French Court to Decide on News Channel's Planned Free-to-Air Move Next Year

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The court will hear TF1's second case in the new year, but it may be too late to save the CNN-style channel

France's Council of State high court has rejected an emergency application filed by TF1 Group to move its 24-hour news channel LCI off of pay TV packages and take it free-to-air.

The court will hear a second case, filed concurrently, some time in early 2015, which the judge cited in the ruling issued Thursday, but the future of the channel remains in the balance.

The judge found that LCI was “not in an emergency situation,” and “the financial difficulties highlighted by LCI, even compounded by the refusal of the transition to free-to-air, do not prevent the company from waiting for the final decision."

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TF1 has sought to move the channel free-to-air, citing a sluggish advertising market and and saying it could increase viewership and strengthen its bottom line if it is free-to-air. DTT competitor BFMTV has about 200,000 viewers on average per quarter hour, compared to LCI’s 13,000.

In July, the Superior Audiovisual Council (CSA), which regulates the French airwaves, refused TF1’s application to move LCI, citing the sluggish ad market overall and saying that it would cause harm existing channels, which have also been struggling with steady and continuing ad market declines. CanalPlus’ iTele and NextRadioTV Group’s BFMTV opposed the move, saying it would hurt their businesses. 

TF1 Group, home to France’s top-rated broadcast network, launched France’s first CNN-style news network in 1994.

While the judge said the court will still hear the second case, that may be too late to save the network. TF1 has threatened to shutter the channel as soon as Dec. 31 if it is not permitted to take it free-to-air.

A plan to restructure the channel and reduce its operations to a few daily hours of news and move content to apps and digital delivery – which would eliminate 148 jobs – was rejected by employees earlier this month.   

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Owners of newspaper and publishing group Le Monde, principal shareholders Pierre Berge, Xavier Niel and Matthieu Pigasse have expressed interest in buying the channel, but TF1 has been resistant in what has become a very public battle through interviews and issued public statements.

Le Monde CEO Louis Dreyfus said in an interview earlier this week that a formal takeover offer had been sent to TF1 CEO Nonce Paolini, and that it is willing to take all employees and keep the channel’s pay-tv berth, though financial terms were not disclosed. TF1 shot back with a statement saying Le Monde’s move was “smokescreen” that “merely invites TF1 to enter into negotiations for a hypothetical proposed acquisition.”

Updated, 10:33 p.m.: TF1 issued a statement saying it will seek to keep the channel alive until June 30, 2015 by extending existing contracts with carriers such as CanalSat and Numericable that are set to expire Dec. 31, 2014, while awaiting the court's next decision.

"Given the schedule proposed by the [Council of State] and the declarations made by some distributors at the hearing, as related by the judge in his ruling, LCI is launching a consultation process with the distributors with a view to obtaining in particular an extension of existing contracts through to June 30, 2015. The employee representatives of TF1, LCI and e-TF1 have been informed."

 

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