Helium Boost: RCN Carriage

2/06/2000 7:00 PM Eastern

New York -- Getting a birthday lift last week, newborn
Oxygen cut a last-minute deal for limited carriage by overbuilder RCN Corp. in the Big
Apple, where the women's network lacks distribution from Time Warner Cable.

Oxygen, which launched last Wednesday during a jam-packed,
star-studded party at its Chelsea Market headquarters/studio here, isn't saying how
many subscribers the RCN deal provides.

"It's limited distribution within New York
City," an Oxygen spokesman said. "We're working with them for broader

RCN officials couldn't be reached for comment. But
computer billionaire Paul Allen is an investor in both RCN and Oxygen, which will also be
carried by his Charter Communications Inc. cable systems. Allen's Vulcan Ventures
Inc. pumped $1.65 billion into RCN and $100 million into Oxygen last year.

RCN's pact with Oxygen gave the women's network
some immediate presence in New York, arguably the media and financial capital of the
world. But it's a small beachfront, since sources placed RCN's New York
distribution at only 40,000 homes, compared with Time Warner's total of more than 1.1

Last week, Oxygen was already running TV spots in New York
telling viewers to "ask your cable operator to give you Oxygen." The commercials
also had a tag line mentioning that Oxygen was available on some RCN systems.

Time Warner declined to comment on Oxygen's deal with
its underdog rival, RCN.

Oxygen officially debuted at 8 p.m. last Wednesday during a
ceremony and countdown that founder-partners Oprah Winfrey, Geraldine Laybourne, Marcy
Carsey, Caryn Mandabach and Tom Werner all participated in. Candice Bergen, who is hosting
Oxygen's Exhale talk show, was also present for the festivities.

According to Oxygen officials, the newbie premiered in 7
million to 8 million homes, and it will be in 10 million shortly. Longer-range, it has
commitments for at least 20 million homes.

The first thing that appeared on Oxygen's air was the
30-second spot the start-up network ran during the Super Bowl. In it, newborn girls in a
hospital maternity ward defiantly toss off their stereotypical pink nightcaps, as the
Helen Reddy song, "I Am Woman,"plays in the background. Then one baby
raises her fist, Black Panther-style.

Before "switching on" the network, via a laptop
computer, Winfrey told the crowd that when Laybourne approached her about creating a
women's network, "this was some divine intervention … the idea of being
able to extend our voices."

Although press accounts have been critical of Oxygen's
initial distribution figure, 10 millions subscribers is a fairly strong launch in
today's cable environment.

The Walt Disney Co.'s SoapNet, for example, debuted
last month with only 1 million subscribers, even though it is offering cable operators
retransmission consent for ABC-TV stations in exchange for carriage of the all-soaps

Anne Sweeney, president of Disney/ABC Cable Networks,
recently told TV critics, "In the cable universe … that's a good launch
number today."

In addition to Allen's Charter, Oxygen has carriage
deals with AT&T Broadband & Internet Services, MediaOne Group Inc. and Insight
Communications Co. Inc.

Oxygen still lacks affiliation agreements with Time Warner,
Cablevision Systems Corp. (which is also a major cable operator in the New York DMA),
Comcast Corp. and Cox Communications Inc. Oxygen has talked with Cox and Comcast about
offering them equity in the network in return for carriage, according to sources.

Oxygen's deal points have been tough for some
operators to swallow. It is seeking analog carriage, and its monthly license fees are in
the 18- to 20-cent-per-subscriber range, which is relatively high for a start-up service.
Oxygen is also offering operators a $1-per-subscriber launch fee -- far below what's
typically offered -- or one year of free carriage.

At the recent Television Critics Association winter tour in
Pasadena, Calif., writers were irked when Winfrey didn't appear at Oxygen's
presentation. But she was front and center at the network's launch last week.

"Greatness is determined by service," Winfrey
said, "a service that opens up the heart."

She also hinted that Oxygen's programming, which is
virtually 100 percent original, is a work in progress. "The network we created is not
the network we will eventually be," Winfrey said. "As time goes on, we will be
even better … I look forward to growing with the network."

Oxygen kicked off with its primetime signature show, Pure
, which featured a performance by salsa-singing queen Celia Cruz. Oxygen viewers
also got their first look at the strip the network is keeping at the bottom of the screen,
which includes Oxygen's Web address.

Oxygen's initial advertisers include Procter &
Gamble Co., but an official charter-sponsor list hasn't been released yet.

In the meantime, the dominant women's network,
Lifetime Television, enjoyed a strong January in terms of ratings. Lifetime was No. 2 in
primetime with a 1.9 rating, behind USA Network and its 2.7, according to Nielsen Media
Research. For total day, Lifetime tied for second place with TBS Superstation, each
posting a 1.2.

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