Marlene

Scripps pulls plug on Shop At Home
Sinking home-shopping network didn't attract buyers

By NAOMI SNYDER
Staff Writer


After failing to find a buyer for the struggling home shopping television outlet, Shop At Home Network's owner announced Tuesday it will shutter operations at the end of June, laying off 660 full-time employees in Nashville.

About 200 other people work there part-time.




The E.W. Scripps Co., which owns the business, had shopped the shopping network but had no bidders. The Cincinnati-based company announced it will stop broadcasts June 22.

"We've been looking for someone to buy the business since January,'' said Scripps spokesman Tim Stautberg. "We were in line to lose money in the second quarter with little hope of stemming those losses."

Company executives said Shop At Home has lost $84 million during the past four years, since Scripps made its first investment in the business.

Executives attributed the losses to the difficulty of getting the fourth-ranked home shopping network onto basic cable lineups across the country, as it competed for with top-ranked QVC and other home shopping networks.

Shop At Home reaches about 57 million households through cable and satellite service. By comparison, QVC reaches about 87 million households.

"It was kind of expected,'' said Joe Bonner, an analyst with Argus Research Co. "You have QVC, you have The Home Shopping Network, you have ShopNBC, do you really need a fourth home shopping network?"

Several employees were less than shocked on Tuesday after the announcement. They had seen about 40 people laid off in March, and the company has been suffering financially for years.

But the news came as a shock to Kimberly Roberto, who has been selling her scrapbooking materials on Shop At Home for nine months.

"They helped me grow my business,'' said Roberto, who operates Scrappy Cat in Berea, Ohio, with her husband. "I had no idea this was coming."

The end of the 18-year-old Shop At Home comes after repeated attempts to rejuvenate it.

Shop At Home Inc. had moved from Knoxville to Nashville in 1998, bringing 300 jobs to the area.

The E.W. Scripps Co. bought a 70% stake from shareholders of the publicly traded Shop At Home in 2002, under the promise of taking the struggling network out of debt.

The television network was operating at a loss when Scripps bought it, according to Scripps executives. At the time, its stock was trading for less than $2 a share.

Scripps brought in such celebrity salespeople as Emeril Lagasse from Food Network, also a Scripps television broadcast. It began to cross-market products from its other networks, such as Home and Garden Television, on Shop At Home.

Bonner attributed some of the company's struggles to competing online shopping alternatives. In fact, Scripps has been more interested in online shopping, as well, recently buying comparison-shopping online sites Shopzilla and uSwitch.

Scripps also bought the Great American Country network in 2004, which is broadcast in Nashville but isn't affected by the closure of Shop At Home.

Shop At Home employees can't easily get jobs at Great American Country. The largest chunk of employees at Shop At Home, or about 40%, work in the call center, and Great American County doesn't have a call center. Plus, GAC's administrative jobs are in Knoxville.

Stautberg said anyone who has worked more than six months at Shop At Home will get a minimum of nine weeks of severance pay. Executives also plan a job fair and are contacting other potential employers to find employment for workers, Stautberg said.

Broadcasting will stop June 22, but operations will continue until June 30 to deliver products.

Stautberg said he didn't yet know how equipment such as cameras would be sold, but that clearance sales would begin soon both on the Shop At Home Web site and on the television channel.

Shop At Home has five affiliated television stations in San Francisco, Boston, Cleveland, Bridgeport, Conn., and Raleigh-Durham, N.C. markets. Scripps executives said they would be sold. •

texasmesquite

Wow Marlene - thanks for this update. I really thought Emeril was really selling his products for this network.

Marlene

He did indeed but you can't carry the weight of the whole network. Very strange, indeed. I think that Scripps just bought too many and now can't support all of them financially.