MEDIUM OF THE MONTH - BBC America has proved more of a hit than its backers dared to hope. Felix Salmon reports. By FELIX SALMON. BBC World is about to announce heavy losses, but its sister channel, BBC America, which airs 'the best of British TV', is taking the US by storm. A year after its launch, the channel is received in 9.7 million homes, which is 4.7 million more than originally anticipated. The channel was set up as part of a $565 million joint venture between the BBC and Discovery Communications in March 1998. The BBC provides the programming and wholly owns the channel. Discovery provides the ad sales and distribution, and footed the $100 million set-up costs. The BBC archives have been raided to provide BBC America's content. There's a big emphasis on comedy (Fawlty Towers, The Fast Show) and drama (Martin Chuzzlewit, This Life). There's also three hours a day of news from BBC World. Some 60% of the programming has never been seen in the US before and, of course, the channel supports advertising. BBC America is still in its infancy. It only started accepting paid advertising this quarter, and doesn't expect to be rated by Nielsen for 18 months. But it does have two extremely strong brands behind it. Until now, advertising on the channel was confined to direct-response ads - spots with toll-free telephone numbers for which the channel gets paid according to how many viewers call in. The ads were primarily there to make sure that viewers didn't become accustomed to ad-free TV before the paid-for ads arrived. BBC America and Discovery have been selling their brand in meetings across America. 'We're pushing it as an extremely high-quality, upscale channel, with a twist of British humour,' says Paul Lee, general manager of BBC America. Lee is targeting six main groups of advertisers: automotives, credit card issuers, airlines, luxury goods, telecoms and financial markets. He is selling an upmarket audience, most of whom are well-educated anglophiles. BBC America's own research shows that 35% of Americans profess to love all things British, and viewers watch the channel for longer than average periods. BBC America's current lack of official viewing figures gives it the freedom to run slightly left-field programming such as One Man And His Dog, in case it takes off as a cult classic. But Lee is cautious with some programmes. 'Some swear words are more offensive out here,' he explains. Facts about BBC America Ownership 100% owned by the BBC Reach 9.7 million homes Affiliate/ad sales Discovery Networks Web www.bbcamerica.com Hours 24 hours a day Distribution Mainly satellite/digital cable. CAMPAIGN 04/06/1999 P27 (Back) to felixsalmon.com