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Technology Stocks : C-Cube -- Ignore unavailable to you. Want to Upgrade?

To: J Fieb who wrote (25492)	11/19/1997 7:59:00 PM
From: John Rieman	Respond to of 50808

Digital peace in Itally. Nokia and Canal Plus boxes........................ ijumpstart.com Peace in Italy as Digital Moves Competition officially was kicked out of the Italian pay-TV market earlier this month when the major Italian broadcasters and Canal Plus signed a memorandum of understanding in which all of the major players threw their support behind the Telepiu digital platform. In essence, the agreement splits Telepiu into two companies - one analogue-based (Telepiu's current business) and one digital (based around Telecom Italia's Stream). The corresponding stakes in both of these companies are different. Canal Plus will control and manage the analogue division, which includes two pay-TV channels (Telepiu Nero and Telepiu Bianco) that go to 900,000 subscribers. Canal Plus will hold 45 per cent of the company, with Mediaset and Telecom Italia holding 10 per cent each. Italian media companies Cecchi Gori and RAI will take 5 per cent each. The remaining 15 per cent will be either divided among new partners or floated on the stock exchange. The shareholding structure of the digital division, dubbed Stream Digitale, will be as follows: Telecom Italia (40 per cent), Canal Plus (30 per cent), RAI (10 per cent), Mediaset (10 per cent) and Cecchi Gori (10 per cent). An important detail is that both Telepiu and Stream Digitale will be open to new Italian and foreign investors, who will be able to purchase a minority stake. The reasoning behind this is clear - to forestall any attacks from the Italian and European competition authorities. The deal has won the support of the Italian government, which had always expressed its preference for a single Italian digital platform for satellite and cable services. This summer, Canal Plus angered authorities when it wound up owning 90 per cent of the Italian platform after it bought German media company Kirch's 45 per cent stake. The Italian government is looking to ensure that a situation where foreign investors control the main media platform does not happen again. The principal reason is the high cost of investment in this field, as well as the fact that up until now Telepiu has attracted only around 150,000 subscribers. The undersecretary at the Ministry of Posts and Telecommunications, Vincenzo Vita said that the deal was of "great importance." He added that the digital platform would have to be open and that the passage from analogue to digital will not be a long process. This autumn, Canal Plus relaunched Telepiu's digital bouquet, with several new thematic channels and a change of name (from Telepiu Satellite to Telepiu D+). Several issues still remain unclear at this point, such as the financial terms of the deal, responsibility for commercial activities and subscriber management and the future of Stream, which has in the past few years been actively involved in cabling up the Italian peninsula.