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A Question of Value: No Deal – Yet – On Canal PlusFor months Vivendi and Lagardère have been meeting to restructure Canal Plus Groupe. The negotiations restarted in earnest earlier in June when the two media giants agreed on structures. Reuters (June 24) reported that a “final solution” – meaning the money – “is yet to be reached.” Under the agreed basic structure Vivendi will control 66% and Lagardère the rest.
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Keep an Eye on Lagardère: Media Revenues Up 8%, Dumps Most of Its T-Online Stake, Readies Investment in Le Monde and Canal Plus, and Has Eyes Set Firmly on US Expansion Pushing the Switch Slowly European Commission Sends Broadcasters New Signals Murdoch Takes a Pragmatic View of the European Media Scene: The Satellite TV Business is Good and Free Tabloids Hurt Paid-For Newspapers Spectrum Freed! No Injuries Reported! French, Spanish and Italian Financial Backers Provide Le Monde With Much Needed Financial Support |
French media companies have been scrambling in the last two years to catch up with the rest of Europe. French regulator Conseil Supérieur de l’Audiovisuel (CSA) has fought an up-hill battle with broadcasters and legislators to get digital media rolling. Now that it is, the biggest names in French media want to firm up their positions. The legal framework for digital terrestrial television in France was created in 2002.
The CSA granted 8 new DTT licenses in May for the Télévision Numérique Terrestre (TNT) digital platform. Canal+ picked up one free channel and three of the pay channels and one. Lagardère was awarded one pay channel and two free channels, one of which is a childrens channel joint venture with public broadcaster France Televisions. The remaining DTT license went to NextRadio for a free business news channel. The CSA received 35 bids for the 8 channels.
The 8 new channels bring to 14 the number of DTT offerings on TNT, launched in March by now former Prime Minister Jean-Pierre Raffarin as “la télévision numérique pout tous” – digital television for all.
All the clamoring for DTT – and its potential for audience and advertising – will certainly threaten TF1, which holds about one-third of the French television audience and the majority of TV advertising. TF1 owns the satellite platform TPS.
The “New Canal Plus” would be controlled by Canal Plus Groupe, according to the French daily La Tribune and quoted by Reuters, with Lagardère trading its 34% stake in CanalSat for shares in Canal Plus Groupe. The new company would control 49% the Canal Plus pay channel and 100% of CanalSat. The deal would not include Studio Canal, Canal Plus Poland or the Saint Germain football club.
DTT investors no doubt heard beautiful music when the magazine TéléPoche surveyed its readers and found 19% thinking about the switch from cable or satellite to DTT. The poll also found NRJ 12 – a music TV channel of NRJ Groupe – the favorite new DTT channel and music channel Europe 2 TV – owned by Lagardère – the biggest reason to switch the DTT.
French news agencies AFP and AFX report visits this morning (June 28) to Canal Plus headquarters by investigators. AFP says “searched” and AFX says “raided.”
The subject of investigators visit is the on-going inquiry into financial conditions surrounding the 2002 sale of Canal Plus Technologies to Thomson Multimedia. French Finance Minister Thierry Breton was Chairman of Thomson Multimedia at the time of the transaction. Thomson Multimedia was folded into Thomson SA, which sold part of Canal Plus Technologies to Kudelski Group in 2003.
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Canal Plus Groupe is the leading pay TV operator in France, and the rest of Europe. And digital pay TV (DTT) is winning customers creating heartburn for free-to-air operators slowly moving to digital platforms. But the free DTT channels are causing heartburn for the pay channels.