Niche TV Goes Digital—and Deeper

New, cost-effective broadband channels chase a single-minded audience

The Weather Channel is narrowing its already narrow focus with a new broadband site dedicated to one subject: global warning. One Degree, which launched last week, features global-warming-related reports from Weather's climatologist Dr. Heidi Cullen and has some 100 contributors blogging on the subject. And you thought weather was niche programming.

Weather isn't the only TV network going microscopic online. Scripps Networks is reaching for new viewers and advertisers with single-subject broadband sites that aim to be more than digital extensions of linear programming. With the increasing difficulty of securing cable and satellite carriage, such sites offer media companies a cost-effective way to program to niche audiences.

“Servicing audiences that are too small to be profitable through traditional TV is exactly what the Internet is good for,” says Jupiter Research Broadband and Wireless Director Joseph Laszlo.

Analysts put the price of starting a niche broadband channel at $50,000-$100,000, making it a low-cost proposition, especially if companies can repurpose content that has already run on TV.

Weather's One Degree, for example, is starting with only about three hours' worth of video content, a quarter of which is from its linear channel.

“Vertical” plans

Scripps, which owns home-improvement channels DIY Network and HGTV, among others, announced plans last year for 10 broadband “verticals,” channels targeted to thin slices of consumers.

Since then, the company has used its extensive video library to launch DIY Woodworking, HGTV KitchenDesign and HGTV BathDesign, which offer instructional videos on everything from making a gourd banjo to giving your bathroom a facelift. New channels on quilting, healthy eating and home improvement are slated for early next year.

HGTVPro—conceived as a cable channel for professional builders before launching on broadband last year—has doubled its video views to 115,000 monthly and added more than 400 videos over the past six months.

It also has attracted advertisers that have never bought spots on the HGTV cable network, including Ironclad Performance Wear, Royal Moldings and Air Tight Insulation.

“It plays to the long-tail theory of the Internet,” says Jim Sexton, senior VP, Scripps Networks Interactive, who oversees, and the broadband channels. “There are lots and lots of small audiences, and when you start aggregating those audiences, it's a really big number.”

Weather sold One Degree to a single sponsor, eco-friendly Toyota, and is exploring doing the same in 2007 with some six new sites.

“What we're finding here is the template for a business model our advertisers are going to pay attention to in terms of getting a cohesive and holistic experience,” says Matthew de Ganon, The Weather Channel VP, broadband & consumer applications.

Keeping stickiness

Although they are few, there are risks in launching such narrowly focused sites. With such a small audience, analysts note, advertisers will likely demand more information on their target viewers upfront so as to better tailor their creative, requiring networks to do more-extensive tracking of viewers and site traffic.

And with savvy viewers who know their area of interest, networks will have to meet a high standard and provide more video beyond repurposed library fare.

“There's always going to be the risk of keeping stickiness,” says Rich Nespola, CEO of digital consulting firm Management Network Group Inc. “You have do your homework to make sure you're maintaining user intimacy and the site's viability.”

Still, the possibility of finding new viewers and ad dollars with niche broadband channels is worth the risk, even if some fail to gain traction, analysts say.

“It's like TV pilots,” says Danielle Levitas, a senior analyst for digital-focused IDC Research. “You always have a good chunk of folks who don't make it past the launch of the seasons. But the successful ones, at the end of the day, is why you do it. If you launch five niche sites and, in six months, just two take off, you more than make back your money.”