Sky Italia may bid on free-to-air frequencies

European Commission's decision sets up media battle

ROME -- Italian satellite broadcaster Sky Italia said Tuesday it received permission from the European Commission to bid on digital free-to-air frequencies in Italy, setting up a likely battle between the News Corp. unit and Mediaset, the television giant controlled by Italian premier Silvio Berlusconi.
 
The landmark decision from Brussels was hotly anticipated in Italy, and, according to Italian news reports, the subject of heavy lobbying from both Sky Italia and Mediaset.
 
For its part, Mediaset immediately announced plans to appeal the decision in the European Court of Justice.
 
Since it was created from two struggling satellite broadcasters in 2003, Sky Italia has managed to make the long-time Italian television duopoly that pitted Mediaset against Italian state broadcaster RAI into a three-company battle that saw Sky Italia dominate the satellite platform and Mediaset and RAI share the free-to-air frequencies.
 
But a switch earlier this year to digital television technologies opened up frequencies, and the European Commission said there was been enough "significant changes" in the sector to warrant reversing the 2003 rules that restricted Sky Italia to satellite airwaves.
 
If Sky Italia manages to bid for free-to-air frequencies, it will set up a new battlefield for Berlusconi and News Corp. chief Rupert Murdoch.
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