Digital Networks Move Ahead in Germany

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The road is open for the development of digital programming
in Germany, following the government's decision last month to let The Kirch Group
increase its stake in pay TV service Premiere to 95 percent from 42 percent.

Premiere, while mostly analog, will be absorbed by
Kirch's DF1 digital direct-to-home platform and fully converted to digital by 2002.

A number of digital channels plan to launch in Germany this
fall. At the MIP-TV program market last month in Cannes, France, French channel fashion.tv
said it launched its digital channel on cable systems owned by Deutsche Telekom A.G.

Telekom's digital bouquet will launch commercially in
September. In addition to six ethnic channels and fashion.tv, Telekom hopes to add another
four or five channels. One source said the most likely newcomer is U.K.-based The
Landscape Channel, which shows various landscapes around the clock.

A planned second channel from Universal Studios Networks is
not likely to be in the package, sources said. Universal's 13th Street is already
part of DF1. Telekom still is negotiating with Universal, but it appears that the new
channel will only be carried on DF1.

A source also confirmed that both Kirch and Telekom have
agreed that DF1 will run the "classic," or conventional, entertainment channels,
while Telekom will concentrate on more interactive-related content.

Still, MTV Germany's three interactive channels, which
were announced earlier this year, are expected to launch on the Telekom platform by
autumn.

More luck seems to be at hand for @TV, a digital network
group backed by German media expert and former MTV executive Michael Oplesch and German
software company Infomatec A.G.

@TV said it plans to develop up to 10 thematic channels,
including travel and consumer services, for the Telekom digital platform.

Despite the digital plans, some German cable networks could
face problems. Authorities said last month that transmissions of some domestic cable
networks are interfering with the country's air-traffic-control system.

While channel names were not specified, the country's
economy secretary is trying to implement an act that would allow the government to shut
down these cable channels. Up to 10 channels -- mostly commercial -- could be affected,
although the industry doubts that any crippling legislation will be passed.

"In the last 15 years, no interference has been
reported," said Juergen Doetz, president of commercial-TV association VPRT.

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