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While the July 2 death of screen legend James Stewart was indeed a sad occasion, it presented a special opportunity for Steve Kmetko.

Kmetko is co-host of “E! News Daily,” the channel’s live entertainment news show. In June, the show was expanded to an hour as part of an overall effort to increase news coverage on E!, the cable channel devoted to all things entertainment.

Kmetko, who grew up in Chicago and went to Columbia College in the early 1970s, said the channel did two live cut-ins announcing Stewart’s death. When “E! News Daily” came on the air later that day, he said “we were able to donate the first 13 minutes of our show to Jimmy Stewart (including an obituary and lots of reaction) and still get in the rest of the day’s entertainment news.

“Now, if we were a 30-minute newscast, I’m not certain we would have given him that much time, and certainly if anybody deserved that amount of time and a proper tribute, it was Jimmy Stewart.”

Because “E! News Daily” is live (Monday through Thursday at 5 p.m. and again at 8 p.m., with a weekend edition Fridays at the same times), it has a leg up on its competition (including “Entertainment Tonight” and “Access Hollywood”) in the entertainment news derby.

“They have to get their stuff up on a satellite at a specific time,” Kmetko said. “We’re not limited in that way. We can go on the air at any time, and I think that gives us an edge. As anybody in any news organization knows, live is live.”

E! has opened a New York bureau, and doubled the news production staff in its Los Angeles headquarters. It also added Gina St. John as a co-anchor to the 44-year-old Kmetko. All of this was part of an effort to strengthen what the network considers its “backbone,” said senior vice president/programming Fran Shea.

“Having an entertainment news team here, even in the (former) half-hour form, was something that people in the industry depended upon initially,” Shea said. “Then, as we got more and more viewers (E! is seen in 44 million homes), it’s really become a real force in our schedule.”

That type of commitment is part of an overall effort to bolster the programming of E! Entertainment Television, which has been on the air since 1990.

E! is increasing its mix of original programming over reruns of classic television series from somewhere around 70 to 75 percent currently to 91 percent in September, according to president and chief executive officer Lee Masters. The plan is to have the network at 95 percent by the fall of 1998.

“We think we have a terrific niche in the television arena, covering the entertainment industry and the entertainment business,” Masters said. “We just want to do everything we can to reinforce the brand and make the brand as big and successful as possible.”

In addition to the beefed-up “E! Daily News,” the new programming, which is either on the air now or in development, includes “Celebrity Profile,” a weekly look at the life and career of a person in entertainment; “Mysteries & Scandals,” a weekly show that focuses on legendary Hollywood types; and “The E! True Hollywood Story,” a semimonthly special on the lives of the famous, which will become a daily feature. Specials, a game show and a talk show are also in the works.

In separate episodes this Sunday, “True Hollywood Story” will profile the royal family of Monaco, and Christian Brando, the son of Marlon, who was convicted of manslaughter in the death of his half-sister’s boyfriend in 1990.

Shows such as “True Hollywood Story” are a type of storytelling “we wanted to branch into,” said Shea. “We wanted to take a two-hour block, or in the case of `Celebrity Profile’ and `Mysteries & Scandals,’ shorter program times, but still tell a story for the whole length of the program.”

E! will also increase its live coverage of award shows and premieres, Masters added. “We did six, I think, the year before last,” he said. “We had 12 last year, and I think we’re going to end doing about 26 or 30 this year.”

On Tuesday, E! will cover the premiere of the Julia Roberts-Mel Gibson movie “Conspiracy Theory” at 7 p.m.

E!’s core remains its news coverage, which suits Kmetko just fine.

“This is where I belong,” said Kmetko, who came to E! in 1994 after covering entertainment for KCBS in Los Angeles.

It is Kmetko’s dream that E!’s strengthened news coverage will be the prime source “for entertainment news and entertainment information the same way that ESPN is viewed for sports, and CNN is viewed for news.”

And although going to an hour with “E! Daily News” goes a long way toward his dream, Kmetko joked there was one downside: “I’d be happier about it if they were doubling my salary.”