MIH to Build Chinese DTH System

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Hong Kong -- China's TV regulators have chosen South
African-based pay TV operator MIH Holdings Ltd. to help the country build a national
direct-to-home system in the face of competing tenders from other satellite-TV companies,
Chinese government sources said.

MIH was one of nine foreign companies invited in July to
provide business plans for building a national DTH system to bring state-run China Central
Television's (CCTV) eight channels to rural areas where it cannot currently be seen
-- about 45 million households.

Loral Space and Communications Ltd., Hughes Electronics
Corp., General Instrument Corp. and News Corp.'s NDS technology subsidiary were among
other companies in the running, according to sources.

Although no official announcement has been made, sources
said MIH's victory was based on a plan to offer substantial discounts on the $100
million capital cost of setting up the system. In exchange, China will allow MIH to take a
small percentage of revenues.

None of the companies involved was available to comment on
the result of the tender process.

It remains unclear if the system will be expanded to
include more of China's estimated 280 million TV households after it begins
operations, probably in 2000. And there were conflicting reports about how many channels
the DTH platform will carry, if any, in addition to the CCTV slate.

Channels produced by China's 15 provincial TV stations
-- some of which produce as many as four -- would likely take up any additional capacity.
Foreign channels are prohibited from broadcasting on a 24-hour-per-day basis to facilities
other than government buildings, high-end hotels and housing compounds for foreigners.

China's TV regulator, the State Administration of
Radio, Film and Television, is also tendering a satellite to carry the DTH system, but a
decision on which company will build the bird has not yet been reached.

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