Murdoch and Messier Square Up Over Italian Pay-TV Deal

17 May 2002

‘I quit,’ said Vivendi Universal ceo Jean-Marie Messier, referring to his company's abrupt exit from negotiations with News Corporation to merge their respective Italian pay-TV units, Telepiu and Stream [WAMN: 16-May-02].

‘Oh, no you don’t,” replied NewsCorp’s Rupert Murdoch, opining that the French giant’s current financial ailments were “not valid reasons” for withdrawal.

He told investors earlier this week that NewsCorp would resort to law if Vivendi reneged on the deal: “If Vivendi doesn't go through with it, we'll sue them,” he said. “And Stream will stay in business as a very active competitor. We can continue to fund it and so can our partner Telecom Italia.”

Vivendi’s purported reason for its exit was the decision by Italian regulators to make the deal conditional on ten contractual conditions – of which one was the limitation of broadcast rights deals with Italian soccer clubs to two years instead of the current three.

Responded Vivendi to Murdoch’ threat: “This is not a gamble. Mr Messier said at the outset that he would not go further with the competition authorities than the conditions he already accepted.”

The more bloodthirsty among media industry observers are said to await with eager anticipation a bare-knuckle fight between the two global media moguls. The smart money is on Murdoch.

Data sourced from: Financial Times; additional content by WARC staff