New Delhi, India -- News Corp.'s Star TV India
redeployed its top executive to spearhead the company's direct-to-home efforts in
Rathikant Basu, formerly CEO of Star TV India, was named
chairman last week of News Corp.'s India Sky Broadcasting joint venture with Hughes
Ispat, the local unit of Hughes Electronics Corp.
Basu's appointment is News Corp.'s latest effort
to push a DTH launch in India, where it has been stymied by bureaucratic red tape and one
failed partnership plan.
ISkyB and Hughes Ispat have confirmed an agreement to
invest $200 million in an Indian DTH service as part of the joint venture that they inked
in January. That agreement came just after Star and India's Zee Telefilms ended
merger talks that would have seen them jointly operate a DTH platform.
Star TV India's longtime marketing chief, Peter
Mukherejea, is expected to replace Basu as CEO of that company. Basu couldn't be
reached for comment.
Basu -- who headed Indian state broadcaster Doordarshan
prior to joining Star TV India -- has a formidable task ahead of him, even though Indian
information and broadcasting minister Pramod Mahajan has taken a more favorable stance
toward DTH than his predecessors had.
Some of India's most powerful media companies --
including Zee TV, Modi Entertainment Group and Hindujas Group -- succeeded in lobbying
Mahajan to institute a six-month moratorium, which ends in June, on the launch of any DTH
service in India. All of those groups hope to launch their own DTH platforms, and Modi has
already signed an agreement with Loral Space & Communications Ltd. for such a service.
Their lobbying was widely seen as an effort to stall ISkyB,
which is much more prepared for a commercial DTH rollout.
At the same time, Basu's three-year contract with Star
TV ends in October, and all of the company's Indian operations are under considerable
cost pressures. ISkyB, for its part, invested $80 million in its first year of operation,
which began in 1996.
What's more, four Star TV executives who are known to
be close to Basu were let go by the company as part of its cost-cutting efforts.
All of this is not to say that Basu hasn't gotten a
hand in some areas. Hughes Ispat is a joint venture between Hughes and Ispat, a local
industrial concern. And India's Mittals family, which owns Ispat, is known to be very
close to Mahajan. Such ties could be important in a country where personal relationships
carry a lot of weight.
At the same time, Star TV's Hong Kong-based CEO, Gary
Davey, who was here last week to usher in the changes, met with Indian Prime Minister Atal
Behari Vajapayee. It is speculated that DTH was one of the media issues that they