Oprah was involved in a ratings war with local Chicago TV competitor Phil Donahue in the early 1980s. Sally Jessy Raphael, Geraldo, and Jerry Springer were other prominent TV personalities at the time. After 30 years, Phil Donahue’s net worth has risen to $150 million. Sally Jessy has a net worth of $40 million. Springer has a net worth of $60 million. What is Oprah’s net worth? 3.5 billion dollars This is around 60 times greater than her nearest previous opponent. What caused this to happen? According to all indications, Oprah should have had a good TV career that could have gone national for a decade or two. A respectable profession that would have netted her a fortune in the tens of millions of dollars today. We can’t possible know how much it was, but it’s reasonable to say it was a portion of a billionaire’s fortune. So, what distinguishes Oprah from the rest of the pack? Everything comes down to one amazing business gamble she made in 1984.
Oprah began her television career at the age of 19 at a CBS station in Nashville. In 1976, she accepted a position as an evening news anchor at an ABC station in Baltimore. She moved to a new morning discussion program on the same channel in 1978. Oprah established her audience niche with the morning talk show style. She listened, she stressed, she could talk about everything from a severe crime to a new muffin recipe.
By 1980, she was outperforming nationally syndicated Phil Donahue in the Baltimore area. By the conclusion of her Baltimore tenure, she was making $220,000 per year, which equates to roughly $560,000 now after inflation.
Recognizing her talent, ABC offered Oprah her own 30-minute morning talk program in Chicago in 1984, which was produced by a firm named King World Productions. King World was also the production company that brought you Jeopardy and Wheel of Fortune. The employment came with a four-year contract and a $30k wage boost every year to $250k, which is equivalent to roughly $600k today. There was even talk of taking the program nationwide.
Oprah was overjoyed. She had to be, how could she not be? She had risen from squalor to make a fortune and become a celebrity. The realization of the American dream!
Oprah’s net worth in 1984 was $500,000 USD.
Something looked odd to Oprah immediately after signing the new contract. ABC execs couldn’t stop talking about how terrific the contract was for her and how simple it was to work with her agency. No executive had ever informed her she was getting a good deal. They were continually complaining about how much money she was earning.
Oprah confided a fellow Chicago TC celebrity, film critic Roger Ebert, about her uneasy feeling. Roger concurred that the transaction was terrible, particularly given his expectation that the show’s earnings would grow 40X if it ever went national. Significantly higher than the $30k raise they were receiving.
Bill Cosby was then contacted by Oprah regarding the matter. Cosby was intrigued by her depiction of the agency and network working so nicely together. Cosby elaborated:
“People feel afraid when they see my agent walking along halls at TV studios, networks, or wherever…
My representative is a piranha. You need a piranha. I know a man. He’ll tell you why I’m affluent. They’re just promising to make you RICH.”
Following Cosby’s counsel, Oprah sacked her longtime agency and hired a lawyer named Jeffrey Jacobs.
Jacobs examined her contract and explained:
“You may sign this contract,” says Jeffrey Jacobs. You may sign it if you don’t mind becoming nothing more than a slave.
“Excuse me?” says Oprah.
“This is a slave contract,” Jacobs says. Slaves are paid a certain wage. They’re prepared to put their money on a national program. This contract is for four years and one million dollars, with the goal of turning you into a well-paid slave. They’re planning to promote this via something called syndication.”
“Roger Ebert told me how he and Gene Siskel fought for a cut of their show’s syndication money but had to bear production expenses,” Oprah says. That’s the type of bargain Bill Cosby strikes for Fat Albert and The Cosby Show, in my opinion… yet I lack that type of clout.”
Photographs by Getty Images
With her approval, Jacobs walked into King World/ABC and informed them the contract was a shambles. They requested an immediate renegotiation.
This was a massive gamble. Consider this. In the 1980s, Oprah was a black female regional TV personality. She wasn’t famous like Bill Cosby. What would have prevented ABC from terminating her on the spot? Even if they had been forced to pay out her contract, it would have been a rounding error.
Jacobs and Oprah then dropped a bombshell on ABC/King World. A bomb that would eventually make her a fortune.
Oprah didn’t only want a big pay raise; she wanted OWNERSHIP of her program.
Surprisingly, ABC/King World concurred. To be honest, Oprah was attracting record viewership in Chicago, so national syndication was looking like a slam dunk.
Oprah’s program was renamed The Oprah Winfrey Show and stretched to an hour in 1986. Oprah would bear all production expenses for her own program under the revised conditions of her contract. And keep in mind that her net worth was in the $500,000 area at the time. She lacked the tens of millions of dollars required to establish a nationally syndicated professional TV program.
What is the solution? Make it up till you make it.
Oprah and Jeffrey devised a strategy in which they would guarantee the show’s future income, believed to be $30 million each year, as collateral to:
a) Cover current production expenses, and
b) Begin building on her own firm and physical studio space at the same time. What is the name of the new firm and manufacturing facility? Harpo Productions and Harpo Studios are two companies. Oprah would own 90%, with Jeffrey Jacobs owning 10% in silence. They presented the idea as if they were a business looking for venture money. Oprah may receive up to 25% of her show’s gross income under the plan. Jeffrey projected that the revenues in year one would be $30 million, and this is what they used as collateral to create their strategy.
“This is incredible, Jeffrey,” says Oprah. “Is Bill [Cosby] doing this?”
“Yes, which is why he’ll soon be one of America’s unseen millionaires,” Jacobs says. Every project he works on, he runs as a business, a partner, not as a paid performer, so he gets a piece of the pie, not crumbs as remuneration.”
In 1990, Harpo Productions and Harpo Studios were established.
Oprah’s net worth in 1990 was $100 million.
Oprah wasn’t finished yet.
Harpo’s distribution partner was still King World. They were effectively salaried employees who took the performance nationwide for a fee each year. Oprah was well aware of how significant she had become to King World as the country’s number one daytime talk show presenter.
Jeffrey and Oprah quickly arranged a new contract with ABC that included book sales, movie projects, a magazine…and, most significantly, new TV series. Oprah didn’t want any awful random program to broadcast before or after The Oprah Winfrey Show, so she agreed to create the series that around her. Her 3.5-acre Harpo complex will be the site of all production.
She wasn’t finished yet.
Jeffrey and Oprah struck an agreement in which Harpo received an ownership part in King World Productions. They set it up so that Oprah could profit from whatever King World produced, including Jeopardy and Wheel of Fortune.
Oprah’s net worth in 1995 was estimated to be between $300 and $500 million.
CBS purchased King World for $2.5 billion in shares in 1999. Oprah ended up owning one-half of one percent of CBS as a result of the agreement. Sumner Redstone, the media billionaire, would ultimately merge CBS and Viacom.
Oprah acquired a share in Disney as part of an equity transaction she received at ABC in the 1990s. That investment was later converted into Disney stock.
Oprah’s net worth in 2000 was $1 billion.
By the turn of the 2000, Oprah had become the United States’ first female black billionaire, as well as the wealthiest person on television. Oprah now earns $300 million per year from her own program plus the ones she produces (most notably Dr. Phil and Rachael Ray).
Oprah’s net worth in 2007 was $2 billion.
Oprah skillfully expanded her holdings outside of television. She joined the Weight Watchers board of directors and became an endorser in 2015. She was first given $43.5 million in business shares. That share has been valued as high as $400 million at times.
She’s also a real estate investor. In Chicago, she owns the property that houses the Harpo Studios. She used to possess a huge house in the Chicago suburbs.
Her most notable real estate asset is a 23,000 square foot property in Montecito, California (near Santa Barbara), which she acquired for $50 million in 2001. This house is now valued at least $90 million. She paid $29 million for a 23-acre farm estate near Montecito in 2016. In Montecito, she has 63 acres.
Getty Images/Jason Kirk
Oprah has a 41-acre home on Washington’s Orcas Island, which she paid $8.275 million for in 2018. She paid $14 million for a property in Telluride, Colorado, in 2014. In 2002, Oprah purchased her first home in Maui. She has spent up to $60 million in the last year to cobble together 163 acres. She spent $32 million for the next-door property in a single transaction.
Getty Images, Oprah Winfrey’s Maui estate
Oprah owns at least $200 million in real estate in the United States.
Oprah’s net worth in 2019 is $3.5 billion.
When all of her assets are considered, Oprah is worth at least $3.5 billion, and maybe as much as $4 billion. Only Steven Spielberg and George Lucas have greater money in the entertainment industry, with $3.7 billion and $5.4 billion, respectively. What’s the one thing they all have in common? All three made the shift from paid employee to OWNER of what they were generating at some time.
Whether it’s Star Wars, Amblin Entertainment, or the aptly named OWN Network, if you want to be affluent rather than just rich, you must be an owner. Oprah has demonstrated this essential lesson 3.5 billion times over.