AMSTERDAM -- IBC -- A top executive at French media conglomerate Vivendi is downplaying reports that the company plans to create a European Netflix with Italian partner Mediaset have run into problems.
Vivendi announced plans to acquire Mediaset S.p.A. 's pay-TV business earlier this year, with the stated ambition at the time of becoming a European alternative to movie-streaming giant Netflix Inc. (Nasdaq: NFLX). Reports now are suggesting that the company had a change of heart last month, deciding it wanted a smaller stake in the company than originally intended.
Press reports have indicated that a Vivendi team working on that project has stopped holding meetings and that a service will not be launched this year.
"I won't disclose what's happening in the boardroom but I'm still hopeful," said Dominique Delports, the president of Vivendi Contents, at the International Broadcasting Convention (IBC) in Amsterdam this week. "It makes a lot of sense for these two great companies [Vivendi and Mediaset]."
Delport believes there is a demand for local content that is not being met by Netflix and rival platforms based in Asia and North America. "The world is not necessarily happy with just Anglo-Saxon and Asian content -- people want to listen to their artists and watch their stars," he told attendees during a Thursday-morning presentation at IBC.
"If you look at the top 20 Internet platforms, 11 are American and nine are Asian, and Europe has been completely skipped," he added. "We can say it's too late but let's try."
Despite Delport's optimism, other recent developments also cast a shadow over Vivendi's ambitions.
In Germany, the company is shutting down a subscription video on demand (or SVoD) service provided by its Watchever subsidiary, citing the difficulties of competing against powerful forces including Amazon.com Inc. (Nasdaq: AMZN) and Netflix in the German market.
"In Germany you have three dominant players and you need to choose your battles," said Delport. "There are hiccups but I'm still confident."
The Vivendi executive also noted that partnerships with European telcos will be absolutely critical to its efforts to challenge the US web giants, bemoaning the absence of an "Airbus for the Internet" -- in a reference to the European aircraft manufacturer and rival to US company Boeing.
Delport revealed that Vivendi is currently in discussions with a number of European operators about its soon-to-launch Studio+ service.
The company is pioneering a new form of mobile content in which a TV series is made up of ten ten-minute episodes. "We think there is a way for people to be entertained for ten minutes when they are commuting or between meetings," said Delport.
Vivendi has invested €35 million ($40 million) in the development of Studio+ this year and will launch the service in Latin America on October 11. It plans to extend the offering to 20 markets by mid-2017.
"It's not a short-term investment and we have to get the metrics right but we are confident," said Delport. "In a few months we'll be able to show you exactly how it works."
— Iain Morris, , News Editor, Light Reading