News Corp. Leads Digital TV Investor Group

News Corp. is teaming up with five other companies to invest a total of $26 million in U.S. Digital Television, a recently launched digital-broadcast TV service that charges a low fee for a limited selection of cable channels. The group, which includes several broadcasters such as Hearst-Argyle Television Inc. as well as News Corp.'s Fox Television Stations unit, will get majority control of the service. U.S. Digital Television will use the funds to expand into new markets and to offer other services such as video-on-demand. U.S. Digital Television leases unused digital spectrum of local TV stations to broadcast 12 cable channels, such as ESPN and Fox News Channel, for $20 a month. Its signals can be received by a digital set-top box and aerial antenna. Regular cable service, in comparison, offers an average of 80 channels for about $40 a month. The service is targeted at the roughly 20 million U.S. households that do not subscribe to cable or satellite television services, as well as those who want a cheaper option. "The target market is a value-oriented home," says Steve Lindsley, chief executive of U.S. Digital Television. The service, initially financed by private investors, has so far signed up 4,500 subscribers.
[SOURCE: Wall Street Journal, AUTHOR: Julia Angwin julia.angwin@wsj.com]
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