Layoffs and restructuring at Oprah Winfrey's beleaguered OWN channel
Weak ratings and a poor financial performance have led to layoffs and yet another executive restructuring at the Oprah Winfrey Network, the cable channel co-owned by Winfrey and Discovery Communications.
OWN, which last week finally canceled its high-profile Rosie O'Donnell talk show, said it was laying off 30 staffers and bringing in executives from Discovery Communications to oversee key operations.
The move comes as OWN continues to struggle to find its voice. Launched in January 2011, OWN has already cost Discovery more than $300 million. The channel's performance has been so weak that there has even been speculation, denied by insiders at the network's parent companies, that if the situation doesn't improve soon the plug could be pulled.
"We're as committed now as we've ever been and are bullish about the long-term value we are building," Discovery Senior Executive Vice President David Leavy said Monday.
“It is difficult to make tough business decisions that affect people’s lives,” said OWN Chief Executive Winfrey in a statement. "The economics of a start-up cable network just don’t work with the cost structure that was in place," she said, adding, "to wholly achieve that long-term success, this was a necessary next step.” Winfrey was at OWN's Los Angeles headquarters Monday to address the staff about the changes.
As part of the restructuring, Discovery Communications will have more say in the business operations. Initially, Discovery had something of an arms-length policy when it came to OWN.
However, as the losses have piled up and the executive suite of OWN started to resemble a revolving door, Discovery decided it needed to step up and become more involved in the channel's operations.
"The cost structure was not sustainable; we had to right-size that," said Leavy.
In January, Discovery dispatched Rita Mullin, a longtime Discovery programmer, to help shore up programming at OWN. Now, as part of this restructuring, Neal Kirsch, Discovery's chief financial officer of its U.S. Metworks unit, will shift to OWN and become its chief operating officer and chief financial officer.
Discovery is also bringing in executives to oversee production and marketing for OWN.
The changes come just two weeks before OWN is scheduled to begin making its upfront programming presentations to advertisers in Chicago, New York and, later, Los Angeles.
-- Joe Flint and Meg James
Photo: Oprah Winfrey at the Sun Valley conference in 2011. Credit: Julie Jacobson / Associated Press.