Beats Are Changing at Australias Music Channels

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Sydney, Australia -- There's a different tune here
amid changes at Australia's various music-television programmers.

Recent weeks have seen MTV Australia's shareholders
restructure their equity in the channel, while the growing popularity of country music in
Australia has led Gaylord Entertainment Co.'s Country Music Television to put a new
emphasis on the region.

At MTV, sources said the network's majority
shareholders -- radio network Austereo and production company Village Roadshow -- have
been unhappy with Optus Communications, their partner and the channel's distributor,
and they have moved to scale back their equity position in the network. The move comes as
Optus' subscriber base has declined to about 170,000 from some 180,000 last April.

Viacom licensed MTV Australia to Austereo, Village Roadshow
and Optus Vision for an unconfirmed $A5 million ($US3.37 million) and minimum guarantees.
It was believed that Austereo and Village Roadshow originally held 40 percent each, while
Optus held the remaining 20 percent. There is speculation that the two majority owners
have reduced their investment, but none of the partners would reveal its new equity
arrangement.

'The relationship between the partners is
ongoing,' said Austereo and Village Roadshow director Peter Harvie, while MTV CEO Kim
Vecera said there was no change to the resourcing, management and staffing of the station.
'It's business as usual,' she noted

CMT announced last week that it is targeting Asia as a
growth area after deciding to close its money-losing European operations. Gaylord group
president Carl Kornmeyer unveiled a new strategy for the channel in Asia to a group of pay
TV industry executives here, as part of a 20-strong Country Music Association delegation
to Australia last week.

The success of the nonexclusive channel, particularly on
United International Holdings Inc.'s Austar platform -- which reaches more than
200,000 rural subscribers, and which has referred to CMT as a 'subscriber
accelerator' -- means that Australia will be the channel's Asian beachhead. CMT
plans to localize the channel for Australia and to set up its first permanent Asian office
here to oversee marketing and affiliate relations throughout the region.

Australia was CMT's first market in the region. The
network reaches 750,000 households on all four of the country's major pay TV
platforms, and it is seen on cable systems in another 12 Asian markets, including Japan
and Thailand.

Australia will get a customized feed with time-shifted
programs and an increase in local content beginning in the second quarter of the year.

Kornmeyer said CMT's regional expansion more than
doubles the company's investment in Australia to date, noting, 'Australia will
be the foothold, and then, we'll take it from there. We're doing this because
the potential is there.'

At pay TV operator Foxtel, assistant programming director
Ross Crowley said, 'This move will reposition the entire channel in terms of industry
perception and audience recognition.'

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