Asiaweek.com | A Tale of Two Sons | 10/27/2000

Asiaweek.com | A Tale of Two Sons | 10/27/2000: "Until recently, Murdoch and STAR have been moving more cautiously into broadband than Li and PCCW. STAR in some respects is an old media company fighting a defensive battle against a flashy newcomer threatening to co-opt its turf. But, notwithstanding the din of publicity accompanying Li's every move, STAR is in a much stronger position to seize the high ground. The current industry model for the ideal broadband company is represented by the pending merger between America Online and Time Warner (Asiaweek's parent company). America Online has a large Internet-access and subscription base. Time Warner controls content � print, movies, TV, music � as well as the second largest cable-TV operation in the U.S. In other words, the merger would join in one company all the ingredients considered important to a new media player: content, a paying customer base ('eyeballs,' in the Net vernacular) and the distribution network ('pipes') to reach a wide audience.

On paper, STAR has many of those ingredients already in place. Although satellite networks are unproven as broadband delivery systems, the company transmits TV programs to an average of 60 million viewers across Asia every day. PCCW, in contrast, has 89,000 Hong Kong subscribers through HKT's interactive-TV network. Add about 835,000 users of Netvigator, the phone company's Internet service provider. A recently reworked deal with Telstra, Australia's big telecommunications company, gives them access to about 2.5 million Aussie homes � and the promise of more.

In content, STAR's advantage is even more clearcut. Among other assets, it holds the number one Hindi entertainment channel in India; Channel [V], an Asian version of MTV; Star Movies and TV programming in Mandarin and "