Vivendi’s Content Chief: European Media Industry Needs to Support Homegrown Distribution Platforms

At MIPTV today, Dominique Delport, President of Vivendi Content, declared. “”Cannes, we have a problem.” Delport, who is also Global MD of Havas, warned the European industry that is has become overly dependent on foreign companies for distribution, saying that Africa and LATAM faced similar problems.

First, Delport looked at consumer behaviour, noting that 50 percent of our time online is now spent using services provided by the ‘GAFA’ (Google, Apple, Facebook, Amazon) companies.

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Delport noted how Google’s huge market cap gives it so much sway in the market. While the fact that ‘Google is huge’ won’t come as news to anyone, Delport provided an interesting stat to push home his point. The search giant’s market cap equates to the total market caps of Disney, Comcast, 20th Century Fox, DirecTV, WPP, CBS, and all of the top six advertising holding groups combined:

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A similarly thought-provoking stat was how Apple’s growth for last year alone, equates to the total revenue for the seven of the top luxury brands:

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But Delport noted that Europe’s woes aren’t confined to GAFA. Of the top 20 internet companies, eleven are from the US and nine are from Asia. Delport said that that stat alone was evidence that there is a strategic need for the European market to support homegrown services. Cue a timely reference to Vivendi’s acquisition of Dailymotion…

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‘Great content isn’t cheap’, said Delport, noting that US TV budgets – even for individual episodes – were starting to look more like European movie budgets, with House of Cards cost $5 million per episode, while Game of Thrones costs double that at $10 million per episode.

Delport also looked at how the future of the industry was going to favour web native players like like the GAFA companies, noting that by 2020 all TV would be digital and file-based, which would enable viewers to create Spotify-like playlists. He believed that Google and Facebook’s focus would be on eyeballs, whereas Amazon and Apple would primarily focus on devices, suggesting that Delport might be underestimating Amazon’s advertising ambitions.

However, it wouldn’t be a keynote by a TV executive if it didn’t feature a stat showing just how small SVOD is in comparison to TV globally. While SVOD is seeing surging growth, Delport said that even in the US it continues to be a relatively small – albeit rapidly growing – part of the industry, at least when its compared to the revenues generated by cable and advertising. Delport said that SVOD should be regarded as a complement to pay TV rather than a replacement.

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You can watch Delport’s presenation in full here:

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