Registration Document BOUYGUES

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Risk factors
Business-specific risks
Regulatory risk
CSA broadcasting licence and enforcement
powers
TF1 is an audiovisual communications service that
requires a licence. The company's initial licence to
use frequencies for a period of 10 years from 4 April
1987 (Law of 30 September 1986) expired in 1997.
Based on Decision No. 96-614 of 17 September
1996, the channel received an initial five-year
renewal of this licence effective on 16 April 1997,
with no requirement for a competitive tender.
The TF1 channel's broadcasting licence was
automatically renewed for the period 2002-2007
by decision of the CSA on 20 November 2001.
Under Article 82 of the Law of 30 September
1986, as amended, this licence was automatically
be extended to 2012 in return for simulcasting the
digital terrestrial free-to-air channel. The CSA, in a
decision of 10 June 2003, modified the TF1 licence
and contract terms to build in stipulations about
the transfer of the channel's programming to DTT.
The Future Audiovisual and Television Broadcasting
Modernisation Act of 5 March 2007 introduced two
automatic five-year extensions of TF1's licence.
The first compensated for the early switch-off of
the channel's analogue signal on 30 November
2011 and was subject to TF1 joining the consortium
set up to implement the analogue switch-off. The
second was in return for the channel's commitment
to provide DTT coverage to 95% of the French
population. Accordingly, TF1's licence is now set
to expire in 2022.
The TF1 group is subject to a variety of commitments
covering general obligations to broadcast
and invest in production, either through its schedule
of conditions or as a result of regulations
applicable to its activity. A change to the regulations
could raise the current constraints imposed
on TF1, with a possible negative impact on the
company's profitability.
If TF1 fails to meet its contractual obligations, the
CSA can, after giving formal notice and depending
on the severity of the offence, impose one of
the penalties set forth in Article 42(1) of the Law
of 30 September 1986. These include a fine;
a temporary ban (of no more than one month)
on producing, broadcasting or distributing the
service, or a category of programme, or part of a
programme; reducing the term of the licence to use
frequencies by up to one year. TF1's compliance
with its obligations is strictly monitored. It has a
dedicated Programme Compliance department
to ensure that the channel's programmes comply
fully with regulatory requirements.
Privacy law and defamation
There are no cases pending that present a financial
risk to TF1.
Risk of additional taxes
Article 53 of the Law of 30 September 1986, as
amended by the Finance Act 2011, deferred the
complete end to advertising on France Télévisions
(the public service broadcaster), initially set for
2012, until 1 January 2016. In exchange for the
postponement, the tax paid by the channels to
make up the France Télévisions' deficit has been
lowered to 0.5% of advertising revenues until
1 January 2016.
This example is a good illustration of the risk of new
taxes to which television channels are exposed,
such as the tax on advertising spending.
Operational risk management policy
The TF1 group has put new risk monitoring and
control systems in place across the board for all
of its businesses.
Bouygues Telecom
Infrastructure access
In a sector characterised by cycles of technological
change, one of the major challenges facing
Bouygues Telecom is to access infrastructure on
the best possible cost terms within a timeframe
that enables it to meet consumer needs for new
services on a timely basis.
Bouygues Telecom has embarked on projects
that will make it a key player in the fixed-line veryhigh-speed
broadband market. Since November
2010, Bouygues Telecom has been using the
Numericable network and marketing its Bbox fibre
service, which offers faster speeds than ADSL. An
agreement with SFR to jointly deploy a fibre optic
network with 3 million connections into the home,
signed on 9 December 2010, will make Bouygues
the only Internet service provider simultaneously
offering ADSL, cable and fibre optic services.
In the very-high-speed mobile business, Bouygues
Telecom has acquired a significant number of
2,600 MHz and 800 MHz frequencies enabling it
to provide very high speed services across France
in the coming years.
Competition
The French electronic communications market
is highly competitive. Competition is likely to
become tougher in 2012 with the entry into the
French mobile telephony market of a new operator
which has been awarded the fourth UMTS
licence and allowed to benefit from asymmetric
regulatory measures never before granted to any
other operator.
In this competitive environment, Bouygues Telecom
has embarked on a new direction, launching new
offers:
> it has created B&YOU, a community forumbased
brand at the heart of social networks sold
exclusively online with no minimum commitment
and targeted at the most autonomous members
of the Internet generation able to manage all
contact with their service provider online;
> it has also launched Eden, a tailored range of
offers catering to customer requirements (with or
without a minimum commitment, with or without
a handset and with a new customer loyalty
programme, etc.), in order to supplement and
simplify its services;
> a new premium service that guarantees next day
replacement for handsets that are damaged,
lost, stolen or faulty.
It is also one of the company's core objectives to
improve its position on the internet and fixed phone
market. Bouygues Telecom is already the market
leader in terms of net growth, attracting 433,000
new customers in 2011 and increasing the number
of its fixed-line customers to more than 1.2 million
as at end December 2011.
Adverse regulatory and tax changes
In a strict regulatory and fiscal environment, new
taxes and regulatory restrictions are being applied
to fixed and mobile services at both European and
national level. Because of the potential impact
on company profitability, Bouygues Telecom is
constantly on the lookout for such developments
BOUYGUES • 2011 Registration Document • RISK FACTORS • 145