Canal+ Tries To Keep Football TV Rights
Canal+ is facing the possibility of losing rights to broadcast French football between 2004 and 2007. Canal+’s main rivals, TF1 and M6, are increasing pressure on Canal+ about the football rights, currently worth around 380 million euros ($374 million) a year for top league matches. The rights are currently shared between Canal+ and satellite pay-TV rival TPS.
Combined with the financial problems of Canal+’s parent Vivendi Universal, it would be a major shock if Canal+ were to lose the football rights. Operators have until Nov. 12 to submit their bids for the rights to the French Professional Football League. The rights would cover the first and second division games between 2004 and 2007, as well as league cup matches between 2003 and 2006. The league has also tried to hold an auction for the rights in an effort to stop Canal+ and TPS teaming up to reduce the amount they pay for the rights.
For TF1 and M6, owners of the TPS platform, such a strategy seems inherently risky. Jean-Antoine Breuil, a media equity analyst at CDC-IXIS Securities, told Interspace: “We don’t think TPS would like to have all the pay-TV rights for [football] in France. It is a huge amount of money. I don’t think M6 and TF1 via TPS would like to make an offer of 380 million euros a year for these rights. I don’t think this price is right.” Jacques Falzon, a media equity analyst at KBC Securities told Interspace: “TPS is expecting to break even next year so it doesn’t have a huge loss to carry. But, if they want to own the rights now, that means they would have losses for some years. You would also have to migrate Canal+ subscribers to TPS for example.”
For Canal+, losing football TV rights would be nothing short of catastrophic. Canal Satellite, its pay-TV platform, has great strength in the area of sports broadcasting. French football rights are considered a jewel in the crown, and without them, Canal+ is severely weakened, both in terms of its premium channel and its pay-TV operation. Falzon said: “It could be very big. Roughly 40 per cent of Canal+ subscribers get the channel because [of the football coverage].” Breuil added: “We think Canal+ will have an interesting offer for all the matches. It is quite important for them. When you compare the Canal+ premium offer in sports to TPS, Canal+ has a strong leadership here.”
Vivendi has dampened speculation that Canal+ is for sale. Jean-Bernard Levy, one of Vivendi’s top executives, sent around an e-mail to the company’s employees quashing a rumour generated by a recent story in Le Monde that linked Pathe and TF1 and Belgian financier Albert Frere in a consortium bidding for Vivendi’s 48.5 per cent stake in Canal+.
–Mark Holmes