Battle of Two TV Strategies

Americans are going through a major change in their television viewing habits, a trend that can only get stronger in the ‘90s. That’s the real significance of this week’s report by a group of television researchers that found significantly more people are turning to cable and staying there.

A victory of sorts for the niche strategists. A setback for the networks and their date-book planners.

Niche programming works this way: Think small. Spend less. Find your place in television’s universe with very specific programs for, hopefully, very specific, dedicated viewers. An example: the MTV Networks that aim at young music fans on MTV, older music followers on VH1, nostalgia collectors on Nick at Nite and now HA! for people who desperately seek laughter. In contrast, date-book programming works this way: Get viewers to date their television set. If it’s Monday it must be Murphy, the Sugarbakers and Rosie. If it’s Thursday it must be the Huxtables, Sam and Carla.

Cable programmers had to be inventive. They didn’t have the budgets and the revenues to compete directly with the traditional Big-Three-and-a-Half networks. Rather than going broad, they went narrow. MTV’s chant about wanting MTV was more an anthem for all of cable than a repetitive, singular advertising slogan.

Thus cable developed themed networks and new audiences: niches for news (CNN and Headline News), sports (ESPN, Prime Ticket, SportsChannel), government affairs (C--SPAN 1 and 2), children’s programs (Nickelodeon). Almost every cable network is identified with specific programming. Lifetime for women’s interests, USA for reruns and sports, A & E and Bravo for the arts.

Now there are sub-niches: weather, golf, show business news, home shopping, country-Western music, nostalgia.

Consider comedy. This year two cable networks aimed at comedy went on the air: HBO spawned the Comedy Channel, the MTV Networks produced HA! Comedians earlier had established a place on cable with successful stand-up shows on HBO, Showtime and A & E. Comedy was a natural. While the networks spent hundreds of thousands on sitcoms and hoped they’d pay off in advertising and future markets, the cable programmers, limited in money, thought cheap. For as little as $20,000 you could get a half hour of comedy with a crew taping at the Improv or at a concert. And you weren’t limited by the inflexibility that networks face in scheduling shows.

For years, the No. 1 network in ratings was the one with the No. 1 comedy sitcom. To get attention try funny. To win large audiences, get them to laugh. To some extent that’s what the people at HA! are thinking.

“What we’ve done is create an environment for viewers,” explained Debby Beece, senior vice president of programming at HA! “The whole channel is an environment, a home base for comedy. That’s different from traditional television comedy. The viewer knows when they punch up HA! they’ll get comedy after comedy.”

Six months old, HA! is edging toward getting into 10 million homes by the end of this year, having just completed a deal with Cox Cable Communications and Cencom Cable Associates in Los Angeles for the HA! network. The break-even point for most cable networks is 25 to 30 million homes. Hitting that mark could conceivably turn a deficit into million-dollar profits.

The strategy in developing HA!’s niche was a mixture of the practical and the creative. Currently, most of HA! shows are television sitcom reruns heavily from the MTM library. HA! is counting on Rhoda and Mary and Phyllis and Bob and Steve to lure the 18- to 49-year-olds the network lust after. At the same time the network isn’t counting on just name familiarity and nostalgia. It wants to establish a unique base.

Almost one-fourth of the programs on the 24-hour service are original shows, shows that the network’s executives hope in time will become classics on their own. “Random Acts of Variety” is an attempt to bring back variety programming, but this time with a brashness and an attitude. The game show “Clash” brings together contestants of opposite persuasion (nudists versus fashion designers, butchers versus vegetarians). Two nights of the week are devoted largely to original program. Co-production deals have been developed with Hollywood producers for additional half-hour, one-act comedies or stories. Jackie Mason will soon find a new home with his own show on HA! Collections of the best (or worst) of cable access shows will become a new form of comedy show.

Creative ways of developing cash-flow to support the new network beyond advertisers have also been developed by the MTV Networks. The “Clash” format has been sold to foreign broadcasters. Some versions of “Saturday Night Live,” to which the MTV Networks has international rights, are being marketed overseas. MTV has a European version and recently completed a deal for an hour video show in the Soviet Union.

Ten years ago, Ted Turner and his Cable News Network showed how a new concept in news coverage could be developed cheaply yet extensively. Twenty-four hours of news available when wanted. Now Turner has two news networks.

Not all niches are winners. The Financial News Network is having its problems. Some ethnic networks haven’t attracted sufficient viewers to stay around. Several others are struggling.

But niches big and small have begun to add up. The trend seems to favor more of them. Tom Freston, chairman and chief executive officer of MTV Networks, sees the number of channels offered by local cable companies moving from 35 to 55. Specialized services--more comedy, more sports, pay-per-view, health--will fill those spots. Dennis Miller, former president and chief operating officer of Think Entertainment and now executive vice president of Turner Network Television, earlier this year told a group of independent filmmakers that by the end of the ‘90s there might be 100 to 200 cable networks looking for shows.

Will the networks be ready for the Attack of the Killer Niches? Maybe we shouldn’t worry about the networks. Will we be ready?