France’s Vivendi Denies Merger Talks with Orange

Orange CEO Stephane Richard, said on Thursday that Orange would consider bidding for Canal Plus if it came up for sale. He added that the former telecom monopoly is interested in a closer alliance with Canal Plus.

Orange was Canal Plus’ first service distributor, and the two companies recently launched an effort to drive customers to Orange’s broadband fibre network.

Mobile Streaming Heats Up

The acquisition of Canal Plus would allow Orange to challenge their chief telecom competitor, SFR, a subsidiary of Altice.

Altice is busy securing content for its mobile platforms. Last week, Altice announced an exclusive licensing agreement with NBCUniversal.

The company already controls streaming rights for the highly lucrative English Premier League.

Now that Orange, TF1, M6 and France Télévision have abandoned their plans to create a joint-SVOD platform, Canal Play can access Vivendi’s $15 billion cash-pile to go head-to-head with Netflix and SPR.

When AT&T acquired DirecTV for $48.5 billion in 2015, they had big plans to expand into mobile video streaming because the mobile phone market is saturated in North America. The buyout made AT&T the largest U.S. pay-TV operator with 25.3 million video subscribers.

Stemming the Tide of Netflix

Netflix, which launched in France two years ago, has underperformed all expectations.

Lack of popular titles, regulatory challenges, namely France’s Media Chronology Law which sets strict release windows, and the absence of home-grown titles has led to a dismal first year for the streaming giant. The series Marseille was Netflix’s attempt at a local hit, but the program flopped among fickle French audiences.

In a preemptive move of Netflix’s launch, Canal Plus released Canal Play throughout France in 2011.

Currently, Netflix and Canal Play have about the same number of subscribers; slightly more than a million subs each, with Canal Play leading.

In a rash of corporate acquisitions including Mars Distribution and Telecom Italia, Vivendi is poised to create a pan-European streaming service with Canal Play to challenge Netflix in France, Germany, the United Kingdom, and elsewhere in Europe.

More Media in Fewer Hands

AT&T’s $85 billion offer to acquire Time Warner is currently seeking approval in the United States.

This merger is leading a global trend to concentrate more media assets in fewer hands by combining distribution with content creation.

Rupert Murdoch’s Twenty-First Century Fox made another bid last week to acquire Sky, the British pay television network.

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