New German web threatens Premiere

Steindorf helms feevee player Stargate

BERLIN — A new company with the ambitious moniker of Stargate has entered Germany’s growing digital pay TV business and could create further competition for the country’s main player Premiere.

Stargate is planning to launch a platform on satellite operator SES Astra that would offer subscribers a bundle of TV channels from diverse broadcasters and content providers.

Roland Steindorf, former topper of German cabler Kabel Deutschland (KDG), is overseeing the project, which is aiming to launch in 2007 on Astra’s digital platform Entavio, set to go online early next year.

However, Steindorf told the Financial Times Deutschland that full financing for the project has yet to be raised. Company is said to be in talks with various investors to help bankroll the project, which would reportedly cost up to Euros 200 million ($263 million).

If successful, the satellite platform would be a first in Germany and operate similarly to local cable operators: Cablers such as KDG and Unity Media offer not only free-to-air channels such as RTL and Sat 1, but also pay TV channel bouquets that include up to 30 outlets. Subscribers pay a flat fee for the bundle, and the cable company pays the individual broadcasters while handling customer service and overall marketing.

Astra will provide only its new digital platform and technical support and services for the pay TV company but will hold no stake in the firm.

Move would also create more competition for Premiere, which last year lost national league soccer to pay TV upstart Arena.

Major Premiere shareholders Irish Bank and Germany’s WestLB recently sold the bulk of their stock in the broadcaster at a loss to hedge funds and private investment banks, while two weeks ago, investment group Permira sold off its 8.4% stake in Premiere.

Meanwhile, German cable giant Kabel Deutschland on Wednesday posted half-year figures. Company remained in the red for the period with a net loss of $32.2 million while revenue climbed 8% to $711 million.

Company attributed its continuing loss to the high costs of technical upgrades to its cable systems. Yet despite a slight decrease in households to 9.53 million households, an increase in digital pay TV and cable Internet and telephony services contributed to the revenue increase.

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