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Technology Stocks : PCW - Pacific Century CyberWorks Limited

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To: ms.smartest.person who wrote (1820)	8/12/2001 10:04:11 PM
From: ms.smartest.person	Read Replies (1) of 2248

PCCW seeks improved content deal Monday, August 13, 2001 JON OGDEN Pacific Century CyberWorks (PCCW) is seeking to renegotiate a 10-year contract with a London-based content supplier for its Network of the World (NOW) broadband channel. According to one source, CyberWorks pays up to US$10 million a month to television production company Trans World International (TWI), an arm of Mark McCormack's International Management Group. CyberWorks denied the spending was so high but declined to give its own figure. CyberWorks admitted that 300 TWI production staff and 30 of its own employees are still producing English-language NOW television programmes and Web-site content from purpose-built studios in West London. That is despite the international version of NOW no longer being a central part of its business plan. "They want to get out of the contract but they can't. It is watertight," the source said. CyberWorks said TWI produced NOW's programmes and Web content on a "cost-plus fees for services basis". It included payments to TWI in a US$100 million cap on earnings before interest, tax, depreciation and amortisation for next year and 2003. A CyberWorks spokesman said: "We have made no secret of the concerns about NOW and the need to control and reduce costs, and look for ways to improve business performance and revenue generation. "We are working closely with TWI to achieve that and we are in discussions with TWI about production costs, content output and marketing, including possible new revenue streams. "Discussions with TWI have been going on for a number of months. There is no hard and fast deadline but we expect conclusion fairly soon." The TWI contract was signed in 1999. With its share price now down 92.86 per cent from its high, CyberWorks has been concentrating on being a value-added telecommunications firm since its takeover of Cable & Wireless HKT in August last year. A spokesman for Trans World International declined to comment on the contract, saying it kept relationships with clients private. biz.scmp.com

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