How Long Will Discovery Continue To Back Oprah?
Supporting Oprah Winfrey's struggling OWN cable network may be well and good for now, but a senior Bloomberg analyst wants to know how long Discovery Communications, which is half-owner of the network, intends to keep on doing so. "The company needs to provide investors with a road map for this business," Paul Sweeney remarked on Wednesday after Discovery shares plunged 6.1 percent after it said that it had assumed 100 percent of the losses at OWN in the first quarter. Bloomberg had recently reported that OWN may have lost as much as $330 million since its inception. Asked Sweeney, "How long will they stomach these losses before they make a serious change in strategy?" On Tuesday, Winfrey tweeted her thanks to Discovery President/CEO David Zaslav "who keeps speaking up for me with his unwavering support." Discovery's other ventures produced higher-than-expected revenue, which rose 16 percent. Morningstar analyst Michael Corty called the results "outstanding." In an interview with Reuters, he said. "The Oprah issue -- that shouldn't be a surprise, it takes time for a network like that to grow."