NewsCorp’s Italian Pay-TV Deal Faces European Probe

02 December 2002

News Corporation’s creation of a pay-TV monopoly in Italy has hit a setback with news that European regulators are launching a four-month probe.

Earlier this year, NewsCorp agreed to buy pay-TV firm Telepiù from Vivendi Universal for €893m ($887m; £570m), intending to merge it with rival operator Stream, which the Murdoch empire co-owns with Telecom Italia. The resulting entity has been christened Sky Italia [WAMN: 03-Oct-02].

However, the European Commission – alarmed at the creation of a “near-monopoly” in Italy’s pay-TV market – has decided to take more time investigating possible effects of the deal.

NewsCorp has already offered several concessions, including the sale of two terrestrial TV frequencies and a number of agreements on film and sports rights.

But, revealed the EC, “the sheer complexity of the remedies and the limited time available … have made it impossible to conclude whether they would be sufficient to remove all competition concerns.”

NewsCorp officials are not said to be worried about the new probe. They argue that pay-TV is too small in Italy (with only 9% penetration) for the monopoly to be abused.

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