TVNZ scores big Australian deal

By Karyn Scherer

TVNZ plans to open five new offices in Australia, after winning almost $150 million worth of business.

The state-owned broadcaster expects to have 10 offices across the Tasman by February, after securing a five-year contract to maintain Australia's recently privatised transmission network.

The deal, which involves operating and maintaining broadcasting sites for ABC and SBS television and radio services throughout Australia, is estimated to be worth almost $30 million annually for the next five years. Until now, it has held the contract for just three states.

TVNZ has also beaten off several rivals to win a five-year contract for new work on the network, which it hopes will be worth more than $20 million a year.

Australia plans to have its existing analogue network converted to digital by 2001, and the British-based owner, NTL, hopes to win the new work.

The managing director of TVNZ Australia, Nick Powl, yesterday described the $20-million-a-year estimate as conservative, although he conceded it was not necessarily a foregone conclusion that NTL would be chosen to carry out the conversion.

NTL outbid a consortium including TVNZ for the Australian network when it was put up for sale by the federal Government earlier this year. It paid more than $A600 million for the asset - twice what analysts were expecting.

Its deal with TVNZ has prompted speculation the two organisations might work together in the future on other projects, such as digital television, and Mr Powl agreed it was possible.

"They cover a whole area of technology and services and we will be talking to them over coming months to see what else we might be able to do together."

NTL is regarded in Europe as an aggressive and acquisitive operator. It successfully bid for the residential television assets of Cable & Wireless Communications earlier this year, becoming the biggest cable owner in Britain and Ireland.

It is believed to be keen to offer an interactive television service in Australia, and has signalled it will attempt to acquire spectrum leftover there once the free-to-air television channels move to digital.