What's next for QVC? Having lost Viacom, the teleretailer may pursue HSN, interactive services - QVC Network, Home Shopping Network

Discount Store News, March 7, 1994 by Arthur Markowitz

Having Lost Viacom, The Teleretailer May Pursue HSN, Interactive Services

WEST CHESTER, Pa. -- After fallingf short in its $10 billion battle with Viacom to take over Paramount Communications, QVC Network chariman Barry Diller Network chairman Barry Diller said: "They won. We lost. Next."

Dill has now delineated the "next" for QVC: transforming the teleshopping channel into a multimedia company, changing its corporate structure and renaming it QVC Inc.

But converting the teleretailer hasn't stopped speculation on QVC's future, especially in light of Diller's long association with and interest in the entertainment industry and his ability to attract other companies willing to back the unceccessful bid for Paramount with pledges of big bucks. In the takeover battle, Diller lined up financial support $2 billion from Bell South, a regional phone company, and $500 million each from two publishing conglomerates, Advanced Publications and Cox Enterprises.

Speculation, which neither Diller nor QVC would comment on, includes.

* Reviving QVC's bid for rival teleshopper, the House Shopping Network, which has been called off during the Paramount battle;

* Starting a new TV network, either in a joint venture with the Walt Disney Co. or with the Time Warner cable system, which had planned such a move with Paramount before that company wasa acquired by Viacom;

* Acquiring a movie studio; Sony Corp. is looking to sell part of its American movie business of Columbia Pictures and Tri-Star, and reportedly has talked with Diller.

QVC's multimedia restructuring involves setting up five divisions. They are:

* QVC-Electronic Retailing as the principla operating unit, with Douglas Briggs as its president. This core teleretailing service will have three departments: merchandising, marketing and programming, each headed by a senior vp.

QVC's basic teleshopping will be expanded by two new services that wilrl share a new shopping channel that replaces The Fashion Channel.

"On Q," to be launched later this month, will be broadcast Monday to Friday as a fashion service for younger adults. It's headed by James Held, who was named excutive vp of QVC merchandising.

"Q2," led by Candice Carpenter, will start airing in late May on weekends and focus on fashion and fitness.

* Operations and Services, led by executive vp Tom Downs. This division will provide across the board fulfillment and administrative services for all current and planned electronic retailing ventures.

* International, with Bill Schereck as president. The division has two current operations, QVC-The Shopping Channel, a joint venture with BskyB in the United Kingdom that is negotiating deals for channels in other European markets, and a Mexican service that is to be rolled out across Latin America and also air in Hispanic markets in the United States.

* QVC-Interactive, a new venture, that will focus on all interactive services, including onlipne shopping. The initial service is expected to be launched early next year. The division is headed by Stephen Tomlin, vp and general manager, interactive technology.

* QDirect, another new division, which will produce 60- and 120-second direct response television ads as well as half hour infomercials. QDirect will also explkore joint ventures with other cable and broadcast networks. The executive to run this operation is to be named later this month.

QVC's adversarial relationship with Viacom isn't over. Viacom plans to offer home shopping as one of its information supherhighway services and is already offering teleretailing as part of its interactive TV test with AT&T in Castro Valley, Calif.

QVC advanced a number of executives as part of its restructuring, while president Michael Body, who co-founded the company, retired. His position isn't being filled as the new QVC, Inc. provides managerial and financial support to its operating divisions.

The new senior vice presidents and their areas of responsibility include the following: Robert Cadiagan, programming; Fred Siegel, marketing; Darlence Daggett, fashion merchandising; Jeff Taraschi, jewelry merchandising; and Mary Forte, home merchandising.