AFP contemplates having the French government as its sole shareholder

Posted by Emma Heald on August 27, 2009 at 3:05 PM

The French state could end up as the only shareholder of news agency Agence France-Presse as an industrial and commercial public company, as the board of director considers what direction its change in statute should take. The plan is being discussed by AFP, the Ministry of Culture, the Ministry of Economics, Finance and Industry and the prime minister's office, reported Le Figaro.

The aim of the statute change is to provide AFP with the resources to assure its continuity and development. AFP put a proposal to change its statute (dating back to 1957) before the government at the end of March, dissatisfied with its current corporate status which its CEO Pierre Louette does not believe gives it a chance to reinvent itself or develop. He would like the agency to become a company: currently it cannot have shareholders and cannot spend its own funds, hence it cannot invest autonomously. AFP believes it needs 65 million euros for development and acquisitions. The state guarantees 40% of AFP's annual budget so already has a vested interest in the agency.

A key concern regarding AFP becoming a company with the state as a single shareholder is clearly that the independence of the news agency could suffer. Le Figaro quoted union representative Thierry Masure who commented "if the state is our owner, our independence will be limited." In order to preserve its independence, AFP's board of directors would keep media representatives on its board of directors, and AFP's president would be chosen by this body rather than by the government.

AFP has experienced problems similar to the Associated Press as its customers suffer financially, with regional papers threatening to drop the service.

Eric Scherer, who runs AFP's Mediawatch blog, explained at a meeting at the OECD how AFP has been adapting to the impact of the Internet, offering its traditional media customers both content and services, such as video, mobile or user-generated content platforms rather than just editorial content, and developing its relationship with the consumer.

The challenges that news agencies face are similar to those that newspapers are tackling, but as the Economist pointed out earlier this year, there are other services that agencies can provide: Reuters has managed to supplement its revenue from news stories with that from providing information to financial-services firms.

Source: Le Figaro