The Wine Network plans to launch this quarter with a focus on the world of wine and related subjects such as beer, cigars and travel.

If successful, it would be the first Hawai'i-based national TV network. But the challenges for an independent startup network devoted to wine are many, including raising millions in financing and breaking into a channel lineup that is increasingly crowded by spinoffs from established networks such as Discovery and ESPN.

Since 1996, the number of national cable networks has grown from 145 to 308 at the end of 2002, according to the National Cable & Telecommunications Association. The channels keep proliferating because there's more money to be made now by capturing television viewers interested in niche markets that advertisers are willing to pay for.

"It's really about choices, and it's about where technology is taking things that are the real driver here," said Hollywood producer Chris Lee, who is also chairman of University of Hawai'i's Academy for Creative Media. "When people have as many channels as cable allows they tailor their interests."

Viewers with such specific interests are an attractive market for advertisers, who instead of paying more to advertise to a mass market, can instead reach a higher concentration of viewers potentially interested in their products.

One particular challenge may be an audience that could exclude viewers younger than 21 — an prime market for many advertisers.

Among the sponsors The Wine Network seeks are wineries in search of a cost-effective way to reach affluent viewers, according to comments by Wine Network co-founder and president Patrick Brunet in a May article in the San Francisco Chronicle.

At the time, the new network had not secured any advertisers but was in discussions with "some big ones," Brunet told the newspaper.

Wine Network co-founder Lorie Kim, who is based in Hawai'i, declined to comment on the network's plans when contacted last week.

Tapping a national audience

Excluding The Wine Network, there are 51 cable networks planning to launch services, according to the National Cable & Telecommunications Association. These include channels aimed at seniors, military personnel, ice skating fans and even puppy lovers.

Among the networks having trouble raising enough money to go on the air is Clearwater, Fla.-based The Puppy Channel, which wants to provide programming consisting of "puppies being puppies."

Daniel FitzSimons, chairman of The Puppy Channel, said creating a cable network isn't cheap, with an estimated price tag of least several dozen million dollars. However, FitzSimons, who has been trying to launch The Puppy Channel since the mid-'90s, said raising money is only the first big challenge. Another is getting cable systems to carry a new network's channel.

"There's good reason for skepticism in that the 500 channel superhighway that was talked about in the '90s turned out to be a 250-channel superhighway," he said. "So the competition for those 250 channels is very fierce."

Startup, independent networks such as The Puppy Channel face an uphill battle because cable operators often have an interest in supporting their own networks, FitzSimons said. Additionally, cable companies prefer to stick with established companies with a track record for customer acceptance and quality programming.

The factors that Oceanic Time Warner Cable considers when deciding which channels to add to its local lineup include customer survey results and the cost of carrying a channel, said Norman Santos, vice president for Oceanic's operations.

While new channels often pay a launch fee to cable operators to get their stations into homes, ultimately it is the cable operator that pays the channel an ongoing subscriber fee, ranging from a few pennies per household to $1 or more.

As for whether Oceanic would carry The Wine Network, "I'm for that," Santos said. "With the local programming we do have some latitude here. If it was a local deal and they were willing to commit to being on a digital channel, then it could be possible."

During the past two years Oceanic has added about 40 channels locally, and the growing ranks of cable channels and increased carriage fees (payments to broadcasters for programs) are factors behind rising cable bills, Santos said.

From April 1999 to June 2000, annual cable prices rose 5.15 percent, according to the Bureau of Labor Statistics. On O'ahu, the price of standard cable service has risen nearly 31 percent since 1998, excluding fees and taxes, according to the Department of Commerce and Consumer Affairs.

"If you have 200-some-odd channels like we do and everybody increases (fees) a penny a year, that's two dollars of increased charges that's being added by the business," Santos said. "If you raise rates two dollars a year, you still break even. "It is a battle."

Paul Lane, a retiree in Ala Wai, said he doesn't watch too many of the channels he gets via cable.

"I don't watch most of the channels," he said. "I just skip by them."

Lane said he's mostly interested in the news, documentary and commercial-free music channels.

As for the possible addition of one devoted to wine, "that would be interesting," he said. "I enjoy my wines."

High risks and rewards

While the risk of starting a cable network from scratch is large, so are the potential rewards. For example, in 2000 Comcast Corp. boosted its stake in The Golf Channel from 50 percent to 91 percent or $365 million. The Golf Channel launched in 1995 with about $80 million. Also in 2000 Viacom Inc. purchased the Black Entertainment Network for $3 billion.

Then there are the social implications of offering an overwhelming number of channels. While it creates a greater diversity of ideas, there's also concern people will be less exposed to differing points of view as television viewership becomes increasingly fractured.

And unlike the days when there were only three broadcast networks and the nation shared a common media culture, viewers today are more selective and splintered in what they watch.

However, UH's Lee said television will always have the ability to galvanize the public.

"There is no question that if we have a national crisis such as 9-11, everybody is going to tune in," he said. "I think that TV will still have that ability to bring us together."