Rupe’s Italian job still a mystery

No launch date set, but Sky will air Wimbledon

ROME — Rupert Murdoch officially bowed his new paybox, Sky Italia, to a packed press conference May 12 — but journalists left the famous Cinecitta studios knowing little more than when they arrived.

There were only the sketchiest program details for what is expected to be a bouquet of 110-120 channels, and no definitive start date, although Sky Italia will air Blighty’s Wimbledon tennis tourney live in July, according to sports head Giovanni Bruno. “We will progressively add new services and events,” he said. The whole network will add channels over the summer and will be fully operational in September.

News Corp. finally rolled its cash-strapped paybox Stream into Vivendi Universal’s equally hard-up Italian digital paybox Telepiu on April 30 in a e900 million ($981 million) deal following months of tricky talks.

So what can viewers expect from the country’s only digital platform, which is 80.1% owned by News Corp. and 19.9% by telco giant Telecom Italia?

“Two sports channels, one 24-hour news channel and a lot of films, documentaries, sports, news and kids’ programs,” Sky Italia CEO Tom Mockridge said in his first public appearance since the merger.

The News Corp. veteran says content will be localized, adopting the successful model used in other countries, as auds “want Italian sports, Italian news, Italian films.”

And he’s confident the new platform will succeed where Telepiu and Stream failed.

“The problem with Telepiu and Stream was not only piracy, which we have greatly reduced, but the fact that their offering was not large enough,” Mockridge said. “We want to give our customers a very large variety of choice, bringing them the best of Italian (products) as well as our international experience.”

However, there was one vital fact for soccer-mad Italians. Decoders and cards will continue to operate and watching games will be cheaper than in the past, when fans had to subscribe to both Stream and Telepiu. Local soccer star Gianluca Vialli, who played for British club Chelsea until recently, will be a sports commentator.

Execs were quick to quell fears about future funding for Italo pics.

“We have a very large amount of money to commit,” David Bouchier, Sky’s general director for product, told Variety after the press conference.

“We have output deals with the Hollywood majors but we would like to … be involved in Italy, in co-funding and investing and participating in films as part of a relationship with the local distributors and production companies, because we need to have access to the best films showing at Italy’s box office.

“In the Italian market, domestic production overwhelmingly relies on money from TV, and the funding of films is very different than in the U.S. Our major supplier of films is already Medusa, the largest local producer and distributor. But we want to give our support across the whole industry, as pay TV has already done in Italy, and we are in discussions with a number of film companies in Italy,” he said.

He added that Sky would not ignore Italy’s independent film and TV industry.

“I lived through exactly the same argument when Sky launched in the U.K., and however threatened the Italian industry feels, it was nothing compared to how threatened the British industry felt,” Bouchier said. “But if you looked at what happened in the U.K., you see that the development of pay TV benefits the local production and distribution community.”

Mockridge was cautious about financial details, refusing to comment on recent reports that Sky Italia will break even in 2004, with e1.62 billion ($1.86 billion) revenues, compared to the $1.34 billion revenues and the $393 million loss expected this year.

“We begin with two companies making large losses and we must increase revenues, but our big commitment demonstrates that we have confidence in the future of pay TV in Italy,” he said.

Telepiu and Stream have 2.48 million customers, and Murdoch expects to reach his target of 3 million “very quickly.”

But the platform’s long-term goal is 10 million subs, equal to sister satcaster BSkyB in Blighty, as Italy and the U.K. have “similar populations and revenue models,” Mockridge said.

While many details still are shrouded in secrecy, Mockridge was able to unveil the team who will run Sky Italia, which will be based in Rome, Milan and Cagliari.

Murdoch is chairman and Mark Williams, who worked with Australia’s Foxtel, has been appointed chief operating officer. Osvaldo De Santis, who has worked with Fox in Italy for 20 years, is general director.

The board of directors will include News Corp. deputy CEO Lachlan Murdoch; News Corp’s. Chase Carey, recently involved in the acquisition of DirecTV; Francesca Di Carlo, from Telecom Italia; and Martin Pompadur, prexy of News Corp. Europe.

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