News

News Corp. Eyeing Further Tech Investments in India

3/26/2000 7:00 PM Eastern

New Delhi, India -- Potential investments for News Corp.'s
planned $650-million global Internet-venture fund are starting to take shape in India.

Earlier this month, News Corp. chairman Rupert Murdoch made
a five-day trip to the country, with both Internet investments and the development of new
Indian channels his agenda. It appears he made some headway: two days after Murdoch's
departure, that News Corp.'s Star TV India programming unit announced a strategic alliance
to develop TV and Internet content with United Television, a supplier of channels and
programming. Star also announced plans to launch a health and education channel.

Star TV India CEO Peter Mukherjee said News Corp is close
to inking an agreement with Infosys Information Technology Ltd., a leading software
supplier.

"We are planning to do some work with [Infosys] on a
global scale," Mukherjee said. "News Corp. also wants to build some
communication links with them for our own internal purposes."

Murdoch spent two of his five days in India negotiating
with a number of Bangalore-based software firms. The talks revolved around potential
alliances to create Web content businesses.

His decision to shortlist Infosys, came as little surprise,
since it is currently India's most valuable software outfit in terms of market
capitalization.

But in a brief question-and-answer session with journalists
at the tail end of his visit, Murdoch declined to name any one company with whom News was
planning to align.

He did clarify that News was willing to invest a large
amount of money to bring broadband-Internet services to India.

"You will hear significant announcements from us in
April," he said. "We are looking at IT [information-technology] investments,
because that is the way the world is moving. We need to be ready for convergence. We may
spend more than $100 million [in India], though the amount could run into several hundred
million dollars."

News is likely to make partial equity investments in a
number of technology companies rather than purchasing one outright, Murdoch said.
"All investment to be made in the IT sector, including broadband services, will be
through Star TV," he added.

Separately, Murdoch indicated that he is still bullish on
Ku-band direct-to-home television in India. His Star unit has for years had designs on
such a platform here.

"What I gather from the Indian government is that it
is working on [DTH regulations]. I am optimistic," he said.

He also said Star "will also be greatly
expanding" its presence in India through the launch of six regional-language over the
next six months. They'll join Star's existing Hindi-language lineup.

While in India, Murdoch also met with telecommunications
companies to discuss infrastructure arrangements and with cable companies to chat about
distribution agreements for Star channels.

Two significant meetings in Mumbai were with the
industrialist Ashok Hinduja, owner of MSO Incable Net Communications, and Dhirubhai
Ambani, whose holdings include telco Reliance Telecom.

"The Ambanis are in telecoms, and at some stage the
interests of the two companies can converge," a News Television India source said.

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