Paul Allen has definitely made worse investments, but Oxygen Media hasn't exactly been a major success. It originally billed itself as ''the first and only network to combine advocacy, technology and creativity for a single purpose: releasing the energy of women to do great things." The television network launched in early 2000, but seven-plus years later only attracts an average of 250,000 prime-time viewers, despite being available in over 74 million homes.
Here are the investments that made this viewership possible.
February 1999: Morgan Stanley shops Oxygen Media to investors, at a valuation of about $750 million, as part of an overall plan to raise $450 million. Initial investors include AOL and Oprah Winfrey.
June 1999: Microsoft co-founder and Portland Trailblazers owner Paul Allen injects $100 million for a 13% stake in the venture, which values the company at about $770 million.
January 2000: LMVH boss Bernard Aranult—the so-called wolf in cashmere—invests $122 million in Oxygen as part of a top-of-the-bubble plan to IPO a collection of disparate Internet investments.
January 2000: Oxygen’s valuation hits about $1 billion before its official launch.
October 2000: Oxygen begins hunting for new investors amid weak subscriber growth. The company shops a 30% to 50% stake at around $700 million to $900 million, down from hoped-for levels of $1.1 billion to $1.2 billion.
December 2000: Paul Allen injects another $100 million as the company scales back its Web operations. In the depths of the Internet bust, the valuation shrinks to about $500 million to $600 million.
Today, Oxygen generates about $80 million in cable subscriber fees, and over 40 percent of its viewers are women aged 18-49. Those are key reasons that NBC just paid $925 million for the network. This follows last year's purchase of the website iVillage--"The Women's Network"--for $600 million.
Men comprise 30 percent of Oxygen viewers, but NBC wasn't really after them.
Bringing Oxygen together with Bravo, the "Today" show and iVillage will help NBC create "a virtual women's network" that gives advertisers an audience of young, affluent women, NBC Chief Executive Officer Jeffrey Zucker said on a conference call.
"This fits perfectly into our strategy of investing in cable and high growth areas," he said. NBC is also expanding its digital operations with Hulu, a Web-based joint venture with News Corp. offering films and shows that will start later this year.
Oxygen's CEO and co-founder Geraldine Laybourne will leave the network at the end of the year.
Regarding the other women's channels...WE (Women's Entertainment) is owned by Rainbow Media Holdings, which belongs to Cablevision. FYI, Rainbow Media used to own half of Bravo before selling it to NBC. Lifetime, which has higher ratings than Oxygen and WE, is owned by Disney and the Hearst Corporation.
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