cancellation of Rosie O’Donnell’s 5-month-old 7 p.m. talk show, which was averaging fewer than 200,000 viewers on a daily basis.
The troubles have led Oprah Winfrey to make media rounds to address the decision to abandon her successful daytime show to start a cable channel focused on lifestyle issues. In an interview on Monday on CBS This Morning, Winfrey admitted the network was launched too soon, that major fixes would be needed and that she's dedicating herself to righting the organization.
The Comcast deal would bring needed income on that path. SNL Kagan, a research firm, estimates that OWN's subscription fee is only 2 cents per subscriber per month, a fraction of what other networks get. On the other hand, SNL Kagan predicts that OWN's subscription fee could rise as high as 15 cents per household, or $153 million per year given the current number of subscribers.
Comcast reps couldn't be reached for comment.
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