Rupert Murdoch could soon emerge as chairman and largest single shareholder of the world's first truly global satellite TV empire under the terms of a tentative $70bn merger that would reportedly knit together his existing necklace of international satellite operations with those of US-based DirecTV.

According to reports in both this morning's Financial Times and Wall Street Journal, talks have now intensified on a complex merger proposal that would also bring in two media titans with vested interests of their own in establishing their digital interactive TV technologies: Liberty Media's John Malone and Microsoft's Bill Gates (who would chip in as much as $4bn-$5bn).

The broad outlines of an agreement for this programming powerhouse have been supposedly hammered out under which General Motors Corp would spin off its Hughes Electronics division that currently houses DirecTV. This would then be merged with Murdoch's Sky Global Networks and floated as an independent public company that would be steered by his News Corp on a day-to-day basis.

Numerous other details, however, have yet to be settled before the mammoth deal can be truly considered done. Indeed, GM itself is denying that such a deal is only a matter of weeks away and has questioned the reported price-tag. "There is nothing to confirm," Toni Simonetti, GM's general director of communications reportedly told Reuters. "We are still in a state of discussion with more than one interested party with respect to Hughes," she said.

Sky Global Networks, which would comprise around 36% of the assets pooled within the proposed new operation, recently delayed its own IPO in anticipation of a merger with Hughes and DirecTV. Its collected interests include News Corp's stakes in the UK's BSkyB (38%), Asia's Star (fully-owned), Italy's Stream (42%), Latin America's Sky Multi-Country Partners (30%) and Japan's SkyPerfecTV (10%).

With some 10 million subscribers and a 65% share of the US direct-to-home market (not to mention a few million more viewers scattered across Asia and Latin America), DirecTV has become an enormously attractive proposition for media giants like Murdoch and Malone now worried that they are about to be locked out of the high-speed broadband distribution networks being rolled out on the ground by cable behemoths like AT&T and Time Warner. Among the other studio conglomerates who have previously been linked with a DirecTV merger - some of whom may still be talking - are Sony, Viacom, Vivendi Universal and Walt Disney.

While appropriately stratospheric for a business that descends from the sky, DirecTV's reported valuation comes despite the fact that the number of new satellite subscriptions has been levelling off recently after a period of furious growth.

With its share price slumping last year, GM had come under fire from Wall Street for not making an easy killing through spinning off the Hughes division that generates so much cashflow through its prized satellite TV assets.

A few months ago, it then became clear that both Murdoch and Malone would be interested in ganging up together in a joint assault on the world's airwaves when they unveiled a $6.4bn share-swapping manoeuvre that left both tied at the hip. The biggest missing piece in their patchwork of international satellite interests was North America, a satellite market that has proved frustratingly elusive to Murdoch for more than a decade now.

The addition of Microsoft into the equation is something of a new surprise but shows how desperate Gates has become to ensure that his operating software becomes the de facto standard for the next generation of set-top boxes. Similarly, Murdoch and Malone are banking that Gemstar's potential as a provider of electronic programme guides (EPGs) will provide them with the on-screen key for unlocking the personalised TV revolution begun by the Internet.

Control the interactive search engines, so the thinking goes, and you control all the potential commercial traffic that may stem from all that channel hopping and web browsing.

Shares in News Corp, which is scheduled to release its second quarter earnings later today in New York, jumped 5.6% in Australian trading on Wednesday once the reports had surfaced.