Copyright 2001 The Age Company Limited  
The Age (Melbourne)
August 16, 2001 Thursday
SECTION: Business; Pg.1

LENGTH: 416 words

HEADLINE: Alston Denies Reports Of A Free Holiday For Foxtel

BYLINE: Annie Lawson And Jenny Sinclair

BODY:
The Federal Government yesterday distanced itself from reports that it would protect the Foxtel cable television network from rival broadcasters by giving it an "access holiday" to facilitate its planned $500 million digital upgrade.

Communications Minister Richard Alston said the government had never supported such a move, but would explore other options to speed up the transition to digital.

An "access holiday" means Foxtel would not be forced to carry programs from other broadcasters on its cable network.

Kerry Stokes' Seven Network warned yesterday that it would take legal action against the government if it legislated to give Foxtel a holiday from access obligations.

Mr Stokes recently won a court case to force Foxtel to carry his C7 sports channel.

Senator Alston said that "the idea of an access holiday, which seems to be what Mr Stokes is principally concerned about, is not something that we've ever supported.

"What we do want to do, however, is explore ways of trying to achieve the means to bring about the digital upgrade as quickly as possible."

Foxtel indicated it would be forced to rethink its plans to digitise its network if it did not get some form of relief, claiming that opening up the digital platform to all players would undermine the commercial viability of its investment.

Foxtel's shareholders - Telstra, Kerry Packer's Publishing and Broadcasting Ltd and Rupert Murdoch's News Corporation - began discussing financing the transition to digital services more than a year ago.

Acknowledging Foxtel's concerns about the cost of the conversion, Senator Alston said any move to protect its interests would not come at the expense of others in the industry.

"You need a formula in advance that not only guarantees certainty for the investors and a reasonable rate of return, but also provides access to a number of other players, including Kerry Stokes," he said.

Senator Alston also emphasised his support for recent decisions by the Federal Court and the Australian Competition and Consumer Commission to give competitors access to Foxtel's analog network, which operates on Telstra's broadband cable.

Seven last week claimed victory after a four-year legal battle when the High Court reaffirmed open access to Telstra's broadband cable, rejecting Foxtel's claim that it had exclusive access to the $3.5 billion network.

Although the judgement covered only analog services, it is expected to set a precedent for digital pay TV.



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