The French Superior Audiovisual Council publishes its favourable opinion on the Salto project
Referred to by the Competition Authority on May 2, 2019, the French Superior Audiovisual Council issued a favorable opinion on July 17, 2019 for the creation of the Salto project.
This project, born of a joint initiative by the France Télévisions, M6 and TF1 groups, consists in creating an online audiovisual service that will, in particular, distribute the live and catch-up TV offerings of the free-to-air DTT channels edited by the parties, any TV services and/or SMADs from third-party editors that Salto may decide to take over according to its editorial line, and edit a subscription video-on-demand (SVOD) supply.
The Conseil's opinion was issued after hearing the parties and players in the audiovisual industry (publishers, distributors, authors, program distributors and producers), and taking into account their responses to the questionnaires sent to them by the Conseil.
A response to developments in usage
Non-linear consumption of audio and video content on screens other than the TV set is growing rapidly, both in catch-up TV and in video-on-demand by contract. Publishers therefore need to be present on all media to meet consumer expectations, keep pace with developments with regard to audience rates, and expand their audience and build loyalty.
Salto is a response to this marked development in usage, which powerful services such as Netflix have amplified in recent years.
Salto will enable the three audiovisual groups to achieve a better return on their investments in programs, by providing them with an additional window of exposure, at a time when the television broadcast advertising market is under pressure from strong competition from unregulated and very powerful foreign digital players such as Google and Facebook.
In addition, online self-distribution(over-the-top or OTT) will enable us to maintain a direct relationship with our users and gain a better understanding of their consumption patterns. The value created by the supply (data, audience, advertising revenue, contracts) should be less diluted, even though intermediaries are multiplying and playing a central role in access to content.
A response to competition from powerful foreign groups
This merger between competing historical players in free-to-air channels is a response to the need to generate synergies by pooling some of their assets. The aim is to meet the increasingly fierce competition from international players in the advertising and program acquisition markets. In this respect, the rapid and significant penetration of the French market by foreign SVOD services is set to continue, with the imminent launch of new services such as Disney+.
This type of collaboration between competing publishers is not new. For example, the BBC and the private ITV group have announced the pooling of their programs in the Britbox pay service. The service has been available in the US and Canada since March 2017.
In addition to these editorial initiatives, alliances such as MediaSquare, Gravity and EBX have emerged on advertising markets to enrich publishers' audiences by qualifying them, and to reach a critical size capable of competing with the high-performance targeted advertising supplies of global players.
The Salto project is thus fully in line with the initiatives that have emerged over the last ten years in Europe and across the Atlantic.
An ambitious and innovative project that the French Superior Audiovisual Council fully supports, with effect from the commitments proposed by the three audiovisual groups at the date of the opinion.
The implementation of this joint project by three historic audiovisual groups with a decisive position in free-to-air channels should preserve the diversity of the French audiovisual landscape.
Salto's aim is to promote French and European creation and strengthen the non-linear supply of French free-to-air channels, without depriving competitors of access to diffusion rights in such a way as to significantly affect the diversity of supply.
The position of the three founding groups and their contractual practices in terms of rights acquisition will enable Salto to build up a rich catalogue of programmes, essential to the service's appeal. However, the circulation of works must remain fluid and take place under normal market conditions, enabling rights holders to be fairly remunerated.
On the other hand, Salto's distribution of audiovisual services does not appear likely, in the short or medium term, to alter the balance of the sector in a landscape marked by the importance of distribution via managed networks. However, the Conseil remains attentive to the balance of relations between publishers and distributors.
The Conseil considered that the commitments proposed by the parties and known at the date of the notice were likely to remove the risks identified.
French Superior Audiovisual Council _ Avis Salto
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