French Media And Telecoms Firms Not Happy With Sarkozy Proposal
Little surprise here. French President Nicholas Sarkozy’s plans to tax internet, mobile and private television broadcasters to support ad-free, prime-time public television, has angered the country’s media and telecoms companies, which have vowed to fight the proposal all the way up to the European Union if need be.
SEE ALSO: France To Tax Mobile, Internet And TV Revenues To Fund Public Broadcaster
According to the WSJ.com, private broadcasters said the plan would force them to foot the bill for their state-owned rivals, while telecoms companies believe they are being arbitrarily and unfairly targeted to pay for ad-free public TV. Moreover, companies have also warned that French consumers may end up paying for the ban on ads anyway, as they will hike the prices of their products to counterbalance the tax. “We wouldn’t have a choice,” Maxime Lombardini, chief executive of Internet-service provider Iliad told the newspaper.”
Under the proposal, which still needs to clear parliament to be made into law, internet and mobile operators would be taxed 0.9 percent of ad sales—which could raise up to 380 million euros ($595 million), while commercial broadcasters would be taxed 3 percent of its ad sales, to come up with as much as 80 million euros ($125 million) a year.
France Televisions, the country’s public broadcaster, currently gets around one third of its revenues from advertising, and two-thirds from a 116 euro ( license fee it collects from anyone owning a TV set in France.
Meanwhile, it’s not hard to see why the proposal has stirred up such anger. In Sarkozy’s speech yesterday, his reasoning for the plan seemed almost whimsical, and at the very least, anti-commerce. He noted that as a boy he enjoyed watching live theater productions that were shown on French public television, and has asked in the past, “what’s the point of public channels,” if they don’t deliver quality cultural and educational programs? Said Sarkozy, “We need to free public-service television from the tyranny of real-time audience measurement. It leads state TV to treat viewers like consumers.”
Posted In: Legal, Regulatory, Companies, Countries, Europe
Social Standing
Which media brands are getting a lift from Tweeters and bloggers right now -- and which are getting panned?
Show Me: