"A low subscriber base makes for a tough sell to advertisers," says Laura Caraccioli-Davis, senior VP-director at Publicis Groupe's Starcom Entertainment. "Yet, if the 8 million people the network has are the `right' 8 million people, advertisers will spend on that network, even though they might not get the ratings right off the bat."
One of the new kids on the block that ad executives feel has the most promise is Fox Reality, which looks to join the ranks of ad-supported networks such as Animal Planet, National Geographic Channel and FX, all of which hit 20 million subscribers in their first year of existence. Aimed at a core audience of young adults, Fox Reality has locked up more than 1,150 hours of programming and about 30 different reality series, including a number of reality shows from non-News Corp. outlets, including NBC's "For Love or Money" and ABC's "Ultimate Love Test." Repeats of Fox shows such as "Temptation Island" and "Joe Millionaire" will also be broadcast on the channel.
"Advertisers have spent nearly $2.5 billion in the last 12 months in reality programming," says Lou LaTorre, president-ad sales at Fox Cable Networks. "In the right environment, these advertisers can really get creative and make a breakthrough statement with their advertising."
MORE EMOTIONAL APPEAL
"The overall [reality] genre has evolved in recent years, generating a positive story for advertisers," says Chris Allen, VP-national broadcast buyer at Omnicom Group-backed GSD&M in Austin, Texas. "This programming is more about emotional appeal rather than shaming people as in years past."
Another network receiving a fair amount of curiosity from media buyers is Viacom-owned Logo, an outlet targeted for the lesbian, gay, bisexual and transgender community. Scheduled to launch June 30, Logo's distribution should be about 10 million, thanks to cable deals with Time Warner and some smaller multiple system operators. The network is also in the midst of final negotiations with Comcast.
"This network represents one of the last, great ideas in cable TV," says Hank Close, exec VP-advertising sales at MTV Networks' Music & Comedy Group, which manages Logo's on-air and online sales. "We are going to hit a very targeted and dedicated audience, which becomes a huge opportunity for advertisers."
Logo has already assembled a library of more than 200 movie titles from nearly every major studio, including HBO's successful film "Angels in America," about the AIDS epidemic in the 1980s. The network is also set with original series such as "First Comes Love," a comedy/make-over show hosted by actor/comedian Scott Thompson of "Kids in the Hall" fame. In the original drama vein, it will roll out "Noah's Arc," Logo's first original scripted series, which will follow the story of an African-American gay man navigating love and life in Los Angeles with his three best friends. And capitalizing on the female surf camp craze, a series called "Curl Girls" follows the lives of a set of young women on the West Coast.
MORE FUN THAN EXPECTED
"I was pleasantly surprised to find that [Logo] was all about celebrating family, just a different kind of family," says Ms. Caraccioli-Davis. "The programming is much more fun and broader than I thought it was going to be."
Advertisers such as Orbitz, Paramount Pictures (which is also owned by Logo parent Viacom) and Subaru of America have bought in to the network, which promises to hit the 25-49 demographic. Negotiations are under way with advertisers in the travel, package-goods, spirits and automotive categories. "Chances are there is always money on the side for something that is unique and breakthrough," says Mr. Close.
With 82% of the U.S. population identifying themselves as Christians, many ad executives also have high hopes for the Gospel Music Channel. Launched in October 2004, the network represents one of the fastest growing independent cable programmers, headed up by prominent cable executives Brad Siegel and Charles Humbard. "We have advertisers that are putting one foot in, others putting both feet in and a handful that are jumping right in with multiyear deals," says Mr. Siegel.
Ford Motor Co. recently signed a multiyear marketing sponsorship to be the lead sponsor and exclusive auto advertiser for the "Gospel Dream 2005" singing contest to premiere in September. The network is said to be close to sealing deals with marketers in the package-goods, fast-food, insurance and soft-drink category.
While the network expects to hit 8 million subscribers by the end of the year, grassroots marketing efforts are conjuring up support from gospel lovers. "Although we can't be packaged with the bigger networks, advertisers are ready to buy into the audience that we can uniquely deliver in a program format different to what has already been brought to the market," says Mr. Siegel.
"This network is definitely filling a void in the marketplace," adds Ms. Caraccioli-Davis. "It's a fan base that to this point has been underserved, so obviously, there is an opportunity there."
Even the kids market is getting another network with Comcast unveiling its PBS Kids Sprout, a partnership among Comcast, PBS, Sesame Workshop and HIT Entertainment.
Of course, if these small, new networks don't get bought up in the upfront, executives hold hope out for the scatter market, when buyers are more apt to trust an up-and-coming network to hit their target audience.
"If you are crazy enough to launch a new network these days, you have to know you have a large and passionate fan base out there that will immediately want to tune in," says Mr. Siegel. "Viewers will obviously look at these advertisers differently, knowing that they helped bring them a network that they love."