At BarterNews, we have been
contending for years that the “Best & Brightest” use barter in the
building of their wealth…here is another example of that message.
Discovery
Communications and Oprah Winfrey have announced a deal where the
Discovery Health network will be bartered to Winfrey next year, and
become the Oprah Winfrey Network (OWN).
The cash-free
transaction involved Winfrey turning over half ownership of
Oprah.com (her
web site with 6 million unique visitors a month) to Discovery, while
the communications company makes her chairman of the network which
is currently seen in 68 million homes. The two entities (Harpo
Production and Discovery) will be joint owners...50/50 in ownership
and profits.
What’s the
value of the deal? Hard to say at this point as Winfrey’s star power
will generate greater revenue from cable companies once she comes
aboard with her programming in mid 2009. But cable TV networks don’t
come cheap. When Microsoft invested in MSNBC back in 1996 it put up
$300 million for its half stake in a startup. (And Bill Gates is a
tough negotiator.)
So Oprah’s
“media empire” includes:
1.
Her top-rated TV talk
show
2. A satellite radio network (XM
Radio)
3. A web site
4. TV movies made under her banner
5. Now the OWN TV Network (68
million potential viewers, with coverage in 2/3 of the nation’s
homes)
The focus of
the channel will be Oprah’s brand—to educate and inspire people to
live the best life they can. Some of Winfrey’s stable of regular
contributors could be expected to be part of the programming.
Winfrey’s current talk show, as well as rights to use of reruns, is
spoken for until the end of the 2010/2011 season.
According to
Winfrey, she made an entry in her diary May 24, 1992, about an idea
for creating her own TV network...15 years later it’s a reality, and
barter once again was the catalyst for a huge deal.
Oprah’s dream
has come true. She will now have the opportunity to do this 24-hours
a day on a platform that goes on forever.
