TV 2-Ã¥ret 1999

ANNUAL REPORT 1999
CORPORATE ACTIVITIES
In recent years,TV 2 have interested themselves
in a number of subsidiary and affiliated companies
where the objectives have been to utilise
TV 2’s strength in producing programme contents
and to provide the channel with the best
possible means of utilising the opportunities created
by digital technology. Several of these companies
have been through costly processes
linked to establishment or reorganisation, and in
this phase their group contributions towards TV
2’s operations have been negative. The net
deficit of the subsidiaries amounted to NOK
21.8 million. When including the guarantee payments
to TVNorge,TV 2’s shares of the deficits
of affiliated companies amounted to NOK 157.8
million.TV 2 sold some of their ownership interests
in 1999 and are currently carrying out a
critical assessment of operations throughout the
group with a view to focusing on the core areas
of television and multimedia.
Through its subsidiary Net 2 Interaktiv
AS, TV 2 hopes to take over a leading position
within the development of interactive media
and services in Norway.TV 2 also sees a considerable
potential in the company Peak Broadcast
Systems Ltd, in which TV 2 today hold a 47.1
percent interest. Peak has supplied graphic and
production systems to several major television
stations, and has entered into an important joint
venture agreement with Microsoft, whereby
Peak will develop vital system components for
Microsoft’s new interactive television platform.
FUTURE PROSPECTS
Internet and broad-band technology create opportunities
for performers who wish to concentrate
on narrower channels with clearly segmented
target groups. In the not-too-distant
future, web-tv will vastly increase the number of
programmes available to viewers. In this development,
programme content appears to remain
the central competitive factor.The value of own
productions and long-term alliances and contracts
for broadcasting rights will be decisive in
the development of the TV 2 product and its
attractiveness to the general public.
In this connection,TV 2 views with disquiet
the spiralling prices of broadcasting rights to
sports events. While TV 2 secured valuable
rights to large international championships,
including the Men’s European Football
Championships in 2000 and 2004, an interest
group of Nordic public broadcasting companies
were in 1999 unable to acquire the rights to the
Men’s World Football Championships in 2002
because the price demanded far exceeded the
sum the channels were able to pay.TV 2 therefore
notes with satisfaction the resolution
passed by the Norwegian Storting (parliament)
in December 1999 to the effect that television
channels broadcasting free of charge to at least
90 percent of the population are to be given
preference to broadcasts of events of significant
societal importance, including major sports
events. However, the positive consequences of
this scheme for the majority of Norwegian television
viewers will depend on the mechanisms
adopted for determining prices.
With the on-going digitalisation process, the
number of performers on the television market
is increasing.At the same time, while the interaction
between various distribution technologies
creates new earning opportunities, increasing
rivalry also demands considerable investments
by those who wish to take part in this competition.
The value of an established brand name is
important in this on-going struggle to find and
maintain a position in the market.
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