Center Takes on News Corp./Hughes

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Sep 8, 2003
Las Vegas, Nevada
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The Center for Digital Democracy, probably the most vocal critic of News Corp.'s proposed billion-dollar takeover of Hughes and DirecTV at the Federal Communications Commission, addressed criticisms recently leveled at the organization by the companies.

News Corp. and Hughes recently took on the Center's assertions about the deal's impact on retransmission consent and the media giant's influence in the pay-TV business with such things as programming and TV technology (details for which were provided in Monday's SkyREPORT: In a filing at the FCC, the companies called the Center's concerns with the deal "unsupported allegations," and added, "Mere speculation is no substitute for evidence and probative analysis."

The Center lashed back with its own FCC filing. "The parties, unfortunately, fail to refute every one of the criticisms and concerns we have raised with the FCC since the start of this docket," CDD said. "Indeed, what the parties fail to say in response speaks volumes: We have identified major and unique problems with this proposed transfer that require the commission to reject it."

On the specifics, the Center took issue with interactive TV technologies owned by the media company. "News Corp. controls a company that dominates the conditional access sector and, as we previously stated, has significant products for the interactive advertising, personal video recorder, and interactive programming markets," CDD said.

News Corp. also has Gemstar. "No other potential (multichannel) entity controls the country's leading electronic program guide service, either," the Center said.

On retransmission consent, the Center said, "Nowhere do the applicants address the fundamental question: How can News Corp. really 'create real competition' to cable when it owns and operates 35 full power stations, including stations located in nine of the top 10 designated market areas," CDD said.

The FCC is reviewing the proposed deal, which has News Corp. taking a controlling stake in Hughes and DirecTV.
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