Murdoch set for NZ voyage

By MICHAEL FOREMAN

Rupert Murdoch's News Corporation is poised to gain a foothold in the New Zealand consumer internet market with the purchase of Voyager's Australian parent, OzEmail.

A source close to Voyager told the Business Herald to draw its "own conclusions" on the local implications of the impending $A500 million ($625 million) acquisition from MCI Worldcom.

The move would make the media magnate a significant transtasman internet service provider.

News Corporation would acquire Voyager's consumer business as Voyager moved its business and wholesale customers to a faster "business class" network operated by OzEmail's controlling company, MCI Worldcom subsidiary Uunet.

Voyager claims to be New Zealand's fourth-largest internet provider, with more than 27,000 customers. Most of these are residential users, although business users account for 60 per cent of Voyager's revenue.

OzEmail, with about 400,000 users, is Australia's second-largest provider, behind Telstra with 500,000 users.

Uunet and News Corporation both declined to comment yesterday on the acquisition. Aileen Berry, the Sydney-based director of corporate affairs at News Corporation subsidiary News Ltd, said reports of the acquisition "fell into the realm of market speculation".

Regardless of whether the Murdoch deal goes ahead, Uunet plans to cream off Voyager's business customers following a similar split of OzEmail last July. Uunet spokesman Mike Ward said migration of business customers to the new network would not begin until "after Y2K".

Uunet would become more visible with the New Zealand rollout of its business network but Mr Ward would not confirm details of MCI Worldcom's rumoured $30 million investment in the high-speed network.

Uunet's arrival would complete the split of Voyager into three components since its acquisition by MCI Worldcom earlier this year.

Uunet announced last month that OzEmail Interline had sold the "intellectual property and contractual rights" of its internet telephony business, known in New Zealand as Voyager Phone, to United States-based ITCX for an undisclosed sum.

Mr Ward said it was too early to comment on the ITCX deal, but OzEmail Interline and Voyager Phone would remain affiliates in ITCX's global network.

Voyager confirmed yesterday that its general manager, Brent Smith, was leaving to head Australian public internet booth start-up E-phone.

Robert Davis, formerly a senior sales executive at Voyager, would replace Mr Smith, taking the new title of general manager, Voyager Residential.