Murdoch seeks support for Kirch alliance

RUPERT Murdoch launches a charm offensive in Germany next week to gain support for a possible new television venture between his company News Corp and the endebted German media conglomerate Kirch Gruppe.

He will be the main speaker at a press gathering in Cologne on June 14 at the invitation of the Social Democrat leader of the North Rhine Westphalia regional government, Wolfgang Clement.

There has been intense speculation in Germany that Mr Murdoch could be about to take a stake in Kirch after the European Commission vetoed Kirch's digital television link-up with Bertelsmann on competition grounds. Kirch lost DM1.4bn from its attempted foray into digital television and is looking increasingly vulnerable financially.

Sources close to the media tycoon deny, however, reports that negotiations are already under way between the two companies. A previous attempt at an alliance between BSkyB and Kirch collapsed last year. The reasons for the breakdown of the talks have never been disclosed.

Mr Murdoch has made no secret of his desire to grab a larger share of the lucrative German television market, the biggest single-language television market in Europe. "If we were allowed to we would go in (to Germany) at full speed," said one Murdoch aide. However, there are powerful opponents to Mr Murdoch increasing his company's presence in Germany, not least Bertelsmann, the country's largest media company which fears the competition.

In an interview with the magazine Der Speigel last week, Bertelsmann's chief executive, Mark Woessner, said he would support Kirch with millions of marks in exchange for film distribution rights to prevent Kirch from linking up with News Corp.

Major European media companies have all been trying to carve alliances in digital television to help share the heavy investment that is required for its development. Digital television, which allows for more channels, clearer images and interactive services such as home shopping, is seen as the future driver of earnings growth.

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