Paula Bernstein

FEATURES

The Hollywood Reporter, June 22, 1999

Oxygen: TV out of thin air

By PAULA BERNSTEIN

In a tiny room padded with bubble wrap, presumably to remind visitors that Oxygen is everywhere, Geraldine Laybourne, the queen of cable television, holds court.

The scene is a coming-out party for Oxygen, the multimedia company she founded last year, at last week's National Cable Television Assn.'s 48th annual convention, and Laybourne is about to reveal some big news: Television royalty Candice Bergen and Oprah Winfrey will star in primetime shows for the Oxygen cable channel, which is set to launch on Feb. 2.

To top that coup, the company has signed a carriage agreement with MediaOne and closed a deal with Paul Allen's Vulcan Ventures worth $100 million. Allen has also agreed to launch the female-targeted cable network on his Charter Communications cable company, which will bring Oxygen up to more than 5 million subscribers when added to the carriage deal the channel has already set with TCI and MediaOne. Not bad for Oxygen's first NCTA, where start-ups typically have to scrounge for attention.

While critics scoff that in this competitive cable environment it's impossible to create an economically viable new cable network consisting almost entirely of original programming, Laybourne is seemingly fearless. "We will have between 8 and 10 million subscribers at launch. We are not nervous about this. We will get on the air and we will do a good job and everybody will want us," Laybourne says.

If Laybourne hadn't turned Nickelodeon into a kids' programming powerhouse and headed up Disney/ABC Cable Networks with such finesse, it would be easy to dismiss her claims. But, she has experience, impressive partners, crucial relationships in the industry and financial backing from none other than AOL and Oprah Winfrey to back her up.

According to those who have worked with her, Laybourne cannot be underestimated. In addition to her proven business acumen, she is known for her quirky sense of humor. When Oxygen's company Web site was being developed, for instance, Laybourne decided it was too businesslike, and insisted that a section be devoted to her hair, complete with photos of her changing styles throughout the decades.

While critics have called the gag "sophomoric," Laybourne isn't fazed. "There are going to be plenty of things on Oxygen that are sophomoric," she says.

Over the past few months, Laybourne has teamed up with Marcy Carsey, Tom Werner and Caryn Mandabach of Carsey-Werner Prods. (creators of such hit shows as "The Cosby Show" and "Roseanne") and Winfrey.

On top of that A-list roster, Oxygen has statistics in its favor. Women spend about 8.8 hours per day with some form of media, as compared with men's 8.2 hours. Women age 18-54 watch an average of 27.8 hours of television per week, compared with men of the same age range who watch 24. Women control 85% of all personal and household goods spending and 70% of all consumer spending. Laybourne and her posse gladly recite these numbers to anyone who will listen.

Apparently, they're not the only ones doing their research. Earlier this month, Turner Broadcasting System announced it would partner with Advance Publications to launch a new lifestyle and information-oriented cable network geared to women. E! Entertainment Television is investing in its new style network, and Rainbow Media is marketing Romance Classics to women. Meanwhile, Lifetime, which Laybourne had a hand in when she worked at Disney, continues to invest in original programming under new president Carole Black.

With all that competition, Oxygen's leadership keeps its inner workings close to the vest. But interviews with principals and other sources make it clear that the development process at Oxygen is in full swing. The driving principle is that female viewers want something entirely different. In one key indicator, the network's programming will differ from traditional networks in that it will consist of themed blocks, not half-hour or hour segments.

"Half-hour programs were not given to us by God. They were given to us by commerce," Laybourne said. Because Oxygen isn't planning to sell programming to international markets, it is not as concerned about fitting into the conventional mold.

"Exhale," the Charlie Rose-style talk show hosted by Bergen, will air Monday-Thursday at 10 p.m. and will vary in length. "It will be as long as the conversation is entertaining," said Werner. Theoretically, it could last only 20 minutes, or could extend to two hours.

Of course, that doesn't address the concerns of advertisers. Will an Oxygen sales person tell media buyers that a spot will run at 10:40 p.m. if the show is interesting enough to go that late? Will viewers, reared on network television, accept the notion that television can break the rules or will they change channels when "Exhale" ends earlier than expected and they are stuck with interstitials?

"It's going to be difficult to get viewers used to something like that. How will they list the programs in the TV Guide?" said Derek Baine, senior analyst at Paul Kagan & Associates.

That doesn't worry the air people. "If it ends in 35 minutes, that's what it's gonna be. That's the overall philosophy on a lot of the programming blocks," says C-W representative James Anderson.

And, while industry types are reluctant to bet against Laybourne, you have to wonder whether highfalutin conversations between Bergen and guests such as writer Fran Lebowitz -- the sample shown at the bubble-wrapped NCTA dog-and-pony show -- will play to anyone outside of Manhattan's Upper West Side.

Among the other programming blocks is "Tribes," geared to teenage girls. Oxygen plans to pass out digital cameras to their target audience and see what they can produce for two hours. Chances are, with low budgets and little experience they won't be churning out "Dawson's Creek" imitators.

Also included in the programming plans are "Oxygen Comedy," a primetime comedy block; "ka-Ching," about women and money; and an as-yet-unnamed e-commerce block that will point viewers to Web sites.

Oxygen is also developing a sports block, featuring "sports you don't see on big networks," according to Mandabach, as well as a movie block and a Saturday-night music block, which will "expand on the Lilith Fair concept."

There are some in the industry who doubt that Oxygen can meet its lofty goals of revolutionizing women's television. While Carsey-Werner has a slew of hits under its belt, the producers have never worked in cable before. It's quite a leap from working with Roseanne and Bill Cosby to handing out digital cameras to teenagers.

The talent that Oxygen has drawn to itself is also not terribly known for cable production experience. Former "Letterman" producer Robert Moron, who was hired with his Panamort Television to an exclusive two-year deal by Carsey-Werner to create television, is from the network world. "Part of his deal is contributing to programs for Oxygen," says a C-W spokesman, "working in development by obtaining talent both on-camera and off."

Other than being movie director Stanley Donen's daughter-in-law, Nikki Donen, the executive producer of Bergen's show, has no more of a resume than being someone Caryn Mandabach knows and believes in. Indeed, the one solid cable guy who has come aboard is former CBS Cable exec Geoff Darby, who is Oxygen's president of production.

Even Laybourne acknowledges that 8-10 million subscribers at launch is not enough to make Oxygen economically viable as a cable business alone. Laybourne has said that to make money with the cable side of her business, Oxygen will need to reach the ambitious figure of 60 million viewers within five years. But if Lifetime's ratings deteriorate, there is a chance that MSOs could drop the channel in Oxygen's favor.

"If Oxygen were to kick ass and get better ratings than Lifetime, it's possible," Baine says. "Five years from now, it could happen."

To see faster financial results, Oxygen is wooing retail partners such As Starbucks Coffee, which recently entered into a strategic alliance with the new venture. As part of the deal, Oxygen will feature Starbucks products and services on its network of Web sites, in return for in-store promotion at Starbucks retail locations nationwide. The two will also exchange content, but it is not yet clear what type of programming Starbucks will provide.

Oxygen is reportedly in talks with Barnes & Noble about working out a similar deal. It is through the Internet and partnerships like the one with Starbucks that Oxygen hopes to recoup its investment.

Unlike most cable networks that are creating Web sites to accompany their existing channel, Oxygen is developing its online component from the ground up. The buzzword at Oxygen, as in the cable industry as a whole at the moment, is "convergence."

"We are at the forefront of the convergence of the Internet and television," Laybourne and her colleagues repeat like a mantra.

While Laybourne seems undaunted in her mission of disseminating quality television to women, she does admit to being concerned about the expectations people have of Oxygen. "The truth is that anything good takes time. You have to make mistakes," she said.