|Oprah Winfrey and her friends will have their own XM channel.
Oprah’s move will extend her TV and print empire to include satellite radio with the $55 million, three-year deal. Getting Oprah Winfrey is a coup for the largest satellite radio operator, which has been relatively quiet during the past few months, drowned out by Sirius’ Howard Stern media blitz.
The new ad-supported “Oprah & Friends” channel will air a weekly original show hosted by Oprah and Gayle King and will have regular segments hosted by popular personalities from her syndicated show, including designer Nate Berkus, Bob Greene, Dr. Robin Smith and Marianne Williamson. (Dr. Phil won’t be a personality on the channel.) The channel will broadcast from a new XM studio at Oprah’s Chicago-based production company, Harpo.
Martha vs. Oprah
A year ago at the 2005 McGraw Hill Media Summit, Sirius CEO Mel Karmazin admitted during a keynote Q&A that the daytime queen would be on his talent wish list, but said he had no plans to add her to the lineup. Two months later, Mr. Karmazin inked a contract with Martha Stewart. According to XM CEO Hugh Panero, talks between Harpo and XM began last summer, when Oprah toured their Washington studios.
“Because of what our company is, what we stand for and our diversity, there was a natural bond between the companies,” Mr. Panero said. “And it developed as we began working with Oprah and her team.”
The move is the latest in a series of steps the satellite operators have taken to attract women. This fall, Sirius launched its Martha Stewart Living Radio and it’s readying a new Cosmo-branded channel. XM has a women’s targeted channel with the “Good Morning America” radio show and Ellen DeGeneres and Tyra Banks.
While early adopters of consumer electronics have traditionally been men, as satellite radio moves beyond the early-adopter phase it is extending its appeal to women. Mr. Panero estimates women compose about 35% to 40% of XM’s total subscriber base. The rise, he said, coincides with the increase in factory-installed satellite radios in cars.
Oprah on different plane
“We have close to 60% of [the factory-installed] market,” he said. “And clearly women represent an enormous percentage of car buyers and influencers. Oprah is to women what sports are to men. There are media celebrities and there’s Oprah.”
The financial terms of the deal are dwarfed by sports deals -- such as XM’s $600 million, five-year baseball deal -- and Sirius’s $500 million, 11-year Stern contract. XM will sell advertising on the show; it is sharing revenue with Harpo. Both satellite operators sell ads on their talk and sports channels but keep the music channels ad free.
Both XM and Sirius subscriptions cost $12.95 a month. XM is the larger of the two, with 6 million subscribers. Sirius has 3.3 million.