French Public Broadcaster, Producers Sign Deal to Squeeze Out Netflix

As it prepares to launch a join streaming service with TF1 and M6, French public broadcaster France Televisions has signed a three-year pact with five local producers guilds to have exclusive rights to all the original drama, documentary and animation content that it co-finances.

Under the agreement, France Televisions will own rights to programs for all windows, from free-to-air to SVOD. The deal is a blow to Netflix, for which France Televisions has been a significant supplier of French library content.

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The pact was signed by France’s main producers guilds: SPI, SATEV, SPECT, SPFA and USPA. These include high-profile producers such as Haut et Court (“The Returned”), Bonne Pioche (“March of the Penguins”), Camera Lucida (“The Enemy”) and Mon Voisin Productions (“Call my Agent!”).

Reacting to the signature of the deal, Netflix said in a statement that “people increasingly want to watch TV when it suits them — and it’s great for consumers that more companies are moving to the on-demand world.” It added that Netflix was “committed to (its) many French partners and excited to bring more great French stories to the rest of the world.”

This latest development was expected as France Televisions recently announced that it was partnering with France’s two commercial networks, TF1 and M6, to launch Salto, a unified streaming service. Although the service has yet to be greenlit by the French anti-trust board, France Televisions’ agreement with the producers guilds means that it will have streaming rights to the series, documentaries and animated programs it co-finances from 2019 to 2022.

The deal follows an internal dispute over the sale of France Televisions hit show “Call My Agent!” to Netflix, which offers the first and second seasons in more than 60 territories and currently streams the third season simultaneously with its being aired on the pubcaster. Although the sale of “Call My Agent!” to Netflix was made by France Televisions’ own commercial arm, it angered Delphine Ernotte, the pubcaster’s president.

Ernotte, who referred to Netflix as the “devil” in a panel discussion in October, said in an interview with the French radio station Europe 1 a month later that “if we want to continue making strong French and European originals, then the creators, producers and distributors of these shows must keep control of the distribution….It’s essential for French players to keep the exclusivity over their productions.”

But the question now is whether French producers will be able to afford to finance ambitious shows without a deep-pocketed service like Netflix coming on board for the SVOD window. A spokesperson for the SPI, the guild of French independent producers, said that under the deal, France Televisions has committed to investing €50 million ($57 million) per year in content for its digital services, including Salto and an upcoming platform dedicated to kids’ programming.

Whether that will be enough to finance the most ambitious original series is unknown. But the SPI spokesperson said France Televisions will have to join forces with TF1 and M6 to help finance content for Salto: “In the long run, they might need Netflix, but for now there won’t be any Netflix exclusivity on France Televisions-commissioned content in France.”

While the agreement with France Televisions may seem like a gamble for French producers, the spokesperson said it was “absolutely necessary to allow France Televisions to preserve its significant investment in audiovisual content amid a difficult context since the public broadcaster has to save € 400 million [$459 million] by 2022.”

Netflix, meanwhile, is facing a new requirement that 30% of their content be sourced from within Europe, but the company does not anticipate that the deal between France Televisions and French producers will have any impact on their ability to reach the 30% threshold — Netflix is only licensing one or two shows from France Televisions per year, according to a company source.

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