Compared to their US, British and German counterparts, French communication groups are somewhat weak. They are characterized by a low multimedia integration, turnover or profits not sufficient to undertake huge investments and a lack of international dimension20.
As other European broadcasters, French TV national stations enjoy a great advantage for the provision of new services. Their transmitters networks provide an almost universal coverage of the population so that they can quickly reach a critical mass of consumers. Moreover, the provision of new services over terrestrial networks does not require the building up of a new infrastructure: costs will be concentrated in the production facilities and the digital decoders. Yet, despite these advantages, French broadcasters' strategies for IS are rather shy. France Télévision (the public TV company) as well as TF1 (the major commercial TV company) have announced plans to launch digital services in a near future. In January 1995, France Télévision has signed a cooperation agreement with Time Warner which, along with co-production, will include the launch of cable and/or satellite thematic TV channels and the development of multimedia projects. France Télévision is also preparing the launch of France Télévision Interactive in partnership with the media group Havas and the electronics company Thomson to provide services with some level of interactivity through a return path based on the telephone and the Minitel.
Canal Plus, which runs a pay-TV channel with 4 million subscribers, is more dynamic. It has set up a multimedia subsidiary and unveiled plans to pour several million FF in the creation of multimedia products, including video games and cultural products, targeting the global market. It has also signed with the German media group Bertelsmann a 30-year partnership to jointly develop pay-TV and interactive services such as video-on-demand in Europe21. Around 2 billion FF will be devoted to these projects over the next three years. The deal will be complemented by the setting up of two joint ventures. The first will develop the required digital technology. The second will buy programme diffusion rights.
Publishing companies’ strategies
French electronics and publishing group Matra-Hachette is carefully expanding its multimedia activities on both sides of the Atlantic. In Europe, Matra-Hachette is setting up together with France Télécom an interactive video games cable TV channel, Ludo Canal , and has announced the launch of a women cable TV channel based on its best selling women magazine Elle. Matra-Hachette is especially active in the production of CD-ROM titles. In the United States, its subsidiary Grolier has sold two million copies on CD-ROM of its popular school Encyclopedia over the last five years.
As for Havas, the other major publishing French group, its multimedia plans and global strategy are unclear. Havas has certainly to make difficult choice. It is linked both to France Télécom and to Canal Plus, the two of which are competing in various fields, notably the technology for digital pay-TV.
Institutional Structures for Coordination and Implementation: Between State and Market
Policy making and regulation for IS in France
Policy arenas and regulatory traditions
IS put into contact four different policy arenas:
· the electronic goods sector which has been to competition for a long time open. There is no barrier to entry; regulatory constraints are weak, or non-existent, and mostly related to consumer protection (safety standards for example). Public policy in this field has mainly consisted in subsidies aimed at fostering domestic companies. On occasions, protectionist attempts have taken place through standards setting or certification process22.
· the print media have been governed by the principle of freedom of speech since the end of the 19th century. Yet, some regulatory constraints apply. They are essentially structural and intended to limit concentration in order to ensure pluralism of opinions.
· the audiovisual media (broadcasting and cable TV) have been part of the state apparatus until 1986, when private channels and cable operators were allowed23. Regulations of audiovisual media are considerably stronger. They are both structural (e.g. concentration ceilings, licensing justified by the scarcity of the spectrum) and behavioral (contents regulations aimed at ensuring the coverage and the promotion of French culture). In addition, in the broadcasting field exists a neat separation between policy making (under the authority of the Ministry of communication) and regulation which is the responsibility of an independent agency.
· the telecommunications world. was until 1990 a de facto monopoly run by a public administration. Public policy in this field was shaped by neo-corporatist relations between the domestic manufacturing industry and the public operator24. Since 1990, the market has been partially open to competition and a separation between operating activities and regulatory functions has been completed25. However, policy making and regulation continue to fall under the responsibility of one single body (the Ministry of PTT).
Major governmental players in policy making
Policy making for IS involves several governmental bodies.
The main player is the Ministry of Industry, Posts and Telecommunications26, within which two departments share the responsibility of the IS policy.
· The Direction Générale des Postes et Télécommunications (DGPT) sets the regulations for the telecommunications sector and defends French positions in international forums (such as ITU or the European Council of Telecommunications).
· The Direction Générale des Stratégies Industrielles (DGSI) is concerned with the promotion of the competitiveness of French industries in France and abroad. The DGSI is also piloting the trials for IS.
So far, this division of labor has worked out without major conflicts, which has been surprising enough given the differences of background of the two departments. Coming from the PTT world and closely linked to the operating activities of France Télécom until 1990, the DGPT has often been pictured as interventionist and marked by the "monopoly culture" of the telecommunications, while the DGSI has more a tradition of "faire faire" (having things done by others) by orienting private initiatives through subsidies. One could have expected some kind of rivalry similar to the one existing in Japan between the MPT and the MITI. That it did not occur can be explained by several elements: the separation with France Télécom has precipitated a change of staff and led to new methods and approaches; as an emancipated entity, the DGPT has sought legitimacy and authority by demonstrating its independence; more generally it seems that a liberalizing mood has gained the telecommunications world since 1993.
The two other major players in the IS policy are:
· the Ministry of Culture which supervises the cinema industry, museums and libraries, frames the copyright and intellectual property policies, and more generally deals with any issue related to the promotion or the defense of the French culture;
· the Ministry of Communication, which is primarily in charge of setting regulations for the broadcasting and the print media.
So far, these two ministries have been little involved in the IS policy. The focus is currently more on the development of infrastructures than on content matters. However, on a longer term, the government is likely to face the challenge of conciliating contradictory industrial and cultural goals. While liberalization and competition are the key words in the policy for telecommunications infrastructures and services, the French approach regarding content matters is fundamentally protectionist and interventionist.
Governmental coordination is traditionally reached in France through interministerial committees, in which interested ministers meet under the chair of the Prime Minister (or his representative). Most of the time, the minister of Budget is present and has an important say in decisions. On occasions, when important decisions are to be made, interministerial committees are chaired by the President of Republic.
For IS, such an interministrial committee has been set up on a permanent basis. It has been complemented by a dozen of working-groups of experts and high-civil servants, which are devoted to peculiar topics (such as teleworking, electronic payment, on-line administrative information). It is important to note that no specific structure has been created to design, coordinate or implement the French policy for IS. This contrasts with previous high-tech policies. In the case of videotex, a Commission - which comprised representatives of ministries, interest groups and MPs - had been established to survey and assess telematics trials. In the case of the cable plan, a Mission Câble (task force for cable) had been set up in order to foster cable projects, disseminate regulatory or technical information and contribute to the sharing of experiences. The institutional vacuum for IS is another evidence of the State's withdrawal in high-tech policies.
IS will involve the regulation of both telecommunications and audiovisual services or infrastructures which currently fall under the responsibility of two different bodies;
· the Conseil supérieur de l'audiovisuel (CSA) is an independent regulatory agency. The CSA issues licenses to private over-the-air TV stations, private radio stations, cable TV systems (and not operators) and TV channels on cable networks. CSA also allocates frequency channels for broadcasting uses.
· the Direction générale des postes et des télécommunications (DGPT) is part of the Ministry of PTT. The DGPT issues licenses for telecommunications networks and services which do not fall under State's monopoly.
This regulatory structure has been the object of two kinds of criticism:
· the lack of independence of the DGPT. The DGPT is part of the ministry of PTT which is also responsible for setting regulations in the telecommunications domain. In addition, although France Télécom has become a public corporation and is no longer part of the Ministry of PTT, the DGPT has been sometimes suspected to keep closed links with the public operator. For these two reasons, claims have been frequently made for an independent regulatory agency which would, on the one hand allow a clearer separation between policy making and the interpretation and implementation of policy, on the other hand ensure fair competition among operators when the telecommunications market is fully liberalized. The Minister for Post and telecommunications, François Fillon, recently announced that such a move should take place in the near future27.
· the overlapping or duplication of responsibilities. Whether some categories of services fall behind the CSA or the DGPT's authority is not always perfectly evident. In some cases, it may be also necessary to get two licenses in order to operate one service. For example, while cable systems are allowed by the CSA, the DGPT issues licenses for the operation of telecommunications services on cable, excepted for those which are related to TV (e.g. conditional access to video programming) which fall under CSA's authority. This situation has led to territory conflicts between the two regulatory bodies, and these conflicts might become more acute with IS as it appeared during the draft of the regulatory framework for trials (CSA, 1995).
There is no serious thinking in France about the ways telecommunications and broadcasting regulators may cooperate. In the UK, which faces the same problem, some have argued for a single "economic" regulator for the whole communication sector, supplemented by a "content regulatory body" concerned with matters of taste and decency (Cave, 1995).