Oprah's OWN Network Faces Axe After Losses Exceed $300 Million
Oprah Winfrey's OWN network could be axed within the next 12 months following reports that network losses are approaching $330 million.
Despite seeing a rise in ratings due to the popular program "Oprah's Next Chapter," Discovery Communications, which partnered with Winfrey to create OWN, continues to lose much of the $600 Million that the company invested in 2008, according to BusinessWeek magazine.
One Wall Street media analyst referred to OWN as the most "successful failure in television today," according to The Los Angeles Times. Despite reports that Discovery is considering opting out of its partnership with Winfrey, Discovery Senior Executive Vice President David Leavy insists that Discovery is not pulling the plug just yet.
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"We're as committed now as we've ever been and are bullish about the long-term value we are building. The cost structure was not sustainable; we had to right-size that," Leavy said in a recent statement.
The OWN network has struggled since launching in January 2011, and reportedly lost over 50 percent of its viewership in just one month, according to Nielsen ratings.
The network is believed to have lost close to $330 million since launching last year, which prompted multiple firings in March.
"If I were writing a book about it, I might call the book '101 Mistakes,'" Oprah said during an appearance on CBS News in April while owning up to the discouraging performance of OWN.
Just days after Rosie O'Donnell's "The Rosie Show" was cancelled due to poor ratings, 30 OWN staff members were also let go, which only highlighted OWN's financial crisis.
"It is difficult to make tough business decisions that affect people's lives. As CEO, I have a responsibility to chart the course for long-term success for the network. To wholly achieve that long-term success, this was a necessary next step," Winfrey, who personally addressed the workers at OWN's Los Angeles office, said in a statement.
