BSkyB chief in move to Murdoch's Star TV

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Louise Thomas

Editor

SAM CHISHOLM, the aggressive New Zealander who heads British Sky Broadcasting, is to be appointed chief executive of the Hong Kong- based Star TV, in which Rupert Murdoch bought a 63.6 per cent stake late last month.

The move will prompt a battle over the future of BSkyB, with Pearson and Granada pressing for more say in the running of the pounds 3bn venture.

Mr Chisholm, who was recalled from holiday in Australia to help secure the dollars 525m ( pounds 352m) Star TV deal for News Corporation against intense competition from Pearson, has been made 'acting chief executive' after the surprise departure of Julian Mounter from Star TV last week.

Mr Mounter, a former Thames TV executive, resigned because he said he would not report to Mr Chisholm, who was to be given the role of overall head of News Corporation's satellite TV interests, including its 50 per cent stake in BSkyB.

News said it would appoint a new chief executive for Star TV within two weeks. It would not say who, but informed sources in Hong Kong said the job would go to Mr Chisholm.

If he was to take this position, Pearson - which has 17.5 per cent of BSkyB and whose managing director, Frank Barlow, is chairman of the venture - would insist on Mr Chisholm standing down from his post at BSkyB. 'He is not going to be able to do the same job at both companies,' said James Joll, finance director of Pearson. 'The shareholders would have to agree a successor.'

News Corp is not taking the same view. 'Sam is a very able man,' said a spokesman. 'We're not ruling him in, we're not ruling him out.'

Pearson is expected to press for an outsider to be brought into BSkyB if Mr Chisholm goes, while News Corp is likely to press for his number two, Gary Davey, to get the job. But Pearson is unhappy that Mr Davey, like Mr Chisholm, is a News Corp employee on secondment to BSkyB.

Pearson would prefer somebody employed directly by BSkyB, with no direct connections to any of its shareholders.

Pearson is understood to be looking to take a larger holding in BSkyB to have more influence over its running. But Mr Joll denied that it had approached Granada to buy its 15 per cent stake.

In his new role at Star TV, Mr Chisholm faces a number of problems which have emerged since News Corp took it over. The main one concerns the BBC's World Service Television, which runs a news and current affairs channel on Star TV. The BBC signed a 10-year deal with HutchVision, the company founded by Richard Li, the son of the Hong Kong mogul Li Ka-shing, to run Star TV. The contract guarantees editorial independence.

News Corp is believed to have approached the BBC to discuss the editorial content of World Service TV, and BBC sources said there was concern that it might want to water down some of the output.

The BBC is prepared to tear up the contract with Star TV if there is any pressure put on the editorial content, and has received a number of approaches from Indian business leaders to join with them to start a rival satellite service.

(Photograph omitted)