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Sat-ND, 11.6.97




Sat-ND 97-06-11 - Super Rupert Mega Mix

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TODAY'S HEADLINES:
RUPERTWATCH
* FINALLY: PRIMESKY
* THE SATELLITE DEAL
* ECHOSTAR TO FIGHT BACK
* THE IMPLICATIONS
LAUNCHES
* CHINESE RULES AND EXCEPTIONS
BUSINESS
* BIGOT'S THOUGHTS ON COMPETITION
* UK TV CONSOLIDATION?
CHANNELS
* PORN CHANNEL ON THE MOVE AGAIN
FEEDBACK: SAT-ND, 9.6.97
* WHERE IS FENGYUN?

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*** Sat-ND summer break: June 24 - July 9, 1997 ***


RUPERTWATCH
by Dr Sarmaz

FINALLY: PRIMESKY
And here's the announcement we've all been waiting for. Just as expected,
Rupert Murdoch's ASkyB digital TV venture will team up with PrimeStar, a
DTH service set up and operated by U.S. cable companies -- including Mr
Murdoch's arch enemy Time Warner. He won't have too much influence on the
newly created company, though -- just a 30 percent non-voting interest.
PrimeStar Partners, the nation's second largest provider of direct
broadcast satellite (DBS) video services, today announced the
reorganisation of its ownership structure from a partnership into a new
corporation called PrimeStar Inc. that will include U.S. satellite assets
from News Corp./MCI. 
Under the terms of the new ownership structure, all existing PrimeStar
partners will contribute their partnership interests and PrimeStar
subscribers to the new company in return for a combination of stock and
cash. Current TCI Satellite Entertainment (TSAT) shareholders will retain
approximately 37 percent ownership of PrimeStar, Inc., with Time Warner
Satellite Services/Newhouse (approximately 30 percent), Comcast
(approximately 10 percent), MediaOne (approximately 10 percent), Cox
(approximately 9 percent), and GE Americom (approximately 4 percent)
rounding out the ownership group.


THE SATELLITE DEAL
News Corp./MCI will transfer to PrimeStar Inc. the 110 degree high power
orbital position, the license for 28 DBS transponders, and two satellites
under construction at Loral. The two Loral satellites from News Corp./MCI
will be added to the two Loral satellites of the same advanced model which
will be owned by PrimeStar Inc. upon completion of the roll-up. In exchange
for the News Corp./MCI DBS assets, News Corp./MCI will receive non-voting
convertible securities with a total liquidation value of approximately
US$1.1 billion, comprised of non-voting convertible preferred stock and
convertible subordinated notes. 
The transaction is subject to approvals of federal regulatory agencies.
Primestar and Tempo Satellite have agreed to dispose of their rights in the
license to operate 11 transponder channels at the 119 West Longitude
orbital slot. FCC regulations forbid any company to hold licenses for more
than 32 DBS transponders.
Concurrently, ASkyB has agreed to sell its Gilbert, Arizona satellite
uplink facility to Tele-Communications, Inc. for a purchase price which
represents ASkyB's investment in the facility, plus related interest
expense. 


ECHOSTAR TO FIGHT BACK
With the deal, Mr Murdoch comes a step closer to his world-wide satellite
TV network. He already owns or has significant interests in British Sky
Broadcasting, Japan Sky Broadcasting, and Latin America's Sky
Entertainment, as well as in the Asian venture Star TV. The deal follows
News Corp's failed efforts to join forces with EchoStar Communications
Corp. "I couldn't quite say this is a replacement, but because that (Echo)
deal didn't work out, this is the next one we're doing," a News Corp
spokesman said. "This is a way for us to recoup our investment in the
satellites." 
As reported, ASkyB and EchoStar have sued each other after their deal fell
apart. EchoStar's reaction is therefore as could be expected. "The News
Corp.-Primestar deal is an abomination, and I know we'll be doing
everything we can to make sure it doesn't happen," said David Moskowitz,
senior vice president and general counsel for EchoStar. 
The PrieStar-ASkyB deal is subject to regulatory approval, and media
reports suggest that receiving it may not be easy. It may be regarded as a
further strengthening of the U.S. cable industry that, as some critics
argue, has already become too strong and faces no competition other than
satellite TV. And besides, there's still a problem with ASkyB's DBS
license: it belongs to Mr Murdoch's 20-percent partner MCI which will be
taken over by British Telecom (BT,) a non-U.S. company. The Clinton
administration had earlier asked the FCC to review the foreign ownership
implications of transferring the license.


THE IMPLICATIONS
What can be expected should the deal go through? PrimeStar, so far using
medium-power satellites that serve only medium-sized dishes, will get an
orbital slot and a DBS license that obviously is better than that they
already owned. It will help them to those famous pizza-sized dishes, giving
them an opportunity to target densely populated areas as well. "Until now,
most of our subscribers have been in rural areas," said Daniel J. O'Brien,
who will become president of the new Primestar Inc. "Now we can compete
vigorously in suburban and urban markets."
The advantage for News Corp is a bit less obvious. Instead of telling the
cable guys to call Dr Kevorkian when announcing the meanwhile demised
EchoStar deal, News Corp now simply joins them. Although the PrimeStar deal
does not contain any promises about a U.S.-wide distribution of Mr
Murdoch's fledgling TV channels such as Fox News on cable, this is probably
exactly what is going to happen. And the cable guys, on the other hand,
will be happy to know what they're at with Mr Murdoch who has in the past
turned out to be a rather disruptive element.



LAUNCHES

CHINESE RULES AND EXCEPTIONS
Official Chinese media became exuberant on the latest launch of a Long
March 3 rocket -- just as if a success was the exception and not the norm.
Today, even a top-ranking politician joined in.
The Chinese Premier, Li Pang, expects the two consecutive successful
launches to "have a great bearing on China's status in the international
aerospace arena," reported Xinhua. Li made the comment today in Xichang,
Sichuan province, during a meeting with personnel who participated in the
successful launching of a meteorological satellite yesterday. "The
successful launching of the Dongfanghong 3 and the Fengyun 2 satellites in
less than one month is of both great economic and political significance,"
the premier noted. He called the launchings "a generous gift to Hong Kong's
return by all the aerospace scientists and workers." 
Xinhua also said that FENGYUN 2 has meanwhile "entered the earth's
quasi-synchronous orbit."



BUSINESS

BIGOT'S THOUGHTS ON COMPETITION
Speaking at a press conference in Singapore, Arianespace's chairman and
chief executive officer Charles Bigot said the European launch service
provider was seeking international co-operation. "We will have to talk to
our competitors and see in what areas we can cooperage with them," he said.
Other companies could complement the Ariane 5 service with medium or
smaller launchers, using the same hardware as Ariane 5 (which by the way
still has to prove it really works.)
Some of his remarks are highly remarkable, to say it in a nice way. For
example, Bigot said that for a "small" market like this, six or seven
companies were too many: "There is no need for so many players." Well, it's
not a surprise that the market leader thinks that there are far too many
competitors.
The truth is, however, that while the market may be small it is growing
fast. There will be heavyweight geostationary satellites that can't be
launched on any of today's rockets. There will by a myriad of small
satellites in low-Earth orbits, and what's best from a launch service
providers point of view: they will quite frequently have to be replaced. 
Arianespace's moves to diversify its business by co-operating with other
launch providers are nothing really new. Almost exactly one year ago,
Arianespace announced the foundation of Starsem, a joint venture for small
satellite launches that for instance has a contract for putting 12
GLOBALSTAR satellites into orbit. Starsem comprises of the Russian Space
Agency, Samara Space Centre, the Russian State Centre for Research and
Construction of Launch and Space Vehicles, Aerospatiale and Arianespace. 
Other suggested co-operations included providing backup capacity for
China's troubled Long March rocket as well as letting other companies
building launch pads at the European Space Centre in Kourou, French Guiana.
Delta launches from Kourou? Back then, industry sources said McDonnell
Douglas was constrained by capacity limits at the two U.S. pads at Cape
Canaveral and at Vandenberg Air Force. But as it turned out, McDonnell
Douglas then agreed to merge with Boeing Co which happens to be involved in
SeaLaunch, a rocket launch venture of its own.


UK TV CONSOLIDATION?
I have to admit that I don't watch the commercial TV landscape in the UK
too closely, but I do get the impression that there's some kind of
consolidation going on as far as the regional ITV broadcasters are
concerned. Today, even two deals were reported.
- Scottish Media Group PLC, the leading broadcaster in Scotland, will spend
an estimated 105 million ($170 million) to acquire Grampian Television
PLC. The transaction would create a combined broadcasting group covering
more than 6 percent of the UK's ITV advertising market. The deal is subject
to approval of the Independent Television Commission.
- Granada Group PLC, which owns 27 percent of Yorkshire-Tyne Tees
Television Holdings PLC, is in preliminary negotiations to acquire the
remaining stake. Together with its Manchester and London Weekend Television
franchises, Granada will own three independent TV properties if the
acquisition is completed. 



CHANNELS

PORN CHANNEL ON THE MOVE AGAIN
According to Eurocom International, the channel's Italian distributor,
hard-core broadcaster Rendez-Vous is once again on the move. Its new uplink
station will be in Portugal, and the channel is going to relaunch on June
16 on a new transponder. The new home for Rendez-Vous will be on Hot Bird
2, tp. 53, 11.785 GHz H. Of course, D2-Mac/Eurocrypt... RDV will grant
three months of free viewing to all their existing subscribers.
(Marcello Berengo Gardin)



FEEDBACK: Sat-ND, 9.6.97

WHERE IS FENGYUN?
"You have mentioned the Chinese launch a couple of times in the last week.
Unfortunately, I can find no corroboration of this launch. According to my
records and other information that is available, the launch of Chinasat 6
on May 12 was the last Chinese launch. I'm curious what your source of
information is and why no orbital elements for this supposed launch have
been released." (Gary V. Samuelson)
When it comes to Chinese rocket launches, there usually can be but one
source, and that of course is the country's official news agency Xinhua.
They may not report everything (launch postponements/failures?,) they may
not be unbiased, but they certainly won't make up satellite launches that
never happened. 
Confusion may sometimes arise from the fact the Chinese seem to have become
rather secretive with their launch activities. As far as I know, there are
no precise launch announcements, let alone live transmissions on TV as
there were earlier. 



Copyright (c) 1997 by Peter C. Klanowski, pck@LyNet.De. All rights
reserved.

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