Star TV joins forces with Cable & Wireless

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HONG KONG--The much-heralded convergence of television media and the Internet has come one step closer to reality with an unexpected agreement between telecom giant Cable & Wireless and Star TV, the Hong Kong-based Asian pay TV service run by Rupert Murdoch's News Corp.

The joint venture, of which C&W owns 60% and Star TV holds the remainder, will combine C&W's existing iTV video-on-demand service in Hong Kong and Star TV programming into a single service, including 50 general- entertainment, news and home-shopping channels, as well as video-on-demand and high-speed Internet access. C&W already operates the territory's largest Internet service provider, Netvigator.

The deal gives expanded programming content to the iTV service, which currently has just 89,000 subscribers, far below its target, while Star TV stands to gain greater household penetration and an early foothold into interactive media.

The new service will be launched early next year, pending licensing approval, through C&W's fiber-optic network, which covers 75% of the Hong Kong market, and Star TV's satellite system. It will compete with Wharf Cable TV, Hong Kong's only cable provider, with 420,000 subscribers.

Copyright November 1999, Crain Communications Inc.

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