Annual report 2014

Group Profile

| Businesses | Litigation | Risk Factors

Strategy

Vivendi is moving forward with its transformation with one clear

ambition - to become a media champion with a European identity and an

international reach, capable of creating and distributing content that is

unique in its genre, everywhere in the world.

This ambition first requires the achievement of several objectives in 2015:

reinforcing our presence in the high-growth markets;

accelerating the digital transition of our businesses;

taking concerted action to identify and support new talent; and

enhancing our pioneering position in the area of CSR.

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Reinforcing our Presence in the High-Growth Markets

To continue its development, Vivendi must capture the extraordinary

growth potential that new geographic markets will generate in the

coming years.

First, the number of consumers of cultural products will increase rapidly

in several continents over the next decade. The OECD estimates that two

billion people will join the middle class in Africa, Asia, and Latin America

by 2025. In moving from a subsistence economy to an entertainment

economy, individuals will naturally tend to consume more media and

content.

As a result, Vivendi must reinforce its presence in these high-potential

markets, which represented 25% of its revenues in 2013. Several of the

group`s businesses are already partially expanding in these countries:

present in Vietnam and Poland, Canal+ Group seeks to accelerate its

growth in Africa where it currently has 1.55 million subscribers; and

UMG, which today generates 80% of its revenues in only five

countries, has announced its intention to expand into China, India

and Indonesia.

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Accelerating the Digital Transition of our Businesses

Greater numbers of consumers will have easy and personalized access

to cultural products: at home, when traveling, on one or more screens,

on demand, or by subscription. They will benefit from the pervasive

use of the Internet and the increase in connected equipment: between

2010 and 2025, the number of Internet users in the world is expected to

almost double from 2 billion to 3.8 billion. Between 2013 and 2017, for

mobile Internet alone, the number of users is expected to increase from

1.9 billion to 2.9 billion.

Vivendi must therefore seize the opportunities that arise from these new

consumption and distribution models. The group has already begun to

invest in innovative services such as streaming, SVoD and electronic

ticket sales:

Vivendi holds high-value interests in new generation platforms at the

point of intersection of media and digital: such as Vevo, Studio Bagel

and Spotify; and

Vivendi has just created “Vivendi Village”, which brings together

innovative and dynamic companies (Vivendi Ticketing, Wengo,

Watchever and The Olympia).

Through its investments in digital platforms, Vivendi will be capable

of collecting and creating value from its customer data. By better

understanding their usage, and knowing more about their tastes, the

group will be able to offer content and services tailored to its customers,

particularly in music. The Global Music Data Alliance (GMDA) formed in

January 2015 by UMG and the Havas group fits into this strategy.

Finally, the digital vector and the geographic vector are two growth

multipliers for all Vivendi’s businesses.

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Taking Concerted Action to Identify

and Support New Talent

Due to the strength of its brands, the variety of its artists and the quality

of its offerings, Vivendi is today a group with recognized expertise in

the discovery and management of talent - all talent, whether artistic

or operational, international or local. For example, more than 60% of

UMG’s physical and digital sales are recorded by local artists in over

59 countries.

Supported by its ability to manage exceptional expertise in music,

television and film, our group intends to take a new step in the

identification, development and emergence of talent.

This is the reason for Vivendi’s recent launch of “Vivendi Talents”, a

project designed to maximize the potential of all talent in creation and

expression:

within traditional professional circuits by combining the group’s

different initiatives in this area (including Talent Factory, Canal Start

and Island Africa Talent); and

beyond the traditional identified talent pools, and in an equal

opportunity approach, by relying on associations supported by the

Create Joy solidarity program.

“Vivendi Talents” will be placed into a concrete format with the opening

of an emblematic space within Vivendi`s corporate headquarters, where

new talents will be able to express themselves, present their projects

and meet with experts.

The group aims to combine this desire to find new talent with its social

and environmental commitment.

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Enhancing our Pioneering Position

in the Area of CSR

By marking a sphere of responsibility for the media and cultural industry

sector, Vivendi has for several years now defined a corporate social

responsibility (CSR) policy directly related to its operations as a publisher,

producer and distributor of content.

This policy is based on four strategic challenges:

promoting cultural diversity in the offer of content and artistic

expression;

protecting and supporting the young people in their use of digital

media;

sharing knowledge, including pluralism in the availability

of information and accessibility to and education in media; and

protecting and enhancing the use of personal data.

1.3.2.

One Ambition - to Make Vivendi a World-Class French Multimedia Group

Annual Report 2014