MUMBAI: The creation of an Italian pay television platform Sky Italia through the acquisition of Telepiu has meant one less headache for Rupert Murdoch.
One of the conditions that was put forth by Murdoch in his acquisition of Vivendi Universal's Telepiu satellite pay TV platform was that the litigation between the two parties would end. This includes Stream's litigation against Telepiu and Vivendi Universal subsidiary Canal+'s litigation against NDS. A couple of days ago Vivendi sold Telepiu to News Corp and Telecom Italia for 871 million euros in debt and cash. News Corp will own 80.1 per cent of Sky Italia and the rest by Telecom Italia.
A year ago in March Canal Plus had filed a suit against NDS for a billion dollars. It claimed that NDS engineers had hacked its security system and then made the relevant codes available for hackers on the Internet. NDS makes similar TV security systems. Canal Plus claims that its smartcard technology allows encryption of signals by broadcasters. So the process of revenue collection from subscribers is smooth. It claimed that security measures were running fine until March 1999 when its software code was copied and published on the website DR7.com. It claims to have spent more than $US35 million on the technology. It had accused NDS of getting its smartcards and sending them to an NDS laboratory in Israel for analysis.
Murdoch now will concentrate on fighting rampant piracy in Italy's pay TV market. He also have to contend with the free to air channels. Earlier Vivendi's Telepiu and Murdoch's Stream were suffering huge losses. In 2001 Telepiu lost $300mn and Stream $200mn as a result of football deals