The Oprah effect: Winners and losers

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Oprah Winfrey’s decision to walk away from her daytime talk show after 25 years when her contract expires in 2011 will have a ripple effect throughout the television industry.

The big winners are Discovery Communications, which is partners with Winfrey on the Oprah Winfrey Network (OWN) that is due to launch in early 2011, Ellen DeGeneres and Warner Bros., which syndicates her daytime talk show and all the TV stations that will no longer have to compete against Winfrey in daytime.

The losers include CBS, which will no longer be able to count on the hundreds of millions that ‘The Oprah Winfrey Show’ delivered in license fees and advertising revenue over the years. ABC is also probably not too happy. Many of its big city stations carried the show and it delivered a sizeable audience to their local news. Sony is also grumbling; it was trying desperately to woo distribution rights to Winfrey’s daytime show away from CBS when her deal expired. Winfrey herself may be a loser because odds are that, at least in the short-term, she will take a financial hit by abandoning daytime talk -- although, of course, in the long-term she is building an asset that could have tremendous value.

While Winfrey and OWN are keeping quiet, the talk show queen is expected to have a visible presence on the channel when it launches. She probably will do a daily show, although it will not be a carbon copy of her current effort. This will help OWN build a brand and boost its distribution for the network.

Winfrey’s departure will be the end of an era for daytime talk. She burst onto the national scene in 1986 after toiling in local TV in Nashville, Baltimore and Chicago, which is where she has made her home for almost 30 years. The late Roger King, a legendary salesman known as much for his hard-living as for his deal-making acumen, signed her to King World and made her a star, and she made him and his brother Michael incredibly rich. CBS later bought King World for $2.5 billion.

When Winfrey premiered, daytime talk was still ruled by Phil Donahue, who dealt with politics and social issues in a more refrained manner. Winfrey was boisterous and enthusiastic and endeared herself to her audience and guests. She was able to woo political leaders and movie stars to her couch and at the same time dip into the more tawdry topics that have also become a staple of TV without soiling her own reputation.

The exit of Winfrey from broadcast TV to cable is yet another sign of the paradigm shift between the two mediums. News Corp., Disney and Viacom all are powered by their cable networks, as is Time Warner. Comcast wants control of NBC Universal not for its broadcast network and TV stations, but for its cable networks. Winfrey is making the decision that she can make more money and build her brand better on cable than broadcast. A few years ago that would have seemed unthinkable, but it is clear that the greater value lies in the broadband medium. OWN, which will debut in 2011 in roughly 70 million homes, will be turbo-charged by having her on board as a regular presence.

At the same time, her own visibility will decline, at least for awhile. While actors bounce back and forth between broadcast and cable, personalities of Winfrey’s stature generally stay put. Ted Koppel left ABC’s ‘Nightline’ for Discovery Channel but his presence in the cultural zeitgeist diminished and he no longer is associated with the network. Howard Stern gave up his perch on FM radio for satellite radio and though his pay day grew tremendously, he is no longer part of the daily conversation around the water cooler. Winfrey probably will have a similar adjustment. Cable is great at building some stars such as Jon Stewart and Stephen Colbert, but those who move there from broadcast face smaller audiences and diminished limelight.

Of course, after a quarter of a century of being in the spotlight, maybe Winfrey won’t mind some quiet time.

-- Joe Flint