Pascale Paoli-Lebailly ©RapidTVNews | 09-09-2011

In an unexpected turn, French pay-TV group Canal+ is to take over of 60 % of French DTT channels Direct 8 and Direct Star.

The channels were bought in a deal, still requiring approval from TV regulator CSA, said to be worth €279 million from Bolloré Média which will retain the remaining 40 % and will be paid into Vivendi shares.

The deal marks Canal+’s entry into the French FTA market and it will embark on a strategy of finding new revenue sources as the arrival of connected TV will shake up the broadcasting market in France.

The group already owns DTT news channel I>Télé, which is not competitive with established players to TF1 and M6 who offer TMC, NT1 and W9. Canal+ will take over Direct 8 and Direct Star as the future of its previous FTA project, Canal 20, is still uncertain. This project is born from the possibility of TF1, M6 and Canal+ each receiving a bonus DTT channel to compensate for the digital switchover and the advent of competing channels.

Yet the EU is against the idea of bonus channels and has not yet decided over the case, while TF1 and M6 were ready to give them up if it could prevent Canal+ to invade their space.

Now by taking over Bolloré’s DTT channels Canal+ has by-passed the problem. Direct 8 reached 2.4 % audience share in August 2011 and Direct had 2.3 %. Both have broken even. Yet Bollore’s interest in such an alliance is not so clear. Bolloré Média ensured that the development of Direct Star and Direct 8 into the competitive DTT market needed to be strengthened by such an alliance with a bigger group.