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The life and death of Channel A

By the time Channel A shut its doors, it had strayed far from its roots as a community site for Asian Americans that offered a retail channel.

When Steve Chin launched Channel A two years ago, the former newspaper reporter flipped through his Rolodex for Asian American writers, commentators, and community leaders to help establish an editorial forum on an uncharted medium.

The plan was to establish an Internet community for Asian Americans centered around advertising revenues, while building an avenue for retail business. "It was more of a Web magazine about Asians and Asian American topics," said Chin, who left the company earlier this year to start a Web consulting firm.

But by the time it closed last week, Channel A had become strictly a retail outlet peddling Asian food and products--a stark contrast to the more politically incendiary editorial site originally envisioned.

The evolution and demise of the site is a sign of the harsh realities of creating a viable business on the Web, particularly for a niche market aimed at a specific community or demographic. And that challenge is all the more difficult if the site's focus and mission are unclear.

"[Channel A] was originally an Asian American site, but they soon realized that if you're delivering commerce, you're going to deliver it to customers who have the money to buy things and not to a specific ethnicity," said Jeff Yang, the publisher of A. Magazine, a print and online publication that explores Asian American issues. "It's difficult to market to Asian Americans because it's a community that's still defining itself."

Channel A was one of many community sites on the Web hoping to attract Netizens of a particular ethnicity, race, religion, gender, or sexual orientation. Communities Incorporated was created last December as a coalition of community sites including Jewish Community Online, African American site NetNoir, gay and lesbian sites PlanetOut and onQ, Latino site LatinoLink, and senior citizen sites SeniorNet and ThirdAge, as well as Channel A.

Many groups originally saw the Web as a vast opportunity to create publications without the tremendous costs of printing and postal services. However, the downfall of retail-based Channel A shows how difficult it can be for such sites to survive on the Web.

"It's not just marketing to a niche community but marketing on a new medium that's challenging," said Nora Contini, associate publisher of Jewish Community Online. Contini said publishing on the Web is like facing "5 million magazines launched in one year and they're all out trying to sell advertising."

Channel A was created in 1996 as a content-driven site targeted at an Asian American demographic. It featured articles on social issues and interest channels ranging from book reviews to shopping services.

By the beginning of its second year, the site had moved away from editorial content and more toward retail business based on Asian American lifestyle. In doing so, Channel A began to open up its marketing efforts to a broader, more mainstream audience.

The shift "was to become an Asian Pottery Barn-Martha Stewart on the Web," said former Channel A chief executive Peggy Liu. "The idea was to bring Asian home products to a mainstream base."

But because of the escalating cost of establishing a brand on the Web, along with the site's natural restrictions as a specialty retail outlet that sold a narrow range of products, the company could not maintain sufficient resources to keep operations running, Liu said.

Ultimately, however, the site may have fallen victim to classic philosophical differences among its founders.

Liu maintains that the site was never geared toward establishing a forum or community for Asian Americans, but rather was meant to be a retail site to bridge East and West. She said her goal was to establish a retail channel with content that backed up the products it sold.

Chin, who oversaw the site's editorial operations, said Channel A could have survived if it had relied on advertising for revenue instead of committing most of its efforts to attracting buyers and profiting from transaction fees.

"Channel A decided they no longer wanted to do journalism," Chin said. "First, they didn't want community journalism. Then they didn't want controversial stories. They thought controversy would drive away shoppers."

Liu agreed with that assessment and added: "One of things I would do differently if I could do it again is to dive straight into commerce," she said. And she would skip the more politically charged content that Chin attracted.

"That doesn't really sell things to a mainstream audience," she said. "It's not transactional content."