Sky Argentina Awaits Ruling on Ownership

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Buenos Aires, Argentina -- A dispute over the legality of
direct-to-home platform Sky Latin America's operations in the country rumbled on last
week, and the company remains grounded while awaiting an imminent court ruling over its
ownership structure.

In question is whether Sky Argentina's local partner,
Telecom Argentina S.A., can own shares in the company, said Vicente Diego, recently
appointed CEO of Sky Multi-Country Partners, the News Corp.-supported parent of Sky Latin
America.

Contesting Telecom's stake is Proconsumer, an Argentine
consumer group, which has argued that local legislation prohibits telcos from investing in
media companies.

A judge had suspended Sky Argentina's operating license,
although the decision was later reversed and Sky's license was returned. Nevertheless,
Proconsumer's bone of contention has not disappeared.

Over the next few weeks, a local judge will rule on whether
Sky's current ownership structure violates Argentine law -- a situation that appears to be
stalling the launch of Sky as a third DTH service in Argentina. The country already has
two DTH providers: panregional platform Galaxy Latin America's DirecTV and
Argentina-specific Television Directa al Hogar.

Diego responded to Proconsumer's accusations by arguing
that Publicom S.A. -- a unit of Telecom, rather than Telecom itself -- invests in Sky
Argentina. He also noted that Publicom does not have a license to provide telephone
service.

Diego said Proconsumer's complaints are groundless, in any
event, given the fact that there are examples of media companies investing in telcos in
Argentina. He also accused the group of blocking tactics.

"It is very curious that a group that calls itself
Proconsumer wants the consumer to have only one choice [of a DTH] platform, not two,"
he added, referring to DirecTV's Argentine operations.

Proconsumer has also accused Sky of plans to lift News
Corp.-owned, Fox-branded channels from local cable systems and to transmit them --
including the soccer games they feature -- exclusively on its satellite platform.

"Sky … plans to transmit soccer games exclusively
on satellite TV -- something which most consumers can't afford," Proconsumer
spokesman Marcelo Fernández Grassi said.

Diego refuted Grassi's accusation, saying, "We are
going to have exclusivity of Fox programming only in relation to DirecTV, not cable."

Jo Dallas contributed to this article

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