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Comcast Bid Fogs QVC Direction

If Comcast Corp.'s bid to acquire QVC succeeds, it raises some questions for the home shopping network.

Byline: SHARON EDELSON


NEW YORK -- If Comcast Corp.'s bid to acquire QVC succeeds, it raises some questions for the home shopping network.


Comcast, a Philadelphia-based cable company, which was an early investor in QVC and now owns a 16 percent stake, is committed to the home shopping business -- but is it committed to chairman Barry Diller's new projects?


Asked about Comcast's plans for the company, John Alchin, senior vice president and treasurer of Comcast, said, "Our thrust would be to move forward with what's there."


"Barry was running the company as we expected him to run it," he added. "We were supportive of launching QVC in the international market and launching Q2 and On-Q."


While Comcast has asked Diller to stay on if the acquisition goes through, there are few who believe he will.


"When Barry arrived, QVC operations were in sound shape, generating over $175 million in cash flow," Alchin said. "Our core business was very strong. What Barry has done was to greatly enhance the profile and brand name recognition of QVC in addition to the other initiatives.


"What we would have to assess is what type of management team would be needed to take those more visionary aspects of the business [Q2 and On-Q] to the next level," Alchin continued. "As a company, we've had a lot of experience with launching new business ventures."
QVC has been moving cautiously toward interactivity.


"We are believers in interactivity, but even as Barry has said, that is some way off. That doesn't mean you don't get involved with some of the interactive experiments. Comcast is involved with more state-of-the-art experimentation."


Comcast's move brought into view the differences between Diller and Ralph and Brian Roberts, Comcast's chairman and president, respectively. While Diller has been trying to merge QVC with larger entertainment companies, the Robertses are strictly interested in QVC as a cable TV home shopping network.


The Robertses objected to the QVC-CBS merger because they didn't want to see their 16 percent stake in QVC reduced to 5 percent in a combined company.


QVC's board of directors agreed to negotiate with Comcast, but with the company in play, Diller is looking for the highest bidder.


Investment bankers are said to be polling the usual entertainment suspects as possible bidders for QVC, including Tale-Communications Inc., Liberty Media, Time Warner, Turner Broadcasting and Walt Disney. These firms, excluding Liberty, are also rumored to be possible bidders for CBS.


Because of corporate ties to QVC and Home Shopping Network, TCI may have problems bidding for QVC, said one analyst.


"I think TCI wouldn't mind being cashed out, given its stake in [the competing] Home Shopping Network. I don't think they will lead a bid or make a competing bid because of their HSN interest."

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