Martha Renegotiating Hallmark Deal

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As Oprah Winfrey struggles to define her TV network, another media maven finds herself at a critical crossroads with her television partner.

Martha Stewart Living Omnimedia (MSLO) is in "active discussions" on a new deal with Hallmark Channel, according to the network. Hallmark is home to five hours of Martha Stewart-branded daytime programming, including The Martha Stewart Show and Emeril's Table, featuring Emeril Lagasse.

The network has had a deal since 2010 with Stewart's publicly traded company, which has weathered financial challenges, including a loss of $9.7 million in the most recent quarter. But analysts are bullish on J.C. Penney's ten-year, 16.6 percent stake in Martha Stewart Living announced Dec. 7, that could earn MSLO more than $200 million.

The current season of Stewart's daytime show will wrap in May but will continue to air in reruns on Hallmark through the summer, along with Emeril's Table and other shows. So far this season, The Martha Stewart Show is 18 percent year-over-year among its target demographic of women 25 to 54. However, Hallmark already has jettisoned late-night shows featuring Stewart's daughter, Alexis Stewart, and Jennifer Koppelman Hutt, daughter of MSLO non-executive chairman Charles Koppelman.

The Martha-branded programming block launched in September 2010 at a hefty eight hours but was downsized only a month later in the face of underwhelming ratings. And while the shorter block has improved its performance in the target demo, there is still room for improvement. Speaking Dec. 7 at the UBS media conference, MSLO president and COO Lisa Gersh reiterated the company's intention to stay with Hallmark, as well as broaden the Stewart brand to more networks and platforms, saying Stewart and Lagasse "can easily attract great audiences on broadcast."

An MSLO spokesperson said: "We love our partnership with Hallmark and are talking about opportunities for daytime programming."