One.Tel in the eye for Murdoch

NEWS Britian's favourite media mogul has received another blow from the New Economy, with his discount telco/ISP venture One.tel going into administration. The company has been criticised for over-expanding too rapidly, from its home market in Australia to France, Germany, the Netherlands, Switzerland and the UK. The company claims to have 2.4 million customers globally. The administrators have promised to keep the Australian service going for the time being, but the future of the European services is more doubtful. Shareholders in One.Tel included News Corp, and Publishing and Broadcasting, run by two of the most colourful characters in Australian Business, Rupert Murdoch and Kerry Packer respectively. Scions of the two antipodean media families, Lachlan Murdoch and James Packer, oversaw the investments in One.Tel. Today they said that they had been "profoundly misled," about the financial health of the company, according to Reuters. The two companies have invested $467m over the years, and together they own 40 per cent of the company. The company's biggest creditor is believed to be Lucent, which lent the company $560m to build a mobile phone network. Shares in the company were suspended yesterday, by which time they had fallen to around Aus$0.19 ($0.10) - well below their peak price of Aus$12 ($6.15). Earlier this year Murdoch suffered another defeat in the world of new media, with 400 losing their jobs as three Fox TV channels scaled back their websites to cut costs.