Orange builds linear and non-linear pay-TV offer

Pascale Paoli-Lebailly ©RapidTVNews | 07-04-2012

On 5 April, Orange TV‘s five channels operated by French telco under the Orange cinéma séries (OCS) brand migrated to Canalsat. Still available to Orange TV subs, it is now also accessible to Canalsat ADSL and dish homes as an option.
OCS is accessible either in the movie package, the whole Canalsat formula or as a unique €12/month option. It reports some 371,000 Orange subs and now can potentially reach 60% of Canalsat's 4 million subscribers. Distribution should also extend in the coming weeks to other platforms on a non-exclusive basis.
This deal with Canalsat is the direct result of pay-TV Canal+ Group’s takeover of 33% OCS stakes.
"The commercial launch on Canalsat will start this month and we’re looking forward to hitting more than one million subscribers over the next three years," Serge Laroye told RapidTV News.
Talking at Mip TV in Cannes, Orange's head of content explained the Canal+ deal is one side of Orange’s new content strategy. He stressed that Orange is not disengaging from content, but its priorities have changed.
"Back in 2007, it was considered that a telco needed to offer content to its subscribers. At the time, the Canalsat-TPS merger did prevent us from having access to channels since the deal was based upon exclusive distribution.
"Orange then entered the content sector by creating its own channels from scratch: Orange Sport and Orange cinéma séries, which inked major and expensive exclusive sport and studios TV rights deals," Laroye explained.
Orange launched into content with quite an ambition, but the penetration rate was not large enough to compensate the overall investments. Over the last four years, Orange TV activities accumulated over €800m of losses.
"This first strategic period ends with the Canal+ agreement and the expansion of OCS to other ADSL, cable and dish platforms along with the upcoming closure of Orange Sport. No relevant business model wasn’t really found for it."
Orange Sport is currently received by 400,000 subs which will be offered other sport channels.
"Orange content strategy is more balanced now. The cashflow that will be saved from Orange Sport and OCS will be reinjected into other content," Laroye pointed out.
"We’ve created an extended basic pay-TV bouquet called Extra, carrying 40 TV channels, catch-up TV services and VoD for €14 per month. And we have recently signed deals with M6 and TF1’s theme channels for ADSL and dish distribution. Our logic is now to build a coherent pay-TV offer aggregating TV, VoD and SVoD, in line with the market standard."
Orange TV currently has 4.374 million subs, and offers one of the first French VoD platforms with 7,000 VoD titles available each month. Included into triple play €34.90 line-up Livebox Star, the SVoD service gives unlimited access to some 150 movies. Orange also operates a 3D event niche channel available to equipped HD subscribers.
But besides pay-TV, Orange’s content rocket also focuses on the development of two other stages: the expansion of music pay online service Deezer, which reported more than one million subs last September 2011 and a enhanced involvement into multiplatform games and transmedia projects. After transmedia investigation game Detective Avenue, Orange Transmedia Lab has thus partnered with Lexis Numérique on Alt-Minds, that will mix thrilling web-series, game and social networks.
Facing the emergence of a new eco-system of TV and the arrival of OTT services, Orange aims at being active both on managed and non-managed networks. Already owning 49% of web video platform Dailymotion, French telco has an option to increase its share up to 100% by 2013. Both partners already offer exclusive sport, 3D programmes and concerts online and on mobiles.
"A coherent IPTV offering, along with the development of international Dailymotion and Deezer platforms, will keep Orange's chances to globally answer to the flood of worldwide web giants," Laroye concluded.