MTG to Launch DTH Satellite Platform in the Ukraine

STOCKHOLM, Sweden — Modern Times Group MTG AB (publ.) (‘MTG’ or ‘the Group’)(STO:MTGA)(STO:MTGB), the international entertainment broadcasting group, today announced that it has signed a partnership agreement with Strong Media Group Ltd. (‘SMG’) to launch the first digital premium DTH satellite TV operator in Ukraine. Viasat will now provide DTH satellite TV services in a total of eight countries, of which Ukraine is by far the largest in population terms.

Viasat Ukraine will offer a wide range of local Ukrainian and Russian channels, as well as locally customised international channels, including Viasat Broadcasting’s own Viasat History, Viasat Explorer, TV1000 East and TV1000 Russian Kino channels. Viasat Ukraine, previously known as Vision TV, is the first operator to be awarded a DTH satellite broadcasting license by the Ukrainian government. The platform will be encrypted with the NDS VideoGuard® conditional access system.

MTG and SMG each own 50% of Viasat Ukraine. The agreement is subject to approval by the Ukrainian competition authorities. The company will be proportionately consolidated by MTG, with 50% of revenues, costs, assets and liabilities reported in MTG’s accounts and included in the segmental reporting matrix in the ‘Pay-TV DTH platform & channels’ line under the ‘Central & Eastern Europe’ section of the Viasat Broadcasting business area.

Strong Media Group owns 100% of Strong International, which is a leading provider of digital TV set-top box decoders. SMG’s eleven wholly owned subsidiaries provide the European TV industry with services and equipment, and control an estimated 20% share of the total European market for set-top boxes. SMG already has a well-established presence in the Ukraine through its subsidiary Strong Ukraine, which has provided a large part of the currently installed TV reception hardware in the country.

Ukraine has an estimated population of over 46 million people and approximately 17 million TV households, with low pay-TV and cable penetration levels when compared with West European markets. The Ukraine generated GDP per capita of US$ 7,800 in 2006 and year on year GDP growth of 7.1%.

The MTG-owned Viasat DTH satellite TV platform currently has over 920,000 subscribers in the Nordic and Baltic countries. Eight Viasat channels including Viasat History, Viasat Explorer, TV1000 East and TV1000 Russian Kino are also offered on a mini-pay basis to third party pay-TV operators in 20 Central and Eastern European countries, including the Ukraine, and attracted a total of over 23 million subscriptions as at the end of June 2007. Hans-Holger Albrecht, President and CEO of MTG commented: “The launch of the new Viasat-branded platform in the Ukraine is an important development in our expansion and growth strategy, and demonstrates the value of our integrated platform and channel offering. The Ukraine is one of the largest and fastest growing markets in Eastern Europe. The partnership structure provides a strong combination of local and regional broadcasting experience and expertise, and is expected to enable us to achieve an accelerated development in this exciting market”.

Samer Mourad, President of Strong Media Group, commented: “We are happy to sign the agreement with MTG, and are convinced that it will result in a successful pay-TV platform. Strong will utilize its Ukrainian distribution network, which has over nine years experience in the country, to support Viasat Ukraine, and will provide set top boxes with NDS conditional access and middle-ware, as well as outdoor units and installation. Strong Ukraine has a full service logistics, sales and after sales services network across Ukraine, which will be used to approach the large base of potential subscribers in this country.”

Link: MTG