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Canal+, beIN distribution deal outlawed

France’s competition watchdog the Autorité de la Concurrence, has ruled against the proposal for exclusive distribution of beIN Sports channels within Canal Group offers.

In a Statement noting the decision, the Canal+ Group said it  have to work on alternative solutions to stop the losses at the French Canal+ channels.

The pair confirmed on February 19th that they were in detailed talks to establish a partnership in the form of an exclusive distribution agreement. Under this agreement, all beIN Sports channels in France would be available through Canal+ offers exclusively. It would have covered a five-year period.

In announcing its financials, Canal+ parent company Vivendi had issued a stark warning: “[Vivendi] cannot on a long term basis continue to finance the losses of Canal+ channels in France.”  Vivendi said that the pay-TV unit posted negative EBITA of €264 million last year, an increase in its losses of €76 million year-on-year. It says it has invested over €1.5 billion in Canal+.

Vivendi warned “this situation threatens the entire Canal+ Group, which employs 8,200 people and is a major player in the financing and development of the movie industry”, it said that it has set making the group break even by 2018 a priority for its new management team, which will involve increasing investment in original content and premium content and improving the user experience. It added that this would be done in an “essential cost-efficient manner”.

A big step in reorganisation is the beIN Sports deal and it said the partnership would allow both channels to bring to their customers an improved offer, while providing sports competitions with a wider exposure. The deal would allow Canal+ Group to market a comprehensive and coherent sports offer. beIN SPORTS would benefit from the expertise and distribution know-how of Canal+ to collectively attract larger numbers of subscribers.

Canal+ and beIN SPORTS, which would both retain their identities, brands and editorial autonomy, would continue to respond independently to sports rights tenders. At the time Canal+ said it was indeed in the interest of all stake-holders (Leagues, clubs, broadcasters, etc.) that sports events were as well-funded as possible in order to provide French homes with high-quality sports shows.

It said the partnership would also benefit and create value for the French TV and films production industry, in which Canal+ is the largest investor in France.

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