Discovery Doubles Up On OWN The Oprah Winfrey Network. Why?

This week:

  • The Latest on Oprah’s Documentary Club
  • What’s going on with Discovery’s big new investment in OWN?
  • The Rosie thing? 
  • And Martha is in the picture?
  • A Tanned and Buffed DCI Legal/Business Affairs office in LA?

More on Oprah’s Documentary Club

We recently reported that OWN rolled out the red carpet for Julia, Forest, Goldie, Gabriel & Mariel.

OWN’s heavily-promoted ‘cinematic documentary’ initiative is evolving into a monthly slot that mixes authored documentaries with celebrity-driven, Lifestyle Specials. 

  • Those 12 ‘cinematic doc’ slots for 2011 are now only 7 — at most
    • Of the 7 slots, three titles were announced: Family Affair, Life 2.0 and Sons of Perdition
    • That leaves a maximum of four more ‘Documentary Club’ acquisitions for next year
  • The ‘celebrity special docs’ are budgeted near our hourly ‘High’ estimate for OWN’s original programs.
    • Talent fees are additional
  • These budgets are higher than for OWN’s acquisitions.
    • OWN’s acquisition costs are close to the industry standard, as we reported recently

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The session: What do the Networks Pay? And How Can You Get Them to Pay You?     
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The date: Sunday, September 12, Santa Monica CA. 

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Bigger Manoeuvres?

OWN’s pre-launch manoeuvres revolve around far higher-level issues than the definition of ‘cinematic documentary’. 

Discovery Communications (DCI) recently announced that:

  • DCI is nearly doubling its original $100m investment in the OWN JV by contributing an additional $89m loan
  • Oprah Winfrey committed to host or star in a show on her network
  • The JV will distribute OWN in the leading international markets: Canada and UK

Is OWN a Piece of Cake for Discovery?

OWN is a challenge for DCI’s ‘buttoned-up’ executive culture:

  • Discovery undertook a serious due diligence effort before committing to its $100M investment in the JV
    • $89M is no tweak!
    • Particularly for a network operator that is better-known for its budget trimming ways than for writing very big checks to programmers
  • A well-informed friend emails that the OWN agenda “Is a big play that is uncharacteristic for Discovery, and seems to be driven by DCI’s stock price.”

Is OWN Shifting Its Focus to Daytime?

Oprah’s commitment to star on her network’s schedule may indicate that OWN is shifting its focus to Daytime versus the fiercely-competitive Primetime schedule

  • A very costly agreement with Rosie O’Donnell indicates that OWN may be doubling its bet on Daytime
  • Meanwhile Martha Stewart moved to Hallmark Channel Daytime
    • Martha wasn’t a factor when the OWN JV was announced
    • She has started poorly, but enjoys the large-scale platform and brand to hurt OWN
    • OWN will need to increase its spending on promotions to attract audiences against competition from Martha
  • And someone in Discovery’s management team must be wondering if their 50%-owned, female-skewing OWN will undermine the primetime of their 100%-owned, female-targeted TLC

Why Beef Up LBA in LA?

Discovery Communications, which is based in Silver Spring MD, also announced the strengthening of its Los Angeles Legal/Business Affairs team:

  • DCI likes the comfort of locating senior LBA resources right down the block from OWN
  • There are other benefits:
    • At the SilverDocs Conference in June, a senior Discovery executive spoke of the need to accelerate and simplify his multi-layered program approval process
    • DCI says that the beefed up LA LBA team will put Discovery closer to the pulse of Factual content development
  • Meanwhile, Discovery is about to launch The Hub, its new children’s channel
    • The Hub is a JV with Hasbro
    • Our friend writes: “That’s a lot of JV’ing and launching in six months!”

Takeaways

  • It becomes all very complicated when a business sector reaches maturity
  • OWN launches in January, 2011