1. Outline
　For the French public broadcasting service, France Télévisions (FTV), the 2010’s can be described as a period of unification and fusion under the leadership of two people. Internally, this has been a process of bringing together organizationally distinct channels under a single corporation. Externally, with digitalization of the media environment now completed, there has been the fusion of broadcasting and telecommunications functions via the Internet and universal provision of online services on multiple platforms.
　Rémy Pflimlin, who was appointed president of FTV in August 2010, has united the five channels, France2, France3 etc., which were previously separate, both administratively and in terms of programming, under the single France Télévisions. The unification process was completed by the signing of a new labor agreement with the labor union in May 2013.
　Expansion onto the Internet had been regarded as slow but Internet access soared after the launch of the news site, Francetv info, in 2011 and free-to-view program catch-up site, Francetv pluzz, in the following year.
　Delphine Ernotte, the then 49-year old vice-president of France’s biggest telecommunications corporation, Orange, formerly France Télécom, succeeded Pflimlin in August 2015 to become the public broadcaster’s first female president. As anticipated, in view of her telecommunications industry background, Ernotte moved quickly to expand the fusion of broadcasting and telecommunications services. On September 1st, 2016, FTV launched the 24-hour news service, Franceinfo, which can be accessed simultaneously as a new channel on terrestrial digital TV and via various Internet platforms. Aimed at establishing contact with the younger generation, this is a universal service provided via satellite, cable, IPTV, smartphone etc.
　SVOD (Subscription Video On Demand) has also become increasingly popular in Europe through the activity of Netflix etc., and Ernotte is now planning to launch a new SVOD platform as well. The executive committee approved the project on February 23rd, 2016. Ernotte’s vision is to rival Netflix by prioritizing French video content. The aim is to commence this new service in the near future.

2. Overview of Broadcasting in France
　Public broadcasting in France consists of five entities – France Télévisions (FTV), Radio France, France Médias Monde (international broadcasting), ARTE (joint French-German broadcasting) and INA (national radio and TV archives) –broadcasting on a combined total of 9 channels. France Télévisions operates 6 of these channels.
　France had 23 nationwide commercial channels as of September 2017, including those operated by the three commercial broadcasting giants, TF1, Canal+ and M6. 18 are free-to-view and 5, pay channels. This brings the combined total of public and commercial nationwide channels to 32.
　Local public broadcasting services are provided by a network of broadcasting stations located in 24 provincial cities under the mantle of France Télévisions’ France3. There are 41 local commercial channels altogether. These, however, are neither subsidiary to the commercial broadcasting stations based in Paris nor connected in a network.
　The digitalization of terrestrial broadcasting was completed at the end of November 2011 and all terrestrial digital TV channels made the switch to high-definition broadcasting in April 2016. The MPEG2 video and audio compression system was replaced by the higher performance MPEG4 system to provide high-definition broadcasts on all terrestrial digital channels. Approximately 80% of households upgraded their set top boxes for the transition and the remaining roughly 20% bought a new TV.
　A combined total of 135 channels can be viewed in the capital, Paris, including all terrestrial digital, cable, satellite and ADSL services. In 2016, the average daily viewing time was 3 hours 43 minutes, a 1 minute decrease from 2015.

3. The Origins of Public Broadcasting in France
　Broadcasting in France was long regarded as the voice of the state and operated directly by it. In 1972, under the conservative President Georges Pompidou, it was stated plainly in the Broadcasting Law that “French radio and television are the monopoly of the state”.
　ORTF (Office de Radiodiffusion et Télévision Française), the forerunner of France Télévisions etc., grew too large, however, and was divided up under the conservative administration of President Valery Giscard d’Estaing because it no longer functioned well as a unitary organization. The parts were reorganized according to function to split ORTF into 7 separate parts: 3 TV stations, 1 radio station, 1 program production company, 1 program transmission company and 1 radio and television archive.
　In 1982, under the left-leaning administration of President Francois Mitterand, a new Broadcasting Law proclaimed that “audiovisual communication is free” and abolished the state monopoly on broadcasting. The entry of commercial operators into the broadcasting industry was thereby permitted. Several commercial broadcasters were launched one after another and, in 1987, the number one public broadcasting channel was itself commercialized. It continues today as TF1, the country’s biggest commercial broadcaster.
　The intensifying competition between channels then led to further realignment of the public broadcasting sector. France Télévisions was established as a holding company funded by state capital under the Broadcasting Law reform of 2000. The various public broadcasting stations became its subsidiaries. Each station continued to control its own programming, labor agreements, personnel and salary arrangements etc. until the Broadcasting Law reform of 2009, when the five channels of France2, France3, France4, France5 and RFO (the French overseas network, now FranceÔ) were united under FTV.

4. France Télévisions Today
　The responsibilities and services of each station within France Télévisions today are as follows:

• ・France2
  The comprehensive news and entertainment channel. Dramas, cultural programs etc. are made by external production companies. The same applies to other group stations as well.
• ・France3
  Operates stations in 24 provincial cities such as Marseille and Rennes for the broadcast of local news and locally produced programs.
• ・France4
  The innovative channel for children and young adults.
• ・France5
  The school education and lifelong learning channel.
• ・FranceÔ
  Broadcasts to metropolitan France on overseas affairs from the overseas departments and collectivities on terrestrial digital, satellite and cable TV channels.
• ・Franceinfo
  The 24-hour news channel which commenced simultaneous broadcasts and Internet distribution in September 2016. Approved as the 27th terrestrial digital channel by the independent regulatory authority, the CSA.

　The other public broadcasting services, aside from those of France Télévisions, are provided by ARTE, Radio France, France Médias Monde and INA. This report, however, treats mainly with FTV.

5. Outline of Combined Broadcasting and Telecommunications Services
5-1. Broadband Internet
　According to the global broadcasting data compiled by Japan’s Ministry of Internal Affairs and Communications, France had approximately 26.26 million broadband subscribers as of the end of June 2015. Of these, 83.6% had ADSL and 14.6%, ultra-high speed broadband. The use of mobile broadband has also been expanding with the spread of smartphones and the number of users stood at 42.81 million as of the end of 2014, a diffusion rate of 64.7%.

5-2 IPTV
　In France, the Internet provider, Free, launched an ADSL TV service in December 2003, and France has since grown to become one of the world’s great IPTV markets. The rapid growth was facilitated by the state’s investment of 2 billion euros (about 240 billion yen) in the laying of fiber optic cables and the introduction of the discounted Triple Play (telephone, Internet and TV) packages by Internet providers.
　Following Free’s lead, France Télécom (now Orange), Bouygues Telecom, Numericable-SFR and other telecommunications operators also now provide IPTV services. About 17.3 million households subscribed to such services as of March 2015.

6. France Télévisions’ Internet Services
6-1. Service Content
　France Télévisions became the first public broadcaster in Europe to provide program streaming and purchase (download) VOD services (Francetv VOD) in November 2005.
　Francetv pluzz, a free-to-view distribution service for viewing programs as they are broadcast and catch-up service for programs broadcast during the previous seven days, was introduced in May 2012. Most programs are transferred from the eighth day after broadcast for distribution on the pay Francetv pluzz VAD video-on-demand service.
　Distribution of the European standard HbbTV (Hybrid Broadcast Broadband TV) i) , which combines broadcasting with the Internet, commenced in May 2011.
　The 24-hour news service, Franceinfo, has been provided simultanously on the Internet and terrestrial broadcasts since September 2016. Ernotte, in keeping with her own telecommunications industry background, is actively furthering the fusion of broadcasting with telecommunications.

6-2. Recent Developments in Internet Services
　France Télévisions combined the previously separate VOD sites for five channels on May 9th, 2017 with the launch of the new france.tv service. Users can search nearly 500 programs broadcast daily on FTV by genre, including news, sport, culture, education and children’s and youth programming, for free catch-up viewing for up to seven days after their broadcast. From the eighth day, this becomes a pay download service, in principle. Francetv pluzz and Francetv pluzz VAD, which serve the same functions, will be absorbed into this in due course. It is also possible to view some news programs live on this site.
　FTV launched the Franceinfo news site for simultaneous TV broadcasting and web distribution in September 2016. An SVOD service offering unlimited viewing of TV dramas and films for a fixed fee is due to begin in the near future.
　Including france.tv as well, the three sites are together expected to continue as main planks of FTV’s digital strategy for the foreseeable future.

7. The Legal Basis of the Internet Services
　The question arises of how this active expansion of public broadcasting into Internet services stands in regard to the law. Essentially, ever since the Broadcast Law of 1982 which permitted participation of commercial operators, broadcasting has been positioned as audio-visual communication (communication à l’audiovisuel), defined as “not possessing the character of private communication but consisting of the delivery of any kind of signs, signals, words, visual images, sounds or messages by telecommunications means to the general public”. The standard interpretation in France is that VOD and other services fall within the category of audio-visual communication.
　A legal basis for expanding services to the Internet and other telecommunications systems has also been added to an article of the Broadcasting Law. Article Two of the reformed law of March 2007 states that a TV service is understood as any service consisting chiefly of audio-visual programs which can be received simultaneously by electronic means by all or some section of the general public. This definition gives legal clarity to the understanding that program distribution via telecommunications networks is a TV service.
　The reform of Article 43 of the Broadcasting Law in 2009 further stated that France Télévisions should, in performing its role as a public service, edit and broadcast diverse audio-visual communication services, including video-on-demand, and recommended, in view of the advances being made in digital technology, that all members of the general public should have access to these programs. The expansion into electronic fields was thereby defined as one of the core responsibilities of the public broadcaster.
　Alongside these legislative measures, the COM contract on objectives and resources (contrat d’ objectifs et de moyens) ii) used from 2007-10 stated that France Télévisions would engage actively with the development of new audio-visual technology in accordance with national policy and perform a leading role in several fields, namely the termination of analogue and dissemination of terrestrial digital broadcasting, introduction of high-definition TV, development of mobile television and video-on-demand, and efforts to eliminate illegal copying.
　The latest COM entered between FTV and the government in December 2016 for the period through 2020 includes a governmental undertaking to provide higher subsidies in order to accelerate the dissemination of combined broadcasting and telecommunications services by FTV.

8. The Internet as a New Source of Revenues
8-1. Receiving Fees or New Revenue Sources?
　The expansion into Internet services was initially performed by subsidiaries but transferred to FTV from 2010 following its repositioning as one of FTV’s core functions. The Internet services are currently being provided within the scope of France Télévisions’ budget, including receiving fees. Ernotte is seeking to develop the electronic market as a future revenue source in which advertising revenues etc. from the combined services would also be added as a new revenue source to TV advertising revenues.

8-2. The Use of Alternative Electronic Reception Devices
　The viewing of TV programs on alternative electronic reception devices is already covered in the law on collection of the tax for the support of public broadcasting. This tax is now levied not only on households with conventional TV sets but also on those where TV is viewed on new types of devices. This expansion is based on Clause 1605 and subsequent clauses of the 2005 General Tax Code, which lays down with respect to private household use that individual possession of a television set or any other device capable of TV reception shall be subject to residential tax when such is installed in a place that is fitted with residential furnishings. This levy is further applied to all other individuals and also corporations in possession of a television set or any other devices capable of TV reception in France.
　In practice so far, however, no collection has been made from households which have no television set and watch programs via other media. The issue has been placed to one side because it was difficult to grasp how many households that had no TV set watched TV programs via other media and the number was anyway considered likely to be small.

9. Future Issues for the Reception Fee System
　According to figures released in January 2017, by the French private-sector survey company, Médiamétrie, however, the viewing of TV programs via online Internet services on personal computers, tablets or smartphones increased by 5 minutes from 2015 to 2016 to reach a daily average of 19 minutes. Further, 16% of viewing households did not possess a conventional TV set and 65% of those aged 35 and under only watched TV programs on the Internet.
　These survey results underscore the creeping decline of TV viewing on conventional TV sets and shift among the young towards online services as their main mode of TV viewing.
　The dependable collection of reception fees (la contribution à l’audiovisuel public) for smartphone etc. viewing by people who do not have a conventional TV set has, therefore, now become a major issue.
　Matthieu Gallet, the president of Radio France, which is also supported in the same manner by the public broadcasting levy, was interviewed by the newspaper, Le Monde, in an article published on February 7th, 2017. He said, “The alternative electronic devices did not exist when the receiving fee system was introduced and the system now has to be reformed. The introduction of a German-style payment system (whereby every household and workplace is obliged to pay regardless of whether it is in possession of a TV set or not) requires urgent examination.” According to an article in Le Monde on August 31st, the Ministry for the Economy and Finance, the organ responsible for the levy, has indicated that there will be no budgetary review of the public broadcasting tax in the 2018 financial year and any such review will be deferred to the 2019 financial year or later.

10. Criticism of the Vigorous Net Expansion of Public Broadcasting
　The oft-heard criticism in Japan that the vigorous expansion of public broadcasting into the new media tends to squeeze out the private sector has hardly been voiced in France. FTV’s executives explain, however, that one reason why there has been so little backlash from commercial operators is that FTV’s net services were initially inferior to those of TF1 and other commercial operators with respect to the distribution of news, sport etc.
　Pflimlin, who was appointed president of FTV in August 2010, placed electronic development at the heart of his strategy and invited Bruno Patino iii) , who had overseen creation of the digital version of Le Monde, to direct this activity. The big increase of the public broadcasting presence in the new media market could at that point have given rise to criticism that the state was giving public broadcasting too much support, but in fact any such opposition remained fairly muted. Rather, the general view in France seems to be that it is only natural for public broadcasting organizations supported by the government to take the lead in undertaking new services and also bear the risks of failure.

11. The Prospects and Three Challenges Ahead
11-1. The Fusion of Broadcasting and Telecommunications
　FTV president Ernotte arrived from Orange (previously, France Télécom), France’s largest telecommunications corporation, and appears to be staking the future of public broadcasting on the ever more vigorous fusion of broadcasting and telecommunications services. This sense of mission may well have been the reason why the independent media regulatory authority, the CSA, chose to appoint the young, then 48-year old Ernotte as FTV’s first female president (appointed in April 2015, assuming duties in August of the same year).
　The timing of Ernotte’s appointment roughly coincided with the start of FTV’s new 2016-20 COM, which was agreed and signed with the state on December 1st 2016, and has given extra momentum to the fusion of broadcasting and telecommunications through state support.
　Concretely, the 24-hour news service, Franceinfo, was launched with simultaneous programming on the Internet and terrestrial digital TV on September 1st 2016, and the local news channel, France3, is also providing richer regional information. In these and other ways, content has become more diverse.
　In view of the recent rapid expansion in the use of Netflix, the U.S. subscription video-on-demand (SVOD) service, in Europe, too, FTV also planned to launch a similar service in 2017 (This has now been postponed to the autumn of 2018). The idea is to compete with the distribution of video by Netflix and other American operators by providing content of French origin.
　To secure the needed content, FTV aims as one of its goals to increase its annual spending on the production of French films, TV drama series etc. by 2 million euros from 40 to 42 million euros (about 5 billion yen).
　The government is helping FTV achieve this goal by reversing its policy of reducing subsidies and, instead, under the COM for 2016-20, increasing the subsidy from 28 million euros in the 2016 financial year to 38 million euros in 2017 and 63 million euros (about 7.5 billion yen) in 2020.

11-2 Securing Stable, Continual Funding
　The increased funding is a promise secured through negotiation with the state. The change of government could, however, still mean that FTV may not receive the funding that has been promised. The government of the Socialist Party president, Francois Hollande, did in fact review the 2011-15 COM signed with the administration of President Sarkozy and a revised COM with much lower subsidies was used for the years 2013-15. The government reduced its support for the public sector under the austerity policies adopted when the economy stagnated and revenue sources declined.
　Something similar may be happening under the administration of President Emmanuel Macron. Francoise Nyssen, the person who, as Minister of Culture, is responsible for media affairs, stated on September 14th 2017, that the budget for public broadcasting organizations, including France Télévisions and Radio France, ought to be reduced in the next financial year. Nyssen during the budget discussions in parliament with the Macron administration taking the view that public sector spending ought to be reduced.
　The budget for the five public broadcasters is set to fall by 80 million (10.4 billion yen) from the 2017 level in the 2018 financial year. Although the Hollande administration did promise that France Télévisions’ budget would be increased to support the medium-term goals of the 2016-20 COM, already, with the start of the Macron administration, that plan is under pressure and may have to be changed.
　Broadcasting policy has indeed shifted frequently in the past with changes of government in France. The only secure and long-lasting way for FTV to achieve full self-sufficiency and editorial independence, free from reliance on governmental subsidies, may in fact be to introduce a receiving fee system that resembles the German model.

11-3．Further Unification of the Public Broadcasting Entities
　Already, a parliamentary report on public broadcasting submitted to the Senate’s cultural affairs committee in September 2015, has recommended the introduction of a German-style system and further unification of the public broadcasting system. The five channels (now 6), each a separate corporation, were combined under France Télévisions in 2009. The new plan is to establish a holding company, France Média, and bring both France Télévisions and Radio France under its umbrella by 2020. For other public broadcasting entities, unification would start from their online units.
　This fresh unification initiative is already gathering steam. As noted above, the simultaneous Internet and TV 24-hour Franceinfo service was launched on September 1st 2016. The management of this project is shared by several separate public broadcasting entities, namely France Télévisions, Radio France, the international broadcaster France Média Monde and archive service INA. Each cooperates by providing content, staff, funding etc. The news sections have thus already set out and are leading the way in the further unification of the public broadcasting entities.
　France in the latter half of the 2010’s has achieved the further fusion of broadcasting and telecommunications services, is seeking ways to secure stable long-term revenue sources to support them, and is feeling its way towards a further unification of public broadcasting entities which can provide not only greater efficiency but also more organic functioning.


Notes：
i. Participated in jointly by France Télévisions, TF1, Samsung, Philips, Sony etc.
ii. The contrat d’ objectifs et de moyens is the medium-term plan agreed by the government and public broadcaster. The government has a say in the plan and guarantees funding for it during its term.
iii. Bruno Patino, former chief of the electronic strategy promotion group at France Télévisions