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Orange and Vivendi's pay-TV arm strengthen commercial ties
July 11, 2017 / 1:44 PM / 2 months ago

Orange and Vivendi's pay-TV arm strengthen commercial ties

* Looking to win more customers with premium content

* Orange to spend 100 mln euros over 5 years on TV series

* Aiming to double Orange/Canal Plus customer numbers

By Mathieu Rosemain

PARIS, July 11 (Reuters) - France’s biggest telecoms operator Orange said on Tuesday that it had deepened its commercial ties with Vivendi’s pay-TV Canal Plus in a bid to lure more customers with premium movie, sports and other TV content.

The announcement ends months of talks between the two groups, although it marks a scaling back from the Canal Plus buyout scenario which Orange chief executive Stephane Richard had floated at the end of last year.

It also highlights the challenges Orange and media giant Vivendi face in a rapidly-changing sector, marked by new competition from providers of on-demand Internet streaming media such as Netflix and Amazon, as well as the aggressive push in France of telecoms and cable group Altice into broadcasting sports matches.

Orange will in coming months distribute Canal Plus’s French channels to ultrafast broadband customers, the company said, without elaborating on the price that will be offered.

This means Orange will directly charge those within this client category (fiber optic offers) who wish to add Canal Plus’s channels to their Orange contract, two sources close to the matter told Reuters.

Until now, Canal Plus was the only entity able to charge customers for the TV content it owns.

Orange boss Richard told reporters there were 900,000 Orange customers that also subscribe to Canal Plus, adding that the company aimed to double this number by 2020 via the new deal.

Orange Content, the new specialist unit within the group, will also consider acquiring distribution rights. Earlier this year, Orange said it was interested in working with Canal Plus on acquiring sports rights rather than trying to buy a stake in the pay TV business.

Orange is also planning to spend 100 million euros ($114 million) over 5 years on TV series, the company added.

Pressure has been mounting on Vivendi and Orange lately after Altice, owner of France’s second-biggest telecoms operator SFR and with deep pockets in terms of spending power, won the rights to broadcast European Champions League soccer matches until 2021 in France.

SFR also bought English soccer’s Premier League rights for three seasons starting in 2016.

Competition is also fierce regarding original TV content.

Orange announced in March a new multi-year contract with U.S. broadcaster HBO, the owner of hit-show “Game of Thrones”, allowing it to become HBO’s sole distributor in France.

For its part, Altice signed exclusive distribution deals last year with Discovery Communications and NBCUniversal for all SFR platforms.

$1 = 0.8771 euros Reporting by Mathieu Rosemain; Editing by Sudip Kar-Gupta

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