Berlusconi-Murdoch battle heats up

War of words intensifies as DTT decision nears

ROME — The battle between Silvio Berlusconi’s Mediaset TV and Rupert Murdoch’s Italo satcaster Sky Italia is heating up in the countdown to an imminent European Commission decision on allowing News Corp. access to Italy’s digital TV field that would challenge Berlusconi’s DTT supremacy.

Mediaset chairman Fedele Confalonieri and Sky Italia chief executive Tom Mockridge have been trading bitter barbs, with Confalonieri charging that Sky has been playing the “victim” of a political conspiracy while enjoying a “totally dominant position,” and Mockridge countering that Mediaset must decide whether to consider Sky “a monopolist or a competitor,” according to Italian press reports Thursday.

Analysts consider the unprecented level of animosity as confirming indications that News Corp. will indeed be allowed by the EU to bid for Italian digital TV assets, entering a booming market led by Mediaset.

The crucial decision, originally expected by mid-April, is now in final stages with EU commissioner Joaquin Almunia quoted as saying he is “considering how to revise” the current rules keeping Sky Italia on satellite.

Sky Italia, which has 4.7 million subs, has been suffering regulatory setbacks imposed by the Italian government, headed by Berlusconi, such as a pay TV advertising cap and a VAT tax hike.

Mediaset’s growing DTT pay TV service has 4.1 million customers, but is much cheaper and generates about one-fifth of Sky Italia’s revenues, which totalled roughly $3.7 billion in 2009.

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