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Vivendi Plans Netflix-Type Service in Europe

7 Apr, 2012 By: Erik Gruenwedel

French media conglomerate Vivendi SA reportedly is planning to launch a subscription video-on-demand service patterned after Netflix in Germany beginning in the third quarter.

Upstart subsidiary Vivendi Multiscreen Entertainment in Berlin eyes the SVOD market as an important strategic project in the dissemination of home entertainment throughout Europe, according to president Stefan Schulz.

Schulz told magazine the unnamed service would emulate Netflix by allowing subscribers unlimited streaming access to movies and repurposed TV programming on multiple consumer electronics devices, including the TV, for a single monthly price.

“We’ll probably begin service in the third or fourth quarter with a major rollout in Germany,” Schulz said. “Similar to what Netflix has done in America.”

It wasn’t immediately clear what, if any, SVOD license deals the Vivendi service has with Hollywood studios or regional content holders. Content, of course, is critical to the viability of emerging SVOD platforms.

Netflix has spent a fortune acquiring rights to premium content, in addtion to buying rights to original series such as "Lilyhammer," "House of Cards" and "Orange Is the New Black," among others.

Amazon thus far has been less willing to match Netflix on content spending. Instead, it has secured secondary deals in an effort to maintain parity when it comes to titles offered.

More importantly, content holders are leery of undervaluing rights to SVOD platforms so as not to jeopardize more lucrative windows such as transactional VOD, pay-TV and packaged media.

Vivendi last year sold its remaining 12% stake in NBC Universal after General Electric relinquished majority ownership to Comcast for more than $30 billion. It also owns Universal Music Group, which just sold home entertainment distributor Vivendi Entertainment to Gaiam for $12 million.

Germany has become a hotbed for SVOD, with Amazon-owned LoveFilm Instant offering service as well as separate service Gold, a partnership between German TV stations ARD and ZDF.

Netflix, of course, launched SVOD service in the United Kingdom and Ireland in January.

About the Author: Erik Gruenwedel

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