TNAG-2763-FCO40-3980-Hong-Kong-licensing-framework-for-satellite-television-broad-1993 — Page 64

.JE HUNG KUND.

JG-1993

17:25

I

TUE 03 AUG 93 10:51

PG.03

BRITISH TRADE COMMISSION

IN-CONFIDENCE

(

P.01

Rofrendo..............

STAR TV and BBC World Service Television

You will be aware that on 26 July Rupert Murdoch's News Corporation announced that it had acquired a controlling stake of 63. 6% in Hutch Vision, the company that supplies the programming to STAR TV. Hutch Vision had previously bean owned jointly by Hutchison Whampoa and the Li Ka-shing family, They continue to jointly retain the remaining 36.4%. STAR TV is owned by a separate company called Hutch Vision Hong Kong Ltd which is licensed by the HK Government to transmit the. STAR service. the organisation is not involved in the take over.

This part of other contender in the takeover bid was Pearson the owners

The of the Financial Times.

Our interest lies in the continuing operation of BBC World Service TV who provide the 24 hour news and information channel to Hutch Vision. I had lunch yesterday with Pat Chalmers, the Asia director for BBCWSTV, who was very gloomy. He said that although the BBC had a ten year contract with Hutch, it had a get out clause which could be activated three years into the contract which would be in 18 months time. Julian Mounter, who was appointed President and Chief Executive of Hutch Vision in February this year (and who had backed Pearson in the take over

bid) had learned that News Corp had a very low opinion of Way?

WSTV. Mounter, although not a total convert to WSTV, recognised the value of the service, and the efforts it was making to produce new programmes aimed at the Asian audience. Chalmers thought it highly likely that Mounter would either go or be pushed.

but if Mounter

None of the above may happen, is replaced by a Murdoch man, WSTV could be in trouble.

does go and There are always rumours that CEN might run in parallel with WSTV in the STAR stable; if Murdoch brings in his own SKX News and the clamour for CNN continues it is going to be very crowded.

The one bit of good news is that BBCWSTV have a ten year contract (presumably with AIASAT) for the use of a transponder and would thereCoreTM retain the ability to continue transmissions. Ag each channel is run as a commercially independent operation presumably WSTV could try and keep their advertising business and operate independently. This however seems a bit of a long shot.

CW Osborne

3 August 1993

Tec Information Dept, FC0

Hong Kong Dept, FCO

IN-CONFIDENCE