NEWS MONDAY 22 - MONDAY 29 OCT 2001

Scroll down page for news in chronological order

WEEKEND'S NEWS Friday 26th to Monday 29th October

Liberty to buy TeleColombus
ARD, ZDF fee change agreed
Viasat anti-piracy PPV success
Cogeco pulls the plug on VoIP
Singapore drops China deal
Rogers Cable CEO in politics?
Cartoon nets kids
KHQ-TV opens Digital facility
EuroNews launches in Denmark
C$1 billion for Canadian broadband
Pace targets VoIP for cable
E-district adds games on Telewest
New Skies for Latin Geography
Digital TV plays with Beasts
Content labelling on the Internet
Powell backs FCC decision on TV stations
New player in Satellite Broadband arena
Cox profits fall 83%
Barco launches HMS-based management

John Malone's Liberty Media of the US is further expanding its push into the German cable market, currently in advanced talks with Deutsche Bank to acquire TeleColombus, Germany's third-largest cable operator.

Liberty was reported to have completed due diligence on TeleColombus on Thursday (25/10/01) and was offering shares and cash valuing it at E1.2 billion to E1.4 billion ($1.07 billion to $1.25 billion), the cash element comprising a quarter of the offer.

Liberty is expected to conclude the deal despite Deutsche Bank continuing talks with other potential buyers.

Another option is for TeleColombus to be split into two regional operations, part going to Liberty, and the rest going to Callahan Associates of the US, which is also acquiring German cable operations.

Deutsche Bank would have stakes in both Liberty and the six regional cable companies it acquired last month from Deutsche Telekom if the deal were to go through. Although Deutsche Bank wishes to exit cable, it is reported keen to keep a stake in Liberty.

Digital TV plays with Beasts


Following its success with Walking With Dinosaurs, UK pubcaster the BBC is to launch Walking With Beasts on Thursday 15/10/01.

The series is believed to be the first documentary to feature interactive applications. Digital terrestrial television viewers will have a pallet of options to choose from, ranging from watching pop-up facts appear in text boxes throughout the programme to being able to chose an alternative narration on the programme, replacing the commentary provided by Kenneth Branagh with a more scientific commentary from Dilly Barlow. Cable viewers can explore illustrated text features on the individual Beasts.

Tim Haines, Executive Producer said, "Across the six programmes we will tell the story of not only what happened on Earth, but to life on Earth since the dinosaurs died out."

Haines commented that bringing to life the computer graphics beasts proved even more difficult than the dinosaurs. "They presented us with a lot of problems we hadn't anticipated, including covering them with fur and feathers and recreating the movement of these creatures. Because they are so close to what we know, the audience will demand an extra layer of accuracy in the animation, whereas nobody really knew how dinosaurs moved."

Three of the biggest players in the new media industry have announced that they will establish a content labelling system. AOL Time Warner, Yahoo and Microsoft's MSN network will allow users to screen out violent, sexual or other objectionable content.

The Internet Content Rating Association's system is currently available free for Internet Explorer and Windows operating system users. This system has been promoted in Europe for two years and it is only now starting to be recognised in the US, influenced by the support given by these networks, which account for half of US Internet traffic.


Users need to answer questions regarding types of content that they do not wish to receive, and choose settings and sensitivity levels so that the system can generate labels to embed into a site's HTML code.

A spokesperson for the ICRA commented, "Adult sites are our best customers because they don't want children to visit as they don't have a credit card and take up bandwidth."

US Senate Commerce Committee Chairman Fritz Hollings criticised US communications regulator the FCC's decision to allow many TV stations to continue earning revenue on spectrum that they were supposed to return to the FCC without charge.

After being accused by Hollings of defaulting on the FCC's obligation to manage the spectrum, Michael Powell, the Federal Communications Commission's Chairman, responded in a letter (23/10/01) saying that the commission had to respond to conflicting mandates established by Congress and its decisions would strengthen free television and benefit consumers.

"Without our most recent action, broadcasters may have been more likely to just take the money and run instead of continuing broadcasting service to the public," Powell said.

Hollings called the commission's plan 'outrageous' and claimed that the FCC bent "the law to meet the excessive demands of industry."

Some 99 analogue TV stations located in channels 60 through to 69 may sell their spectrum to wireless companies and continue broadcasting in analogue on digital-channel assignments located outside of the 60-through to 69 band, under the agency's plans.

Under digital-TV-transition rules established by the FCC and Congress, TV stations have the right to remain in the 60-through to-69 band until 2006 or until 85 per cent of households in a market have digital-reception equipment, whichever is later. Consequently the FCC decided that allowing wireless companies that want the spectrum to pay TV stations to leave it promptly was the best way to clear the band expeditiously for use not just by wireless carriers, but also by public-safety organisations, which were allocated 24 MHz within the band.

Powell backed the agency, telling Hollings that rapidly cleared spectrum would increase government revenue at next June's auction by wireless bidders and put more spectrum into the hands of the public-safety community to serve its need for nationwide interoperability.

Powell did not know how much money the TV stations would receive, but Paxson Communications Corp., which has 17 analogue stations in the 60-through to-69 band, expects to receive $1 billion from the wireless companies to clear out within a few years.

Frontline Communications, a US provider of Internet services including DSL and dial-up access, is using satellite technology to deliver Internet connections to its customers. The company is selling Packages for the service starting at $34.99, up to $109.99 per month. The equipment costs $375.

Frontline's system gives users a 400kbps high-speed connection for downloading files from the Internet. The satellite Internet service is a one-way offering which uses phone lines for the return path.

Frontline is available throughout the US. Its aim is to provide the service to areas where broadband products are not widely accessible, too expensive or unreliable. The company said that early sales results, especially in areas where other broadband services are not available, have been extremely encouraging.

The satellite offering uses the Satmex 5 satellite operated by Satelites Mexicanos, backed by Loral.

Cox profits fall 83%

Cox Communications, the fifth-largest US cable company, reported an 83 per cent drop in Q3 net income reported on Thursday (23/10/01), citing a fall in advertising revenues and lower one-time gains from the sales of stakes in other companies.

Net income was $143 million - 23 cents per share - for the three months to September 30, down from $838 million - $1.37 per share - for the same period a year earlier.

Q3 revenues were $1.03 billion, 14 per cent higher than the $902 million reported for the same period a year earlier.

The company's pre-tax gain on investments fell 62 per cent to $470 million in Q3, down from $1.25 billion in the same period a year earlier, partly due to a $90 m illion pre-tax loss on derivative instruments.

"Advertising sales have been slow all year due to the uncertain economy," said Jim Robbins, Cox's Chief Executive and added, "The business disruption caused by the events of the September 11 contributed further to this issue."

During the Broadband Communications Europe Conference & Exhibition, 16-18 October 2001 BarcoNet announced the launch of what it says is the first end-to-end HMS-based management system.

The first deployment of an HFC network management system based on the HMS industry standard is underway in Germany at Kabel Deutschland GmbHÿs Leipzig and Wolfsburg sites in projects led by main contractor WISI. The project covers total network management, including the hubs, optical nodes, return path receivers and amplifiers.

"Operators can now monitor their HFC networks regardless of the manufacturer of the network equipment," said Stefaan Verhelst, BarcoNet's Vice President of Sales & Services. "It gives them great freedom of choice, whilst guaranteeing full interoperability. This naturally increases the system's overall reliability and significantly reduces the cost of monitoring the network. The extensive know-how and practical experience in HFC network management we have acquired over the past years has now enabled us to offer operators the first highly reliable end-to-end solution, now complete with newly developed HMS transponders."

Users integrating the solution with BarcoNet's ROSA management system are able to use its SNMP Prolile Manager to avoid software development and integration, ensuring communication between several vendors' products within their networks. Barco adds that zero maintenance is required for BarcoNet's open interface management elements, such as the company's PHOENIX HFC network monitoring gateway.

Friday 26th OCTOBER

UK digital terrestrial service ITV Digital has just reported a higher-than-expected 82,000 increase in subscribers in Q3 to reach than 1.2 million customers. But while current subscriber growth at ITV Digital remains on target to reach its break-even of 1.7million subscribers by the end of the financial year 2003-4, its reported churn rate of 23.1 per cent has scared off potential investors.

Pan-European broadcaster RTL controlled by Bertelsmann, is reported to have told owners Carlton Communications and Granada that it would not buy into either company until they have shed the burden of ITV Digital which it described as a ¬poison pill.ÿ

"We would not be interested in any kind of relationship with either of them with that [ITV Digital] around their necks," a senior European executive was reported as saying in the Financial Times newspaper.

This additional thumbs down for ITV Digital has added to pressure to restructure, close or dispose of the business � a move increasingly thought likely despite government wishes to see a thriving DTT market in the UK.

RTL and Granada had discussed a possible strategic partnership but RTL's bankers are reported to have not wanted ITV Digital involved, though Granada denies that ITV Digital is a significant issue

During Q3 138,000 customers signed up to ITV Digitalÿs dedicated digital sports channel ITV Sport.

Carlton and Granada have been looking at their restructuring options to get a return on their £800 million plus investment, including discussions with rival commercial pay-TV operators.

Thomas Middelhoff, Chief Executive of the German media giant Bertelsmann, told the Sunday Times that he is keen to buy a big British TV company.

But ITV Digital is just one target as RTL is also the largest shareholder in Channel 5 and many inside the company believe it should invest in that brand.

ProSieben's poor Q3

ProSiebenSAT.1, Germany's largest television broadcaster, has announced that its pre-tax profit almost halved to E34.6 million ($30.9 million) in the first nine months of this year. These lower-than-expected Q3 results have raising doubts about its ability to meet its already twice-lowered profit target for the year.

These results could see a re-valuation of the company prior to a merger with KirchMedia, the free-TV and rights business of the KirchGruppe media empire.

Sales were E1.42 billion, down 4.5 per cent on the year, and one to two per cent lower than analyst forecasts of about E55million pre-tax profits.

In contrast KirchMedia has had a successful year with a 15 per cent increase in sales and a 42 per cent increase in profit. KirchMedia, has a 52.5 per cent share of ProSiebenSAT.1, which it will fold into its subsidiary by the middle of next year.

Urs Rohner, ProSiebenSAT.1 Chief Executive, said, "We made the best of a difficult situation in the German advertising market. Thanks to severe cost management, only half of our sales drop has had an impact on profits."

Last year ProSiebenSAT.1 made nearly 70 per cent of its pre-tax profits in the last three months of the year, so no profits warning has been issued.

EchoStar local option opposed

Eddie Fritts, President of the US' National Association of Broadcasters, has said in a letter sent to US regulator, FCC Chairman Michael Powell Wednesday that EchoStar and its Chairman and CEO, Charlie Ergen simply aim to promote the interests of EchoStar by securing waivers of local stations' rights to get satellite delivery of local television. He says that Echostar's proposals do not further the cause of DTT.

EchoStar proposed to the FFC to broadcast via satellite distant network signals to cities where local stations are slow to upgrade to digital TV. Under the proposal Network affiliated broadcasters unable to meet the deadline to turn on a digital signal could be required to grant digital distributors like EchoStar a distant network signal waiver for importation of a digital network feed. "If the broadcaster will not provide consumers with a digital signal, we will," says Ergen.

Fritts opposes EchoStar's proposal insisting that the purpose of requiring delivery of local channels was to protect local stations' ability to serve their local communities with free, over-the-air news, sports, weather and public affairs programming.

French UMTS licences delayed

Following last week's reduction in licence fees for the first two UMTS licences, Christian Pierret, the French Secretary of State for Industry, has confirmed that the government intends to put the machinery in motion for award of the two remaining licences.

Opening the telecoms and networks show in Paris on Tuesday 23/10/01, he said that the calls for candidates for the last two licences will be issued before the end of this year. The head of the telecoms regulator ART said that it plans to submit the rules for the new round, which is to be a 'beauty contest' rather than an auction, to the government before December 15 for approval.

Taking into account the time necessary to file and consider the applications, this means that the earliest the results could be announced would be autumn 2002.

Fantasy goes Euro

The Fantasy Channel, TVX, a UK adult entertainment channel which prides itself on a distinctively British approach to 'soft core' porn, has launched a new pan-European premium television service, The Fantasy Channel Europe. The channel successfully launched on October 22nd, on Hot bird 13 deg East, frequency 12.475 GHz, horizontal encrypted in Viaccess.

The Fantasy Channel Europe is transmitting from 8pm to 6.00am CET for 10 hours a night 365 days of the year. The channel intends to extend distribution throughout Europe while there are plans to extend into North Africa, Middle East and Far East. The channel is offered to DTH, DTT, Cable operators and Hotels.

OU Ootaja (Waiter), a company controlled by the Estonian investment bank Lohmus, Haavel & Viisemann (LHV), has acquired 75 per cent of SIA TV Riga, owner of Latvian television channel TV5.

OU Ootaja bought the shares from SIA Skonto, owner of 25 per cent of shares in TV Riga, and SIA Grafton Entertainment, owner of TVNET's internet news and TV portals in Latvia and Lithuania, at the beginning of October, LHV reported.

LHV is planning to invest more than $1m into the TV station. LHV said the city channel, TV5, is a channel about Riga and its inhabitants, seen in Riga and within a radius of 70 kilometres from the Latvian capital, broadcasting 18 hours a day.

Sky Sports adds live play

Last weekend (21/10/01) saw the first ever live, play-along interactive sports programme a Premiership football match from Sky Sports, broadcast on the Sky Digital platform using Two Way TV's interactive television technology.

Sky says that this is the first time that any network in the world has provided interactive consumer entertainment of this kind and on this scale.

Sky Sports licences Two Way TV's interactive technologies, particularly Playlive which it integrates into the Sky Digital platform for use with its own content, in this case Premier League football.

Sky Sports subscribers pay to join in with Sky Play. The challenge is to make a series of predictions as the live game plays out, viewers using their anticipatory skills and football knowledge. Points are won or lost for each decision, with cash prizes on offer.

Participants pay £1.50 via a premium phone line at the point of registration. Two Way TV has an on-screen credit at the end of the game.

Two Way TV Chief Executive Matthew Tims said, 'Two Way TV's goal has always been to deliver interactive programming that enables the audience to join in with the on-screen action. Sky Sportsï Sky Play is the first to emerge on a digital network and one with a significant audience. This shows how a major broadcaster, one that has already led the way with clever interactive services, has recognised the potential in a technology and format that adds further entertainment value. It is an ideal combination and we are exploring similar deals that will quickly spread the word among viewers generally that there is something new to do
with your television set."

The German Department of Trade and Industry has announced that it does not believe it necessary to increase regulation in order to control the new German cable operators.

Permanent Secretary Alfred Tacke made the announcement at a broadband communications symposium held by the department this week. The regular and existing antitrust and telecommunications features of the legislation would be enough to grant non-discriminatary access for content providers.

However, media legislation in Germany usually comes under the responsibility of the Laender, the individual states that form the Federal Republic of Germany. These bodies consider changes in the treaty on broadcasting, containing the rules on advertising, child protection and other regulatory issues in all of Germany, and expect to control new cable operators to a much higher degree than is the case with Deutsche Telekom.

The fear is that the new operators would ban existing free channels and replace them by their own pay TV services. The vast majority of cable systems have been sold by the former state telecommunications monopoly holder Deutsche Telekom AG to Liberty Media which will control more than 10 million cable homes. Other regions with a total of about 7.5 million homes have been sold to Callahan Associates, while the systems of the Hesse region with about 1.5 million homes have been sold to a conglomerate let by the British cable company NTL.

Straight TV from Trouble

Independent UK entertainment and music producer Straight TV has been commissioned by Flextechÿs youth channel Trouble to deliver a one series run of its music series Planet Pop.

Trouble Channel Editor Heather Jones has ordered eight x 30-minute episodes of Planet Pop, which will transmit from 5th November at 5pm. The programme will be shown on Mondays, and then repeated every day throughout the week.

Planet Pop was originally developed for Channel 4 and was transmitted as part of the popular T4 youth strand up until December 2000. Planet Pop was one of the most successful programmes ever shown on T4 and it is anticipated that the series will perform well on Trouble, with its strong and targeted reach to teenage audiences. Straight TV has already produced over 150 episodes of Planet Pop featuring Robbie Williams, Britney Spears, 5ive, Steps and The Spice Girls.

Thursday 25th OCTOBER

United Pan-Europe Communications, Europe's largest cableco, is to close television channels in a move likely to raise concern over the launch of its digital services and its ability to hit financial targets, according to today's Financial Times newspaper (24/10/01). The first channel to be closed down at the end of the year is Sport1. The staff of Sport1 have already been informed of the decision. UPC is also considering shutting down Innergy, an alternative lifestyle channel.

The main reasons cited for the closures are the high costs and the failure to attract customers in the face of the company's debt problems and need to reduce expenditure.

The channels are among eight that UPC produces and are a key part of a package of television, video and internet applications intended to raise the average monthly revenue from subscriptions.

The company's digital launch was scheduled to begin in September, but it has not happened - and although it has not been abandoned, there are now doubts about the company's commitment to the launch. The company reached 42,000 set-top box installations by the half-year stage three months ago, and has since completed only a low-key launch of the service in Vienna, Austria, consequently, it is unlikely to achieve its target of 250,000 installations by the end of the year. This will inevitably impact the company's aims to close its funding gap by April or May 2003 and achieve break-even in 2004 .

The company's shares, which peaked at over E80, have fallen as low as E0.23

EchoStar to meet 'must-carry'

There are doubts about the likelihood of launching the EchoStar 7 satellite before January 1st 2002, when new must-carry rules are due to be implemented in the US. However company executives insist that if the rules survive a constitutional challenge in a Virginia Appeals Court then EchoStar will be prepared to meet the provisions.

During a conference call detailing third quarter financial results, EchoStar CEO Charlie Ergen said "We are prepared for must-carry." He added that EchoStar 7 "does not look like it will launch in time" for must-carry. Still, he said, "We plan to be ready by January 1st."

Must-carry rules are the subject of a constitutional challenge in the 4th Circuit Court of Appeals in Richmond, Virginia. Satellite interests hope to overturn the rules, which are set to kick in on January 1st 2002.

With its new satellite, EchoStar aims to expand its local TV offering and meet must-carry mandates if necessary.

EchoStar Communications Corp also reported its Q3 earnings this week, stating that it earned almost $3.1 million, or one cent per diluted share, on revenue of a little over $1 billion during the third quarter, which ended September 30.

The company had 6.43 million subscribers at the end of the quarter, compared with 4.765 million at the same point a year earlier, an increase of almost 35 per cent over the 12 months.

For the third quarter of 2000, EchoStar reported a loss or $142.3 million, or 30 cents per diluted share, on revenue of almost $698 million.

EBITDA (earnings before interest, taxes, depreciation and amortisation) was $155.2 million for this year's third quarter, compared with a loss of $26 million for the same period a year ago.

It is the first time that quarterly revenue has exceeded $1 billion.
Ergen said discussions are continuing with General Motors Corp and its Hughes Electronics Corp subsidiary over EchoStar's bid to buy Hughes and its DirecTv unit, but did not provide further details.

New Skies Asian appointment

Holland-based New Skies Satellites has appointed Mathew Oh as Director of Sales for the Asia-Pacific Region.

Oh joins New Skies from Loral Cyberstar, where he held a similar position and worked on the successful launch of Internet via satellite in Indonesia. At New Skies Oh will focus on developing business in Indonesia, Thailand, the Philippines and Hong Kong. Oh previously worked for Hutchison Corporate Access, now part of Pacific Century Cyberworks, and Singapore Telecommunications.

Japan deploys Video on Demand

Japanese MSO Tomen Mediacom (Mediatti) has entered into an agreement with US server company nCUBE Corporation to deploy what it describes as the first large-scale video-on-demand (VOD) service in Japan.

This is the second phase in the expansion of Mediatti following the earlier announcement of a partnership with Scientific-Atlanta. Together the companies aim to bring Japan its first interactive digital cable TV system.

Under the agreement, nCUBE will provide its nABLE Interactive Management Platform software as well as its n4 Steaming Media Appliance for deployment at networks under Mediatti's umbrella throughout Japan. The nABLE Interactive Management Platform manages all of the systems and operations that comprise the nCUBE VOD system. nABLE manages stream control, bandwidth allocation, asset management and content distribution. NCube describes the n4 as offering a highly scalable and cost effective solution for storing and streaming video content from an operator's headend to the viewer.

Initial deployment of the nCUBE technology will be in interactive digital cable TV trials being held in Tokorozawa for a six month period from Spring of 2002.

nCUBE will also offer assistance to Mediatti in acquiring Hollywood content for its service.

"Japanese viewers of networks under our umbrella will now be able to view their favourite movies when they want to. They will no longer have to take the trip to the video rental store. They can enjoy a movie from the comfort of their armchair together with the other interactive services that Mediatti will be providing," said Hiroshi Morimoto, President of Mediatti.

Initial deployment will be on a trial basis for six months beginning in the spring of 2002. Upon successful completion of the trials, the technology will be extended to a broader coverage of Mediatti's subscriber network.

Rai seeks alternate jurisdiction

Italian Communication Minister, Maurizio Gasparri, has described as, "judicially groundless" a letter from Roberto Zaccaria, President of the Italian state radio and television broadcaster RAI, rejecting agreed limits in jurisdiction and control between RAI and the Ministry, insisting that the agreement be respected by the state broadcaster.

The state TV company consequently chose to apply the European Community directives 'TV without borders', as these were more favourable to the broadcaster, especially with regard to promotions, and it asked for the opinion of the Communications Authority for guarantees.

Gasparri said that it is true that the law has assigned some regulatory competences to the Communication Authority, but without prejudice to the legal regulations.
The RAI Director, Stefano Blassone, replied, "It is clear that RAI respects the law. It is equally clear that the law is not the Minister."

Under Zaccaria, RAI, which is still state-controlled (previously an IRI holding it will now pass to the Italian Treasury) launched Raisat, a RAI-controlled company that has produced six satellite channels. He also oversaw the deal between RAI and RCS Publishing creating further channels.

A pay-TV group formed by '24 hours Television' (a society owned by Il sole 24 ore), and TVs of the Italian publisher L'Espresso, has asked the President of the Antitrust Authority, Giuseppe Gasparro, for 'precise guarantees for future market assessments,' in view of the possible merger between Telepiu and Stream, which will lead to a single platform.

A letter from the group said that it needs guarantees for free pluralist alternative media, with clearly defined conditions for competition, and new measures to decide upon the minimum share of channels for national content providers.

Broadcom boosts interactive offering

Broadcom has strengthened its move into interactive television with highly integrated devices that support two-way communication over cable systems. Its new BCM3125 combines three chips into a single IC, including an in-band video channel 64/256-QAM receiver, an out-of-band control channel QPSK receiver and a QPSK/16-QAM upstream transmitter.

Korea launches interactive satellite

Korea's first fully interactive digital satellite television system is to be launched by Skylife later this year. Skylife will become the sole provider of satellite broadcasting services in Korea.

Skylife will use Harmonic Inc headend systems including Harmonic's DiviCom encoders, which form the core of a headend facility, maximise bandwidth efficiency and enable delivery of a wide range of digital television programming and services.

Skylife will offer Korean consumers almost 150 channels of digital video and music programming. The company expects to be on air by the end of 2001, with a plan to grow to approximately 3 million subscribers by 2005.

"We are changing the dynamics of the Korean television market by offering consumers an entirely new way to receive high quality video entertainment," said Dr Seon-kyu Park, Managing Director of Skylife's system integration centre. "In addition to video and audio programming, we will offer interactive services, such as home banking and online gaming, so we must make the best use of our bandwidth. Harmonic's proven compression and multiplexing technology is the critical component that will enable us to deliver so many channels of video, music and interactive services."

Skylife's main investors comprise public telecommunication and broadcasting companies including Korea Telecom, KBS, MBC, and KT Freetel.
Harmonic's distributor, Acetel, will provide systems to Ssang Yong Information and Communications (SICC), the prime integrator. This project is one of the largest of its kind in Asia.

Realnetworks adds 20 media partners

RealNetworks, an Internet media delivery and technology company, has agreements with 20 media and content companies to provide programming for the RealOne subscription entertainment service which is due to launch next month.

At launch partners include ABCNews.com, Animal Channel, CBS Survivor Insider, CNET Networks, CNN, E! Online and E! Entertainment Television, FOX Sports, RadioAMP, The Wall Street Journal Online and The Weather Channel.

Also available to consumers at launch will be RealOne Music, RealNetworks' premium music subscription service that will include MusicNet, which enables consumers to stream and download music from the catalogues of Warner Music Group, BMG Entertainment, EMI Recorded Music and Zomba.

NTL launches digital in Ireland

NTL has installed three new digital headends in Ireland, enabling provision of over 80 channels of digital television in three regions of Southern Ireland: Dublin, Waterford and Galway. The turnkey contract awarded to Belgium's BarcoNet for design to implementation was valued at over E4 million.

"BarcoNet was able to integrate all contribution, conditional access and deploy transrating technology to ensure multiplex maximisation of content," said Dennis Greatbatch, NTL's Head of Broadcast Development. "The task to provide digital services in all three regions within a tight time frame was a challenge. The success of BarcoNet is due to the excellent portfolio of digital products that provides a redundant end-to-end solution controlled by one single management system."

A major benefit cited for the entire system is its comprehensive monitoring and control, achieved by using BarcoNet's Rosa network management system, locally and remotely, which can be centrally managed from NTL's Digital Media Centre in the UK.

In the three Irish headends, BarcoNet's technology accommodates program contribution from several different types of network: MPEG over ATM from the UK digital cable service, as well as satellite and locally encoded content.

Conditional Access (CA) is provided by Nagravision's CA system, which is integrated into the headend via BarcoNet's Krypton scramblers, scrambling all transport streams. By further integrating transrating technology from the CherryPicker statistical multiplexer into its headend, BarcoNet says it was able to reduce the bit rate and maximise available bandwidth.

Initially, the new digital service was made available to 140,000 homes by the beginning of this month (October). NTL plans to expand availability of the service to an additional 10,000 homes per month.

Auction World Dot TV to launch

Auction World Dot TV is a new live auction channel launching 1st November on the Sky Digital platform Channel 651 in the UK, covering 'fine jewellery, home electronics, gadgets and entertainment.'

Other sales lines will include exclusive film related merchandise, memorabilia, collectibles, and toys and bikes.

The venture is headed by George Spitaliotis whose aim is to bring the shopping channel genre upmarket. The company is currently seeking brand owners, manufacturers, wholesalers, and distributors and sales agents.

Transmitted live 4pm to 12am everyday from Teddington Studios, the channel is being created by a team which includes Rob Beynon, former Director of Programming at CNBC and EBN, working with launch consultant Mike Kaufman, formerly Executive Producer at VH1.

Initially Auction World viewers will bid for goods via phone-lines, with a rollout of full interactive services planned for next year.

Nordic competiror for Kids TV

Cartoon Network, Fox Kids, Nickelodeon and Disney face a potential joint counter-attack in the four Nordic countries, after revival of the Nordmagi project backed by the region's public service broadcasters - Danmarks Radio, DR, Finnish YLE, NRK of Norway and Sweden's Sveriges Television, SVT.

Nordmagi has been a workshop to develop joint children's and youth productions. The first tangible result, 'Now is... NOW,' is a live puppet animation series to teach mathematics for smaller children, was launched in 1999 and still on the air in all four countries.

Now Nordmagi's aspirations have grown and the four broadcasters are in discussion about developing a new, pan-Nordic digital children's channel.

"For the very first time there is a common interest, and a joint wish, if not even a vision, to launch a Nordic digital children's channel," Annika Bioernstad, MD of Nordmagi, comments.

Many of the project's ideas are still on the drawing-board and a total concept will be presented to the four broadcasters early in 2002. Bioernstad envisions an operation, acquiring programmes from its owners, but also developing its own productions.

"We will certainly build on the solid traditions of Nordic children's television production, but we will also aim at being available on several platforms in the new media landscape. Interactivity, for instance, is an area where we think there is space for much more creativity," says Bioernstad.

Recent figures show that international children's channels have made heavy inroads into the young Scandinavian audiences: in Denmark, for instance, children's viewing of Cartoon Network, Fox Kids and Nickelodeon has in later year increased from a single figures to almost 20 per cent.

AT&T management changes

The change of heads of the Cable Division of US communications giant AT&T on Tuesday (23/10/01) may presage the selling of the division.

Former head of the MediaOne Group, William T Schleyer, succeed Daniel E Somers, who was AT&T Broadband President and Chief Executive. Media One Group is a cable company acquired by AT&T last year. A new Chief Operating Officer and a new technology officer were also appointed.

Drake Johnstone, an analyst with Davenport & Co is reported as saying that these changes in AT&T's management could be preparing the way for the sale of the company's broadband division. "They want people who can run the business as a standalone entity. They're polishing up Broadband before selling it."

AT&T and cable TV provider Comcast Corp restarted talks last month about the purchase of AT&T's broadband unit. In July 2001 Comcast offered an unsolicited $40 billion stock swap which was rejected by AT&T's board.

AT&T has since spoken with other firms about investing in or buying its broadband business. The other possibility is to spin off the company as a separate entity.

AT&T's Chairman and Chief Executive C Michael Armstrong commented that Schleyer's appointment is part of an effort to strengthen AT&T Broadband's senior management whilst the company revises its options for the business.

"Bill Schleyer has the operating skills and strategic vision to take AT&T Broadband to the next level of performance. He was one of the first industry leaders to recognise and exploit cable's high-speed data and communications capabilities," said Armstrong

Prior to its acquisition by the US West Media Group Schleyer also led Continental Cablevision.

AT&T also announced that current President and Chief Operating officer of Denver-based hosting services company Relera Inc, Ron Cooper, will join AT&T Broadband as Chief Operating Officer.

David M Fellows, principal with venture capital firm Pilot House Ventures, will join as Chief Technology Officer. Like Schleyer, Cooper and Fellows, 49, are former MediaOne and Continental Cablevision executives.

AT&T Broadband, is the US' s biggest provider of high-speed Internet access and local phone service via cable, with about 16 million cable subscribers.

FCC reviews Media Ownership

US rules governing media ownership have to be reviewed said Michael Powell, the US's chief telecommunications regulator and Chairman of the Federal Communications Commission, on Tuesday (23/10/01).

Although multiplicity of owners of the nation's airwaves and newspapers is desirable, decades-old ownership indicate that media ownership rules might be outdated indicate Powell.

At a press briefing, Powell said "Diversity remains a vital interest, but the tools to maintain it must be re-examined."

A Federal Appeals Court ruling that operating systems serving more than one-third of the US population are unconstitutional as the limits on free speech have already put limits on cable ownership. The same court is now reviewing whether similar limits on owning television stations are legal.

If the changes are implemented, the industry will have a wide-rang of effects, probably leading to mergers that could fundamentally change the US's media scene. AT&T is already intending to sell its cable division - possibly to Cablevision or AOL Time Warner, deals that would likely be illegal under the old regulatory regime.

Wednesday 24th OCTOBER

Turmoil in Norwegian TV market
Testra access plans announced
GlobeCast's Adult launches
Sprint abandons national broadband
Polish satellite TV bid
BT to strengthen BSkyB ties
Government supports Digital TV
AOL TW in Chinese CATV
OpenTV in DirecTV ichannels
Disney cuts Fox price
TV2 franchise extended
Tandberg Taiwan wins

Turmoil in Norwegian TV market

Recent turmoil in the international media market has now affected two of Norway's leading players. On Monday (22/10/01) it was announced that state-dominated telco Telenor aims to expand into the media, focusing on the private market, and concentrating all its operations into one single unit, Telenor Plus.

Simultaneously Norway's public service broadcaster and market leader NRK, announced the closing-down of NRK Futurum, formed two years ago, to develop new digital media ventures.

"There is no particular drama in this," Svein Prestvik, MD of NRK Futurum, comments. He said, "Most of what we have been doing will now be integrated into the traditional operations of NRK." NRK Futurum currently has a staff of some 150 people; its budget is around NK200 million (£14 million).

Telenor has been developing new services in areas like Internet, broadband, interactivity and various television-based content services, all focused on private use. New business divisions were incorporated including Telenor Broadband Services and Zonavi for interactive development.

To get deeper into 'content' Telenor has recently made a number of spectacular acquisitions, particularly buying into A-Pressen. A-Pressen, Norway's Labour-based national press group, is currently expanding into Sweden and Russia, and various additional media sectors. It controls one-third of TV2, Norway's largest private and commercial network.

Last year Telenor also acquired a significant part of Metropol, a chain of major-cities' local television stations. Telenor acquired a 50 per cent share in Canal Digital, previously held by Canal+. Canal Digital, with over one million subscribers, is one of the two leading Nordic DTH operators.

From now on, Telenor's terrestrial telephony, Internet, broadband and various television and content services, will be merged into Telenor Plus, one of four main business areas in Telenor. The three others are Business Customers, Telenor Mobile and Telenor Newworks.

Stig Eide Sivertsen, the first MD of Telenor Plus, said, "We have now taken a first step on our way to giving all our private customers one name, one business area, to relate to in the future." Sivertsen had been MD of Telenor Broadband Services prior to taking over Telenor Plus. He is now also in charge of Canal Digital and Telenor Avidi, Norway's leading cable television service.

Telenor also recently acquired Swedish cable operator Sweden On Line, and several smaller Swedish cable operators, making Telenor the second biggest cable operator in Sweden.

Australia's Communications Minister Richard Alston says he is committed to revealing the government's plans to allow access to dominant teleco Telstra's cable system before the nation goes to the polls on November 10.

The issue has become a vexed one after legal challengesled Australian courts to rule that Telstra had to open the system to pay TV providers. Telstra is a 50 per cent stakeholder in dominant pay TV platform Foxtel, with News Corp and PBL taking 25 per cent each.

The trio say they are reluctant to upgrade the system, including building two-way functionality and digitising it, if they are going to get uneconomic access rates from newcomers in return.

After that, they will also have to decide how revenues will be shared once they offer new services. Economic uncertainty after the September 11th terrorist attacks, have made each of the three focus on their core businesses.

Making matters more complex, they are bracing for an estimated $50 million loss in the current financial year, down from the 2000-01 figure of $31 million, due to steep rises in programming costs caused by the fall of the Australian dollar in relation to the greenback.

GlobeCast Northern Europe has launched four new adult entertainment channels for RHF Productions Ltd after leasing a second transponder on Eutelsat's Eurobird satellite.

The decision to increase capacity follows the success of the low-cost, 'one stop' distribution services offered on GlobeCast's first Eurobird transponder, which was fully booked when it launched in April.

Aimed at UK viewers, Red Hot Films, Red Hot Amateur, Red Hot Euro and Red Hot All Girl are part of an end-to-end deal in which GlobeCast takes on all operations. The package includes digital encoding, multiplexing, uplinking and monitoring the satellite's output, as well as providing encryption services and integration with the electronic programme guide operated by Sky Digital.

Positioned at 28.5 degrees east serving homes with Sky Digital, GlobeCast's transponders on Eurobird are claimed to offer a more cost-effective way to reach more than 5.5 million viewers in the UK.

GlobeCast's Head of TV Channel Distribution, Nigel Gibson said that the end-to-end service was developed to help smaller broadcasters reach the largest possible audience without having to maintain a costly infrastructure for distribution. "Niche broadcasters want to concentrate on making programmes, not distributing them," he said. "The one-stop service we launched on Eurobird in April has proved so popular we've had to take more capacity on the satellite."

GlobeCast's first multiplex on Eurobird broadcasts nine channels including EuroNews, Extreme Sports and Digital Classics. The new transponder will carry a further eight channels when fully booked.

Polish satellite TV bid

BT to strengthen BSkyB ties

OpenTV in DirecTV ichannels

OpenTV Inc agreed to work with DirecTv Latin America to create turnkey interactive channels for the DBS broadcaster.

Parent company Lagardere, publisher of fashion magazine Elle, and its interactive channels will provided the 'sponsorship' for the channels which will present programming on beauty and fashion, cooking, wines and horoscopes. Four channels will broadcast in Spanish and four in Portuguese.

The companies expect that by the end of the year the interactive channels will be available to about 800,000 subscribers with interactive set-top boxes

OpenTV and Lagardere subsidiary Lagardere Active iTV will create, develop and market interactive TV services to network operators. Lagardere Active iTV is responsible for the design, editing and content update of each of the channels, while OpenTV handles technical development and operations.

Disney cuts Fox price

The Walt Disney Company is expected to announce as early as today that it has cut the purchase price for the Fox Family Worldwide cable television operation by up to $100 million.

Disney agreed to buy the Fox Family cable channel parent in July for $3 billion cash plus $2.3 billion in debt. The price was seen as high at the time, but in the wake of the advertising slump, this view has hardened, and Disney is capitalising on the keenness of the sellers to dispose of this asset.

News Corporation and Saban Entertainment each own 49.5 per cent of Fox Family and the remaining one per cent is owned by Allen & Company, the investment bank.

Fox Family reaches more than 80 million homes in the US and more than 30 million homes elsewhere.

The government of Norway has officially extended the franchise of the country's biggest private commercial TV operation TV2.

There had been several months of uncertainty, since TV2 saw its franchise put out for public tender last spring, due to expire at the end of next year. On Monday 22/10/01 the channel was been given another seven year licence, from January 1 2003 to December 31 2009.

However, TV2, whose original licence awarded in 1992, was more or less for free, will now have to pay a one-off fee of 150 million krona (£12 million). TV2 will also have to pay an annual 25 million krona fee, plus a so far undisclosed charge, based on the station's advertising revenues. Some of the fees will go directly to the Norwegian Film Fund, thus supporting future production of Norwegian movies and television series.

Both TV2 and the government are reported satisfied with the new agreement. At TV2 a senior official, Rune Indroey, Director of Information, welcomed the new agreement as "Something we will be able to live with. During the future franchise period it will cost us between 350 and 500 million krone in fixed fees, but if, for some reason, NRK (the totally licence-financed public service broadcaster) was allowed to take advertisements, even as a part-financing, we will be allowed to renegotiate this agreement.

"We are also very happy to be able to retain our present full editorial freedom. Some of the new rules imposed on us are, indeed, stricter, but this has not been a major obstacle in the negotiations with the government."

"We are particularly satisfied with some of the new demands for TV2, ie rules stating that TV2 will focus more on Norwegian language, identity and culture and that at least half of the future TV2 programming will be of local origin," adds Roy Kristiansen, Permanent Under-Secretary of State at the Ministry of Culture.

TV2 had appeared to take it for granted that its present franchise would be automatically renewed. Then, last year, the government shocked the Norwegian media establishment by suddenly declaring that the franchise would be opened up for public tender. Eventually TV2 came out as the only applicant for the franchise.

Another unusual aspect of the agreement is that the present ownership limitations for TV2 will be abolished. This will be particularly welcomed by Schibsted, Norway's biggest media group, which has held 33 per cent of the TV2 shares since launch in 1992. The other two thirds are held by Danish Egmont with the Norwegian A-Pressen. A-Pressen has expanded both into other media and into other territories, like Sweden and Russia. Schibsted has long warned that either it will be allowed to increase its ownership in TV2 or it might consider selling out partially or totally.

MTG returns Swedish DTT licences
Digital Rumours boost Carlton and Granada shares
BBC bid for NTL Towers
One in 10 pirate viewers
Aform looses DTT appeal
Mip - the show goes on
HK newcomers hit by piracy
Nordic PSBs open Brussels office
Netgem shares soar
Viasat Denmark claims PPV record

MTG returns Swedish DTT licences

By Inge Naning

After four months of legal wrangling Swedish media group Modern Times Group, MTG, is now throwing in the towel and declaring itself willing to hand back its DTT licences. These cover the Swedish DTT multiplex with five services which MTG was awarded over two years ago. The move by MTG carried the proviso that Sweden's state-controlled TV and radio owner-operator Teracom "abstains from demands," relating to earlier contracts.

Early in 1999 when the MTG was expressing strong scepticism about digital television in general, the company surprised the Swedish media industry by handing in several DTT applications to launch on April 1 1999.

MTG was then awarded a whole multiplex of its own, for its flagship generalist station TV3, as well as youth-oriented ZTV, mini pay Viasat Sport, TV1000 and its then newly acquired free-to-air business service TV8.

These five services were all supposed to be on the air on April 1, 1999, when Swedish DTT was launched. But MTG gave the project a very low priority, and the five MTG services did not go on the air until early spring of 2000, after the government threatened revocation of its licences.

Meanwhile MTG did a complete about-turn on the issue of digitisation and announced a sudden, major transition of its Viasat DTH operation from analogue to digital. The move affected over a million subscribers in the Nordic territories, which competes with Telenor's Canal Digital for lead position. All the company's digital efforts are now focused on DTH and DTT has become a secondary issue.

Last winter further obstructive moves were made targeted at the Swedish media establishment. MTG announced the introduction of an SEK115 (£7.50) monthly fee for its free-to-air services (TV3, ZTV and TV8), but only for DTT subscribers. And in June MTG announced its decision to pull out of the DTT project altogether as of Aug 15, due to 'poor performance.' At that time MTG faxed a last minute demand to Teracom to keep the MTG services on the Senda DTT platform, but Teracom pulled the plug at midnight sharp, on August 15.

Since then there have been public accusations of 'lying' (from both parties) and legal wrangling. MTG has even involved the EU commission, and recently the Swedish government decided to find out whether or not MTG had violating Swedish laws.

MTG had been expected to hand the licences back to Teracom, but has so far, refused to do so. Teracom badly needs new services to boost the sad performance of its DTT operation, currently comprising just 85,000 subscribers. Several willing national and international operators including MTV, Eurosport, Discovery, Nickelodeon, Animal Planet, and Sweden's biggest private channel TV4 are all seeking government-approved new licences, to start DTT broadcasting. Two new multiplexes have been made available.

But a major question, after the latest round of licence awards has been, are there 15 new licences available or just 10? MTG's refusal to give its licences back has confused the issue, and MTG has also speculated about 're-leasing' of its licences to other, more interested international operators.

But MTG has certainly had a major asset in its hands. A recent survey sponsored by Teracom to find out which new channels the potential DTT subscribers preferred gave TV3 a number one position. Number two was a project from Sveriges Television, SVT, the country's public service broadcaster, Guldkanalen (the Gold Channel), a UK Gold-inspired operation, planned to be a joint venture between SVT and Telia, the latter taking on the financial and administrative burden. In 1997, however, Telia decided to put the project on hold.

Digital Rumours boost Carlton and Granada shares

UK terrestrials Carlton Communications and Granada saw their shares rise yesterday morning as City speculation grew concerning an imminent withdrawal by Carlton from ITV digital TV platform. Although ITV Digital has had a total £1.1 billion of investment it has already cost the two companies more than £800 million and there are growing doubts about its future as a standalone business.

Shutting down ITV Digital and selling on their subscribers to rival pay-TV operators could mean a £750 million ($1,079 million) saving for its owners, according to City analysts.

"We believe the industry will come to an accommodation on ITV Digital by the first quarter of 2002. Everyone stands to gain from the restructuring. ITV Digital has been a lead weight on the profits of Carlton and Granada, an irritant to BSkyB and problematic for the government," said Mathew Horsman, analyst at Investec.

The advertising downturn is likely to get worse before it gets better, both Carlton and Granada are under pressure to cut costs.

After the City analystÿs forecast, Carlton shares rose 10 per cent in early trading to 187p, while Granada's jumped 4.2 per cent to 130p. The news also affected BSkyB, i