France Opens Online Market

French media companies now prized partners of foreign online operators

The parliament of France has passed the bill that will end the national online gaming monopoly. The bill is expected to become law in time for the 2010 World Cup soccer matches, which start in June.

Operators will need a license from the state and be taxed at a rate of 7.5 percent on sports betting and horse racing and 2 percent on poker. The government will have the power to block illegal sites, and financial transactions between those sites and French banks.

In the run-up to the opening of the French market, the existing monopolies have closed deals with media platforms and private companies with products that will enhance their ability to compete in the new environment.

French national lottery and sports betting operator Francaise des Jeux has been especially aggressive. The company recently signed an agreement with telecommunications provider Orange to add betting to Orange’s French portals. In March, the French operator acquired its supplier of fixed-odds betting products, London-based Laverock von Schoultz. In February, FDJ inked a sponsorship deal with the nation’s largest commercial TV channel, TF1. And in January, FDJ and French casino group Lucien Barriere formed a joint venture to launch an online poker site, with Online Gaming 3D holding a 12.4 percent share and CyberArts providing the platform.

In March, French horse-race wagering monopoly PMU signed an agreement with PartyGaming to provide its online poker product. In November, PMU contracted with Ireland’s Paddy Power to provide sports betting.

On the private competition side, Ladbrokes announced last month that it has signed a conditional 50-50 joint venture agreement with television Group Canal+ to launch a French-licensed online betting and gaming service. Canal+ is the leading premium pay TV provider in France and operator of such channels as Canal+ and Canal+ Sport.

Ladbrokes Managing Director of Remote Betting and Gaming John O’Reilly said, “Canal+ is a brand that is synonymous with sport in France. We believe that there is an opportunity to build a good business in France over time as the market and regulation develop.”

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