A year ago, when the ad market was tres hot, nothing was quite so hot as the much-talked-about launch of the National Geographic Channel. 
    Then came the big chill. The channel launched last month in a much different climate, and with a lot less oomph than many had expected.
   But that hasn't damped spirits all that much at the network.
    "We’re pacing ahead of every goal we had from a revenue point of view. In terms of absolute revenue, CPMs, any benchmark we can think of, we’re pacing ahead," says Rich Goldfarb, senior vice president of sales at the National Geographic Channel.
   As an untested entity in a category crowded by the Discovery Channel and its offspring, the network is relying on a brand that has become part of America’s cultural landscape to see it through the tough times.
   National Geographic Channel launched on Jan. 7 with 10 million initial subscribers, with commitments for 18 million more over the next few years.
     NGC is now carried on DirecTV, which accounts for the majority of the channel’s current subscriber base, plus AT&T, Adelphia and National Cable Television Cooperative. It is on cable in only a few major markets, including San Francisco and Los Angeles.
   The relatively low penetration is surely working as an impediment to ad sales, especially since the downturn in the ad market of a few months back.
   Still, Goldfarb maintains that there is no shortage of advertisers.
    "There are always going to be some who, for whatever reason, will say, ‘Okay, we’ll wait until every single thing is as perfect as it can possibly be.’ Then one of two things happens: either they never get in, or at least into the shows they want, or they have to pay a price they don’t want to pay," says Goldfarb.
    "The greatest barrier that has been holding people back so far has been simply that they don’t have the funds right now to commit to the channel, and as soon as they do they will."
    The network has deals in place with a number of major national advertisers, most of which include time on all of NGC’s original programs. The list includes a heavy dose of automotive companies like Ford, Toyota, Nissan and Subaru, financial-services companies such as State Farm and New York Life, as well as a smattering of other familiar names like Johnson & Johnson.
    The network is trying to lure advertisers into cross-platform packages that span the network, international television (the company has been operating networks outside the U.S. for several years) and the National Geographic magazines.
     Ford has signed on for such a package, and Toyota bought a global TV deal. Goldfarb hopes that when broadcast upfronts come along this spring, more big media deals will follow.
    "It made sense to launch in January, but that meant that we couldn’t take advantage of broadcast upfronts. The next opportunity for significant volume will be in the upfronts," says Goldfarb.
   The network also expects more advertisers to jump onboard as cable companies across the nation begin to pick up the channel. 
        A spokesman for NGC says all the major MSOs have shown interest in picking up the channel and that only the terms of the deals are in question.
     National Geographic Channel’s monthly subscription fee is a tad steep at 15 cents per subscriber, and some observers suspect that the price tag is what has kept some of the top cable companies like Time Warner and Cablevision from striking early deals.
    NGC is not yet rated by Nielsen, and no informal audience numbers are yet available for the network. But NGC’s competitors continued to do well last month: The Discovery Channel was up 8 percent in households over January of 2000, the Learning Channel was up 10 percent and the Travel Channel was up 150 percent.
    That success cuts both ways; it means that there is plenty of interest in the sort of programming that NGC offers, but it might also mean that NGC has been unable in its first month to take many viewers away from its rivals.
    But considering the adverse conditions, National Geographic and Fox, which owns two thirds of the network, are pleased with the launch and with the channel’s potential for growth.
    "Our advertisers have gravitated to this channel in a weak market for a reason. They’re taking advantage from the start and building an automatic incumbency," says Goldfarb.
    "Everyone recognizes that 10 million homes at launch is just that—at launch. We will grow significantly and everybody knows that."

© 2001 Media Life