Man who beat Murdoch plans global TV

The scion of a wealthy Hong Kong family, fresh from waging war against Rupert Murdoch, has turned his sights on Europe and interactive television.

Richard Li foiled Singapore Telecom and Murdoch in the battle for Hong Kong Telecom, launching a share issue so hot that there were near-riots in the streets of the former colony. His new project is aiming his global interactive internet television project, Network of the World (Now) at the United States and Europe.

The son of Hong Kong property and telecoms magnate Li Ka-Shing, the younger Li has yet to make his mark outside Asia, where he first made his name in the early 1990s creating a similar satellite television venture, Star-TV, virtually from scratch.

Those who have watched the 33-year-old tycoon at work in Hong Kong think the crucial deals that will give his new venture satellite and cable distribution outside Asia will not be long in coming.

With the launch last Friday of Now, timed to coincide with Wimbledon, Mr Li will already be broadcasting to 130 million homes in Asia through AsiaSat 3. Outside Asia, he will have to rely on broadband internet access to deliver Now content, or strike deals with European and US cable and satellite companies.

"We can't disclose exactly who we're working with, but we are in talks with the major players," says one London executive.

Eventually, the service could be delivered globally by up to 20 satellites through a joint venture project with Daimler-Chrysler Aerospace.

But with the first satellites not due for launch until 2003, this is unlikely to be realised soon, forcing Mr Li into bed with existing players.

Stephen McKeever, a telecom analyst at Lehman Brothers in Hong Kong, says: "There is a logic to this strategy of linking content with distribution. There are lots of big [media] pipelines in Europe, but so far not much to pipe down them."

Mr Li's track record has already attracted heavyweight partnerships that include Intel, China's leading PC manufacturer and distributor in Legend Holdings, Australian telecoms giant Telstra, and Japanese cable company Tomen Mediacom.

Mr Li's net empire has sprung seemingly from nowhere. In fact, Mr Li founded parent company Pacific Century Group in 1993 with the $US1 billion given to him by Mr Murdoch for Star-TV. But it was only last year when Mr Li bought out an unspectacular Hong Kong-listed telecom company, Tricom Holdings, and turned it into Pacific Century CyberWorks, that the main vehicle for his global ambitions was created.

Analysts believe something in the region of $US120 million has been put aside to build the network and production centres needed to get Now on air.

But whether Mr Li's latest venture, described by Michael Johnson, his chief aide, as "the glue that holds it all together," succeeds will be decided largely on content and the ability to attract and keep viewers.

Deals with media companies such as sports footage provider Trans World International, owner of the rights to Manchester United football matches, will supplement the company's own media content created at PCCW's west London studios and soon from studios in Hong Kong and Tokyo.

Mr Li has also struck content deals with Era Communications, of Taiwan, one of the largest producers of Chinese language media, as well as Commercial Radio of Hong Kong and a string of smaller companies.

But sooner or later Mr Li will come face-to-face with the big guns of broadcasting. Established names like Walt Disney and Time Warner already control far superior entertainment archives.

Meanwhile, in the British interactive market, BSkyB has counted some 3.3 million interactive television users, and in the US Microsoft's WebTV has more than 1 million subscribers. AOLTV, launched by the net giant America Online, is due to go live next month.

This probably does not faze Mr Li, who has shown himself fully able to cut a deal. At 33 he has already bloodied the nose of Mr Murdoch, twice. First by selling him Star-TV, a company that is still losing money, for $US950 million in 1992, and secondly by outwitting him in the battle for Cable & Wireless's 54 per cent stake in Hong Kong Telecom by leveraging PCCW's rising shares in much the same way that AOL took over Time Warner in January.

Mr Murdoch, and even more unusually Goldman Sachs, had backed a losing bid by Singapore Telecom. And last month Mr Murdoch pulled out of a separate joint venture between Star and Hong Kong Telecom to provide interactive television once it became clear that Mr Li had the upper hand.

For now Mr Li may have outwitted the big guns. But will he be third time lucky and see Now take off to become a global brand?

- INDEPENDENT