Taking on Rupert in Italy

By Jeff Israely/Milan

Italian Prime Minister Silvo Berlusconi and Rupert Murdoch were always considered friendly rivals. They have even spent time together at Berlusconi's Sardinian villa. But the competition may be heating up. The Mediaset TV network, owned by the Berlusconi family, is taking direct aim at Murdoch's Sky Italia with an innovative attempt at poaching lucrative soccer viewers. As the world's first free TV network to offer pay-per-view sporting events, Mediaset surprised Murdoch & Co., whose satellite rights until recently meant an exclusive on top-flight matches. "We bought the whole cake, which has now become just a slice," a Sky executive griped. Mediaset paid nearly $146.5 million to secure the terrestrial rights for the top Italian clubs for the next three years. Viewers watch the games by inserting a prepaid card (six matches for $22) into a digital box. Since January, the company has sold more than 1.5 million cards. The idea is catching on: the Telecom Italia-owned La7 station sells a similar card that lets viewers see smaller teams play. --By Jeff Israely/Milan