An order for up to 150,000 boxes, with more contracts still to be let, could be unveiled within the next week or so - possibly on Friday, at Sky's annual meeting. The boxes, which will decode digital television signals to give viewers access to as many as 200 channels, are set to emerge as the prime "gateway" to digital television.
Rival broadcasters fear that plans to launch competing services will be held ransom to Mr Murdoch's stranglehold on the descrambling technology, as Polly Toynbee wrote in yesterday's Independent.
But Dr Lewis Moonie, Labour's spokesman on broadcasting, dismissed the claims. "This is nonsense, quite frankly, from someone who has had their head between their knees for the six months, we were debating this in detail in committee," he said.
"We have cast-iron assurances from the Government that the regulations will ensure common standards. My information is that the Department of Trade and Industry is well aware of the problems and its regulations will meet our concerns. This idea that Murdoch is going to flood the market with cheap trash is a condescending middle-class idea - the idea that you've got to protect people from this stuff. People don't like cheap trash."
But Carol Tongue, Labour MEP, and member of the committee on media and culture, disagreed. "Control of the set-top box is one of the most critical political and economic issues of our time," she said.
"All broadcasters should be able to reach every citizen through the digital decoder box on their own terms - not those of BSkyB.
"Unless the Government acts now to guarantee a common interface in every set-top box that is manufactured, we will be on the verge of a market failure that would irretrievably wound our democracy.
"Television should be a democracy of the mind, not a monopoly."
Other critics said politicians were too concerned about the next election, and were unwilling to upset Mr Murdoch's plans for fear of losing the support of his newspapers.
Broadcasters said the launch of digital satellite next year could even pre-empt efforts by the Government to develop digital terrestrial television, (DTT) which would not require satellite dishes or new aerials.
DTT, a cornerstone of the Government's policy for the digital age, will only work in conjunction with a set-top box or a new, digital television set.
Broadcasters fear that consumers will be unwilling to buy a digital terrestrial box in 1998, if they have already been sold a digital satellite box in 1997.
The Department of Trade and Industry is at present reviewing proposals to ensure that all broadcasters and other digital service providers are given "fair and open access" to his set-top box.
A spokesman for the DTI said: "There will be a disputes procedure in the regulations, which will probably involve Oftel and may involve an independent arbitrator.
"Contrary to Ms Toynbee's article, Oftel's record is impressive. BT, for example, does not regard it as a soft touch."
BSkyB has insisted privately that it would be happy to have any broadcaster come through its system.
However, rivals are worried that the company's control of the gateway, as well as electronic programme guides that allow viewers to select programmes, will be used to further Sky's own commercial objectives.
All the programmes you never wanted
So what is digital TV?
Digital compression allows far more information to be sent along wires or through the air:one satellite transponder can carry as many as 10 digital TV channels instead of one.
How many channels will there be?
Up to 200 on digital satellite, maybe 150 on digital cable and about 18 on digital terrestrial television.
Digital terrestrial what?
DTT is the Government's favoured new technology. It allows many more channels to be broadcast "through the air", without a dish, but you would need a set-top box.
A box that sits on the telly to receive digital transmission signals and which allows only those who have paid to receive the service, so- called conditional access.
So what's all the excitement?
BSkyB plans to launch its service next year, using technology owned by a Murdoch company. It is feared he will install his boxes before rivals can develop competing technology and thereafter broadcasters would have to use his "gateway".
What is the Government doing?
The Department of Trade and Industry is looking at ways of regulating conditional access technology but there are fears Murdoch will have launched his box before that.Reuse content