NEWS _ Text version only - February 8. 2000 ============================================ FROM AUSTRALIA Seven tunes in to Granada TV By BEN HOLGATE and FINOLA BURKE 08feb00 THE British television group behind Coronation Street and Heartbeat has teamed up with the Seven network to create a new company that guarantees greater international exposure for Australian programs. Granada's Australian production arm, Artist Services, will join Seven's in-house production staff to build the largest TV production company in the country, making shows as diverse as SeaChange and Home & Away. As part of the merger, Granada has acquired 9 per cent of the Seven network, a stake valued at $141 million, it was announced yesterday. The move signals Granada's further entrenchment in the local industry after purchasing Artist Services from chairman Steve Vizard and Fairfax 15 months ago. Mr Vizard will be chairman of the new company, which will be launched next month, with offices in Melbourne and Sydney and is yet to be named. Seven chairman Kerry Stokes said Granada, which is the largest producer of TV in Europe, would guarantee overseas sales and generate financing through offshore distribution advances. The new company would make at least 350 hours of TV in its first year, of which 200 hours would be for Seven. "The company is going to be judged by the quality of the goods produced," said Mr Stokes. New shows have already been commissioned, among them The Farm and Eugenie Sandler, P.I. for the ABC, and My Brother Jack for the Ten network. The company will employ about 700 people, half of whom will come from Seven. The rest will be mostly contract employees associated with Artist Services. The news could not have come at a better time for the local TV industry, which has suffered a significant downturn in recent years. TV drama production fell 27 per cent in 1989-99 from the previous year and overseas sales have dropped by about one-fifth from a high point three years ago. . ===================================== Associated info on the above news item Granada buy rids Seven of stirrers By KEVIN MORRISON British TV broadcaster Granada Group bought a 9.1 per cent stake in Seven Network yesterday after the two companies pooled their local TV production operations into a joint venture to create the country's largest TV production group. The $141.6 million purchase was welcomed by Seven executive chairman and 34 per cent-shareholder Mr Kerry Stokes, who said it was "an endorsement of Seven's strategy". Granada bought 23.4 million Seven shares at $6 a share, which was 8.5 per cent above Friday's close of $5.53, with Macquarie Equities and Deutsche Bank crossing the shares in a special trade on behalf of Granada. The acquisition helped lift Seven shares 25c to finish at $5.78, the highest close in almost two years. It is believed 4 per cent of Seven shares bought by Granada were sold by Australian investors with the other 5.1 per cent bought from foreign investors, or about a quarter of all shares that foreigners can own under foreign media ownership laws. These rules limit Granada to a total of 15 per cent of Seven. Mr Stokes said he was not a seller of shares. "I have not sold any shares, nor would I contemplate ever selling any shares that I own in Seven," he said. But it is understood that Sir Ron Brierley's Guinness Peat Group, Deutsche Asset Management and Portfolio Partners were among the sellers. Media analysts said Granada's strategic stake was was good for Mr Stokes as it helps to tighten the share register, blocking the prospect of the company being taken over and at the same time reducing the chances of unfriendly shareholders trying to stir up opposition to Mr Stokes. In the past year, companies associated with Mr Kerry Packer, Mr Reg Grundy and former BSkyB chief executive Mr Sam Chisholm were all rumoured to have bought Seven shares in efforts to destabilise Mr Stokes's grip on the company. The Granada deal is the second alliance Seven has made with an international media company. Last month it teamed up with NBCi the Internet arm of US television network. With the formation of key partnerships and Seven finally making inroads in reducing its costs by outsourcing its operations, sentiment towards the company's shares has improved markedly since the network's nadir last July when investors left in droves during Seven's share buy-back at $5 a piece. "I think there is definitely an improvement in sentiment towards the stock, but none of these deals are going to have any impact on Seven's first-half results," said Mr George Colman, media analyst at Salomon Smith Barney. Seven is to release its first-half results next month. Analysts tip little improvement on the $37 million of a year ago. Mr Stokes said there would be no staff losses from the TV production joint venture, which has a working title of NewCo, and will employ about 700 people. Mr David Champtaloup has been appointed chief executive of the company, which will be chaired by Mr Steve Vizard, the chairman of Artist Services. TV program July 30 - Julian Mounter resigns as Seven chief executive, cites 'irreconcilable differences'. Stokes takes over as executive chairman Aug 8 - Seven plans to cut costs by $30m Sept 9 - Seven reports 49pc fall in net profit to $42.2m Nov 3 - Letter of intent with Granada for TV production company Jan 13 - Ties up with US network NBC's Internet unit NBCi to access its content and technology Feb 7 - Granada buys 9.1pc of Seven at $6 a share end news item 1, February 8, 2000 ............... ========================================================================== FROM AUSTRALIA CWO cracks Telstra's local loop By Michael Sainsbury, Information Week Cable & Wireless Optus is about to prise open Telstra's long defended local loop with an ADSL trial. CWO has been champing at the bit to extend its broadband reach beyond its own cable network and this trail is the first step. Up to three other carriers are also understood to be in final negotiations with Telstra to participate in the trial. This follows a directive from the Australian Competition and Consumer Commission last October making the local loop a 'declared' service. Under the decision, Telstra must move to open up its copper network for access by other telecommunications carriers. This would mean other players will be able to install their own equipment on Telstra's network to provide data services as well as local calls. Such a decision was long feared by Telstra, which regards its local loop, and its concomitant access to around 99 percent of Australian telecommunications customers, as the jewel in the crown. And the number one carrier has made no secret of its opposition to having rival's equipment on its network citing interference and technology problems. But whether it goes with its own equipment on the Telstra network, or uses Telstra's wholesale ADSL product would depend on price according to a CWO insider. CWO has the most to benefit from the decision. The company has already set up a joint venture with US broadband leader Excite@Home and is offering commercial services to residential customers. And its US partner has already moved into the business market there with its @Work service. The company also offers high bandwidth data services off its own CBD networks - but up until now it has been hamstrung by its inability to access the Telstra network in any way other than to resell Telstra's products. So a trial with CWO over the so-called unbundled local loop is being held in tandem with a wholesale trial of Telstra's own ADSL product. Eventually, CWO intends to target cashed-up small to medium business users with its ADSL product. The ACCC's Chris Pattas said, "The Commission would want the unbundled service to be offered in broadly the same time frame as the wholesale service." But CWO is believed to be concerned that Telstra will use delaying tactics is getting an unbundled product into the marketplace, either defying the ACCC or seeking relief from the regulator over technical issues. A spokeswoman for Telstra said that the carrier is planning to have an unbundled local loop wholesale product on the market in August. ....... end news item 2, February 8, 2000 =========================================================================== FROM AUSTRALIA ABA move to censor newsgroup SIMON HAYES THE Federal Government has extended its ban on pornography to Internet newsgroups. Content on popular portal deja.com has been banned following a complaint that it contained a pornographic story. Filtering software companies will be instructed to block access to a posting on deja. com, a site that archives Usenet newsgroups, after the Office of Film and Literature Classification (OFLC) refused classification for the content. The incident has turned up the heat on newsgroups, with the Australian Broadcasting Authority (ABA) vowing to identify the worst offenders to ISPs, which may then decide to ban whole forums. The complainant, free speech advocate and Electronic Frontiers Australia (EFA) board member Danny Yee, said the anonymous posting, titled Agony in Pink, was submitted to see what classification it would earn. Agony in Pink was posted to alt.sex.stories in December 1998, and then archived on deja.com. Mr Yee has also complained about a Web site featuring the first chapter of the novel, Eat Me. While the book was subject to print classification guidelines, the online content would be classified as a film, he said. Mr Yee said the standard being applied to Internet content meant "the more explicit Mills and Boon-style novels wouldn't make the cut". ABA online services content regulation manager Stephen Nugent said that banning a page on deja.com was relatively straightforward, but stopping a live newsgroup posting being replicated to servers around the world would be more difficult. Mr Nugent said the ABA would report back to ISPs with a list of some of the worst newsgroups. Some ISPs may decide not to accept those that habitually carry prohibited content. "We will build a profile of newsgroups that are problematic and provide that to ISPs," he said. ISPs would be expected to consider whether they would continue to receive them. "We're not asking them to ban them. In the spirit of co-regulation, we are keeping them informed," he said. While most complaints received so far concerned Web content, the experiences of a similar scheme in the UK showed that much problematic content resided in newsgroups, Mr Nugent said. He said it was possible newsgroups would generate the most complaints in future. Concerns about newsgroups were not reflected in Canberra, where a spokesman for Communications Minister Senator Richard Alston said he expected most complaints would be about Web sites. Ministerial spokesman Sasha Grebe said users were more alert about potential dangers in newsgroups than on the Web, and USENET was not high on the censorship radar screen. "I wouldn't think as a parent I'd be that worried about my kids accessing a newsgroup," Mr Grebe said. "Newsgroups are a much smaller problem." . ... end news item 3. February 8, 2000 .............. ========================================================================= FROM AUSTRALIA Chello plays bush card DAN TEBBUTT REGIONAL Australia will have a second high-speed Internet option from next month after Chello Broadband confirmed one of the industry's worst kept secrets. The Amsterdam-based company last week confirmed plans to launch a fast Net access service in conjunction with regional pay TV operator Austar. Both companies are owned by United Pan Communications, which also plans a similar service in New Zealand with Saturn Communications. The network will be based on multichannel multipoint distribution service (MMDS) wireless local-loop technology after Chello successfully completed a trial in Albury-Wodonga. While managing director Philip Alexander refused to reveal what download speeds Chello would offer, MMDS can deliver data rates up to 10Mbps over considerable distances without requiring a direct line of sight. Mr Alexander said the retail service would be faster than Telstra's 128Kbps ISDN-based OnRamp 2 product: "It is significantly faster than anything available in regional Australia." He took a swipe at Telstra's pricing for the Big Pond Advance satellite service, which uses volume-based charging for 64Kbps or 400Kbps downlinks. "They are not competitive at current prices," he said. Because MMDS offers only a one-way downlink, Chello plans to establish its own Internet service provider to manage the telephone-based uplink. The ABC has signed on to provide rural and regional news for the service, with AAP delivering national news and sport, music from Channel V, technology news and games from ZDNet and international news from the BBC. "We think we'll have the most compelling broadband offering in rural and regional Australia, and people in the regions will get it faster than their city cousins," Mr Alexander said. Several major stock analysts recently upgraded forecasts for Austar on the strength of its exclusive agreement with Chello. Chello is believed to be preparing for an IPO on the Amsterdam and Nasdaq exchanges. ............... end news item 4, February 8, 2000.... =================================================================== IINTERNATIONAL PAY TV & ENTERTAINMENT NEWS IN BRIEF FEBRUARY 8, 2000 SCREAM 3 TOPS THE BOX OFFICE: Moviegoers were cravin' Wes Craven's Scream 3 this weekend - the tongue-in-cheek horror flick topped the box office with $35.2 million, according to industry estimates. Scream 3's gross topped the income of the rest of the top 10 films combined! The Hurricane finished a distant second, and Stuart Little, Next Friday and Eye of the Beholder rounded out the top five. SHEEN PONDERS CITY MOVE: No one could really replace Michael J. Fox, but Time reports that ABC and DreamWorks are talking with Charlie Sheen about joining Spin City after Fox departs the sitcom later this year. If a deal is reached, production of Spin would move from New York to Los Angeles to accommodate Sheen. KARLOFF KIN SUES UNIVERSAL: Boris Karloff's daughter is suing Universal Studios for more than $10 million, claiming she is owed royalties for the use of Karloff characters Frankenstein's Monster and Ardath Bey and Imhotep from The Mummy. According to Variety, Sara Karloff claims Universal tweaked Karloff's characters to avoid paying her royalties. Karloff died in 1969; daughter Sara is the successor to all rights in his name and likeness. CRUISE SWAPS FOR NICOLE: Following in the footsteps of Eyes Wide Shut, Tom Cruise (and Paramount) have acquired the rights to a British novel about wife-swapping for wife Nicole Kidman to star in. The novel, Heartswap, will be published in June, and tells the tale of two foxy female friends who get drunk and set out to seduce each other's fiance. ROB SCHNEIDER IS AN ANIMAL: Rob Schneider will show off his animal instincts in his next pic, a Disney movie titled Animal. According to the Hollywood Reporter, Schneider plays a man who received organ transplants from various animals and finds himself taking on their characteristics. Schneider is one of the writers of the project, and pal Adam Sandler is an executive producer. LETTERMAN'S PALS TO THE RESCUE: David Letterman pals Julia Roberts, Jerry Seinfeld, Bruce Willis, Bill Cosby and Steve Martin will introduce their favorite Late Show moments in the show's timeslot this week, and will be interviewed by either Regis Philbin, Charles Grodin or Late Show band leader Paul Shaffer, reports AP. GIFFORDS TO SPLIT?: Friends of Kathie Lee and Frank Gifford say the famous couple is preparing to split up by year's end, according to a lead story in The National Enquirer. Friends reportedly say that tensions still exist between the perky morning-show host and her ex-sportscaster hubby nearly three years after his messy, public affair with buxom former flight attendant Suzen Johnson. WILDER BATTLING CANCER: Gene Wilder, who lost comedienne wife Gilda Radner to cancer in 1989, is himself now battling the disease. Manhattan's Sloan-Kettering Cancer Center told AP the 64-year-old actor (Blazing Saddles, Young Frankenstein) was diagnosed with the disease last year and is being treated to prevent a recurrence of lymphoma. ........................... end news February 8, 2000 ============================================================================