April 15, 1999

The owner of Home Shopping Network, Ticketmaster and USA Network is buying Hotel Reservations Network, a Dallas-based company that books discounted hotel rooms, the two companies said Wednesday.

Although Hotel Reservations Network is already affiliated with more than 1,000 companies and their Internet sites, the purchase by USA Networks Inc. will expand Hotel Reservations Network's exposure on the Internet, HRN president and founder Robert Diener said.

"The big challenge on the Internet is to get your name out there in a big way," Mr. Diener said. "What this does is to really take it to the next level. The idea is take HRN and put it on all the various media networks of USA."

For example, if someone calls up Ticketmaster for a Broadway theater ticket, "it's a natural to offer them a hotel room. We handle over 110 hotels in New York," Mr. Diener said.

USA Networks owns the cable channels USA Network and Sci Fi Channel; Studios USA, which produces and distributes films for theater and television; Home Shopping Network; Ticketmaster; and USA Networks Interactive, which includes Internet Shopping Network.

The New York-based company also owns a controlling interest in Ticketmaster Online-CitySearch Inc.

"Not unlike many interactive companies, HRN has had zooming growth since it offered Internet services in 1995," said USA Networks chairman and CEO Barry Diller. "Unlike many others, it has substantial revenues and profits. We're delighted to be in business with them."

The deal announced Wednesday is expected to close in about 45 days, Mr. Diener said. No sales price was disclosed.

Hotel Reservations Network is to become an operating unit of USA Networks, with Mr. Diener remaining president and David Litman staying as chief executive officer.

Hotel Reservations Network, a private company based at Walnut Hill Lane and North Central Expressway, booked about $66 million in revenue in 1998, Mr. Diener said.

It expects to have 1999 revenue of around $125 million, but "that' s an extremely conservative number," Mr. Diener said.

Hotel Reservations Network, which started out as an 800-number reservation service, is rapidly changing to an Internet-dominated company.

Last year, about 45 percent of its reservations were done on the Internet, and the numbers currently are about 70 percent.

Mr. Diener projected that Hotel Reservations Network may soon see 80 percent of its bookings done through the Internet.

Hotel Reservations Network has contracts with about 600 hotels in 34 cities, including seven cities outside the United States, to sell their rooms and, in some cases, it buys blocks of rooms and resells them to consumers.

About 25 percent to 30 percent of its reservations now come from non-U.S. citizens.

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