A great oral to save the project

A great oral to save the project

To be able to celebrate their marriage at the beginning of 2023, the television groups TF1 and M6 must absolutely convince the Autorité de la concurrence of the merits of their union, or risk having to cancel everything in a sector disrupted by American platforms. Hearings are organized Monday and Tuesday by this institution, in order to negotiate with the chains and their respective owners – the Bouygues and RTL groups (subsidiary of the German Bertelsmann) – and to question competitors and representatives of the sectors concerned. The debates promise to be long, because opinions on the merger are very divided. A report – not public – from the Authority’s investigation services also darkened the prospects for the project, announced in May 2021.

The merger between TF1 and M6 would indeed lead to the creation of a French television giant, with nearly 4 billion euros in turnover. With 75% of the TV advertising market share, the risk is that it will become unavoidable for advertisers and that it will weigh heavily in the already conflicting market for channel distribution, as well as for the purchase of audiovisual programmes. For the Autorité, these are “significant competition problems”, unless very significant remedies are imposed.

Resist streaming platforms

Unacceptable for the two groups, who intend to join forces in order to better resist competition from streaming players (Netflix, Disney, Amazon or even Youtube and Tiktok) who are eating away at their viewing time and attracting ever more advertisers. “The nature and extent of the remedies required in the investigation report would make the project of the parties lose all relevance, which, in this case, would abandon it”, reacted at the end of July.

TF1 and M6, which expect to generate between 250 and 350 million euros in “synergies” thanks to their merger, responded to the Authority in mid-August by offering more limited concessions, in particular the separation of their advertising agencies for three years. or the creation of a separate management for radio (which would bring together those of RTL and Indés Radio, managed by TF1). But “it will surely be necessary to go further” to make the college of the Authority give in, told AFP a source familiar with the matter. According to her, the sale of a secondary channel like W9, which would reduce the advertising market share by a few percentage points, is no longer excluded.

A “failure” for France?

The college – made up of 17 members including magistrates, academics, lawyers, business leaders or consumer representatives – will make its decision in mid-October. The whole issue is whether it intends to redefine the contours of the video advertising market, by integrating the global streaming giants, which would mechanically reduce the weight of French players. The government also has the possibility of overriding a refusal by the Authority if it justifies reasons of general interest.

“If this operation does not take place, it will be a huge failure for France, which had the opportunity to show the way in Europe”, declared to Télérama the boss of M6, Nicolas de Tavernost, appointed to lead the new entity. . It would also be a serious blow for the two groups, which will have to review several projects. In particular, they provided for the sale of the TFX and 6ter channels to Altice, which thus hopes to become the second largest television advertising player, and the purchase of France Télévisions’ shares in the Salto platform. TF1, for its part, has already withdrawn from a certain number of activities linked to marketing and the online press. Finally, Bertelsmann will have to find a new buyer for M6 as soon as possible because the channel’s broadcasting license expires in May 2023. Once it is renewed, any change of shareholder will be prohibited for 5 years.

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