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SAT-ITALY 18.04.1997

SAT-ITALY (ITALIAN SATELLITE AND MEDIA NEWS) - 18 April 1997

TELEPIU IN THE RED
During a meeting held in Paris last week between the managers of Canal Plus
and financial analysts, it was announced that Telepiu losses (in which Canal
Plus holds a 45% stake) for the period 1996-1997 amount to around 340
million DEM, which is a huge increase compared to the 52 million losses
during 1995-1996. The debts for the same period amount to 266 million DEM
(compared to the 170 million registered in 1995).
The losses are so high because of the huge investments made for the launch
of the digital satellite service Telepiu Satellite. But according to Laurent
Perper, director general of Canal Plus, the negative balance is also a
result of the higher cost of acquisitions of programs, marketing costs and
other new initiatives. But, predictions remain that break the break-even
point will be reached in the second part of 1999. However, the break-even
point for Canal Plus's TV interests in Scandinavia will not be reached
before the year 2001.

EU EXAMINES TV LICENSE FEES
According to an article in the Italian daily "Corriere della Sera", the
governments of the EU countries are preoccupied because the State financing
to the European public TV stations may become vulnerable due to EU norms
regulating State financing. It seems the preferred option of resolving the
question is the signing of a protocol which could form part of a new Treaty
on state financing. In any case, a decision will have to be reached soon,
since several public TV stations including RAI (Italy), RTP (Portugal),
France Television and TVE (Spain) have been "denounced" to the EU Antitrust
by their private TV channel rivals. The EU commissioner in charge of the
matter, Karel van Miert has already expressed a positive decision concerning
the financing of RTP. A decision is also expected soon on the French and
Spanish cases, while a decision on the RAI case is expected to come in a few
months.

LOCAL TV STATIONS IN TELEPIU DIGITAL PACKAGE
The pay-TV network Telepiu and a local TV station based in Milan have a
signed an agreement which will see the programs of Sei Milano (whose major
shareholder is the clothing firm Benetton) being transmitted as part of the
Telepiu Satellite digital package. The programs will be transmitted on a new
satellite channel dedicated to local news from the major Italian cities. It
started broadcasting on April 15th and Sei Milano's programs will be shown
on a six month test basis, Monday to Saturday, in the 13:00-22:00 hr. time
slot. The service will be offered free to Telepiu satellite subscribers, as
is already the case with the channels TMC and TMC2/Videomusic.

STATUS OF TELEPIU 3 UNCLEAR
The seemingly never-ending discussions on the new Telecommunications bill
and it's amendments continue in Italy. A new sticking point has appeared and
it concerns the future of the terrestrial (and satellite) pay-TV channel
Telepiu 3. The government wants the channel, which transmits arts and music
programs, to leave the terrestrial airwaves as soon as possible (by August
this year), and switch to satellite only broadcasts, in order to free up the
much needed terrestrial frequencies. The frequencies would then be awarded
to nation-wide channels which need to improve their coverage (primarily
Cecchi Gori's channels TMC and TMC2/Videomusic). 
Silvio Berlusconi's Mediaset TV holding company which has a 10% stake in
Telepiu would be ready to accept the government decision, but only under
certain conditions. The big problem is that if Telepiu 3 disappeared of the
terrestrial airwaves, the number of national TV networks would go down from
15 to 14. At that point, Mediaset which operates Berlusconi's 3 private
channels Canale 5, Rete 4 and Italia 1, would become vulnerable since under
the new Telecommunications bill, no subject or company can own more than 20%
of the total number of TV channels. In simple words, that means Berlusconi
would have to sacrifice one of his 3 channels, most-likely Rete 4.
On the other hand, the government is ready to provide ample guarantees to
Berlusconi. One of the options is that it could declare that the number of
national TV channels remains 15. This could enable Rete 4 to continue
transmitting as before. Also, now it seems less likely that the government
will fix a date when Rete 4 will have to switch to satellite-only broadcasts.



MORE CHILDRENS PROGRAMMING IN ITALY
According to a recent survey by KPMG Consulting, the number of hours of
programs devoted to chidden is on the increase in the U.S. as well as in
Europe. In 1994 for example, 2,000 hours of animated programs were produced,
in comparison to 60 in 1986. Currently there are 7 channels devoted to
children in Germany, with investments of 113 million DEM for programs. In
the UK, the number of  such dedicated channels is six. In Italy, there is
currently only a syndication network, Junior TV whose programs are shown on
local TV stations throughout Italy.
RAI has already announced that it will launch a new thematic satellite
channel devoted to younger viewers. It will start broadcasting, in the
clear, on September 15th, via the EUTELSAT HOT BIRD 2 satellite.

NO PORN CHANNEL FOR THE MOMENT FOR TELEPIU
The managers of Canal Plus, the major shareholders of the Italian pay-TV
network Telepiu have in recent months been examining the possibility of
adding several adult channels to Telepiu's digital package. Among the
channels contacted were Satisfaction Club Television and several U.S. backed
ventures such as Eurotica. According to some satellite equipment dealers,
one of the major reasons Italians cite for buying satellite dishes is to
watch adult programming and it seems Canal Plus saw this as a good
opportunity to increase fledgling subscription numbers to the Telepiu package.
However, it seems that after contacting the relevant Italian authorities
concerning this idea, Canal Plus had to give up at least for the moment. The
current Italian broadcasting laws in fact prohibit the transmission of
obscene material and recently the only Italian adult channel, SCT had to
move its HQ out of the country.

DISNEY INTERESTED IN RETE MIA
After unsuccessful negotiations with a U.S. based shopping channel, the
Italian TV channel Rete Mia is again in the headlines. According to an
article in Italian weekly "L'Espresso", the Walt Disney Company is in
advanced negotiations for taking over the channel. Walt Disney Company is
not conducting the negotiations directly but via Scandinavian Broadcasting
Systems (SBS), a holding company based in Luxembourg and quoted on Wall
Street, in which Walt Disney has a stake of 23%.
SBS operates several commercial TV stations in the Benelux countries and
Scandinavia. The Italian channel Rete Mia based in the Tuscany region of
Italy is currently a shopping channel. The shareholding structure is as
follows: Profit (30%), Salvatore Cingari (30%) and Internova (40%). Rete Mia
has a 75% coverage of Italy and thanks to the new Telecommunications bill
and its successive amendments, it will be able to increase its coverage to
the rest of the Italian peninsula.

NEWS IN BRIEF
- The specialized magazine "Satellite" recently conducted a survey among
around 200 dealers and satellite distributors throughout Italy. The survey
showed that the most sold analog satellite receivers were: Pace (22%), Nokia
(12%) and Fraccaro (10%). The most sold digital receivers were: Nokia (46%),
Grundig (27%) and Pace (21%).
- Despite persistent rumors in the Italian press, it seems that Saudi Prince
Al Waleed has no intention in selling his stake in the TV holding company
Mediaset. This has been confirmed by the Tunisian film producer Tarak ben
Ammar who is also Al Waleed's business partner.
- The company Hughes Olivetti Telecom (HOT) which operates in the
telecommunications via satellite area has reported has reported doubled
revenues for 1996. In its area of business, HOT holds a 35% quota of the market.
- Television viewing figures during March in Italy are down compared to
previous months according to recently released figures. There were 3 million
viewers less during the prime-time slot compared to February's figures. In
total there were 25,806,000 viewers compared to 28,014,000 (March 1996) and
27,975,000 (March 1995).
- The Italian satellite segment operator Nuova Telespazio (owned by Stet)
has reported an increase of 11,5% for revenues during last year.






PROGRAMME HIGHLIGHTS ON ITALIAN SAT-TV CHANNELS
                                   FOR THE WEEK APRIL 20-26 

PRIME-TIME MOVIES
21.IV - RAI UNO, 20:50h - A perfect world (USA-93), starring: Clint
Eastwood, Kevin Costner, Laura Dern
22.IV - RAI DUE, 20:50h - Everything to gain (USA-97), starring: Charles
Shaughnessy, Sean Young
22.IV - RAI DUE, 01:00h - Lunga vita alla signora (ITA-87), starring: Marco
Esposito, Simona Brandalise
23.IV - RAI DUE, 20:50h - Il soldato di Ventura (ITA/FRA-76), starring: Bud
Spencer, Franco Agostini
25.IV - RAI TRE, 20:45h - Timecop (USA-95), starring: Jean-Claude van Damme,
Mia Sara
26.IV - RAI DUE, 20:50h - Treacherous beauties (USA-94), starring: Mark
Humphrey, Catherine Oxenberg

SPORT
20.IV - RAI DUE, 19:00h - Basketball (m): Italian league, play-off
22.IV - RAI UNO, 20:40h - Football: UEFA Cup, MONACO-INTER (semifinals)
24.IV - RAI TRE, 16:30h - Tennis: Federation cup
24.IV - RAI DUE, 20:40h - Football: Cup winners cup, FIORENTINA-BARCELLONA
(semifinals)
25.IV - RAI TRE, 15:35h - Volleyball (w): Italian league, semifinals
25.IV - RAI TRE, 16:20h - Tennis: Federation cup 
26.IV - RAI TRE, 16:30h - Volleyball (m): Italian league, final
26.IV - RAI TRE, 00:05h - Hockey on ice: World championships, SWEDEN-ITALY

ENTERTAINMENT
20.IV - RAI DUE, 18:20h - On tour with Laura Pausini
20.IV - RAI DUE, 20:50h - Julio Iglesias sings Tango
20.IV - RAI UNO, 22:35h - David di Donatello '97 - Italian movie awards ceremony
23.IV - RAI UNO, 20:50h - Premio Regia Televisiva '97 - Award ceremony for
best TV programs according to Italian TV critics
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