OPTUS WELCOMES ACCC'S DECISION

Chris Anderson, Chief Executive of Optus, today welcomed the ACCC's decision to allow the Optus/Foxtel Content Sharing Agreement (CSA) to proceed.

"The CSA is a breakthrough for Optus. All the very best subscription television content - in movies, sport, general entertainment and other genres - will now be seen on OptusTV.

"In turn, this will significantly strengthen Optus' bundled offerings of telephony, internet and subscription television - because we will now have more appealing subscription television content to bundle with our telephony and internet products.

"Foxtel will assume Optus' financial obligations under our existing subscription television content contracts. This will fundamentally improve the economics of Optus' local loop telephony, broadband internet and subscription television businesses.

"With an improved product offering and better economics, Optus will now be an even more powerful competitor in local loop telephony, broadband services and subscription television.

"Concurrently, Optus will lease to Foxtel a substantial volume of capacity on the Optus C1 satellite, which is scheduled to launch in early 2003."

In summary the agreements will see:

• Foxtel assume Optus' financial obligations under its movie and other content arrangements;
• Optus add Foxtel content to its platform - Optus will also supply some content to Foxtel;
• Optus have the right to resell the Foxtel services until 2010; and
• Foxtel lease a substantial volume of capacity on the Optus C1 satellite.

As Optus disclosed to the market in March, the new content supply arrangements will have an annual EBITDA benefit of up to $30 million per year; and the sale of C1 satellite capacity will generate annualised revenue of around $40 million per year.

"We are pleased the ACCC has approved the transaction, following lengthy and careful review. The new arrangements are good news for our customers; for Optus; and for the Australian pay television industry.

"Today's decision secures Optus' presence as a powerful competitor in local loop telephony, in broadband internet and in subscription television," Mr Anderson concluded.

For more information:
Stephen Woodhill
Phone: +61 2 9342 7850
Mobile: +61 413 318 455