Murdoch offloads TV technology firm NDS


Stephen Foley
Friday 16 March 2012 03:03

Rupert Murdoch's News Corporation has offloaded its remaining stake in NDS, a satellite TV technology provider where computer hacking allegations have returned to haunt its former parent company.

The US giant Cisco agreed to pay $5bn for NDS, which is 51 per cent-owned by the private equity firm Permira and 49 per cent-owned by News Corp, to expand its television technology business.

John Chambers, Cisco’s chief executive, said that TV programmes and video will soon be “pervasive, on every device”. NDS’s flagship product, VideoGuard, which is installed on home TVs via smartcards integrated into set-top boxes, complements Cisco’s video offerings because it allows television operators to extend their pay-TV services to other media devices.

NDS was accused by its competitors of illegally extracting software code from their cards and posting the information online, allowing hackers to create counterfeit cards. James Murdoch was on the board of NDS when the allegations first came to light in 2002.

The allegations resurfaced last year amid the furore over hacking by employees at another News Corp subsidiary, News International.

Rebel shareholders suing News Corp and the Murdochs in the US have cited the allegations against NDS. News Corp says it will fight the shareholders’ claims.

To the extent that the allegations were ever tested in court, they have been shown to be untrue. A claim brought by EchoStar against the company was rejected, and EchoStar was ordered to pay NDS over $18 million in legal costs. The Supreme Court of the United States refused a petition from EchoStar to challenge that ruling. Claims brought by other companies have all been abandoned, settled or dismissed.

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