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TVNZ and Sky: making up is not so hard to do

Friday 18th August 2000

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TVNZ chairman Ross Armstrong has been secretly talking to Sky Network Television to see if the state broadcaster can take a digital shortcut by piggybacking on Sky's satellite service.

Mr Armstrong has been discreetly meeting with Sky managing director Nate Smith at Mr Smith's Auckland home in a bid to repair relationship damage between the two companies and revive the idea of working together.

This week the government privately indicated the cabinet's position would be that TVNZ would not be allowed to fund its own digital service.

And TVNZ sources said Mr Armstrong was encouraging his people to start mending fences with Sky - which apparently is still keen to do a deal despite having formed a closer relationship with TV3.

TVNZ, until May 1999 a Sky shareholder, was originally going to join Sky's digital service but changed its mind as chief executive Rick Ellis argued the nation's leading broadcaster should have its own digital network.

To sign up with Sky would entail losing the gateway to viewers' homes, Mr Ellis said.

That plan failed when the National government lost its nerve at the last minute and failed to sanction the spending of millions on the project.

TVNZ's relationship with Sky has been strained after TVNZ sold its stake in Sky for less than the market would have paid and Sky sold crucial sports broadcasting rights to TV3.

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