Crown Media Narrows Loss; Preps HD Channel

STUDIO CITY, August 8: Crown Media Holdings today announced
that it reduced its second-quarter net loss from last year’s $227.4 million to
$43.7 million; and unveiled plans to launch a high-definition version of the
Hallmark Movie Channel in the first quarter of 2008.

Hallmark Movie Channel HD is
Crown Media’s first HD initiative. Henry Schleiff, president and CEO of Crown
Media Holdings, noted: “This launch is in direct response to the growing demand
for family-friendly content on television today. Once again the Hallmark brand
delivers the very best in high-quality entertainment for families and offers
distribution partners and advertisers an outlet to reach their consumers where
they know they are spending time.”

According to Kagan Research,
nearly 50 percent of all homes with cable or satellite television will have HD
sets by the end of 2007.

Meanwhile, the company recorded
second-quarter revenues of $55.9 million, marking an 11 percent gain. Crown
Media saw ad revenues rise 13 percent to $49.3 million and subscriber revenues
were up 2 percent to $6.5 million. Subscribers were up 13 percent to 82.6
million.

"I am pleased to report that the second quarter
delivered continued strength in our core business fundamentals," said
Schleiff. "We experienced significant subscriber expansion, and now stand
at over 83 million subs, the appeal of and demand for our original programming
and family friendly series continues to place us among the top-rated cable
channels, and advertisers in growing numbers are rewarding us for the unique
niche that Hallmark Channel has with our increasingly important demographic of
women, 25-54.”