From: Satjournal@aol.com
7
Satellite Journal International
                                                 Volume Five
                                                    June, 16
                                                        1997
     "Anyone who enjoys the privilege of publishing and
   broadcasting in open societies should demonstrate their
unshakeable belief in the universality of free speech should
 they ever seek to broadcast in societies that are closed."
                              
  The New PrimeStar
  Murdoch to buy International Family Entertainment
  Hughes to build new satellite for Sweden
  Commerce Committee: Proposed legislation
  OrbView-2 Satellite Arrives at Vandenberg
  Cricket Anyone!
  Goal!
  Microsoft invests $1 billion in Comcast
  HBCO Distribution Contract
  Upcoming Launches
  New files and documents at our WebStand
  In Brief
  YET ANOTHER NEW VERSION AVAILABLE
Satellite Journal is pleased to announce that SJI has opened
a "channel" on the Pointcast service. Currently in beta
testing, Pointcast 2.0 offers readers all the latest news,
weather, sports, Internet news and now Satellite Journal
Weekly. To receive this "channel" you need to install
Pointcast 2.0
To do this, go to our website at
http://members.aol.com/satjournal and click on the Pointcast
logo on our home page. Follow the instructions and you will
be up and running. Pointcast is a FREE service. (Ed note:
While this is beta software, I have had no problems with at
all.)
MINING COMPANY WEB SITE
Thanks to those who are visiting
http://satellite.miningco.com The site also offers the
latest in news and information and in the near future will
have chat and message board areas. This site is advertiser
supported so please visit it often and send your comments to
satellite.guide@miningco.com.
     
     
                              
                      The New PrimeStar
     PRIMESTAR signed a binding letter for the restructuring
of PRIMESTAR Partners L.P. Simultaneously, PRIMESTAR
Partners, L.P. has entered into an agreement to combine the
assets of PRIMESTAR, Inc. with ASkyB.
     According to terms of the agreements, each partner
company involved in PRIMESTAR, including TSAT, Time Warner
Satellite Services, Newhouse, Cox, Comcast, MediaOne
(formerly Continental) and GE Americom, will contribute
their PRIMESTAR customers and partnership interests into the
newly formed, public entity of PRIMESTAR, Inc.
Additionally, ASkyB will contribute its two satellites
currently under construction as well as the license to
operate at the 110 degree West Longitude orbital location
using 28 transponder channels.
     Primestar and Tempo Satellite have agreed to dispose of
their rights in the license to operate 11 transponder
channels at the 119 West Longitude orbital slot.
     Concurrently, ASkyB has agreed to sell its Gilbert,
Arizona satellite uplink facility to Tele-Communications,
Inc. for a purchase price which represents ASkyB's
investment in the facility, plus related interest expense.
     Current TSAT shareholders will retain approximately 37
percent ownership of PRIMESTAR, Inc., with Time Warner
Satellite Services/Newhouse (approximately 30 percent),
Comcast (approximately 10 percent), MediaOne (approximately
10 percent), Cox (approximately 9 percent), and GE Americom
(approximately 4 percent) rounding out the ownership group.
ASkyB, in return for its contribution of assets, will
receive non-voting convertible securities with a total
liquidation value of approximately $1.1 billion; comprised
of approximately $600 million liquidation value of non-
voting convertible preferred stock (convertible into
approximately 52 million shares of non- voting common,
subject to adjustment) and approximately $500 million of
convertible subordinated notes (convertible into
approximately 43 million shares of non-voting common,
subject to adjustments).
     Existing TSAT shareholders will exchange their current
TSAT shares for shares of the new PRIMESTAR, Inc. on a one-
to-one basis.  For other contributing partners,
approximately 132 million new shares of stock are expected
be issued to meet the terms of the agreement, combined with
approximately 67 million TSAT shares currently outstanding
(76 million on a fully diluted basis).  Each contributing
partner will receive a combination of equity ownership of
PRIMESTAR, Inc. and cash, with TSAT shareholders receiving
equity in PRIMESTAR, Inc., all subject to closing
adjustments.
     The board of directors of the newly-structured
PRIMESTAR, Inc. will consist of eleven representatives;
three chosen by TSAT's series B shareholders, three chosen
by Time Warner Satellite Services, one each chosen by Cox,
Comcast, and MediaOne and two independent members.
     Jim Gray, PRIMESTAR Partners' current Chairman and CE0
will be appointed Chairman and CE0 of PRIMESTAR, Inc. until
the transition to the new company has been completed.  An
executive search will commence immediately for a new CEO to
lead the venture.  Dan O'Brien, current President of Time
Warner Satellite Services, has been named to the position of
President and COO of PRIMESTAR, Inc.
     John Goddard, formerly CEO of Viacom Cable and
currently serving on TSAT's board of directors, will lead a
transition committee including Mr. Howard, Mr.  Gray and Mr.
O'Brien, which has been charged with determining the final
management structure for PRIMESTAR, Inc., as well as the
location of the business offices.
     Completion of the agreement is contingent on approval
by TSAT shareholders and all necessary government and
regulatory approvals.
     
                         Ownership of Common       Voting
                         Shares Outstanding       Power
Current TSAT             37%                      38%
Stockholders
Time Warner/ Newhouse    30%                      30%
MediaOne (U S WEST       10%                      10%
Media Group)
Cox                      9%                       10%
Comcast                  10%                      10%
GE (GE American          4%                       2%
Communications)
                         100%                     100%
     The combining of ASkyB and PrimeStar is not however
without pitfalls. Regulators, mainly the FCC, will look at
the deal to see its impact on competition in cable and
satellite television.
     Here's the areas the FCC will be interested in:
"    channel capacity for satellites used to beam TV
 programs around the nation.
"    competition between providers of cable TV, high-powered
 DBS TV, and DTH satellite TV that must use larger dishes
 than DBS.
"    DBS providers' access to programs
"    the three orbital satellite slots now capable of
beaming programs nationwide.
"    Tele-Communications which shares one of the other two
slots with EchoStar.
     Charlie Ergen EchoStar's Chairman and CEO responded.
Below is his statement:
      Consumers across the country would object in mass if
they understood Primestar Inc., a proposed comprehensive
combination of the five largest cable companies in the
world, including the largest content providers in the United
States, with perhaps the most powerful media mogul.
     It clearly is not in the public interest to give the
single piece of real estate in space which is most capable
of fostering effective competition to cable, to a cable and
content cartel of unprecedented size and proportion.
     This proposal, if permitted, would clearly result in
even higher cable television rates and the consumer will
continue to be held hostage to the powerful cable interests.
This alliance will violate the spirit of the 1996
Telecommunications Act and the best intentions of President
Clinton and Congress in passing what was intended to be
comprehensive pro-competitive legislation.
     The stark contrast with Rupert Murdoch's recent promise
to Congress that he would: "offer consumers a full-fledged,
satellite-delivered alternative to cable" is disturbing, and
raises serious questions.
     This transaction is obviously anti-competitive and anti-
consumer. We are confident that the Federal Communications
Commission, the Department of Justice, and the Federal Trade
Commission, together with other federal and state regulators
charged with protecting consumers, will reject this proposed
alliance.
     We trust that our leaders in Washington will not allow
the "Big Cable Operator in the Sky" to deprive American
consumers of a competitive choice.
     EchoStar Communications Corporation intends to
vigorously oppose this anti-competitive combination on many
levels.  EchoStar notes that in its pending litigation with
News Corporation Ltd. in U.S.  Federal Court in Denver, it
has demanded damages and specific performance from News
Corp. which prohibits News Corp. from completing the
transaction with Primestar Inc.  EchoStar is contractually
entitled to use the 28 DBS frequencies at 110 degrees W.L.
which News Corp. proposes to contribute to Primestar, Inc.
     Regarding the litigation News Corporation released the
following:
     News Corporation has filed its answer and counterclaims
in the breach of contract action brought against it by
EchoStar Communications Corporation in the Federal District
Court in Denver, Colorado.
     News Corp.'s answer denies all of the material
allegations in the Complaint and asserts twenty defences,
including bad faith, misconduct and failure to disclose
material information on the part of EchoStar and its
Chairman and Chief Executive Officer, Charles W. Ergen.
     The counterclaims, in which News Corp. is joined by its
subsidiary American Sky Broadcasting, L.L.C., assert that
EchoStar and Ergen breached their agreements with News
Corp., and failed to act and negotiate with News Corp. in
good faith.
     Additionally, the counterclaims allege that Ergen
personally acted wrongfully and caused EchoStar to act
wrongfully to advance his own self-interests in retaining
control over EchoStar and gaining control over the DBS
business of News Corp. and ASkyB - all contrary to the best
interests of EchoStar, News Corp. and ASkyB and their
shareholders.
                              
      Murdoch to buy International Family Entertainment
     Overshadowed by the ASkyB/PrimeStar deal is the other
merger news this week.
     A subsidiary of Fox Kids Worldwide will merge with and
into IFE, with IFE as the surviving corporation, in a
transaction valued at approximately $1.9 billion, including
outstanding debt.  Holders of IFE Common Stock will receive
$35 per share in cash.
     Pat Robertson, IFE's Chairman, Tim Robertson, IFE's
President and Chief Executive Officer, and trusts controlled
by them have agreed to sell all shares of IFE's Class A
Common Stock (in the form of Class B Common Stock into which
such shares are convertible) and Class B Common Stock held
by them, and each of The Christian Broadcasting Network,
Inc.  and Regent University have agreed to sell all their
shares of Class B Common Stock, to FKW for $35 per share in
cash, pursuant to separate Stock Purchase Agreements, and
each of such stockholders has executed a consent approving
the merger.
     Liberty IFE, Inc.which holds non-voting Class C Common
Stock of IFE and $23 million of 6% Convertible Secured Notes
due 2004, convertible into Class C Common Stock, has agreed
to contribute its Class C Common Stock and Convertible Notes
to FKW, in a transaction intended to be a tax-free exchange,
in exchange for a new series of nonconvertible 8.5%
preferred stock of FKW.  The FKW preferred stock will have a
liquidation preference equivalent to $35 per Class C share,
plus an amount designed to compensate Liberty for foregoing
interest on the Convertible Notes and for certain tax
consequences.
     It is anticipated that Pat Robertson will be Co-
Chairman of IFE and Tim Robertson will continue as President
and Chief Executive Officer.  Corporate headquarters will
remain in Virginia Beach, Virginia.
     Standard & Poor's  has placed its triple-`B' corporate
credit rating and triple-`B'-minus-r preference stock rating
on News Corporation Ltd., and its ratings on the company's
units on CreditWatch with negative implications.
     According to S&P, the IFE merger is a good strategic
fit with News Corp.'s Fox Kids programming.  However, the
price represents an extremely high multiple and, largely due
to debt financing expected at the venture level, the venture
will be unable to generate net cash flow to its partners.
     Even prior to the IFE deal, News Corp. had little debt
capacity remaining at the triple-`B' corporate credit rating
level.  For the trailing 12 months ended Mar. 31, 1997,
Australian accounting earnings before interest, taxes,
depreciation, and amortisation (EBITDA) coverage of interest
was 2.9 times and coverage of interest plus debtlike
preferred dividends was 2.8 times, pro forma for the
acquisitions of New World Communications Group Inc. and
Heritage Media Corp. On a U.S. accounting basis, June 30,
1996 EBITDA coverage of interest was 2.68 times and coverage
--- Msged/386 4.00
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