Following the resignation of TF1's chairman Patrick Le Lay from his position as chairman of French digital satellite service TPS, a potential merger or at least an alliance between TPS and Canal Plus-rival service CanalSatellite no longer seems so far-fetched.
Most observers see Le Lay's departure from TPS - where he is replaced by top TF1 executive Emmanuel Florent, - as a way to ease tensions between TF1 (a 25% shareholder of TPS) and the pay-TV's two other main shareholders Suez Lyonnaise and M6.
Both Canal Plus Group's COO Denis Olivennes and TPS' COO Jacques Espinasse have been quoted at length in the French press, neither of them dismissing the possibility of an alliance between the two operators. "A single platform would make more economic and commercial sense." Olivennes told Le Figaro, "There is no doubt that there is the possibility for an alliance" echoed Espinasse, although he stressed that there were no talks yet, although he hinted at a possible merger between the two operators' pay-per-view services.
CanalSatellite, launched in 1993 and which now boasts nearly 1.7 million subscribers, is a profitable operation, whereas TPS, created at the end of 1997, has still to break even (a $88.1m (Ffr650m) loss is expected in 2001).
A few months away from the launch of the bids for the digital terrestrial franchise, a merger or at least a partial merger between the two operators would make sense, and would be in sync with Canal Plus' Group chairman Pierre Lescure's vision for a single commercial operator for the new services.