HBO to Expand TV Production, Film Ventures : Entertainment: The company has set up a unit to develop comedy series and low-budget movies. It sees a growing market here and abroad.

Home Box Office Inc., underscoring a trend set by the broadcast networks earlier this year, said Monday that it will produce television programs for the three major networks and other cable-TV services.

HBO, which has seen its growth slow in recent years as the cable industry has matured and become more competitive, hopes to take advantage of the expanding market for TV programs both here and abroad.

Under a newly established HBO Independent Productions unit based in Los Angeles, the company will initially concentrate on developing and producing comedy series and “low budget” theatrical films for domestic distribution.

“We’re preparing ourselves for TV in the 1990s,” said HBO Chairman Michael Fuchs. “TV has changed, and the market for the type of comedy HBO specializes in has grown substantially.”

The demand for comedy programming, particularly in the United States, has reached record levels because the networks and local stations continue to rely on the format for the backbone of their prime-time schedules.

Moreover, within the last year, many of the traditional boundaries that have separated the networks from the studios have begun to erode as the costs of producing programs continue to escalate. ABC, for example, said it will develop shows for CBS, NBC and Fox in addition to the cable networks--a policy that up until now has been unthinkable because of traditional rivalries.

Chris Albrecht, named president of HBO Independent Productions, is now talking with producers, writers and agents about proposals for new series. “We have the ability to deficit (finance) our own pilots and series,” he said.

So-called deficit financing is a standard practice for producers, who must absorb costs not covered by the license fee paid by the network. Virtually all prime-time shows are made at a loss, with the profits only recouped when enough episodes are made--usually 100--for the reruns to be sold to local TV stations.

It is that payoff--called “off-network syndication”--which has all the networks and studios scrambling. Hit comedy series such as “The Cosby Show” have generated more than $575 million in rerun profits, and even lesser hits such as “Who’s the Boss” have raked in more than $275 million for Columbia Pictures.

Albrecht, however, said HBO will avoid the highly expensive traditional studio development process and instead work with a network of writers and producers with whom the company has been associated for several years.

“We’re not going to be in the Marlens and Black $10-million to $18-million business,” he said, refering to the expensive deal that Walt Disney Co. recently struck with Neal Marlens and Carol Black, the husband-and-wife comedy writers of “The Wonder Years.” “I defy (anyone to say) how people are going to make money on those deals anyway.”

HBO instead will be looking for ways to keep down overhead, one of the most expensive parts of the production business, by contracting out all legal and accounting services.