Outlook: Murdoch set for digital dogfight

Outlook: Murdoch set for digital dogfight

AFTER MONTHS of hype and corporate bluster, the battle lines for the great digital dogfight of 1999 are becoming clear.

On the evidence of the past week, Rupert Murdoch's BSkyB looks like the clear favourite. While British Digital Broadcasting - sorry, ON Digital - announced its new name in a blaze of publicity on Tuesday, it couldn't disguise the fact that the rest of its strategy is in tatters.

The reason is that Sky, which unveiled its plans on Thursday. It will launch in October with a massive marketing campaign - ably supported, no doubt, by Uncle Rupert's newspapers - and an impressive array of channels, sport and pay-per-view movies. The whole lot will be available for a starting price of less than pounds 10 a month and, hey, when you've forked out pounds 200 for a dish they'll even come and install it for nothing.

This leaves ON Digital's offering looking rather threadbare. It was supposed to be a cheap and cheerful alternative to Sky, bringing you 30 channels for under a tenner without the stigma of having to fit a dish to the side of the house. But Sky has signed up all the channels - many of them on an exclusive basis. And it looks as if ON Digital's price advantage has disappeared as well.

However, this is not a two-horse race. While Sky looks streaks ahead of ON Digital already, the real threat could be from the cable television companies. The prospect of the full 200 channels, no satellite dish, and high-speed internet access as well could prove a compelling alternative to what Sky is offering. As ON Digital has found to its cost, however, Sky will not give up its stranglehold on the couch potato without a fight.