The French government looks set to intervene in a stalemate between pay-TV outfit Television Par Satellite (TPS) and industry bodies BLIC, BLOC and ARP about the relationship between the pay-TV sector and French producers.

TPS is under pressure to sign an agreement with the three organisations which would govern its investment in French film production and broadcast of the films concerned.

If TPS fails to the sign the agreement, the French government is likely to weigh in, according to the head of French cultural body CNC, Jean-Pierre Hoss. Rival pay-TV operator Canal Plus has already signed a wide-ranging memorandum of understanding with the three organisations, putting further pressure on TPS to follow suit.

The agreement has sparked heated controversy in the French film industry and an on-going feud between TPS and Canal Plus for over a year.

The main issue - still only partly resolved - is the exclusive broadcasting window traditionally attached to Canal Plus' investment in French titles. TPS has been lobbying for the creation of a second window - for titles pre-bought or acquired by Canal Plus - and to be in a position to bid for pay-per-view rights.

The memorandum signed by Canal Plus looks likely to grant TPS the second window but the French pay-TV giant isn't budging on the issue of pay-per-view. Canal Plus wields significant power in the production sector due to its heavy investment. In 1999 it invested $136m (FFr926m) in 140 French or French co-produced films. In comparison, TPS, a newcomer in the pay-TV arena, invested only $15.3m (FFr104m) in 19 titles.