E! Eyes Fashion Net Spinoff

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Cannes, France -- E! Entertainment Television
is laying the groundwork for a spinoff fashion television network, sources familiar with
the plans said.

E! officials attending the MIP-TV trade show
here declined to provide details of the fashion channel plans. But the market was abuzz
with reports of E!'s representatives searching out fashion-oriented product, as it seeks
to build inventory for a channel that would capitalize on the success of E!'s fashion
programming on its U.S. service.

According to sources, the network has not made definitive
plans to launch a fashion service, but is likely to make a decision shortly. Unlike many
new services that are launching abroad prior to their U.S. rollout, among them National
Geographic Television, the fashion channel is likely to debut first in the U.S. and then
test the international waters.

Cable operators in the U.S. also said E! is looking for
analog and digital carriage for a new network.

Domestically, the network can capitalize on E!'s strength
as one of the few stand-alone channels to break the 50 million-subscriber mark -- which
would make the launch of a second spinoff service easier.

E! has enjoyed success with such fashion programming as its
pre-Oscar show, in which Joan Rivers talks with celebrities about what they're wearing to
the awards. This year the show attracted 1.7 million viewers, making it E!'s most-watched
show ever.

Fashion isn't the only genre that E! is exploring, but it
is the most likely sister service to emerge in the coming months, according to industry
sources.

"Leveraging the strength of the E! brand into other
ventures has always been part of our long-range plan," said Dale Hopkins, E!'s senior
vice president of marketing. "A new channel concept is currently in the development
stages; however, nothing has been finalized and we are waiting approval from our board of
directors."

The network declined to comment on other aspects of the
potential channel, including whether it would be digital or analog, or if something would
be officially unveiled at next month's National Cable Television Association show in
Atlanta.

With analog carriage space at an all-time premium,
operators reckoned that the new channel would have to be digital to make it onto the
programming catwalk. But even there the prospect of a fashion-oriented channel received a
lukewarm review, with one operator calling it a "minor niche."

"In a digital world, it may work," said another
operator. "But there are some good networks cued up" waiting for carriage.

Linda Moss in New York contributed to this story.

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