I was thinking about this for the last couple of days, and I don't remember the exact time I heard that there was going to be a "Game Show Network", but I definitely know it was my mom who told me about it after reading a short article about it in TV Guide, I think.
Since GSN debuted when I was 9, I had no inkling of the economics of TV, only that USA had gotten my eyeballs glued to them for most of my childhood on weekday afternoons with game shows, and I couldn't wait to see what could happen with 24 hours a day of game shows! I honestly imagined different shows on at all times of the day and getting to see any game show I knew and ever wanted to see.
I finally got to see GSN 3 years later (right before the Dark Period) when my family added a satellite dish to our small cabin in Michigan, and I was immediately hooked. Heck, the first thing I learned when I turned it on: The Joker's Wild was not only hosted by Pat Finn nor was it a "game of definitions" (yep; I never knew about the Barry/Cullen version until that day!). My mom commented that I spent over 12 hours the next day watching the channel, which greatly annoyed the rest of my family as that was the only TV in the cabin...
Anyway, to the other question: My 9-year old brain thought it made economic sense because, of course, everyone I knew loved game shows*, and so they'd be glued to the channel too! And, looking back at the channel now with "adult eyes", I think GSN made economic sense largely because USA was doing well with its afternoon game show block for years, and Family Channel had greatly expanded their game show lineup with success at that time. Plus, it was a fascinating trip through TV history, and the shows largely didn't require significant viewer investment to know what was going on.
*"Everyone I knew", that is, friends and family, largely only kept up with game shows because of me, but could take or leave them...bless them!
**Except for my grandma, who loved game shows...and Peter Tomarken...but not Jim Lange.
Anthony