Who Knows What Women Want? Gerry Does…

Cable World, Feb 21, 2005

By Shirley Brady

Gerry Laybourne's latest young-female-targeted creation dares to go younger than Oxygen--or even Nickelodeon, where she cut her teeth in cable TV programming. As I sit in her office on the top floor of New York's foodie paradise at Chelsea Market, she reaches back from her conference table to pluck a booklet from a pile of papers on her desk. The words "Ellie Likes Boys" catch my eye as Laybourne starts flipping through the pages.

"My hobby has been making these shutter-fly books with my digital camera," she says as she zips through her handmade kids' book featuring photos of her husband, veteran TV producer and animator Kit Laybourne, goofing around with their 18-month-old granddaughter. "I write these little stories, and Ellie now has about a dozen of these that I sent her."

The image of Laybourne as a doting grandmother--sneaking scissors onto planes so she can make scrapbooks and collages for Ellie during long flights-- may not jibe with that of the tough-talking Oxygen chairman and CEO who frequents Capitol Hill to lobby against cable a la carte provisions. Or with the plugged-in arbiter of cool who's defied the critics, a dot-com meltdown and the odds of seeing her start-up cable network for young women turn 5 this month.

Oxygen has gone through its share of ups and downs since its launch on Feb. 2, 2000--smack in the middle of dot-com fever. Originally targeted as an independent "telefusion" (TV plus online) brand for women 18 to 49, Laybourne subsequently had to retool her strategy, which led her to lay off all but eight of her 250 online staffers (about 10% of her workforce) in December 2000 and scrap original Web content.

It's no small irony, now that Oxygen at 5 is no longer a convergence play, that other television networks are embracing Laybourne's vision of a media brand that plays across several platforms. Even rival women's programmer Lifetime started dipping its toe into original online content this year.

But having seen the network reach both profitability (2004 was Oxygen's first year in the black) and distribution targets (it's now in 54 million homes) ahead of her business plan's schedule, Laybourne is ready to go back to the future, in a sense, and revisit her dream of converged media for women.

Convergence--Take 2

Five years on, though, Laybourne's dream of convergence has changed somewhat. Taking Oxygen's brand to the video-on-demand realm has taken precedence over developing content for the Web. The lessons learned from Oxygen's first attempt at convergence five years ago is helping the network navigate the VOD waters.

"Fortunately we've got quite a bit of content that we still own from when we were an Internet company that's applicable in a video-on-demand world," Laybourne says, pointing to Oxygen's Moms Online portal that features a series of animations that gives tips to mothers. "We've got new mothers. We've got women who are single and thrilled about it. So how do we superserve all these different women? It's going to be through new kinds of video-on-demand product."

Oxygen's strategy five years ago was to match the programming on television with compatible Internet programming, says Oxygen president and COO Lisa Gersh Hall. "We had online brands that matched the titles of shows, but it was very difficult because we really were trying to drive [viewers] from the Internet to television--[they're] very different platforms."

Though Hall is deep in discussions about how to "Oxygenate" her distributors' nonlinear platforms, she insists Oxygen executives always will give great care to their linear channel. "But there's also a place where people will watch television on demand, which I like to think of as 'video on demand' but not limited to that [VOD] platform," she says, referring to everything from wireless phones to DVRs. "It's video that's accessible when you want it on a variety of different platforms."

Growing Pains and Growing Up

Despite the revamped business strategy, Hall has secured carriage commitments from almost every major MSO. DBS distributor EchoStar is still a holdout, even though it acknowledges that Oxygen is its subscribers' most- requested network.

Hall's deals give Oxygen space on the coveted expanded basic tier, a feat that she credits to Laybourne's reputation. "As an independent that was founded by someone in the cable industry who was so respected for building brands, cable operators were willing to make a bet that the original programming that we'd develop would be different enough and important enough to viewers that it was worth the investment of their very valuable beachfront real estate on expanded basic carriage," Hall says.

Insight president and CEO Michael Willner also credits "eternal optimist" Laybourne with defying the odds. "She accomplishes so much by the simple belief that nothing is impossible," says Willner. "That's the underlying reason why Oxygen succeeded without the help of mega-media ownership."