Henson, Hallmark Team Up to Launch Kermit

New York -- Kermit the Frog and Miss Piggy are the newest
players in the international pay TV-programming business, with The Jim Henson Co. and
Hallmark Entertainment announcing plans last week to launch The Kermit Channel.

The 24-hour channel, a 50-50 joint venture between the
companies, is scheduled to bow in September, in Asia and Latin America, with a forecasted
2 million subscribers, a Hallmark spokeswoman said. It will feature original and library
programming from both companies aimed at kids and families.

Hallmark Entertainment Network -- Hallmark's
library-programmed pay TV channel, which is distributed outside of the United States --
will handle distribution for Kermit. The companies said they expect most of HEN's
affiliates -- which include almost 1 million subscribers in Asia and nearly 3 million in
Latin America -- to carry the new channel.

Worldwide, HEN has about 6 million subscribers. The
companies expect Kermit to have between 8 million and 10 million subscribers within a year
of its launch.

Margaret Loesch, who was named president of Jim Henson
Television Group in February, and George Stein, HEN's president and CEO, will manage
Kermit. Before joining Henson, Loesch was vice chairman of Fox Kids Worldwide, where she
oversaw the international launches of Fox Kids Network.

Launches in other regions are expected to follow. A U.S.
launch is being considered, but it has not been solidified. HEN launched its first
international channel in 1995, but it has shied away from a U.S. launch due to the lack of
available carriage space and because the domestic rights for much of its programming are
held by others.

In addition to their library programming, HEN and Henson
also have an ambitious original-production slate that includes animation, live action and
computer-generated 3-D shows.