In Business This Week: HEADLINER
OPRAH WINFREY: WHAT WOMEN REALLY WANT?
Oprah Winfrey is investing with some big names in TV in a new cable channel targeted at women. Joining Winfrey and her Harpo Entertainment Group are Geraldine Laybourne, ex-president of Nickelodeon and founder of Oxygen Media, plus Roseanne producers Marcy Carsey, Tom Werner, and Caryn Mandabach. Other backers include America Online and ABC.
Winfrey, who will help create new programming, wouldn't comment. But with her name, the team can "build our brand immediately," says Laybourne. "There is no source who knows what women want and need more than Oprah." Tele-Communications Inc. will carry the channel to 7 million subscribers; Laybourne aims for 20 million by launch.
Have people overdosed on Oprah lately? Her movie, Beloved, did poorly at the box office, and her talk-show ratings are down from last spring. "I think Oprah should be the brains, not the face [behind Oxygen]," says consultant Simon Williams. Laybourne vows to avoid overexposure: "We will be very protective of the natural resource" known as Oprah.EDITED BY KELLEY HOLLANDReturn to top
GRIST FOR PAPER'S MERGER MILL
THE PAPER-PRODUCTS INDUSTRY CONTINUES TO CONTRACT. On Nov. 24, International Paper, at $20 billion the largest paper-products company in the world, announced it was buying competitor Union Camp for $6.6 billion. The deal comes just two months after Union Camp announced a restructuring to cope with the effects of the Asian crisis. Because fewer U.S. products are being wrapped and packaged and sent to Asia, the industry is in a funk. But IP Chief Executive John Dillon says the deal isn't about tightening capacity. "This is about putting two very strong companies together and making them better," he told analysts. Meanwhile, Smurfit-Stone Container, which was created by a megamerger earlier this year and is shouldering $6.5 billion in debt, is cutting back. It announced on Nov. 24 that it would lay off 3,600 workers, idling facilities that produce 1.1 million tons of paper products and taking a one-time charge of up to $350 million.EDITED BY KELLEY HOLLANDReturn to top
EXPECT LAWYERS TO TIE UP MCI'S LINES
HERE COME THE SUITS. ON THE HEELS OF A NOV. 10 ruling by the Federal Communications Commission that MCI Communications overcharged some of its customers, attorneys are scrambling to file class actions. The FCC determined that MCI had unfairly charged some customers "nonsubscriber" rates of 38 cents a minute plus a $2.49 connection fee. The practice may have affected millions of customers. On Nov. 20, two class actions were filed. An MCI spokesman says the company is proposing changes in its rates to satisfy the FCC.EDITED BY KELLEY HOLLANDReturn to top
FEDEX STOPS DELIVERY ON A UNION
UNIONIZING FEDERAL EXPRESS' 140,000 workers has long been the dream of labor organizers. That now seems more unlikely than ever. The Memphis-based express-delivery giant--one of the few nearly union-free shops among major transportation companies--is likely to remain that way. With FedEx founder Fred Smith threatening to outsource hundreds of their jobs, the company's 3,500 unionized pilots on Nov. 20 scrubbed a Dec. 3 strike vote. Analysts say the about-face by the pilots dashes any hopes of organizing FedEx' other employees.EDITED BY KELLEY HOLLANDReturn to top