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Murdoch's News Corp. enters Russia

MOSCOW, Dec. 29 -- Media mogul Rupert Murdoch's News Corporation has entered the Russian market, joining with Russian tycoon Boris Berezovsky ('beh-reh-ZAWF-skee') in a venture holding exclusive rights to sell advertising time on two major Russian television networks, ORT Channel 1 and TV-6. Russian newspapers report today that the new advertising venture, which is seen as a first step in the Murdoch empire's penetration of Russia, will begin operations in January, selling ad slots on both networks, in which Berezovsky already holds significant stakes. Advertising sales for ORT, formerly Soviet Central Television and still watched by over half the viewers in Russia and millions of people in the 12 former Soviet republics, was previously handled by Video International and Premier SV, Russian companies controlled by Sergei Lisovsky ('sir-GAY lee-SAW-skee'). Lisovsky's companies have been raided by the Russian Tax Police and he is under criminal investigation on charges of tax evasion. Russian President Boris Yeltsin on Monday signed a decree providing ORT with a credit line worth $100 million to prevent the network's collapse while the accounts are sorted out. The state still holds a 51 percent stake in ORT, but the company has been relying solely on advertising revenue for survival since the empty state coffers have failed to provide and financial support. But the Russian financial meltdown in August cut advertising income by up to 80 percent, and previous sales practices have led the once proud network to the brink of ruin. Murdoch clearly hopes to gain a profitable foothold in Russia, and media analysts say News Corp.'s link-up with Berezovsky and his media empire could also eventually extend from the advertising venture to the purchase of stakes in Berezovsky's newspaper holdings, as well as other joint ventures.

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Berezovsky has indicated he would like to branch out in new directions, and his aides have hinted at a new satellite television network, which could use the technology and programming developed by Murdoch's BSB-Sky network, Fox network and other channels. ---

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Copyright 1998 by United Press International. All rights reserved. ---

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