OWN 'Not Panicking' After Lackluster 'Rosie' Launch, But It Needs a Hit Soon, Sources Say

Oprah Winfrey, Chairman, CEO, and Chief Creative Officer of OWN: Oprah Winfrey Network, poses with Rosie O'Donnell at their Television Critics Association presentation on July 29, 2011. (Reuters)

Rosie O’Donnell is not exactly the savior Oprah Winfrey’s OWN cable network was hoping for.

Despite appearing on the cover of Winfrey’s O magazine and constant promotion on the Discovery Channel network, the October 10 premiere of “The Rosie Show” on OWN produced less than half a million viewers, while “Oprah’s Lifeclass” did even worse, attracting just 333,000 viewers.

And both shows lost viewers the night after their premieres, with “The Rosie Show” dropping more than 36 percent, to 317,000 viewers the following Tuesday, while “Oprah’s Lifeclass,” also dropped to just 279,000 viewers.

But even with the lackluster ratings, OWN execs aren’t ready to throw in the towel just yet.

“The strategy is that they are giving themselves five years to have a hit,” a source close to OWN told FoxNews.com. “There’s no real panic, but if there’s no hit in five years, they’re pulling the plug. The numbers are bad–really bad. For the people who claim to be the best team in television, they just don’t seem to be able to handle it.”

A rep for Discovery Communications took issue with the five-year plan claim, and says that Discovery is standing by Winfrey and OWN for the long haul.

“The five year timeline is not accurate,” David C. Leavy, Discovery Communications’ chief spokesperson, tells FoxNews.com. “Discovery is a very patient investor and someone who builds cable networks for a living. It just takes time. We’re very pleased with where the network is, we’re very pleased with ‘Rosie’ and ‘Lifeclass.’"

Another insider agrees that OWN is here to stay for the time being.

“It’s rare for a channel to launch and then just, quote, ‘pull the plug,’” a top cable network executive told FoxNews.com. “What companies tend to do is give a channel a certain amount of time, and then they’ll rebrand it. They’ll use what many people call ‘beachfront real estate’ – the distribution – to come up with another concept.”

OWN’s dependence on reality shows is also an advantage, Brass Ring Entertainment executive producer Rick Telles explained. “Reality shows are a lot easier to get up and running than scripted shows,” he said. “You can experiment, and it’s not as expensive.”

Moving forward, Discovery plans on wide range of programming for OWN. “I think you’ll find that there will be a mix of programming and different kind of genres and categories on the network,” Leavy explained. “We obviously have a variety/talk show with ‘Rosie’ and some really innovative programming that I don’t think you’ll find anywhere else on the dial in ‘Oprah’s Lifeclass,’ which is really meaty, ‘live your best life’ programming, and a lot in between.”

While 497,000 viewers was a disappointment for the debut of “The Rosie Show,” OWN execs pointed out it improved on what Discovery Health was doing a year ago in the same time slot by more than 200 percent.

“I think that OWN is looking for anything to build on, and the improvement with ‘Rosie’ is certainly a positive thing,” the cable executive explained. “But the overall ratings, not withstanding the success of 'Rosie' on Monday night, is about 12 percent below what Discovery Health was doing a year ago at this time. It’s been a very public black eye for the company.”

The lackluster ratings are not due to a lack of support. Last week, the New York Post reported that Discovery spent over $200 million on OWN, with an additional $25 million on marketing. “I think they’ve spent more than that,” suggested the cable exec. “I would characterize OWN as a distraction for Discovery. I think there’s been a enormous amount of senior management attention on it, and they’ve put a lot of money behind it with very modest returns.”

But OWN may have bigger problems than outsized spending and low ratings. “At MIPCOM last week, almost everyone I ran into had something negative to say about OWN,” said the cable network executive, referring to the television and entertainment market held annually in Cannes, France. “They told me stories about how OWN would greenlight a project, then change their minds, then go ahead, and then decide that they really didn’t want it that way, then they would change things midstream, they would want 10 episodes and then they would change it to five... The frustration that the production community had for that channel was at an almost comical level. It was at a fever pitch.”

With things as bad as they are at OWN, why is Discovery so committed to Winfrey’s troubled network? “I think there’s an emotional element to this,” said the cable network executive. “The Discovery gang is thinking, ‘We’ve already sunk all of this money into it, let’s give it some more time–we’re dealing with Oprah.’ There’s a seduction that would allow this to continue. I don’t see Discovery shutting OWN down in a rational business way, or looking at it in a very dispassionate way. I think that there’s emotion that’s very much involved in this because it’s Oprah.”

According to Telles, if OWN hopes to survive for five years and beyond, it needs to find shows that resonate with viewers.

“Look at the History Channel,” said Telles, a former reality TV producer. “It’s a small cable network, but it has three or four reality shows that are doing really well – they’re getting big numbers. They’ve done a very good job of figuring out what their audience wants, and they give them great shows. They’re getting a couple million viewers. This summer, ‘Pawn Stars’ was in the top 10 out of all the networks – that’s crazy. ‘Storage Wars,’ American Pickers’ – all those shows do well for them.”

Discovery says they plan to expand their use of social media to build viewership for OWN. “I think Oprah has a very passionate audience and part of what you try build here is that deeper engagement, that sticking experience, and so we focus a lot online, and through Facebook, and try to create an environment where viewers and consumers can get nourished both on TV and online,” said Leavy. “I think so far, so good, but over the coming years, you’ll probably see even more of that.”

One insider believes that a hit show – and change of leadership – could turn the tide for OWN. “I think good leaders and good executives can come in and take a bad situation and turn it around,” explained the he cable network executive. “With OWN, I do think there’s a culture of dysfunctionality there, and I think it’ll take a superhuman effort to change things. I wouldn’t say that it’s likely that it’ll be fixed, but it’s possible if they bring in the right executive.”

Discovery, meanwhile, believes that they have the right leader with Winfrey.

“Since the ‘Oprah Winfrey Show’ concluded, she’s taken over the CEO reins, she’s been in the office almost every day, she’s screening tape, meeting with producers, and has been completely engaged, and that has made a difference,” said Leavy. “I think that you’ve seen with this October launch – kind of a reset or Oprah 2.0 – with a lot more original content, a lot more Oprah on the air, a whole new look and feel of the network and we’re really kind of beginning anew now, and that’s important. You’ve got to start somewhere. We launched in January, but now we’re starting to find a little bit more of our rhythm, and having Oprah 100 percent in the chair makes a huge difference.”