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Galaxy (Australian TV)
Encyclopedia
Galaxy is a former provider of pay television programming in Australia
via satellite
and wireless cable (microwave) delivery methods.
Galaxy was founded in 1993, and begin test broadcasting on 1 January 1995 via microwave, making it the first provider of pay-TV services in the country. It was officially launched on Australia Day (26 January).
At launch only two channels were fully operational, the local Premier Sports
and international news channel ANBC. Digital satellite broadcasts began in September 1995.
Galaxy was a joint venture between Continental Century Pay-TV and Australis Media. Each held licenses allowing them to provide four channels of satellite delivered television
Continental Century Pay-TV and Australis Media held exclusive licenses to broadcast pay-TV in Australia via satellite until 1997. Their main competitors were Foxtel
and Optus Vision, both of which operated separate cable
networks. The Galaxy channel package was franchised to CETV (Later Austar)
and East Coast Television (ECTV) in regional areas.
At its peak, there were around 120,000 Galaxy subscribers. The service ceased shortly after Australis Media went into liquidation on 18 May 1998.
called tenders for Australia's first pay-TV licenses. Surprisingly, the first license was purchased not by one of the major media players but by an entrepreneur, Albert Hadid, who quickly onsold it for a rumoured $33 million profit. The licenses ultimately ended up in the hands of Continental Century Pay-TV, a joint venture between Australian venture capitalist CVC and US cable company Century Communications and Australis Media, an upstart company in which TCI
and Guinness Peat Group
were major shareholders. Australis paid a total of A$333 million for the satellite and microwave licenses they would require to launch a pay-TV service to be branded Galaxy.
Galaxy secured contracts with three major Hollywood studios - Columbia TriStar, Universal Studios
and Paramount Pictures
(the latter two both partners on a joint venture, United International Pictures
)- for the exclusive first-run rights to broadcast their film and TV product on its Galaxy service. The output of these studios formed three channels — Showtime
, Encore
and TV1
— that would become the mainstay of Galaxy's programming.
After the remaining output from the major studios was purchased by Optus Vision, Galaxy's other competitor, the News Corporation
and Telstra
owned Foxtel
, was forced into an embarrassing deal to purchase content from Australis at a reported cost of A$4.5 billion over 25 years.
Galaxy, along with Austar
were the providers for the Sega Channel
in Australia for Sega Australia (known then as Sega Ozisoft
).
Despite this lucrative deal, the financial situation at Australis was troubling. The installation cost of equipment was high (reportedly around $500 for a microwave antenna and $1000 for a satellite dish), forcing them to greatly subsidise installation costs. Furthermore, increased competition from Foxtel
and Optus Vision forced Galaxy to lower prices further or lose customers.
The financial crisis at Australis meant that much of Galaxy's life seemed to be spent trying to save the company from receivership. In October 1995 a merger was proposed by Australis and its biggest rival, Foxtel
. The proposal was rejected by the Australian Competition and Consumer Commission
, citing fears that a merger between the two businesses would stifle competition. Another Australis-Foxtel merger was proposed in July 1997 but was also vetoed for similar reasons. Another proposal made in August 1996 under which Australis and Optus would share satellite infrastructure (while still trading separately) was approved by the ACCC but later blocked by the Australian Federal Court.
With hopes of a merger dashed and serious cashflow problems continuing to plague the company, Australis relied on "rescue packages" of capital injections from a number of new investors (including Kerry Packer's
PBL
, among others) in order to stay afloat.
On 18 May 1998 the Supreme Court of New South Wales
declared that Australis was insolvent and the company went into liquidation. It has been estimated that losses totalled A$800 million. Of those who purchased assets after the company's collapse, the biggest beneficiary was likely their biggest competitor Foxtel
, who were able to purchase Galaxy's 65,000 remaining subscribers as well as terminate their crippling programming deal and renegotiate directly with the studios.
There has been considerable controversy over the role Foxtel may have played in Galaxy's demise: in 2003 it was the target of legal action by Australis bondholders, who sued Foxtel's parent company News Corporation for the $6 billion which they alleged Australis would have earned had it not lost the rights to the programming content.
and Arena, are still part of the basic entertainment package on Foxtel, Galaxy's sport service became Fox Sports
, Galaxy's music channel Red was renamed Channel V
in 1997, and Galaxy's two movie channels are still running today as Showtime Australia
.
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
via satellite
Satellite television
Satellite television is television programming delivered by the means of communications satellite and received by an outdoor antenna, usually a parabolic mirror generally referred to as a satellite dish, and as far as household usage is concerned, a satellite receiver either in the form of an...
and wireless cable (microwave) delivery methods.
Galaxy was founded in 1993, and begin test broadcasting on 1 January 1995 via microwave, making it the first provider of pay-TV services in the country. It was officially launched on Australia Day (26 January).
At launch only two channels were fully operational, the local Premier Sports
Fox Sports (Australia)
Fox Sports is an Australia group of sports channels. They are owned by the Premier Media Group, which is in turn owned by News Corporation, and Consolidated Media Holdings. Its main competitors are ESPN, which has little local content and the free-to-air digital channel One HD...
and international news channel ANBC. Digital satellite broadcasts began in September 1995.
Galaxy was a joint venture between Continental Century Pay-TV and Australis Media. Each held licenses allowing them to provide four channels of satellite delivered television
Continental Century Pay-TV and Australis Media held exclusive licenses to broadcast pay-TV in Australia via satellite until 1997. Their main competitors were Foxtel
Foxtel
Foxtel is an Australian pay television company, operating cable, direct broadcast satellite television and IPTV services. It was formed in 1995 through a joint venture established between Telstra and News Corporation....
and Optus Vision, both of which operated separate cable
Cable television
Cable television is a system of providing television programs to consumers via radio frequency signals transmitted to televisions through coaxial cables or digital light pulses through fixed optical fibers located on the subscriber's property, much like the over-the-air method used in traditional...
networks. The Galaxy channel package was franchised to CETV (Later Austar)
Austar
Austar is an Australian telecommunications company. Its main business activity is Subscription Television but it is also involved with internet access and mobile phones...
and East Coast Television (ECTV) in regional areas.
At its peak, there were around 120,000 Galaxy subscribers. The service ceased shortly after Australis Media went into liquidation on 18 May 1998.
History
In January, 1992, the Government of AustraliaGovernment of Australia
The Commonwealth of Australia is a federal constitutional monarchy under a parliamentary democracy. The Commonwealth of Australia was formed in 1901 as a result of an agreement among six self-governing British colonies, which became the six states...
called tenders for Australia's first pay-TV licenses. Surprisingly, the first license was purchased not by one of the major media players but by an entrepreneur, Albert Hadid, who quickly onsold it for a rumoured $33 million profit. The licenses ultimately ended up in the hands of Continental Century Pay-TV, a joint venture between Australian venture capitalist CVC and US cable company Century Communications and Australis Media, an upstart company in which TCI
TCI
-Medicine:*Transient Cerebral Ischaemic attack, see Transient ischemic attack*Tricyclic antidepressant medication*Target Controlled Infusion, a method for controlling intravenous infusions.-Psychology:*Theme-Centered Interaction, a method of psychotherapy by Dr...
and Guinness Peat Group
Guinness Peat Group
Guinness Peat Group is an investment holding company with interests in Europe, Australia and New Zealand.-History:The company, which had been formed as an investment offshoot of the London-based investment bank Guinness Mahon in the 1980s, was acquired by Brierley Investments Limited in 1990...
were major shareholders. Australis paid a total of A$333 million for the satellite and microwave licenses they would require to launch a pay-TV service to be branded Galaxy.
Galaxy secured contracts with three major Hollywood studios - Columbia TriStar, Universal Studios
Universal Studios
Universal Pictures , a subsidiary of NBCUniversal, is one of the six major movie studios....
and Paramount Pictures
Paramount Pictures
Paramount Pictures Corporation is an American film production and distribution company, located at 5555 Melrose Avenue in Hollywood. Founded in 1912 and currently owned by media conglomerate Viacom, it is America's oldest existing film studio; it is also the last major film studio still...
(the latter two both partners on a joint venture, United International Pictures
United International Pictures
United International Pictures is a joint venture of Paramount Pictures and Universal Studios , to distribute some of the two studios' films theatrically outside the United States , Canada, and the Anglophone...
)- for the exclusive first-run rights to broadcast their film and TV product on its Galaxy service. The output of these studios formed three channels — Showtime
Showtime Australia
For the American service, see ShowtimeShowtime Movie Channels is an Australian pay-TV movie service, available on the Foxtel, Optus and Austar TV platforms, the service consists of five original channels , three HD simulcasts For the American service, see ShowtimeShowtime Movie Channels is an...
, Encore
Showtime Australia
For the American service, see ShowtimeShowtime Movie Channels is an Australian pay-TV movie service, available on the Foxtel, Optus and Austar TV platforms, the service consists of five original channels , three HD simulcasts For the American service, see ShowtimeShowtime Movie Channels is an...
and TV1
TV1 (Australia)
TV1 is an Australian cable and satellite channel available on Foxtel, Austar and Optus Television's subscription platforms.-History:TV1 launched as part of the original Galaxy lineup. The channel is jointly owned by Sony International Television, Universal Studios and Paramount. The channel shows...
— that would become the mainstay of Galaxy's programming.
After the remaining output from the major studios was purchased by Optus Vision, Galaxy's other competitor, the News Corporation
News Corporation
News Corporation or News Corp. is an American multinational media conglomerate. It is the world's second-largest media conglomerate as of 2011 in terms of revenue, and the world's third largest in entertainment as of 2009, although the BBC remains the world's largest broadcaster...
and Telstra
Telstra
Telstra Corporation Limited is an Australian telecommunications and media company, building and operating telecommunications networks and marketing voice, mobile, internet access and pay television products and services....
owned Foxtel
Foxtel
Foxtel is an Australian pay television company, operating cable, direct broadcast satellite television and IPTV services. It was formed in 1995 through a joint venture established between Telstra and News Corporation....
, was forced into an embarrassing deal to purchase content from Australis at a reported cost of A$4.5 billion over 25 years.
Galaxy, along with Austar
Austar
Austar is an Australian telecommunications company. Its main business activity is Subscription Television but it is also involved with internet access and mobile phones...
were the providers for the Sega Channel
Sega Channel
Sega Channel was a project developed by Sega for the 16-bit Sega Mega Drive/Genesis console. Starting in December 1994, Sega Channel service was provided to the public by Time Warner Cable and TCI, which later was acquired by AT&T during its cable acquisition spree that formed AT&T...
in Australia for Sega Australia (known then as Sega Ozisoft
Sega Ozisoft
Namco Bandai Partners is an amalgamation of several former Atari offices located in PAL territories, which were acquired beginning in 2009 by Namco Bandai Holdings. The acquisitions came on the heels of Atari's financial difficulties, which had begun to snowball in 2006...
).
Despite this lucrative deal, the financial situation at Australis was troubling. The installation cost of equipment was high (reportedly around $500 for a microwave antenna and $1000 for a satellite dish), forcing them to greatly subsidise installation costs. Furthermore, increased competition from Foxtel
Foxtel
Foxtel is an Australian pay television company, operating cable, direct broadcast satellite television and IPTV services. It was formed in 1995 through a joint venture established between Telstra and News Corporation....
and Optus Vision forced Galaxy to lower prices further or lose customers.
The financial crisis at Australis meant that much of Galaxy's life seemed to be spent trying to save the company from receivership. In October 1995 a merger was proposed by Australis and its biggest rival, Foxtel
Foxtel
Foxtel is an Australian pay television company, operating cable, direct broadcast satellite television and IPTV services. It was formed in 1995 through a joint venture established between Telstra and News Corporation....
. The proposal was rejected by the Australian Competition and Consumer Commission
Australian Competition and Consumer Commission
The Australian Competition and Consumer Commission is an independent authority of the Australia government. It was established in 1995 with the amalgamation of the Australian Trade Practices Commission and the Prices Surveillance Authority to administer the Trade Practices Act 1974...
, citing fears that a merger between the two businesses would stifle competition. Another Australis-Foxtel merger was proposed in July 1997 but was also vetoed for similar reasons. Another proposal made in August 1996 under which Australis and Optus would share satellite infrastructure (while still trading separately) was approved by the ACCC but later blocked by the Australian Federal Court.
With hopes of a merger dashed and serious cashflow problems continuing to plague the company, Australis relied on "rescue packages" of capital injections from a number of new investors (including Kerry Packer's
Kerry Packer
Kerry Francis Bullmore Packer, AC was an Australian media tycoon. The son of Sir Frank Packer and Gretel Bullmore, the Packer family company owned controlling interest in both the Nine television network and leading Australian publishing company Australian Consolidated Press, which were later...
PBL
Publishing and Broadcasting Limited
Publishing and Broadcasting Limited was one of Australia's largest companies, with interests primarily in media and gaming. The company demerged in late 2007, spinning out its gaming interests into Crown Limited...
, among others) in order to stay afloat.
On 18 May 1998 the Supreme Court of New South Wales
Supreme Court of New South Wales
The Supreme Court of New South Wales is the highest state court of the Australian State of New South Wales...
declared that Australis was insolvent and the company went into liquidation. It has been estimated that losses totalled A$800 million. Of those who purchased assets after the company's collapse, the biggest beneficiary was likely their biggest competitor Foxtel
Foxtel
Foxtel is an Australian pay television company, operating cable, direct broadcast satellite television and IPTV services. It was formed in 1995 through a joint venture established between Telstra and News Corporation....
, who were able to purchase Galaxy's 65,000 remaining subscribers as well as terminate their crippling programming deal and renegotiate directly with the studios.
There has been considerable controversy over the role Foxtel may have played in Galaxy's demise: in 2003 it was the target of legal action by Australis bondholders, who sued Foxtel's parent company News Corporation for the $6 billion which they alleged Australis would have earned had it not lost the rights to the programming content.
Legacy
After Australis's insolvency, its eight channels continued to run on the Foxtel platform, and six of them are present in some form on all the major pay television providers in Australia. Two of Galaxy's general entertainment channels, TV1TV1 (Australia)
TV1 is an Australian cable and satellite channel available on Foxtel, Austar and Optus Television's subscription platforms.-History:TV1 launched as part of the original Galaxy lineup. The channel is jointly owned by Sony International Television, Universal Studios and Paramount. The channel shows...
and Arena, are still part of the basic entertainment package on Foxtel, Galaxy's sport service became Fox Sports
Fox Sports (Australia)
Fox Sports is an Australia group of sports channels. They are owned by the Premier Media Group, which is in turn owned by News Corporation, and Consolidated Media Holdings. Its main competitors are ESPN, which has little local content and the free-to-air digital channel One HD...
, Galaxy's music channel Red was renamed Channel V
Channel V Australia
Channel [V] Australia is an Australian subscription television music channel, and also the newest Channel [V] channel. It is available on Foxtel, Optus TV and Austar satellite and cable services...
in 1997, and Galaxy's two movie channels are still running today as Showtime Australia
Showtime Australia
For the American service, see ShowtimeShowtime Movie Channels is an Australian pay-TV movie service, available on the Foxtel, Optus and Austar TV platforms, the service consists of five original channels , three HD simulcasts For the American service, see ShowtimeShowtime Movie Channels is an...
.
External links
- Australis Background - an in-depth log of the life of Australis Media
- Rupert's killer of a deal - a news article on the allegations that Foxtel unfairly contributed to Galaxy's death.
- An extract from Mark Westfield's 'Gatekeepers' which recounts the negotiations between Australis and PBL for the first rescue package.
- The Demise of Australis - an editorial using the death of Galaxy as an example of the negative effects of Australian media regulations.
- Online news article announcing that Australis has collapsed.