Friday, March 30, 2012

Austar chief slams News Corporation pay TV piracy claims as "farcical"

The chief executive of regional pay television company Austar has denied reports that News Corporation promoted a wave of piracy to damage its pay TV competitors.

John Porter, who has led Austar since 1995, told AM the accusations made by the Australian Financial Review newspaper and the BBC are "farcical".

Listen to my interview with John Porter here. 

Read the ABC News Online story here.

Austar shareholders meet this afternoon to vote on Foxtel's $2.5 billion takeover bid for the regional pay TV company, and Mr Porter is firmly backing the offer.

Foxtel is 25 per cent owned by News Corporation's Australian division, News Limited.

Mr Porter says all pay-TV operators deal with hackers and he is not surprised to hear that News Corporation had its own security unit to protect its profits.

"Certainly there was a piracy issue back over a decade ago," Mr Porter said.

"It was the early days of digital satellite transmission, and the whole industry worldwide had a problem; you didn't have to be a Mossad agent to crack the encryption of the early satellite transmission system."

Mr Porter insists that News Corporation did not promote pay-TV piracy; in fact, he says both Foxtel and News Corporation worked to resolve piracy issues around the world.

"I think we would have been aware of a conspiracy in this area," he said.
"I mean, it doesn't surprise me that a bunch of security experts would be discussing these issues over a decade ago in the very early days of visual encryption, but we've seen no signs of any conspiracy in this area that would lead me to believe that this story is just not on base."

And he says he would not waste his time reading any of the 14,000 emails published by the Financial Review to support its claims of piracy.

"I find this story to be so farcical that I really don't think it is worthy of my time," he said.

Mr Porter says Austar staff also deal with hackers in their efforts to maintain the security of the company's systems.

"I have a security expert, ex-Australian Federal Police, who works in this area full-time," Mr Porter said.

"Any time you have a secure system in the pay world, people are going to try to hack it. Every so often it moves us to build a better mousetrap."

And Mr Porter insists the value of Foxtel's takeover offer has not been affected by any security operations.

"The scheme arrangement in front of our shareholders is extraordinarily compelling, and I think what happened over a decade ago in the area of security, which was certainly not material to the value of the deal, is completely irrelevant," he said.