CNN lost its cable-news-network lead to Fox years ago, but had a firm grip on second place … until now.  CNN’s viewership has remained steady, but MS-NBC has grown its audience considerably, thanks to its partisan direction over the last year.  Neither comes close to knocking off the champ, though:

CNN is poised to finish March third in the prime-time weeknight ratings behind Fox News Channel and MSNBC, the first time this has ever happened for the channel that pioneered the cable news genre nearly three decades ago.

CNN says its overall business is healthy and it is not straying from its straight news path. But it is suffering more audience erosion than its rivals since the peak days of the presidential election, further proof that the opinionated prime-time shows on Fox and MSNBC have greater audience loyalty.

CNN’s weekday prime-time ratings are relatively flat compared to last year during the primary campaign, up 1 percent from March 2008, according to Nielsen Media Research. Fox’s ratings have jumped 30 percent and MSNBC, the new No. 2, is up 24 percent. The biggest growth in cable news is for CNN’s partner, HLN, formerly Headline News, which is up 62 percent.

Fox remains on a mountain above its two closest competitors, with its prime-time audience in March more than that of MSNBC and CNN combined. “The O’Reilly Factor” has done particularly well, keeping more of its postelection audience than anything else on CNN and MSNBC.

CNN says they will continue to focus on straight news reporting rather than try to compete on the ideological bases of their competitors, but some conservatives will scoff at that notion.  While CNN sets up their shows as straight-arrow reporting and analysis, many have detected subtle and not-so-subtle biases from hosts Anderson Cooper, Larry King, Campbell Brown, and others.  They may not be as explicitly directional as either Fox or MS-NBC, but they have not plowed a down-the-middle approach.

Brown appears most in danger of losing her slot, falling far behind Keith Olbermann, who himself remains far behind Bill O’Reilly.  CNN says they’ll stick with Brown in order to build her audience, but the populist schtick doesn’t seem to be competing with the more well-established populist schtick of her competitors.  Brown will go on maternity leave, which might portend a change, but CNN will replace her with Roland Martin in the interim, who doesn’t have Brown’s charisma.

CNN might consider sticking closer to a straight news approach, and perhaps finally pushing Larry King into retirement.  He’s barely beating Rachel Maddow now as it is, and both are getting clobbered by Sean Hannity’s solo effort.  They’re not going to find ideological space any longer, not with MS-NBC going explicitly liberal. If they really want to provide an alternative, that’s the opening.