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SAT-ITALY 21.03.1997




SAT-ITALY (ITALIAN SATELLITE AND MEDIA NEWS) - 21 March 1997

CANAL PLUS SEEKING ITALIAN PARTNERS FOR TELEPIU
In an interview published in French daily "Les Echos", the director general
of Canal Plus, Michel Thoulouze has confirmed rumors that his company is
ready to buy Kirch's 45% stake in Italian pay-TV network Telepiu. If this
really happens, Canal Plus would have in its hands 90% of Telepiu, with the
remaining 10% belonging to Fininvest owned by media magnate Silvio Berlusconi.
But it seems that Canal Plus which entered Telepiu as a shareholder last
September by taking over the NetHold group, has no intention to keep such a
large share of the company. As soon as the Kirch shares have been bought,
Canal Plus would be ready to sell a stake to Italian investors which would
be interested in participating in the relaunch of Telepiu. 
Unfortunately, the current financial situation of Telepiu is a deterrent for
many potential investors. The losses for 1996 are estimated to be more than
120 million DEM and this is due principally to heavy investments for the
launch of the digital satellite service.
In the same interview, Thoulouze added that "if we are offered a good price
for our stake in the German pay-TV channel Premiere, we would be consider
the idea of retiring from Premiere". It seems that an exchange of shares
with Kirch (which has a 25% stake in Premiere) is the most likely scenario
which will also see the Kirch stake in Telepiu moving into Canal Plus's hands.
Thoulouze has also said that, in agreement with the other Telepiu
shareholders (Kirch, Nethold and Berlusconi), they have introduced a
restructuration plan which has already saved 125 million dollars, which in
turn will be re-invested into programming, subscription services and the
relaunch of the Telepiu networks. "In the past, grave strategic errors have
been made. If Canal Plus's methods were used, the number of subscribers of
Telepiu would have been 2 million and not 800,000" added Thoulouze.

IL CANALE METEO
As previously announced, a new Italian satellite channel joined on March
14th Telepiu's digital package Telepiu Satellite. Il Canale Meteo is in fact
the Italian version of The Weather Channel. The service is broadcast 24
hours a day, naturally in Italian and offers viewers the latest weather
updates for Italy, Europe as well as regional and local forecasts. The
channel also broadcasts short programs about the atmospheric conditions and
phenomenons and the effect they may have on man and the environment.

TELECINCO RECORDS PROFITS RISE
The Spanish private TV channel Telecinco in which Italian media magnate
Silvio Berlusconi holds a 25% stake, has closed 1996 with the "best results
in its history" and has plans to double its revenues during this year. This
result has been obtained thanks to a drastic restructuring plan administered
by the channel'0s CEO, Maurizio Carlotti who arrived in Madrid back in 1994.
He succeeded in saving the channel which was burdened by a huge debt and a
constant fall in audience. The total revenues for 1996 amounted to 32
million DEM.  
Telecinco's audience ratings have increased from 18.5% in 1995 to 22% last
year, placing the channel at second place. One of the reasons for this
audience rise is a tabloid format program called "This time we cross the
Mississipi" which is filled with vulgarity and nudity. The audience of the
program has been between 30-40%.
The management of Telecinco is currently studying a "top secret" plan for
expanding the channel into Latin America, through acquisitions and alliance
agreements. Already negotiations have started with the Chase Manhattan Bank
for a loan of around 180 million DEM which would serve to launch the new
initiative.

ZEFFIRELLI DOCUMENTARY LIVE VIA SATELLITE
A documentary program about the Pope filmed by the famous Italian director
Franco Zeffirelli is set to have its world premiere via satellite. The
documentary called "L'Europa e Giovanni Paolo II" (Europe and John Paul II)
will be transmitted on Friday March 21st at 18:30 hours live from Rome via
satellite to Europe. Three satellite channels have confirmed that they will
carry the event - RAI International, Telepace as well as the EU satellite
channel. This event is being organized as part of the celebrations for the
40th anniversary of the Rome Agreements. During the course of the program,
there will be live links with Strasbourg and Brussels with many
representatives of the European Parliament taking part.

RAI AND MEDIASET ACCUSED OF FORMING SPORTS CARTEL
The Rome-based daily "La Repubblica" has in the past days reported about an
alleged cartel formed by RAI and Mediaset, the principal Italian TV
networks, for buying TV rights for major sporting events. These allegations
are currently being examined by the financial police. The whole affair is
based on a document, which contains details about a meeting held in May 31st
1996 between Adriano Galliani, CEO of Mediaset and Lorenzo Vecchione, a RAI
official during which a hypothetical alliance was formed for dividing TV
rights to football, Formula 1 and the Giro d'Italia bicycle race. This
agreement would have damaged other TV companies and sports federations which
participated in the auctions for TV rights, unaware that the "potential
buyers" had already divided the TV rights cake, with no need to enter a
price war. The document mentions the TV rights to many major football events
such as the Champions League, Cup Winners Cup, UEFA Cup and Italian league
football.
There are some indications that there has been some sort of a unofficial
understanding between the two TV networks at least for some sports events.
Mediaset decided to give up the TV rights to the Giro d'Italia race for 1997
and offered it to principal rival RAI. Also, possibly during the auction for
Italian league football, RAI and Mediaset came up with a very low cash
offer, which ended to everybody's surprise with the rights being bought by
upstart TV channel TMC (owned by Cecchi Gori) for 230 million DEM. 
Both RAI and Mediaset denied, through official press releases the above
mentioned allegations. The latest news is that Cecchi Gori has entered court
proceedings in Florence requiring that the court investigates the alleged
cartel accusations.

ACCORD ON TV SITUATION IN ITALY NEAR
It seems that an agreement on the TV situation between the Italian
government, the principal opposition parties and all the relevant players on
the Italian media scene is finally near. As we previously reported in
SAT-ITALY, the passage of the new Telecommunications bill is blocked in the
Senate with no end in sight to the party discussions. The Italian government
has in the meantime come up with a amendment proposal which is set to
unblock the impasse.
A new Telecommunications Authority is to be set up and frequencies that are
currently not used will be allocated to TV companies (among them Rete A,
Telemarket, Rete Capri and Retemia), which is set to favour especially
Cecchi Gori who has for some time been lobbying for national coverage for
his TV channels TMC and TMC2/Videomusic. In one year, the new legislation
concerning the advertising quotas on TV will come into effect. By January
31st 1998 a new frequency plan should be approved, which should be the base
for the assigning of new, definitive licenses for TV stations. The business
of assigning the TV licenses is set to end by April 30th 1998. There will be
a limit how much one individual (or media company) can own - 20% of the
total number of national TV networks. As the total number currently amounts
to 12, that means that one media group cannot own more than 2 national TV
networks
For the private TV network Mediaset, the new legislation will mean that one
of its  channels, Rete 4 will have to abandon terrestrial transmitters in
favor of broadcasting only via cable and/or satellite, while for RAI it will
mean that its third TV channel, RAI Tre will have to financed only by
license fee and not also with advertising. The government amendment will
precisely say if RAI Tre can continue to broadcast via terrestrial
transmitters, and if so, it would have to become a "federal" channel, ie. a
network which broadcasts local information in which the Italian regions
would take a stake.
Meanwhile, a new law has been published in the official publication
"Gazzetta Ufficiale" which is set to liberalize satellite communications
according to EU norms. This government decree abolishes the monopoly of
Nuova Telespazio in this area which means that other Italian or foreign
companies can now enter the market for satellite services in Italy.

NEWS IN BRIEF 
- An agreement between state television RAI and media magnate Vittorio
Cecchi Gori concerning the TV rights to Italian football, movies and other
programming has been signed on March 19th , despite opposition from some
members of RAI's administrative council.
- According to a survey by the Italian magazine "Satellite", the 10 most
popular satellite TV channels in Italy are as follows: Eurosport, Euronews,
DSF, Tele+1, Tele+2, CNN, RTL2, Filmnet, Viva and SAT 1.



PROGRAMME HIGHLIGHTS ON ITALIAN SAT-TV CHANNELS
                                   FOR THE WEEK MARCH 23-29

PRIME-TIME MOVIES
23.III - RAI UNO, 20:50h - David - Part I (USA-ITA), starring: Nathaniel
Parker, Sheryl Lee
23.III - RAI DUE, 20:50h - Mobius (USA-95), starring: Leslie Nielsen, David Week
24.III - RAI UNO, 20:50h - David - Part II
26.III - RAI UNO, 20:50h - Terror in the family (USA-96), starring: Joanna
Kerns, Dan Lauria
26.III - RAI DUE, 20:50h - Piedone a Hong Kong (ITA-75), starring: Bud
Spencer, Renato Scarpa
27.II - RAI DUE, 20:50h - Barabba (ITA-62), starring: Anthony Quinn,
Vittorio Gassman, Ernest Borgnine
28.III - RAI TRE, 20:40h - Il grande fausto - Part I (ITA), starring: Sergio
Castellito, Ornella Mutti
28.III - RAI UNO, 22:40h - Francesco d'Assisi (ITA-74), starring: Lou
Castel, Mino Bellu
29.III - RAI DUE, 20:50h - At the midnight hour (USA-96), starring: Patsy
Kensit, Simon MacCorkindale
29.III - RAI UNO, 00:20h - L'inchiesta (ITA-86), starring: Keith Carradine,
Harvey Keitel

SPORT
26.III - RAI TRE, 15:35h - Basketball: Italian league, quarter-finals play-off
27.III - RAI TRE, 20:30h - Football: European championship qualifiers,
ITALY-MOLDOVA (under 21)
29.III - RAI TRE, 15:25h - Volleyball: Italian league, quarterfinals
29.III - RAI TRE, 16:50h - Formula 1: GP Brazil, heats 
29.III - RAI TRE, 18:05h - Rowing: Oxford-Cambridge race
29.III - RAI UNO, 20:40h - Football: World Cup qualifiers, ITALY-MOLDOVA

VARIETY
29.III - RAI DUE, 22:30h - Pavarotti in Concert, from Napoli




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