OWN Charter Sponsors Renew Deals in Upfront

Winfrey's ratings upturn buoys advertiser interest
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Improved ratings have come at the right time for Oprah
Winfrey's struggling OWN Network, which was able to get the eight advertisers
who signed two-year deals as launch partners to renew their sponsorships during
recently concluded upfront negotiations.

Sticking by Winfrey and her nearly two-year-old cable
channel are Procter &  Gamble,
General Motors, Target, Toyota, Nissan, Wal-Mart, Kellogg and Kohl's, according
to Kathy Kayse, executive VP for ad sales at OWN, a joint venture of Winfrey
and Discovery Communications.

Since its ballyhooed launch, OWN's ratings have been
disappointing. Discovery has poured $300 million into the project so far. It racked
up almost $50 million in losses in the first quarter, writing off failed OWN
programming including a Rosie O'Donnell talk show.

But ratings rose for the second consecutive quarter in the
second quarter, with double gains among women 25-54 in both primetime and total
day. Oprah's Next Chapter aired the
second part of her interview with the Kardashian family on June 24, winning the
time period among female viewers.

"This momentum is coming at a critical time as advertisers
continue to place their bets on the network," said Kayse, who said OWN had
wrapped nearly all of its upfront business. Dollar volume was up from last
year's upfront and while she wouldn't disclose whether prices on a cost-per-thousand
(CPM) basis were up or down, Kayse said Winfrey maintains the kind of premium
pricing she commanded when the network was launched.

Kayse said that most of the original advertisers thought
that OWN's ratings goals were a little lofty, but their deals were linked to
top-tier programming and programming that featured Winfrey herself and to
vignettes and other unique sponsorships.

The sponsorships were also pricey, with P&G reportedly
committing $100 million to OWN and others pledging $10 million to $15 million,
a large sum for a startup.

When viewership came in lower than promised, "we did them
right in terms of how we worked with them through the challenges we had with
ratings. We helped them right-size the business," Kayse said. "They've always
look at it as a long-term proposition and investing in the future with us."

Two other charter advertisers, Johnson & Johnson and
JPMorgan Chase, dropped their sponsorships after their one-year deals expired.

In addition to the charter sponsors, Kayse said OWN is
attracting more advertisers in additional categories, though the retail
category has remained particularly strong.

Kayse says advertisers are attracted by the way Winfrey's
multi-platform presence, which has made her Lifeclass show popular.

"It may not be the ratings story that you find with Next
Chapter," she says, but "what's really attracting a lot of advertisers to Oprah's
Lifeclass is the whole notion of our cross-platform success on Facebook, with
Oprah's Twitter fees and the audience she's able to command on a global basis.
That's been an extremely well received story in the market."

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