Veteran newspaper editor Shelby Coffey III ended a 17-month experiment as the number two executive at ABC News yesterday by signing on as president of CNN Financial News.

Coffey succeeds Lou Dobbs, who quit CNNfn in June to launch a Web site, leaving behind a three-year-old business network that has made little headway against its dominant rival, CNBC.

And Coffey was not the first choice; Paul Steiger, managing editor of the Wall Street Journal, turned down the job last month.

Coffey was recruited by CNN Chairman Tom Johnson, who had hired him as editor of both the Dallas Times Herald and the Los Angeles Times when Johnson was a Times Mirror executive.

Coffey said the chance to manage a network, albeit one far smaller than ABC, was "a big factor" in his decision. He told reporters that ABC News President David Westin "has been terrific in making me a partner in many respects. There is, however, a real pleasure in running your own show."

One factor in Coffey's decision may have been the possibility of a reduced role at ABC News, where he is executive vice president.

Insiders say that Westin, having consolidated his hold on the job once held by Roone Arledge, is reorganizing the division in a way that could have made Coffey less of an unofficial deputy.

Johnson stressed that Coffey will be in charge of all of CNN's business coverage, including "Moneyline" and three other shows that air on the main network.

The appointment came after Coffey met with Gerald Levin and Ted Turner, the top executives of CNN's parent company, Time Warner.

Despite his lack of business news experience, Coffey, a former editor of The Washington Post's Style section, said that "it's an area of coverage I've found really compelling." He said that searching for "the best new way to look at a continually expanding world is just fascinating to me."

CNNfn reaches just 12 million homes, a figure that Johnson finds "frustrating," noting that Coffey will work on achieving greater distribution overseas. (CNBC, by comparison, reaches about 75 million homes.)

And ratings for "Moneyline" have slipped since the departure of Dobbs, who anchored the show for 19 years. But with 370 staffers, a $50 million-plus budget and lots of lucrative advertising, Johnson said business news is the network's most profitable division.

Howard Kurtz appears on CNN's weekly media program.

CAPTION: Shelby Coffey III moves to CNNfn, ending 17 months at ABC.