BIZ WATCH

By BERNARD BAUMOHL, DANIEL EISENBERG, JOSHUA COOPER RAMO, BILL SAPORITO AND RICHARD WOODBURY

RUPERT'S CABLE COMPROMISE

In the satellite business, just as in real estate, location is everything. So when Rupert Murdoch ended up with satellite slots at 110[degrees] west longitude, he knew he had the equivalent of a condo in Malibu. The position offers panoramic views of the U.S.

But finding the right thing to do with the real estate was surprisingly difficult. Murdoch's ambition--to build a global carpet of satellite dishes--requires a partner to deliver programming to American homes. In February he announced plans to buy a 50% stake in EchoStar, a start-up that owns birds at 119[degrees]. That deal cratered earlier this month, so Murdoch cut a tentative agreement with his adversaries in the cable industry. He may give up rights to his slots in return for nonvoting shares of PrimeStar, the satellite company that includes TCI and Time Warner. He failed to force the cable guys to carry all his programming, but he will get greater distribution. The cable giants get a slice of the best real estate in the sky. It's a rough neighborhood, though: market leader DirectTV lives at 101[degrees].

YOU SANK MY BATTLE CHIP!

Digital CEO Robert Palmer must have known that picking a fight with Intel might start an all-out war. Last week he got one.

Two weeks after Digital sued Intel, claiming patent infringement, the microchip giant struck back with a devastating suit of its own, charging that Digital was misusing confidential information. Worse, Intel--which sold an estimated $150 million of chips to Digital in 1996--threatened to choke off the vital supply. Wrote general counsel F. Thomas Dunlap: "It's unreasonable to think the relationship...can remain the same." In other words, let's starve the s.o.b.s.

Intel, meanwhile, is battling more significant problems. On Friday the firm warned that second-quarter earnings were likely to be softer than expected. In response, the stock stumbled 7%. But insiders say the company is still seeing impressively strong orders for its new Pentium II chips. Given Intel's well-known penchant for strong second-half results, chip watchers expect a rebound. The champ, Digital is learning, is still the champ.

SMOKIN' JOE CAMEL NEAR HIS LAST GASP

He's cool. He's suave. And soon smokin' Joe Camel may also be history. In a 3-to-2 vote last week, the Federal Trade Commission charged that R.J. Reynolds violated federal laws by using Joe to hawk cigarettes to kids. The surprise decision, which reversed a 1994 ruling, was based on internal Reynolds documents that suggest Camel relied on Joe to boost its share of the under-18 market, which has leaped to more than 13% since 1987, when Joe Camel was first introduced in the U.S.; Camel's share of the youth smoking market was then less than 3%. Later this month, the ftc will try to put teeth in its ruling by persuading a court to ban the ad everywhere except in bars and nightclubs, places it hopes even smoking teens won't be.

MICHAEL JORDAN SMELLS MONEY

Chicago Bulls star Michael Jordan didn't win the N.B.A.'s Most Valuable Player award--that went to Utah's Karl Malone. But Jordan could claim another kind of MVP, as in Most Valuable Perfume. His Airness's first shot at fragrances, Michael Jordan cologne, is a swish, with sales flying over $60 million in its first six months.

Jordan is an all-world endorser, but the $23 cologne (1.7 oz.) is his own creation. The line is expanding to include soap, body oil spray and a deodorant. Jordan is turning a fashion/fragrance hobby into more millions. "This is a good way to be creative. It's going to be a career after basketball," he said recently. He mixed the brew with help from venture partner Bijan Fragrances, part of the tony men's fashion house. (Among the essences: fairway grass, rare air, cool.) Colognes have a dismal failure rate, but Jordan didn't risk his own cash. His risk is in his name, and as he points out, "That's enough."