SAT-ITALY 29.07.1997


* A note to all subscribers of SAT-ITALY *
I will be on vacation from today so I'm sending out the news three days
earlier than usual. The SAT-ITALY service will be back on August 29th. Thank
you for all your kind comments about the service.

One of the principal media stories in the past week here in Italy has been
that the Italian media magnate Silvio Berlusconi is under investigation by
the Spanish authorities for alleged tax evasion. A court magistrate under
order from the Anticorruption authorities has searched the headquarters of
the Spanish private TV channel Telecinco in which Berlusconi's TV holding
company Mediaset has a 25% stake. Telecinco is accused by the Ministry of
finance of not paying 2 billion pesetas (around 24 million DEM) in taxes and
Silvio Berlusconi is personally accused of not paying taxes from 1991-1993
which amount to 1 billion pesetas.
Additionally, the investigators suspect that Silvio Berlusconi in facts
holds 50% of Telecinco through "phantom" companies. Another person besides
Berlusconi is also under investigation. He is Javier de la Rosa who bought
stakes in the TV channel during 1990 and 1991 which he later resold via a
company called Telefuturo and during this operation, according to the
anticorruption authorities, he evaded paying taxes amounting to 1 billion
According to the Spanish authorities, the Fininvest (now Mediaset) group in
fact exceeded the 25% limit for foreign ownership established by law, and at
one time held 80% of the capital of Gestevision Telecinco S.A.
Silvio Berlusconi has denied any wrongdoing and in a press statement said
that Mediaset had only a 25% stake in Telecinco, he himself never had any
role in the day-to-day operations of the channel and that any exchange of
capital in the channel was done in a regular way.
During the coming football season '97-'98 there will be no changes to the
way the games are televised by the Italian pay-TV network Telepiu. At a
meeting of all the presidents of the Premier League teams it has been
decided that only one game will be televised live (Sunday nights), as has
been the case up till now, by the pay-TV network Telepiu. This means that
the proposal to televise another match on Saturday nights has not been
accepted, but will instead probably happen during the next season when a
third game will also be transmitted live (Monday nights).
The decision not to broadcast more than one match live this coming season is
due principaly to two reasons. One is financial, because Telepiu offered far
less for the additional games it was to have carried than the football teams
asked for. A second reason is that there was heavy opposition to such an
agreement from the rival TV networks - Mediaset, RAI and TMC.

The talks between the principal Italian TV and media companies (RAI,
Mediaset, Cecchi Gori, Stet) and Canal Plus (the majority shareholder in
Telepiu) on the subject of a single Italian digital platform are still going
on with no end in sight. It seems that a positive result is now less likely
than a week ago when all the parties announced they reached a preliminary
The French company Canal Plus which currently owns a 90% stake in Telepiu
(around 80,000 subscribers to the digital service) has still not accepted
the idea that Italian companies are to take the day-to-day running of
Telepiu. In fact Canal Plus has accepted that the Italian companies will end
up having a majority stake in Telepiu but has also asked that a clause be
included in the agreement which would ban the Italian companies forming a
cartel inside Telepiu, ie.passing majority decisions on all major questions.
In a separate development, the financial commission of the Italian Senate
will make a decision during this week on the government proposal for
introducing financial incentives for the acquistion of digital satellite
reception equipment. The government has in fact suggested that value added
tax would drop from 19% to 4% on all subscriptions to digital satellite
services (ie. Telepiu) as well as for the satellite kits necessary for
receiving the digital signals (dish, digital receiver, LNB).

Telecinco, the private Spanish TV channel in which Berlusconi's Mediaset has
a 25% stake has reported increased revenues for the first half of this year.
They amount to 5,5 billion pesetas (around 63 million DEM) which is an
increase of 60% compared to the same period last year. The audience share
has also increased by 4,5 points and totalled 22,5%.
Telecinco in cooperation with Mediaset is exploring the possibility of
launching a TV channel in Spanish based in Argentina. The project
tentatively called Hispanidad involves the production, distribution and
transmission of TV programs for a potential market of around 400 million
people on five continents. This project will probably be officially launched
on October 12th, the anniversary of the discovery of the Americas.

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