Staff Reporter

From the outside, the 27-story highrise looks like any other buttoned-down business emporium along the Miracle Mile skyline.

But inside, men in suits are extremely scarce.

On a third-floor sound stage, Steve Kmetko dishes out gossipy Hollywood news bits on a set that features a goldfish tank shaped like an exclamation point, with the letter "E" etched into it. Meanwhile, the "Talk Soup" crew is wandering through the building looking for anybody willing to put on a ridiculous costume; one recent week, a group of volunteers was spotted in the building's parking lot dressed up as a mob of Abraham Lincolns, assaulting spacesuit-clad host John Henson with butterfly nets.

Yes, this is the headquarters of E! Entertainment Television, a company whose president and chief executive is known for having shaved the corporate logo into his head Mohawk-style to celebrate the network's launch in 1990.

E!'s growth curve since then has been steep and it's expected to get even steeper now that Walt Disney Co. owns a big chunk of the company. That is, if E!'s CEO Lee Masters can elevate the channel's substandard ratings out of the Nielsen netherworld.

From about 15 million subscribers when Masters took over a flailing cable channel called Movietime and transformed it into E! seven years ago, the network now reaches 42 million people.

Revenues have grown from an estimated $3 million in 1990 to an estimated $97 million in 1996, according to analyst Derek Baine with Paul Kagan Associates. Baine estimates the network's 1996 operating cash flow was $29 million and will reach a projected $36 million this year.

(E! doesn't disclose financial figures; Masters said the numbers from Kagan, a Carmel-based research firm that specializes in the cable industry, are a bit high for 1996 and bit too low for 1997.)

Any way you measure it, E! is a network on the rise. And although many observers predicted a change in programming and direction after Disney and Comcast Corp. teamed up in January to buy a 58.8 percent stake for $312 million, Masters said that isn't going to happen.

"We anticipate, over the next few years, greatly increasing physical production," said Masters. "I don't know that it's a change of direction as much as ramping up and going more aggressively in the direction we have been. If anything, we'll be more of what we are."

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