Taiwan DTH Platform Sets Mid-99 Bow

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TVB International, Hong Kong broadcaster Television
Broadcasts' overseas arm, said that its joint venture direct-to-home satellite TV
project for Taiwan will become operational by mid-1999.

TVBI, the Malaysian state-supported satellite company
Measat, and their Taiwanese multimedia company Era International plan to provide a DTH
platform of channels, Internet access and interactive services, including home banking,
through four Ku-band transponders on the Measat 2 bird.

The project was due to have launched in the third quarter
of this year. Jack Chang, chief operating officer for another would-be Taiwanese DTH
operation, SpaceTel, suggested the delay was caused by interference from microwave
frequencies used by state-owned telecommunications provider Chunghwa Telecom.

TVBI deputy general manager Michael Chan, however, insisted
the problem had been resolved and that Measat 2 is now providing "a strong and clear
signal." He blamed the hold up on delays in getting equipment. "We got to the
end of the summer and realized that we were two months behind schedule. So we thought why
not wait until next year when we could launch all the services together," he said.

Taiwan is Asia's strongest pay TV market, with 80
percent of the island's 4.5 million homes receiving cable TV. Chan said the DTH
service, whose name remains a closely guarded secret, would initially target upper income
homes currently unable to receive cable.

The service would feature five TVBI and Era channels,
although Chan added that he is talking with a number of other channel providers about
joining the platform. Only Turner Broadcasting's TNT, Cartoon Network and CNN
International had signed on with the joint venture.

TVBI is currently seen in 95 percent of Taiwan's cable
homes and Chan said this distribution would be unaffected by the creation of the platform.
"We are the area software provider and, as far as we are concerned, it does not
matter how we are distributed. We are interested in creating as many revenue streams as
possible."

Others are skeptical about the project's chances of
success. Paul Bustin, a former head of marketing and distribution with Star TV and now an
executive director with London-based digital TV company Static, commented that the joint
venture was based on a "flawed business model," and added, "Measat in
Taiwan is speculative nonsense."

Measat did not reply to phone calls seeking comment. The
company remains in financial difficulties prompted by the fall in value of the Malaysian
currency, the ringgit, against the United States dollar. Its domestic DTH service, Measat
Broadcast, now reaches about 175,000 subscribers, but expansion plans into India, the
Philippines and Indonesia have been shelved.

Although Chan said Philips Electronics N.V. is due to
provide the set-top boxes for the Taiwan venture, the Dutch multinational has suspended
its business with Measat Broadcast after the Malaysian company failed to pay $US20 million
for equipment it ordered. The dispute is currently in arbitration in Singapore after
Measat's parent company, Binariang, filed suit against Philips.

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