Oprah Winfrey and the New OWN Network

This week, Oprah Winfrey announced her departure from daytime television.  The last airing of the "Oprah Winfrey Show" will be in fall of 2011 as she prepares to start her own cable network, ending its 25th season on national broadcast television.

The announcement puts to rest some speculation that began once she announced the launch of OWN: The Oprah Winfrey Network, in a 50-50 partnership with Discovery back in January 2008.  (Discovery Communications President & CEO, David Zaslov pictured to the right along side Oprah Winfrey.)

OWN is set to launch in January 2011 in 80 million U.S. homes, replacing Discovery Health. Research firm SNL Kagan estimates the channel generates 12 cents per month in fees per subscriber, but that is expected to rise to 17 cents by 2013 after Winfrey settles in.

The amount Winfrey earned in her broadcast contract, in which CBS Corp. syndicated her show to stations nationwide, was not revealed. But Anthony DiClemente, an analyst at Barclays Capital, said the deal on cable "can provide higher value."

Winfrey will serve as Chairman of The Oprah Winfrey Network, LLC and the venture will be 50/50 owned by Discovery and Harpo. This is a cashless transaction and The Oprah Winfrey Network, LLC will be an independent company.

Discovery Communications will contribute to the venture the Discovery Health Channel as well as handle distribution, origination and other operational requirements for the proposed venture. Both organizations will contribute advertising sales services to the venture. 

Sources: The Detroit Free Press and The Associated Press

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