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01/22/2008

Barter Catalyst For Huge Oprah/Discovery Cable Network Deal

At BarterNews, we have been contending for years that the �Best & Brightest� use barter in the building of their wealth�here is another example of that message.

Discovery Communications and Oprah Winfrey have announced a deal where the Discovery Health network will be bartered to Winfrey next year, and become the Oprah Winfrey Network (OWN).

The cash-free transaction involved Winfrey turning over half ownership of Oprah.com (her web site with 6 million unique visitors a month) to Discovery, while the communications company makes her chairman of the network which is currently seen in 68 million homes. The two entities (Harpo Production and Discovery) will be joint owners...50/50 in ownership and profits.

What�s the value of the deal? Hard to say at this point as Winfrey�s star power will generate greater revenue from cable companies once she comes aboard with her programming in mid 2009. But cable TV networks don�t come cheap. When Microsoft invested in MSNBC back in 1996 it put up $300 million for its half stake in a startup. (And Bill Gates is a tough negotiator.)

So Oprah�s �media empire� includes:

1.      Her top-rated TV talk show

2.   A satellite radio network (XM Radio)

3.   A web site

4.   TV movies made under her banner

5.   Now the OWN TV Network (68 million potential viewers, with coverage in 2/3 of the nation�s homes)

The focus of the channel will be Oprah�s brand�to educate and inspire people to live the best life they can. Some of Winfrey�s stable of regular contributors could be expected to be part of the programming. Winfrey�s current talk show, as well as rights to use of reruns, is spoken for until the end of the 2010/2011 season.

According to Winfrey, she made an entry in her diary May 24, 1992, about an idea for creating her own TV network...15 years later it�s a reality, and barter once again was the catalyst for a huge deal.

Oprah�s dream has come true. She will now have the opportunity to do this 24-hours a day on a platform that goes on forever.


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