Murdoch Net venture lures ONdigital chief

STEPHEN GRABINER, the chief executive of ONdigital, resigned yesterday ahead of moving to take up a post with Rupert Murdoch's new on-line interests, just days after denying he was considering doing so.

Mr Grabiner is to join eVentures, an equally-owned startup company that was founded last month with $50m in seed capital by Rupert Murdoch, chairman of ONdigital's rival BSkyB, and Softbank founder Masayoshi Son.

The recruitment of Mr Grabiner seems a calculated move to destabilise ONdigital even though the digital terrestrial broadcaster's 250,000 subscribers amount to only one-fourth of those subscribing to Sky Digital.

"Stephen Grabiner did an excellent job getting the company from a standing start to 250,000 subscribers, despite tough opposition from Sky," said Mathew Horsman, media analyst with Investec Henderson Crosthwaite.

Stuart Prebble, 48, has become ONdigital chief executive with immediate effect. A former Granada Media Group executive, Mr Prebble is viewed as a safe pair of hands, though he is likely to prove a more independent chief executive than Mr Grabiner, who was recruited by Michael Green, the Carlton and ONdigital chairman. Carlton and Granada jointly own ONdigital.

Mr Prebble was previously managing director of channels and interactive media at GMG, responsible for developing pay-TV. Prior to that he served as controller of ITV network factual programmes, having worked as a producer, editor and reporter for both "World In Action" and the BBC.

Sources say Mr Grabiner, 40, was leaving ONdigital after only a year following a number or rows with Mr Green. Mr Green, according to one insider, takes an inordinate interest in ONdigital's day-to-day operations and this led to confrontations with Mr Grabiner.

His resignation marks the second time in as many years that he has walked out of a top post with a leading media group.

Last April, Mr Grabiner left Lord Hollick's United News & Media after a brief stint as executive director and chief executive of UK consumer publishing.

On Friday, Mr Grabiner, 40, said he fully expected to be with ONdigital in the future. "Yes is the answer to that question," he said, commenting on whether he would remain with the company. He added: "I'd love to know who's making this up."

People familiar with the situation said Mr Grabiner decided to leave last week. "It was absolutely clear he was going on Friday," said one insider. "ONdigital wouldn't get into an auction once they heard he was negotiating with ePartners."

ePartners was set up last month with funding of $300m to spearhead News Corp's belated entry into the Internet. Mark Booth, former chief executive of BSkyB, was parachuted in to head the venture.

eVentures' first funding is a $22.5m investment in the UK affiliate of E-Loan, a California-based Internet mortgage company.

Sources said a deal to hire Mr Grabiner to a top management post with eVentures could be announced imminently.