Canal Plus to Shut Down SVOD Service CanalPlay, Blames Anti-Trust Board Regulations

Canal Plus Group is set to shut down its subscription-based VOD service CanalPlay, which launched seven years ago and saw its subscriber base plummet in late 2015 in the wake of Netflix’s debut.

Canal Plus Group president Maxime Saada told the Senate Committee on Culture that the group’s streaming service had been greatly penalized by the strict regulations imposed by France’s broadcasting authorities and the anti-trust board that banned CanalPlay from having exclusive rights to content it developed and produced.

“Right when Netflix launched, the anti-trust board banned CanalPlay from having exclusive rights to content. Back then we had 800,000 subscribers, now we have 200,000 of them,” Saada said.

“This ban has just been lifted, but it’s too late. In two years, we’ve been crossed off a market, which is gradually replacing linear TV,” Saada said, adding that if French lawmakers didn’t improve the conditions for Canal Plus Group, “French fiction will also disappear.”

“Again, the anti-trust board is putting us in a a grotesque situation whereby we lose international rights to our own shows after three and a half years. We have to buy them back in order to exploit internationally,” Saada said. “Only in France do we see that. It’s not that way in the U.K., Spain, or Italy.”

Canal Plus recently struck a deal with DirectTV to launch a Canal Plus International channel in the U.S., but its slate doesn’t include some of the group’s hit original shows — “The Bureau,” “Versailles,” and “Baron Noir” — because Canal Plus doesn’t own global rights to those series.

However, Saada did not blame the country’s strict windowing schedule, which forbids streaming services from accessing films for 36 months after their theatrical releases. Indeed, Canal Plus has not been pushing for a drastic change in the windowing schedule because it’s primarily lobbying for reforms that will preserve the interests of its pay-TV channel Canal Plus.

The Canal Plus chief said the company was also greatly penalized by France’s fiscal regime, which neither Netflix and Amazon are subjected to because they’re not headquartered in France.

“The reality is that we’re walking with a ball and chain while being faced with rival players who have way more resources than we do,” Saada said.

Saada said Canal Plus invests more than $3.2 billion (€3.7 billion) annually in content, including series, films, and sports. “By comparison, Netflix invests $8 billion per year in content. That’s two times more than Canal Plus, but Netflix is present in 190 countries while Canal Plus is in 30 countries.”

He said the group didn’t intend on cutting its investment in films going forward, especially now that it’s lost broadcast rights to French Premier League soccer to Mediapro, because movies are driving subscriptions.

Canal Plus has to inject 12.5% of its annual turnover in pre-acquisitions of French and European films. Due to the decline in its annual revenue, the company’s investment has inevitably dropped, but Canal Plus is still considered to be a pillar of the French film industry.

“We invest between €170 million to €200 million per year in French films — that’s more than 100 French films, about half of which are first and second films,” Saada said.

The French executive also said Vivendi, Canal Plus Group’s parent company, was well-positioned to counter the hegemony of U.S. culture, and deliver original and sophisticated content from Europe, or even Africa, that could give audiences an alternative to Hollywood movies which are often skewed toward young adults.

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