Page 44 - 2012 Annual Report

VIVENDI l 2012 l Annual Report 44
GROUP PROFILE – BUSINESSES – LITIGATION – RISK FACTORS 1
1
SECTION 2 - BUSINESSES
SEASONALITY OF GROUP BUSINESSES
2.7.3. Watchever
In 2012, teams from Vivendi Mobile Entertainment (VME, a wholly-owned
subsidiary of Vivendi) focused on the development of a new offering to
the general public, allowing them to stream movies and TV series on all
devices (SVOD).
The service, which is called Watchever, was launched in Germany in early
January 2013. For a monthly subscription of €8.99, it provides a wide
selection of TV shows and German, European and international movies.
It is accessible via the Internet on various types of devices: connected TV
sets, game consoles, PCs, tablet computers, and smartphones. Watchever
is an integral part of Vivendi’s plans to make content available to the
public over multiple distribution channels.
2.8. SEASONALITY OF GROUP BUSINESSES
The business activities of Vivendi subsidiaries are seasonal in nature. As a
result, a greater volume of sales is generated in the last quarter, especially
during the holiday season at the end of the year. This is the case with
Activision Blizzard, Universal Music Group, SFR, Maroc Telecom (in some
countries) and Canal+ Group. For Canal+ Group, there is also a seasonal
nature to the broadcasting of international or local sporting events. The
Africa Cup of Nations, for example, can influence the number of sales,
especially for no-commitment subscriptions. A particular feature of GVT
in Brazil, is that while the subscription contracts in the form of monthly
plans represent 76% of its revenues, the remaining 24% correspond to
actual consumption, which is billed per minute of use, and is therefore
less predictable in terms of revenue. As for its on-demand services, they
are used less during the holidays and summer.
With Maroc Telecom, in Morocco and other parts of Africa, seasonality
may also vary according to religious rites. During the month of Ramadan
(from July 21 to August 19 in 2012), for example, business is slow, both for
fixed lines and for mobile. In Morocco, Mauritania, Gabon and Mali, it is
stronger during religious holidays and the end of the year, and during the
summer months, except in Burkina Faso because of the heavy rains that
may affect network quality.
To manage seasonal fluctuations, products are launched throughout
the year (e.g., popular video games and related content, albums, films,
new packages and attractive services). In addition, the subscription-
based business model generates more regular income, spread out over
each month of the year, allowing Vivendi’s subsidiaries to maintain good
visibility in relation to their revenue projections.
2.9. RAWMATERIALS USED IN THE GROUP BUSINESSES
The main raw materials used by Vivendi subsidiaries are:
✱ paper for packaging products at Activision Blizzard, Universal Music
Group, Canal+ Group, SFR and Maroc Telecom;
✱ polycarbonate for CD or DVD production at Activision Blizzard,
Universal Music Group and Canal+ Group;
✱ plastics for the packaging of products and peripherals for games on
consoles and for PCs at Activision Blizzard;
✱ copper for laying cables at SFR, Maroc Telecom and GVT;
✱ polymers derived from petroleum for the installation of fiber optics at
SFR, Maroc Telecom and GVT; and
✱ steel for the construction of pylons at SFR and Maroc Telecom.
Paper, polycarbonate and plastics do not experience price variations that
may have a significant impact on the activities of companies that use
them. However, the polycarbonate and plastics used in some packaging
as well as in accessories and game peripherals may experience price
changes due to the fluctuation of oil prices.
Copper, polymers derived from petroleum and steel used by Maroc
Telecom and SFR do not represent a large enough cost to have a significant
impact on their activities.
Generally, Vivendi’s subsidiaries’ business activities are not dependent on
any raw material suppliers.