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Agence France-Presse
First Posted 09:24am (Mla time) 06/26/2008
PARIS -- President Nicolas Sarkozy confirmed Wednesday his government will tax Internet and
telephone providers to offset lost revenue after it scraps advertising on French public
television next year.
Speaking after receiving a parliamentary report on the plans, which he first floated early
this year, Sarkozy confirmed advertising would be stopped on all France Televisions channels
after 8:00 pm from January. Advertising would be scrapped altogether by the end of 2011.
New taxes on telephone operators as well as a levy on additional private television
advertising revenue -- expected to mechanically increase -- would be brought in to
compensate for the lost funds, Sarkozy told a press conference.
"Fixed and mobile telephone operators and Internet service providers will be asked to
contribute to the height of 0.9 percent of their turnover," he said.
A spokesman for the French federation of telecoms and Internet operators immediately
denounced what he called a "counter-productive and illegal" tax, saying it would cost the
industry 378 million euros per year.
Sarkozy said the television levy was expected to generate 80 million euros (US$124.5
million).
The total lost revenue for France Televisions, funded by a combination of license fee and
advertising, is estimated at 800 million euros.
The European Commission said Tuesday it was "not enthusiastic" about the French plans, based
on the parliamentary report which advocated a lower, 0.5 percent, telecoms and Internet tax.
"For the European Commission, it is important to increase citizens' purchasing power and
growth in Europe. It is not in favour of a new tax on sectors that are drivers of growth,"
said commission spokesman Martin Selmayr.
Sarkozy also announced plans for the head of France Televisions to be appointed by the
government -- subject to a veto by parliament -- instead of by the CSA broadcasting council.
The Socialist opposition attacked the decision as "a serious blow to the independence of the
media."
But the head of France Televisions, Patrick de Carolis, welcomed Sarkozy's speech in a
message to staff, sent to AFP.
"We head into the coming months reinforced in our strategy, with responsibility and all
necessary vigilance," he said, adding that the president had "clearly reaffirmed his support
for our editorial line."
Sarkozy argued Wednesday that scrapping ads would allow public television to make bolder
choices, for programmes to be "judged over a season, not a quarter hour" of audience
ratings.
The president first announced plans for the broadcasting shake-up in January, sparking
concerns he planned to downsize the public broadcaster.
The opposition Socialists accused him of bleeding public television dry without offering a
clear plan for offsetting the loss.
Shares in France's main private television channel TF1 -- whose main shareholder Martin
Bouygues is a close friend of Sarkozy -- soared on news of the proposed advertising ban.
TF1 remains France's most-watched television, with its popular mix of gameshows, reality TV
programs and American prime-time series, dubbed in French.
The fare offered by France 2, 3, 4 and 5 channels ranges from gameshows and popular in-house
TV dramas to high-brow round-table discussions on art, politics and current affairs.
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