Honda website
Honda website

APRIL 17, 2002

More trouble in the pay-TV world

HOT on the heels of the collapses of Kirch, ITV Digital and the South American PSN network, comes news of a crisis at the heart of France's Canal Plus, the biggest contributor to the Formula One group of companies. Canal Plus agreed a 10-year-deal in 1996 which guaranteed F1 an annual income of something in region of $40m for the rights to broadcast pay-TV coverage of F1 in 70 countries. In 1996 it was even suggested that Canal Plus might buy the Ligier F1 team to support its investment but in the end the team went to Alain Prost and Canal Plus became its chief sponsor for three years.

In 1999, however, Canal Plus was bought by Vivendi Universal, a water company which was in the process of transforming itself into a media business under the management of Jean-Marie Messier. Soon after the sale, Canal Plus opened negotiations to reduce the payments to F1 as in three years it had managed to build an audience of only 15,000 subscribers and decided not to continue sending staff to races, the commentary from then on being done in Paris.

As part of a renegotiation of the deal Canal Plus gave up the rights to South America is exchange for a 20% reduction in payments and an assurance that there would be more onboard cameras reserved for pay-TV. The company has continued to make losses and this week Messier took the radical step of firing Pierre Lescure, the boss of Canal Plus. Messier is believed to have given the new management a two-year deadline to make money although Lescure's supporters in France are now trying to unseat Messier.