Company Town : History Is Searching to Find Its Place : Television: New channel is one of many ventures facing big barriers as they seek space on crowded cable systems.

Can a network popularizing history turn a profit today?

The New York-based History Channel, launched at the beginning of the year, is betting it has the right formula to be successful, if not today then within a few years. But the 24-hour channel is only one of many new ventures seeking space on today’s crowded cable systems, and all of them have huge barriers to overcome.

In three months, the History Channel has expanded from an initial 1 million domestic subscribers to more than 3 million, General Manager Dan Davis says. The latest increase of nearly 300,000 came last month with the addition of Century Communications outlets in West Los Angeles and parts of the San Fernando Valley. (Other Southland systems offering the History Channel include Paragon Cable in Torrance and Garden Grove, Cox Cable in Santa Barbara, Time Warner Cable in Palm Springs and Saugus, and American Cablevision in Coronado.)

In addition to its domestic viewership, the History Channel has added half a million Canadian subscribers, Davis said.

But viewership numbers are just part of the story. Equally important is the fact that the channel’s audience includes a large number of 18-to-45-year-old males with high disposable income--the target audience most advertisers want to reach.

By contrast, the major networks’ audiences skew heavily toward women. At any moment, nearly six of every 10 viewers on CBS, NBC or ABC are female, said David Poltrack, CBS vice president of planning and research. (Fox, which seeks to counter-program the major networks, comes closer to an even split.)

The History Channel offers documentaries, miniseries and docudramas--some commissioned as original works, most reruns or acquired from studios or independent producers.

Sample offerings, Davis said, include a 19-part documentary on the history of automobiles and a 10-part series on visionaries who designed such projects as the space shuttle and the Eiffel Tower. Programs also include the weekly series “America at War,” “The Real West,” “The World at War,” “First Flights,” “Crusades in the Pacific” and “Victory at Sea.”

Bill Croasdale, head of Western International Media, the nation’s second-largest buyer of media advertising time, said Davis has essentially mapped out a similar marketing strategy to that of ESPN and CNN, sports and news channels that have a disproportionately high number of male viewers.

Underlying the strategy is the conviction that there is a growing hunger among Americans to know about their past. A year-old survey commissioned by the History Channel showed that half of all Americans over 18 are more interested in history today than they were five years ago.

The channel was launched by the Arts & Entertainment network, which has 65 million subscribers. Davis, himself a former A&E; ad salesman, said the parent network shares four national advertising sales offices and has promoted the History Channel on its airwaves. (A&E; is itself owned by Capital Cities/ABC, Hearst Corp. and NBC.)

The History Channel has a long way to go to break even: Davis said it must attract 20 million subscribers. After an initial surge, the pickings are slimmer for the foreseeable future.

Despite promises of new technology, cable systems that carry an average of 35 channels still dominate the market, Croasdale said. In addition to channels reserved for the major networks, other space has been set aside for public-access programming, established premium networks such as HBO and Disney, and pay television.

The relatively few slots left attract at least five applicants per opening, said Eric Brown, regional marketing director for Century Communications. In some areas, existing networks already double up on the same channel, he said.

Nor have cable operators been eager to replace even under-performing networks with new choices. Cable customers who are used to certain offerings do not like having them dropped, Brown said.

Larger cable systems don’t necessarily supply a new network to all their viewers. Because cable companies pay the network to air its programming, not airing a new offering immediately throughout the system allows cable operators to hedge their bets and save money.

Although Century Communications serves Santa Monica, it has yet to provide that city with the History Channel.

The upshot is that a new network may have to struggle for years to win an available slot--and it may never win it, Brown said.

Lack of channel capacity and resistance by cable operators are not the only hurdles to be overcome. Potential advertisers want to know the breakdown of their audiences, provided by the Nielsen ratings. A new network generally cannot afford to engage this service until it reaches 12 million subscribers, Croasdale said. Until then, it relies on estimates of the type of audience it is attracting--and on discounted rates.

Thus, when he buys air time on any new network, Croasdale often demands both a 50% discount and a rate freeze for up to five years. Even if the History Channel were to expand its viewership base or supply the proper demographics, those “charter rates” would remain fixed.

Because of this, no new network is expected to break into the black for four to five years, Davis said.

But “I love history,” he added, “and this seemed like an interesting challenge.”