Murdoch: big three will run world's media

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By Jane Schulze and Geoff Elliott, The Australian

RUPERT Murdoch believes that in three years the world will have three large media companies - and News Corporation will be one of them.

Speaking after releasing News's half-year results on Wednesday night, the chairman and chief executive of The Australian's owner, The News Corporation Ltd, ruled out a counter-bid to US cable group Comcast's record $US54billion offer this week for the Disney group.

But he acknowledged the changing power structure in the world's media.

"In three years the media scene will have at least three very big competitive companies in Comcast, News and Time Warner, and several very good and well-run smaller companies such as (US satellite pay-TV group) DISH and (US cable group) Cox," he said.

Comcast's move is seen as a strong vindication of Mr Murdoch's strategy to build News into a global content and distribution company. In December, News secured US distribution for all its content businesses, such as the Twentieth Century Fox movie studio, by buying the US satellite pay-TV group DirecTV for $US6.6 billion.

But Mr Murdoch did not believe News would be disadvantaged by the might of the Comcast- Disney group if that deal was approved.

"We will have just as much ability to pressure them as them us," he said.

"For example, DirecTV would now be paying ESPN (owned by Disney) about $US300 million a year so there will be a lot of money going back and forth, but we will be in a pretty equal position."

The Comcast bid for Disney seems to have inspired Telstra chief executive Ziggy Switkowski, who said it supported the argument for convergence between the telecommunications and media industries.

Comcast had a huge distribution platform to deliver content, and obviously saw the benefit of also owning the content, he said.

But Dr Switkowski said Telstra was still learning how to develop more relationships with content companies.

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