Filed by Vivendi S.A.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: The Seagram Company Ltd.
Commission File No. 1-2275
and
Subject Company: Canal Plus S.A.
Commission File No. 82-2270
July 11, 2000
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Safe-Harbor Statement
This presentation contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on management's current expectations or beliefs
and are subject to a number of factors and uncertainties that could cause actual
results to differ materially from those described in the forward-looking
statements. The forward-looking statements contained in this release address the
following subjects: expected date of closing the merger; future financial and
operating results; and timing and benefits of the merger.
The following factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements: the risk that
the Vivendi, CANAL+'s and Seagram's businesses will not be integrated
successfully; costs related to the merger; failure of the Vivendi, CANAL+ or
Seagram's stockholders to approve the merger; inability to further identify,
develop and achieve success for new products, services and technologies;
increase competition and its effect on pricing, spending, third-party
relationships and revenues; inability to establish and maintain relationships
with commerce, advertising, marketing, technology, and content providers.
Investors and security holders are urged to read the joint proxy
statement/prospectus regarding the business combination transaction referenced
in the foregoing information, when it becomes available, because it will contain
important information. The joint proxy statement/prospectus will be filed with
the Securities and Exchange Commission by Vivendi, CANAL+ and Seagram. Investors
and security holders may obtain a free copy of the joint proxy
statement/prospectus (when it is available) and other documents filed by
Vivendi, CANAL+ and Seagram with the Commission at the Commission's web site at
www.sec.gov. The joint proxy statement/prospectus and these other documents may
also be obtained for free from Vivendi, CANAL+ and Seagram. Information
regarding the participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise, is contained
in the joint press release relating to the transaction filed with the Commission
by each of Vivendi and Seagram, on June 20, 2000.
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THE FOLLOWING IS A TRANSCRIPT PREPARED WITH RESPECT TO THE
VIVENDI/UNIVERSAL TOWN HALL MEETING
JULY 10, 2000
10:00 A.M.
SECTION 1
SPEAKERS:
EDGAR BRONFMAN, JR.
JEAN MARIE MESSIER
PIERRE LESCURE
RON MEYER
DOUG MORRIS
JOHN BORGIA
LESTER YANO
OUIDA ROBINSON
BONITA CHAN
KIRK TRUTNER
KEVIN CAMPBELL
ERIC LICOYS
PHILLIPE GERMOND
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MR. BRONFMAN: Good morning, Madames and Messieurs, bon jour. Okay. That's
another place. How are you this morning? I want to welcome everyone who is here.
I want to welcome everyone who is watching and listening somewhere else around
the United States or even outside of the U.S.
Let me first try to give you just a brief outline of how the program will
hopefully proceed and then I will have a few remarks as well. You're going to
hear from me. Then you will hear from Mr. Messier and Pierre Lescure. Then Doug
and Ron will join us. We're going to take your questions from a panel of
employees who have gotten their questions through Vox, Pathways and others and
are part of those who are attending this meeting.
We then want to take questions from those who are not necessarily on the
panel, people who are in this room, people who will be watching and listening
from other locations. We'll then take a look at some of our upcoming product and
then Jean Marie and I will close with very brief remarks at the end.
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We're going to do our best to answer all of your questions, but please bear
with us because the reality is that we're really very early in this process.
It's amazing that all of this is maybe I think three weeks old now since the
announcement or not quite three weeks; so please recognize that we are going to
do our very best to be as forthcoming as we can. There are some things probably,
some areas where we may not be able to go due to SEC and other restrictions and
there may be some areas where we simply don't know the answers, but if we don't
know the answers, we'll tell you we don't know the answers and do our best to
get back to you as quickly as we can.
Let me begin my own remarks by trying to outline what has transpired and
why and talk about the future of Vivendi/Universal and the importance of your
role in driving this new company to its new destiny.
Before I do that, though, I would like to give you maybe just a little bit
of personal perspective. You know, as a member of the Bronfman family and as a
member of the board and as the CEO of Seagram, I have proposed this transaction
because I really believe that it's in the best interests of all the Seagram
shareholders.
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The best positions are creative businesses for growth and that's what this
meeting is going to be all about, but it also will allow our spirits and wine
business to address the fundamental need in the spirits and wine industry to
drive further consolidation, and it is both my role and my hope in that piece of
the consolidation to ensure that not only do our shareholders fare well in the
spirits and wine consolidation, but as many of our Seagram spirits and wine
employees do as well, and I just want any of those people who are listening here
today, and I'll be addressing more of them tomorrow, to know that and to
understand that. But this combination for our creative businesses offers, I
think, extraordinary opportunities for all of our employees, but this decision
in making and proposing this transaction clearly for me is not without emotion.
In fact for me it's really very personal.
When I became CEO, my focus and my top priority was to advance and grow the
investment that our shareholders held in Seagram and certainly my family was and
is a very large shareholder, but I never sought to put their interests ahead of
other shareholders, though I was intent on advancing their position as well.
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That focus and that priority really resulted in our acquisition of and our
commitment to the creative process, to our acquisition of MCA and to trying to
grow our business in music, film, television and recreation. And that commitment
does not change going forward.
I will continue to have that focus, only now it won't be from the position
of CEO, but as vice-chairman and representing the largest shareholder of this
extraordinary new company because I truly believe that the continuation of our
goal to produce the world's best movies and music, television and recreation
experiences will create extraordinary growth prospects for shareholders, and I
believe that today as a result of this combination that the growth possibilities
of Vivendi and Universal together are really extraordinary.
Let me try and describe that to you briefly. You will learn much more from
Jean Marie and Pierre as the morning goes forward, but these initiatives are
dramatic and important because, first of all, as I was very proud to say to Lew
Wasserman when I called Lew several weeks ago to tell him all about what was
unfolding that the name Universal will now sit atop one of the largest, most
important media and communications companies in the world.
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And I am very proud to have had a part in making that possible, and as
someone said to me, now Universal really is universal. There's no question that
with the convergence of technology, the investment required in technology, the
continuing importance of distribution that the ability to marry our content with
the extraordinary distribution platform of Vivendi and Canal+ and then on top of
that to create a company and perhaps the only company that is poised to take
advantage of the next generation of the Internet, the second generation of the
Internet, that is an extraordinary company indeed.
And what do we mean by the next generation of the Internet? Probably the
first generation meant you're connected to the world from a fixed point. You sit
in front of your PC and you have access to the world.
The next generation of Internet, though it is a little bit more difficult
for us in the U.S. to believe it since our cellular systems are so pathetic, but
the next generation of the Internet is connectivity to the world from wherever
you are whenever you're there across any platform or device.
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That's the next generation and that's the vision that Jean Marie and I
shared when we first began talking to each other just at the happenstance of
having breakfast together in October of last year in Paris, and we started
talking about where the world was going and I found that our visions were very,
very much the same.
And when you learn more as you will this morning and as you will as this
merger advances, you will see that the assets with which we are joining at
Vivendi and at Canal+ are really extraordinary assets that allow this vision to
be created.
There's no question that our content is more valuable aligned with the
distribution platform and theirs is a great distribution platform and there's no
question that a distribution platform like theirs is advantaged by our content;
and so in my view one and one make three before we even get to the point of view
of building that aggregation service called Vizzavi which takes advantage, as I
said, of the next generation of the Internet.
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But when you think about all the business models that we have yet to create
that can be created and the freedom to be in a sense indifferent to where the
margins move between content, distribution and aggregation allows us to serve
the consumer and in this new world of the Internet, there is only one winner and
that's the consumer.
The consumer is going to get what the consumer wants. They are going to get
it in the way that they want it and we have to find a way to give it to them.
And as a content company, we need to be worried about where our margins are,
does the distributor get it, does the aggregator get it. The aggregator has the
same problem, and the distributor has the same problem, et cetera.
When you are one company like Vivendi/Universal, we can better serve the
consumer, therefore better growing our customers and be indifferent so long as
that margin stays, or the majority of the margin stays somewhere in the group,
and so not only do I believe we are as well positioned now or will be when this
merger closes than any other media and communications company, but I think we
will have the size, the scale to invest more strongly and more actively in all
of our businesses.
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And the other thing that I will say is one of the most important things to
me about this combination, in addition to the fact that I feel so strongly that
the new Vivendi/Universal is a powerhouse of a company, is that the assets here
being joined together are almost entirely complementary.
This is not a merger about cross-savings. This is not a merger about
eliminating masses of operations. This is a merger about joining complementary
businesses and services together to create a larger, more effective, more
competitive and ultimately more profitable whole.
I think when you meet Jean Marie and when you met Pierre, you will agree
with me that these are people who are committed not only to their business, bu
to our businesses.
I think you'll feel comforted that there is a seamless management view
about where the future is and how best to get there and therefore what I would
like to do without taking up too much more time of the morning is introduce you
to John Marie Messier who I met in October of last year. We were supposed to
meet I think for a half hour and I would like to say in front of everyone here
the reason I met Jean Marie Messier, so you can either blame him or give him the
credit, was because of Blair Westlake -- where is Blair -- who last summer wrote
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me an E mail which some of you know is probably the only way to communicate with
me effectively, and said, there is this guy named Messier in Europe and you
probably ought to put him on your radar screen.
And I was going there on vacation with my wife and was able to find some
time on Jean Marie's schedule so we had breakfast. I think it was scheduled for
half an hour, 45 minutes, and we ended up spending several hours talking about
our vision of the future.
And Jean Marie then got in touch with me again I think in February or so of
this year and we started focusing on whether or not some kind of combination
would make sense to his shareholders and to ours.
So I'm delighted to be able to introduce him to you, to be able to tell you
that over that period of time, I think he and I have developed a genuine
friendship. As or more importantly, I think we've developed a great deal of
mutual respect and trust in each other's abilities and each other's vision.
And it is therefore my pleasure and my privilege to introduce him to you
now. Jean Marie Messier.
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MR. MESSIER: Thank you. Thank you so much for your warm welcome. I feel
privileged to talk to you, to talk to people of community known around the world
as being as very creative and talented, and I want also to tell you that I'm
very pleased, Lew, that you are part of the attendance today because you as a
person represent so much to this business, to this place and to anyone in the
room. Thank you, Lew.
Many thanks to my friend, my partner, my colleagues, all of them, and
Edgar, for his very kind words.
I try to think of several ways of introducing myself to you because I know
that's the first thing I have to do, and finally for various reasons, but one of
them being just to show you that I'm not looking at myself too seriously, I have
chosen an abstract of a very popular Canal+ program, the puppet show, named
"Ligen D'an yafoal" (phonetic spelling) where I have my puppet and the only
thing you have to know is my surname in France and Europe is J2M. When you
understand that, you will understand. Believe it or not, that's my story.
(Video played here.)
And so I hope you begin to know me a little bit through this video. Since
this combination happened, I have had the opportunity to learn about how people
are speaking, how you do speak here in Hollywood, and I have to tell you that I
have picked up a whole new vocabulary. If I may say so for starters, Edgar and
I, we don't make appointments with each other.
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His people are talking to my people, and instead of the traditional
"Messieur," I have been called "Baby," "Buddy," "Bubbela;" so over the past few
months, I got the feeling that I have done about everything here. I've done the
power breakfast thing. I've done the sushi lunch thing. I've done the poolside
dinner thing and whatever.
I have learned the difference between kibbutz and how to kibbits, and
Edgar, even if you are on the back stage now, when you told me, Edgar, about the
asking price for Seagram, I think that I learned all about the meaning of
"chutzpah."
So today, good morning, Vivendi/Universal. It's really great for me to be
here in L.A. and with those also who are viewing this meeting from other
locations. For me as you can understand that's quite an emotional occasion
because that's the marriage of two or three with Canal+ great companies and
that's the birth of an integrated global communication powerhouse, and I'm not
indifferent to this moment.
That's a lot of emotion behind it.
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The creation and the story of the birth of Vivendi/Universal, you heard it
a few moments ago through Edgar remembering that first time in October, Edgar
came, visited me in Paris for breakfast when he was on vacation. He was without
tie. He was with his vacation clothes, with shirt sleeves and we chat.
And at the end of the conversation -- it is not simple for you to
understand that -- at the end of this conversation with Edgar, I got the strong
feeling, and I think it was shared, that going together between Vivendi, Canal+
and Seagram, we were just going to make the Internet swing, and I think that's
what this combination is about.
How did we come to such a conclusion and to a large extent so quickly. I
think that because we are both on the same wavelength. Just think about it.
Edgar had taken a traditional, hugely successful global spirits business into
new territory, the entertainment industry.
I've taken a traditional hugely successful water business into new
territory, the convergence between the media, the telcos and the Internet; so
scotch and water, that's the birth of Vivendi/Universal.
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And Edgar, I congratulate you for your imagination and vision that you have
made shared by your family first, your board and I do hope all Universal
employees. Thanks and congratulations, Edgar.
I'm here to talk with you about my vision of Vivendi/Universal and to show
how just the parts will fit together because I think that is what you need to
hear this morning. We are here to create the future and to have fun because you
cannot be in the entertainment industry if you don't believe in fun.
But what is most important for me is just to meet with you, to hear what
you have to say and to try to answer your questions; so please, the time we
spend together today, make it as candid as possible, as relaxed as possible.
We are here for one single purpose. That's just to communicate, which means
basically that's no question is taboo this morning. I will share our strategy
with you and show you why Vivendi/Universal is in the perfect place at the very
right, at the exact right time to become this global leader in the
communications.
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I know that you have been through different ownerships, through lots of
changes. I'm sure that you may be saying, "Here we go again." Not so. Not so.
And here's why. With us it is a win-win combination.
You bring us contents and expertise in the movies and in music and you
bring us access to the U.S. market. I do think that we bring you both much
enhanced access to Europe and at the same time what I think is wonderful
know-how of what's going to happen in the new Internet age in the coming decade.
When you put Europe and the U.S. together, when you put your wonderful
knowledge of the key contents and our knowledge of the new age of Internet, this
is the ultimate combination. This is the winning combination for the coming
decades.
That's why we are doing this combination. That's why you, you are core to
the future of Vivendi/Universal. And now let's prove it together.
Vivendi/Universal will be the global company that truly integrates what I
described as, on one side, outstanding contents with innovative delivery systems
around the Internet, all driven by your creativity and your talent.
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By offering information, any time, anywhere, we will be the first company
to provide music, sports, film, publishing information, education, interactive
games across satellites, TV, wire and wireless networks as around and through
all the Internet channels distribution. That's to say Internet access, media,
any device at any time in any place.
We will be together the best company at combining premier global and local
contents with the next generation digital distribution reaching more than 80
million people in Europe, 80 million European subscribers through Vizzavi.
You may have heard or read about Vizzavi. What's Vizzavi? I want to explain
it to you in a few seconds. The best way is just to show you within the original
version the advertising TV campaign on Vizzavi. Just have a look at it.
(Video played here.)
MR. MESSIER: That's the first introduction to this Europe first
multi-access portal via mobile phones as interactive TV, and you know our
friends at Canal+, they have begun with interactive TV already close to five
years ago in '96.
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Because of Vizzavi, we will have together the largest worldwide footprint
in mobile and pay TV customers. Let's use it. We are creating a family of
powerful media brands supported by a growing portfolio of new companies.
Just think about it. No one else -- no one else -- can offer so much across
so many platforms. If it involves media or the delivery of that media, then we
are in it. And we are in it big time.
When I talk about Vivendi/Universal being global, the first, the best, and
the only company in its league, I just want you to be happy. Why? Just because
you are lucky. You are lucky because Vivendi/Universal, as I will try to convey
to you all along this discussion, Vivendi/Universal is not an ordinary company.
You are not part of an ordinary company. In fact Vivendi/Universal is very
extraordinary.
By joining the forces, we become the next generation Internet company with
tremendous, tremendous contents. The know-how to exploit and to distribute these
contents, and the global capacity to distribute it through all, all media.
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Here is what it means to you. What it means to you is that you will be part
of a top tier global company, who is to spend 30 seconds in fears, whose market
cap, looking to what the others are saying, may be well over $120 billion.
It means that the only major player ahead of us is going to be AOL-Time
Warner. But they are only U.S.-centric and only PC-centric. Vivendi/Universal is
going to be the next. Starting at number 2, we'll have one place to win
together.
But being neither U.S.-centric, we will be well balanced between U.S. and
Europe, neither PC-centric for the coming generation of Internet directly
multi-access which is what I want as a customer in my personal life every day.
And after us, but after us only, you will find small companies named CBS
Viacom, named Disney, named Yahoo. That's where we are going to stand together.
We are in a fantastic position to exploit the future because we are ready
for the explosive growth which will come through the era of convergence.
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Here are just two examples that I would like to mention. Last year there
were 15 million users of digital TV. By year 2005, there will be more than 100
million.
In the next five years, if you take what we call the WAP and the third
generation mobile, they will grow from zero users to more than 300 million users
around the world.
Vivendi/Universal will be driving and benefitting from this broad band and
multi-access new Internet revolution. And be sure of one thing. Contents will be
the key differentiator. First with music, games and cartoons and then with the
videos and the movies. We have it all. And that's just great.
Speaking of the movies, obviously when I'm looking to Universal, what a
wonderful brand. Universal for me is just nothing else but Universal. Going from
Hong Kong to Rio, from Paris to New York or to Rome, films like "Jurassic Park,"
"The Lost World," "Patch Adams," "The Mummy," "Erin Brockovich," or even "Nutty
Professor II," that I have been pleased to see, Ron, is still on the back stage.
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I looked at it before the release before coming here, July 29th. By the way, I
do think that this is the hit of the summer. All these films without forgetting
"The Gladiator" that my kids just loved, all these films are loved by millions
of people. Everyone knows it is so. That's one of the jewels of the Seagram
crown is the music business with the Universal Music Group as a worldwide
leader, but both global and for the local music in its countries which is very
important.
Our strategy is to use on top of what you do on a traditional basis and
that you will continue to do is to use the Internet to fulfill this promise of
all this music. We will take, thanks to Internet, we will take this market of
music from a $40 million yearly market to I'm sure in the coming decade to at
least a $100 million per year market.
Why the Internet? Because when you look to the facts, music has today a
limited audience. 5 percent of the population is buying 75 percent of the music.
By offering more outlets via the Internet, the PC, the mobiles, the PDA's,
consoles, ITV, we will be able to match the right music with the right consumer.
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That means just greater personalization, increased interactivity which is
what I'm looking for as a customer, by the way, and we're interested in it, and
then sales. It's a win-win for everyone. It's a win-win for the labor. It's a
win-win for the artists. It's a win-win for the consumers.
What you have to know about Vivendi is that Vivendi is above all often
entrepreneurial culture. We have been, I think, always quite agile to, let's
say, sniff out the new opportunities and to establish an early foothold in new
industries, like the multi-access portals, the Vizzavi you saw, the electronic
games, the interactive TV with Canal+ and Pierre Lescure that you will see in a
few minutes, as you have seen with Canal+ from the very first day.
Vivendi has grown because of its strong traditions and through its embrace
of the new. Vivendi/Universal, that's for me quite a natural bridge between the
old and the new economies. We will take advantage of the possibilities offered
by the new technologies, but at the same time, we will continue to strongly rely
on the traditional activities and contents.
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Vivendi has not been living in a vacuum dreaming of the future. We already
have a wealth of content developed by others in education, games, business
information. For example, you may know the 2000 edition of the Petit Larousse
encyclopedia has already sold over 1 million copies.
On the games front, let me take that example. Our WEB site, Flipside.com.
Please, if anyone in the room doesn't know Flipside.com, when you are back in
the office, just go and surf to Flipside.com. That's the place to go for on-line
gaming.
Here you can find up to 60,000 players at the same time, multi players on
the same game. Our success has made Flipside.com one of the top ten sites in the
world for the global duration. With Flipside.com only for the games, we are
ahead of NBC Internet, we are well ahead of our growth line, we are well ahead
of Amazon.com. You hear lots about Amazon.com. That's 2.5 times the total
duration of Amazon.com. So we are No. 9 in that field.
With your help we have to target the top five and I hope as soon as
possible the top 3.
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Recently another example, Havas has launched the second generation of
interactive CD roms games with Diablo II. 2 million copies from day one. The
biggest ever worldwide launch in the games field, and at the same day, they run
in 8 languages. They were obviously English, French, German, Italian, Korean,
Japanese, and I think I'm forgetting Polish and I don't remember the 8th. 2
million copies the same day. You know in your business what a hit means.
We, Vivendi, we are very interested in all different businesses by looking
to the largest hits. And of course there is also the contents of Canal+ in the
movies business, in the sports, with very strong licensing agreements for the
soccer all over Europe.
In the telecommunications sector through what you see on the small video,
we have already in place tens of millions of users. All success requires global
platforms, global reach and global sensibility. That's certainly not news to you
in Universal.
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Last year in '99, about 60 percent of your music turnover was made outside
the States. If you do consider the film entertainment business, including -- I'm
including the international TV, the business there, you were close to 50 percent
of the turnover outside the states; so you already know about that.
Together a new Vivendi/Universal will be a major global player with
tremendous resources and capabilities in the States, but also all around the
world, and if there is something for which the Universal brand is made, has been
made, that's to be all the around the world.
In a few minutes, you will hear from others on the Universal team; Ron,
Doug Meyers and meet the new head of all the films and TV businesses, Pierre
Lescure.
But I also want you to meet two of our team members who were unable to join
us this morning because I just want you to know, to share with Edgar and I the
whole team of people who is going to take care, on an operational basis, of
Vivendi/Universal every day; so first please meet with my very good friend and
colleague, Eric Licoys who is the head of Vivendi/Universal publishing.
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MR. LICOYS: (By video) Good morning, my name is Eric Licoys. I am CEO of
Vivendi/Universal as Pierre Lescure, but I am also chairman of Havas. Havas is
one of the leading companies in publishing and multi media in Europe, and
worldwide leader in education and games for PC.
I'm pretty sure that all of you know our famous brands as Jump Start in
Education, as Heart Light, as also Java II, that you will discover here today.
We are very proud to win the game of the year every year, but we are also very
proud of our studios in L.A. as Sierra, or Blizzard.
We know that collaboration has already started between the CEO of Havas
interactive in L.A. and Jim Wilson. There is a great future for collaboration
between the two companies and we are extremely excited with the future.
We know that in that kind of spirit with a lot of friendship between your
teams and our teams, we'll do a tremendous job and I will say that we welcome
you in the warmest way, and if I can say something on behalf of all my team,
it's just vive Vivendi/Universal. Thank you.
MR. MESSIER: That's Eric Licoys that you will see very soon.
And now please meet with the man who helped tremendously Vivendi to be
transformed into major telephony company and who is taking care of large part
and very attractive part of our future which are all the developments relating
to the Internet field; so please now meet with Philip Germond.
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MR. GERMOND: (By video) Good morning. My name is Philip Germond. I am
senior executive vice president of Vivendi in charge of the telecommunication
and Internet activities. I feel very sorry not to be with you today, but today
might be a very special day for me or tomorrow. Because I'm going to be, for the
fourth time, the father of a daughter. So that's the reason why I'm not joining
you today in Los Angeles.
Maybe a few words about what I've done before. I joined Vivendi five years
ago as the CEO for the telecommunication activities. Before I've been 15 years
with Unipickard and before I was a student at Stanford University at the
business school; so maybe a few words regarding the telecommunication activities
and the Internet activities of Vivendi.
I mean, our main activity in telecommunication is Sigitel. Sigitel is the
No. 2 operator in France. We have 40 percent market share in the mobile activity
in France. We started off with the activities a couple of years ago. Now we have
a bit more than 10 percent share of French market for long-distance telephony.
And we have very high gross.
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Just to give you an example, for critical assets, we have today penetration
rate of the mobile telephony in France is 37 percent. We expect to achieve by
the end of 2003 maybe a penetration rate of close to 70, 75 percent.
Why do I insist so much on the mobile telephony is because we believe that
today the access on the Internet is almost 100 percent through the PC. We
believe that in the future, accessing Internet will be done through different
form factor, through the PC screen, through the TV screen and also through the
mobile phones and we believe that the job of telecommunications operator is not
just to provide communication or voice communication. It's also to provide to
our customers content.
And in order to differentiate it against our competitors, we need very
valuable content; so we as an access company, we need content and also the
content companies might be music, might be education, medical for the activities
of Havas, for example, or movies, video.
We'll need to have access to the customer. That's a perfect combination; so
that's why I believe that what we are going to achieve together, that merger
between Vivendi, Seagram and Canal+ is probably the best combination we can
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imagine to enter into this new world of moving into the broad band, moving into
a high gross entertainment services world, and we believe that we can be, thanks
to that merger, one of the greater winners of this new world if not the best in
this world.
MR. MESSIER: Did you notice, even the French people are speaking English. I
know that some of you were worried a little bit about that and what's going to
happen if I don't speak French. If you don't speak French, I have only one
recommendation. Just learn to speak English.
I'm sure that there will be a lot of questions coming from you on the
integration of our two companies and we will go through them very shortly, but I
have one major challenge for everyone here, and listening in.
We need to work together and with every bit of our creative talent. We need
to work together to make the integration of Vivendi/Universal a tremendous
success. This will mean that we will have to understand what each of us brings
to our business activities.
It will also mean organizing as much energy, focus and cooperation as
possible between our teams, in identifying, implementing the synergies across
the board. Synergies in that case is marketing ideas, product ideas, services
ideas.
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Now is not the time for second opinions. Now is just the time for action
and that's what I wanted to tell you today.
As you may have noticed or may begin to notice, I'm full of enthusiasm
because I'm waking up every morning thinking that leading a group like Vivendi,
leading a group like tomorrow morning, Vivendi/Universal, that's really the
opportunity of a lifetime.
Vivendi/Universal will succeed because of its ability to be a giant, to be
flexible, to be inventive and to be first to market. Ours must be an environment
of open-minded and open-ended communications.
Share your ideas. Share your dreams. Vivendi/Universal is the place where
they can take root and flourish. Together let's expand our frontiers.
You have, all of you, you have a tremendous reputation for creativity, for
talent and for marketing savvy. Never stop being innovative. Never stop asking
why not. Never stop trying to push the boundaries of the possible and never
forget with what I've just told you that you are core to our future, you are
core to Vivendi Universal's future.
This morning I'm welcoming you and I am welcoming you warmly into the
Vivendi world, and at the same time, it will be just great for me to be welcomed
by you in your world.
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That's the way we will be able to create together Vivendi/Universal.
Vivendi/Universal, that's a fantastic group. That's a winning team.
Vivendi/Universal very soon, it's all yours; so let's build together this future
of Vivendi/Universal, vive Vivendi/Universal, and thank you very much for
listening to me.
May I now, before we go to your questions and answer them, just introduce
my old friend Pierre Lescure who has been with Canal+ for the last 16 years.
Pierre, the stage is yours.
MR. LESCURE: Thank you. Thank you, Jean Marie. Even in French, I would have
problems finding the right words to express my pleasure, my pride, my excitement
here today. When I passed the gate of Universal Studio, the security guard gave
me a warm and professional reception. I perfectly knew he got instructions, but,
guys, I can tell you I really liked the feeling.
I entered the Lew Wasserman building. I hope, Lew, one time, I will have
the opportunity to be at your very special table for lunch. I hope that.
I went up to Ron's office, stood in front of his window and what did I see.
415 acres of mystery, magic and entertainment. As you can imagine, walking
around the lot was a tremendous experience for me. A delightful moment.
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Visiting Universal Studios is a pilgrimage for me. To a certain extent, I
am walking on sacred ground. Part of me is coming home at last. It is a personal
celebration.
I have derived so much strength and inspiration from movies that have been
shot here, and from the way they were made. My dreams, my ambitions, my values,
my aesthetics, both as a teenager -- that was a long time ago -- and as -- don't
laugh too much when I say -- and as an adult, have been shaped and influenced by
what goes on in this town. On the screen, and off.
I've always been a great admirer and keen observer of the way you do things
here in the States, and to a large extent Canal+ has been built and managed
according to my personal understanding and adaptation of American methods.
What I am trying to say here is that I may in fact be much less of an alien
than my thick "Gerard Depardieu" accent may lead you to believe. I respect this
town, what it stands for, and the way it operates. I think I have a pretty good
understanding of the things you do and the way you do them.
Let me quote Francis Scott Fitzgerald and his book "The Last Tycoon."
"People in the East pretend to be interested in how pictures are made, but their
fascination is with the pretensions, the extravaganzas and the vulgarities. Tell
them pictures have a private grammar, like politics or automobile production,
and watch the blank look come into their faces."
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In other words, I will listen to you, and sometimes you will also listen to
me, I hope. You will soon discover I am the oddity of sorts, a French man
without great theories. Although it may come as a disappointment to you, I don't
come here with a predetermined plan. I may quote from "The Last Tycoon," but I
don't have an Irving Thalberg closet fantasy.
I'm not here to mingle with movie stars. I've had my picture taken with
actresses a couple of times already, so that's taken care of. I don't want to
play the mogul. I can't. I won't have time. I'll be too busy working with you.
I will learn a lot from you, I said. It has always been, and it will be
very inspirational for me to talk with Ron and with many other Universal
executives. For me, Ron Meyer has a very strong quality. He never forgot he was
an agent, a great agent, before joining Universal Studios. He really loves
talents and they gave it back to him.
I will listen to you, but sometimes, you will also listen to me. I have
been working closely with Universal, sometimes with Blaire Westlake and of
course, I working closely with Universal for the last 16 years since 1984 when
Canal+ was launched in France. I'm pretty familiar with your company and with
Hollywood.
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This is why I am convinced Canal+ can also bring you something. Maybe its
pioneering spirit, when it launched pay TV on the old continent or when it was
first to offer digital and interactive TV, which Jean Marie talked about, to
millions of viewers in Europe.
We've also built up strong and personal relationship with our subscribers,
14 million subscriptions all over Europe, and I believe we understand their
wishes and their dreams extremely well.
What I'm bringing you is a group with a very strong multi-domestic culture
where global meets local. Canal+ has several pluses to offer you and I will make
sure everybody at Universal benefits from the experience we at Canal+ and we at
Vivendi have accumulated in Europe. But let's check it out.
(Video played here.)
So what have we learned from this video? That I am not a fashion man. I
started out as a journalist, but I promise I have never been a movie critic,
which means that I don't come here with a cultural agenda. I am not on a
mission. I like popcorn and moreover I love popcorn movies. Believe me, I take
my popcorn movies very seriously, but I also take "B" movies seriously and art
films because they are all my pleasure and they are all my business and both at
home and at the office, as all of you, entertainment has always been a serious
matter and a top priority.
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Some people will remind you of our first difficult inroads into Hollywood,
but I don't know a single of our mistakes which didn't help us to become
stronger and do things better. In the last six years, all our moves in Hollywood
have been profitable. You won't have to teach me everything from scratch because
we do have some experience in movie production as well. We've been running
StudioCanal again, the major studio in Europe, for the last 10 years. We've been
making movies, some very popular ones, and entertained millions of viewers.
I know I come to Hollywood with some inconveniences. I'm French. And I live
abroad. There's very little I can do about my being French; but let me assure
you, I am going to try to play against type and make you forget all the
exasperating French, all the arrogant know-it-all and snotty maitre D's you
might have seen in the movies and in real life.
As far my being based in Paris, all the technology wonders Jean Marie
Messier has shown us will be put to good use, but believe me, after August with
my family in the South of France, you will see a lot of me here on the lot. Take
my word for it. We can work together. And we will. And we will do great things
together. Thank you very much.
34
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Now I think it's the right time to ask Edgar, Jean Marie and Doug Morris
and Ron Meyer to join me on the stage.
MR. MEYER: Let me start by saying we've been through a lot of change and
change creates uncertainty which all of us have shared. I think with what you
have heard today and what I've learned in the past few weeks, I think this
change is going to be an extraordinary one and I hope all of you will join me in
embracing it.
In this company there is a tremendous foundation, and obviously a great
company that was created by Lew Wasserman. Seagram and Edgar continue to build
on it and to continue to build on its strength and I think that this new
combination really is a beginning for us to grow and really compete in a new
century. I think it's an exciting time for all of us. It's a great time and an
exciting time and I think that it's to all of our advantage and I really do hope
that all of you will recognize what a great opportunity this is for this company
to continue to grow.
Also today as Jean Marie said and as Pierre said and Edgar said, please
take this opportunity to ask the questions that are on your minds. As I said
before, there are no sanctions for asking unpopular questions. That's what this
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forum is for. It's for you so you will understand better what is taking place
here; so please think about what you want to say and ask the most provocative
questions you can think of.
MR. MORRIS: I second everything Ron said. Last night I stayed up late
thinking I was going to say something vaguely intelligent. Everything has been
covered.
I actually feel this is great for the entire company and I would like to
take a moment. I think it's actually a very historic moment that we're in the
middle of and I would like to congratulate Jean Marie, Pierre and Edgar. Thank
you for this opportunity.
MR. BRONFMAN: We're going to be joined now by John Borgia who is going to
moderate the Q and A part of this morning. So, John, if we can ask you to join
us on stage and hopefully begin the Q and A. John Borgia.
MR. BORGIA: Good morning. First I want to thank you guys. That was a great
presentation. Jean Marie and Pierre, we learned a lot today so thank you very
much for those.
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My first job is to distract you a little bit while they put up the chairs,
and I'll tell you what we're going to do. We've got five of our colleagues
coming out and they're going to ask questions that you have sent in. We've got
lots of questions that have come in through Pathways, Vox, we got E mails, we
got faxes. We've put some of the questions together, and we've edited a few,
although these gentlemen have not seen the questions, nor do they have prepared
answers; and in a minute these five colleagues are going to come out and then
we're going to do that.
After they're finished, we're going to take a break. Jean Marie is going to
show you Vizzavi. He's got a demonstration he's going to do himself. We got a
lot of technology working today. I hope it all works.
There's about 10,000 people participating at 60 locations. We have
satellite in New York. We have Web questions coming in; so after the panelists
are finished, we're going to open up the floor for another 45 minutes and any
questions you have, come up to the microphones and then we will deal with those
questions.
If we get through all of that, we'll let you go to lunch. It may still be
Monday.
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We are now ready for the panelists to come on out. Okay. We're now ready
for the panelists to come on out. As I mentioned, we do have a lot of questions,
and we're going to ask you to try to keep the questions as short as possible,
and I would ask those that are answering to try to be crisp, also, so that we
can -- so we can get to them. This is where I move to the chair and introduce my
colleagues.
MR. MESSIER: The human resource guy has to be very well organized.
MR. BORGIA: No pressure up here. This is what we usually do Monday
mornings. If we just start holding Ron's hand, then we'll know. If you start
holding her hand, then we'll know.
Ladies and gentlemen, let me introduce you to my immediate right is Lester
Yano of the Universal Music Group. Ladies and gentlemen, Lester Yano.
Also helping us out today is Ouida Robinson of Universal Television and
Network. Lots of TV people here. You said that. Sitting next to Doug, we have
Bonita Chan of Studio Ops.
Bonita, welcome. And to Bonita's right representing Universal Studios
Hollywood, Kirk Trutner. Last but not least this handsome man on the right is
Kevin Campbell of Universal Pictures.
Kevin, as you know, you won the toss. We're going to start with you.
MR. CAMPBELL: Will the current structure of the Universal Studios Group
remain intact?
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MR. BORGIA: Let's start with the easy ones. Okay. Pierre, would you like to
answer that one?
MR. LESCURE: The answer is yes. The answer is yes. You can imagine it was
impossible for me to tell you and to present me as I did a few minutes ago
without having the first statement. There is no better team than the home team.
I have now to spend time with you with your top executives, one organized as
soon as possible. We'll organize that as soon as possible. And my need is to
spend time with people, to listen to them, to know how you work, but just remind
my first answer to your question so precise, my answer is yes.
MR. BORGIA: Kevin, thanks.
MR. MESSIER: You can make a judgement on the studio's team. Just look to
the release. Just look to what has happened in '99 with Universal Studios. Just
look to what has happened since the beginning of the year with Erin Brockovich,
with U571, with the Gladiator, with Nutty Professor II coming right away in the
coming weeks. Don't you think that you are globally making a wonderful team when
you have the chance to get for your studios a wonderful team. You just keep
them. You support them.
MR. BORGIA: Next up is Lester.
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MR. YANO: There's still a lot of rumors about management changes. Will Ron
continue to run Universal Studios?
MR. BORGIA: Ron, would you like to answer that?
MR. MEYER: I need to say, first of all, I really work, but it's an
opportunity for me to say it, I really work with the greatest group of
executives and staff, I think, that exist in this business. It's the best studio
that exists with the best people. I'm excited generally to work with our new
partners. Pierre and I particularly have become friends very quickly and easily
and I say that genuinely; so I'm very excited to continue and I plan to
continue.
MR. TRUTNER: Recent communications from Seagram reference a time period of
18 months to two years before benefits, bonuses or merit structures will be
affected by the merger. Does this mean that these programs will be restructured
or even eliminated after that period?
MR. MESSIER: The answer is no. No. The answer is no. Don't misunderstand.
When you -- when we are giving security, something just to show you that's no,
this combination is not a combination of cost savings. We're not here for
changing everything from day one. We just made this legal commitment because
there are legal commitments to convey the message to each of you that what we
want to do is to build more, what we want to do is to have any of you even more
incentivised in this job than he is today. That's the reason why we put the
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statement that for the coming two years we are taking very strong commitments to
mentioning whatever we are speaking of, bonuses and different benefits that you
can have.
It doesn't mean that our intention is to change everything after that.
That's just to reassure you from day one.
MR. BRONFMAN: John, if I can add, when we were negotiating together, Jean
Marie and myself, and I must say for a deal as difficult, complex and large as
this one, it was -- it had its moments, but it was remarkably smooth. But we
negotiated on behalf of our shareholders.
We also negotiated on behalf of our employees and I want to say that we
worked hard to make sure there were protections for our employees. As Jean Marie
said, they are only that. The point of this merger is to grow.
But I also want to say as hard as we did negotiate on behalf of employees,
I want to say that Jean Marie and his team responded quickly, generously and
thoughtfully to those requests.
(Conclusion of Section 1.)
<PAGE>
SECTION 2
SPEAKERS:
EDGAR BRONFMAN, JR.
JEAN-MARIE MESSIER
PIERRE LESCURE
RON MEYER
DOUG MORRIS
LESTOR YANO
OUIDA ROBINSON
BONITA CHAN
KIRK TRUTNER
KEVIN CAMPBELL
ERIC LICOYS
PHILLIPE GERMOND
<PAGE>
MR. MESSIER: There is one point I want to have. I am sure we will go back
to that through your questions.
When I took over the chairmanship of Vivendi four years ago, less than 10
percent of our employees who were shareholders of Vivendi. Today two thirds of
the Vivendi's employees are shareholders of Vivendi.
That's part of our vision, of our philosophy of managing a company. You are
creating the wealth of our companies. You deserve to get back part of it. That's
as simple as that.
MR. BORGIA: Read it, please.
MS. ROBINSON: Why do you think that the market, as well as financial
analysts and the media, have had a negative reaction to the news of the merger,
and why do you think the stock is trading so far below the announced merger
price?
MR. MESSIER: If you want to have a calm life for several months, don't
enter that kind of merger. The very day you enter that kind of combination, you
know that the market is going to be crazy because people will begin arbitrage.
They will begin to play, to go out of
<PAGE>
your stock, saying, Okay, we will kee waiting, and we will be back as soon
as we think that it's going to happen, but let's play and make money just in
between.
Basically, the Vivendi stock has been hurtled, let's say, 20 percent,
roughly, since the announcement or since the first leak, the preannouncement of
this transaction, we would say. Just make a comparison with similar
transactions. When AOL acquired Time Warner, the stock of AOL was down close to
40 percent in three weeks. When Internet Works acquired Lycos, their stock,
after three weeks, was down 30 percent.
We do know that we have to go through this very volatile period of time,
but what we do know and which is much more important is that's the value of our
business -- is through the combination. It is not hurting it in any way.
There is no risk linked to this combination. There is only -- if we do our job
well, there are only upsides for this combination, and one thing that I do
know: When I took over the chairmanship of Vivendi, our stock price was 22
Euros. It's today 90 Euros four years after that.
I would love to see it back very soon to the 115, 120 it deserves as a
starting point. It will come back to this fundamental value as soon as the
market will
<PAGE>
have the feeling that, yes, that's going to happen, that the
antitrust issues have been overcome, that everything is in place -- one thing
being the Vivendi/Universal as a U.S.-listed stock. And I just want to convey,
yes, that's a period, and you will see, during the coming months, volatility on
the stock price, but even if the market is always right, they are not right
every day.
We know what the fundamental value of Vivendi/Universal is. We know that
the market will go back to this fundamental value. Let's wait these few weeks'
to few months' period of time where the market is made by arbitragers, and to a
certain extent, my feeling is that you're not going to see Vivendi, which is
going to be quite soon your stock, your company -- you will not see Vivendi back
to 90 Euros before a very, very long time or before the day where, with Edgar
and Pierre, we will decide to split the stock three to one.
MR. BORGIA: We all look forward to that day.
Bonita, your question, please.
MS. CHAN: Would you please elaborate -- on the transition of 401K
contributions from Seagram to Vivendi? Will the current retirement plans roll
over into the new company, or will these plans become vested after the close of
the deal?
<PAGE>
MR. BRONFMAN: John, do you want to answer that?
MR. BORGIA: Ken Kahrs, are you here?
The 401K plans are going to continue, and as is always the case, any money
that you've put in the 401K plan -- obviously, that's your money. The money that
we've put in as a match, as you know, has to vest each year over time. If you
are vested, of course, that's yours, but we expect that plan to continue.
Now, if you've selected Seagram stock as one of your investment choices,
that will roll over into Vivendi/Universal stock at the same exchange rates. I
would add, because that question is a little tricky on vested retirement plans
-- as you know, on our retirement account plans, you have to be here five years
to vest.
If you're not here five years, this transaction is not going to accelerate
that. So we expect the plans to continue as we know them today. Being moderator,
it's easier than that. Kevin, you're up for number two.
MR. CAMPBELL: Under the new structure, how will Universal be involved in
new technology such as the Internet, digital distribution, broad brand, HDTV,
and interactive television?
MR. MESSIER: The answer is as much as
<PAGE>
possible, and don't wait anything from our side. Please, have new ideas,
suggest new proposals, new products, new services.
There are several ways to associate Universal or even, within the Seagram
group, U.S.A. Networks, to this strategy. If you take, just to speak 30 seconds,
of the company led by your friend, Barry Diller -- if you take things like
Ticketmaster, Home Shopping, other reservations, they are made for Vizzavi. It
will happen to them in Europe. It will happen to you in the music field. It will
happen to you in the movies field -- this access to this wonderful distribution
that is working in Europe.
If I may take a few examples, I was mentioning, in my introductory speech,
the Diablo II launched with two million copies in day one. The previous launch
of Diablo at that time, owned by Sundance Software -- it was only 800,000
copies. For what reason -- because they were basically all U.S.? Now they are
really worldwide.
If I can take another underground example, speaking of the music side, in
France, there is a well-known artist by Pierre Lescure, a French rocker, French
artist, named Johnny Holiday. He has been there for the last 40 years, Pierre,
and he's a great, great artist.
Last week there was launch of his last album. It was a live concert within
the Eiffel Tower, which has been recorded and launched in three weeks, not far
from the total recall. What did we do? In one day, we built very simple
operations. We sent several millions of short messages to our mobile subscribers
in France, telling them SFR is proud to announce the issue of the new Johnny
Holiday album next Friday. It was built in one day. It was the largest ever
direct marketing operation made by the Universal Music Group.
What's going to happen next time, thanks to this approach to the wireless
world -- we will offer to our clients, to our subscribers, not only to be
informed about the launch of the coming album of Shania Twain, but also, to hear
the first track and, then, to have access to promotions and so on. So you have
to understand that this world of Internet and this world of multi-access portal
is really creating tremendous new opportunities in all our businesses from the
music to the TV, to the movie side.
That's what we intend to develop. This is a starting trend in Europe for
one reason -- because there are many, many fields where you are well ahead of us
in the states. There is one field where Europe is well ahead of the States.
That's the mobile telephony. That's the wireless world. When I'm here, that's a
shame for me -- to have to try 10 times to get a call through. This will come
back in the States. We are two, three years ahead of the States. Fine. Let's use
that.
Let's use our wonderful position in Europe through Vizzavi to create the
new business models, to create the new services to customers, to create the new
ways to distribute your content, and as soon as the U.S. market will be ready,
we will be there with the strongest position that you can imagine.
So there are dozens of ideas that we can implement together. There are also
ideas between your Universal Studios' characters and Universal interactive and
Havas interactive games. There are a lot, a lot, of ideas, but I really want you
to act -- the way I want you to act is just try to understand, to be in contact
with the other teams of the group, and come with new ideas. Come with marketing
ideas.
This is a combination of innovation. This is a combination of marketing.
This is a combination of creating new services. This is a combination of
creating and being the first mover into the new age of Internet.
We have tremendous capacities. I will, myself, with Edgar, push every
single right idea in that field. You will never be disappointed. Any good idea
-- we will take it, and we will implement it.
MR. BRONFMAN: Just to be in here after the vision, but just so you
understand, there is no intention to sort of take out of the Universal Music
Group, The Studios Group, or The Recreation Group, the Internet, the internet
activities and place them somewhere else.
Universal Music is responsible for its internet activities. The Studio is
going to be responsible for what it's going to do. We're going to coordinate
that. We're going to aggregate that, and we have -- in terms of the aggregation
services, we have partners for you so that you can actually take those ideas and
deliver them, but there's no intention here to sort of put the Internet to the
side of the businesses. So I hope you understand that.
Also, just to say -- and we shouldn't get into too much organizational
discussion because I don't think we know for sure all that we should know, but
just, also, so you know, because this is such a PC-centric world that we're used
to, when we talk about Vizzavi, remember that PCs, really, outside the U.S. are
really not heavily penetrated at all. That's true in Europe.
Vizzavi has a footprint of 80, soon 100 million -- this time next year, 100
million customers. Today AOL has four million customers in Europe, just to give
you a sense of the size and the proportion of the wireless world versus the
wired world outside of the U.S.
MR. BORGIA: Thanks. Lestor, back to you.
MR. YANO: Will Barry Diller play a greater role in the new company?
MR. MESSIER: I will begin to answer that question when you see what Barry
is doing within the USA Networks. In all the electronic side of it, he is just
doing a great job. I've seen that, from day one, Vivendi/Universal will be able
to offer to you at USA Works further opportunities of development and further
opportunities of development in Europe, especially.
On top of that, the relationships between Seagram and USA Networks are
clear. There is a contract. It's transmitted, as it stands, to
Vivendi/Universal. We will use all the rights that we have in these contracts
with one single idea on top of that -- is that when you have a good project
which is able to create and to add value to what you are doing, there is always
one way to structure it efficiently between the two companies.
But, yes, I have more than great respect to Barry and to his ability to
develop his business and to create value, and I am very supportive of people who
are able to create value for their company and their shareholders.
MR. LESCURE: I'd like to add just one point. As you can imagine, we are
already at Canal+ all over Europe. We are covering 11 countries. We have
something like four million homes equipped with interactivity -- interactive TV,
TV set, and setup box. So for the kind of activities Barry has developed in your
country in terms of commerce through the TV, I think we will be really
interested, and he will be very interested to export the concept and the format
he has so well developed here.
MR. BRONFMAN: Okay. Why don't you give a sense of how many transactions a
month that you do with your digital customers in France alone, for instance,
just to give people a sense.
MR. LESCURE: You watch, Edgar. Every month we are making through our setup
box, our digital setup box, and all the customers we have all over Europe
equipped with our digital setup box -- we are making 2.5 million operation
transactions through the TV every month. So it works.
MR. BORGIA: Yes. It's well developed.
Okay. Kirk, go back to you.
MR. TRUTNER: As a value-driven company, what is our moral obligation to
provide entertainment that is not offensive? One of the Universal Music Group's
current acts has caused a great deal of controversy. Will we continue to
distribute such acts as Eminem?
MR. BRONFMAN: Doug, why don't you answer that?
MR. MORRIS: There's a slippery slope between deciding whether something
deserves censorship, or does the artist have creative freedom? No one has really
been able to traverse that slope, including the Supreme Court.
So what we have done is we have formed a committee that has both men and
women on it, people of different ages, people of different ethnic backgrounds,
and whenever there's a controversial album, we submit it to this committee. They
give us back their opinions.
On many occasions, we get the artist to change the part they find
objectionable, and on several occasions, we actually have not put the album out.
Now, you have to remember that we put out more than 5,000 albums a year,
and the ones that contain explicit language or are controversial -- they are all
stickered. So people really do know what they are buying. So we're going to
continue on this present policy, and I think it works very well.
MR. BORGIA: Thank you, Doug.
We're going to have just two more questions from the panel so we can move
along. Ouida and, then, Bonita. Ouida, you're up.
MS. ROBINSON: How will the merger and Vivendi's involvement with Vodafone
affect globalese initiatives into wireless market for music delivery?
MR. MESSIER: You will be pleased to do it because you --
MR. BRONFMAN: I think the global delivery of music in a digital format is
gigantically enhanced by Vivendi/Universal's or Vivendi's joint venture with
Vodafone, which gives it access to -- if there are ten million SFR consumers and
24 million -- let's just say 15. So 25 million Vivendi consumers, then, there's
55 to 65 Vodafone customers. So that footprint is dramatic.
I think that however we organize the digital distribution of music -- and
that may be different places to places because, obviously, in Europe, it's
wireless. In the U.S., it's going to be wired. I think, globally, in the entire
digital distribution of music, it is enormously enhanced by, frankly, the
platforms that exist that allow us to do that.
Before, before this announcement, digital distribution of music was
something where there were other gatekeepers, whether you're at Farm Club or
whether you're at one of the labels or wherever you are, you've got to then go
to someone to create access for you, to create opportunity for you, whether it's
technology or audience reach or something else.
Here there's a built-in technology platform that can be accessed and grown
and adopted and adapted -- sorry -- as well as a built-in footprint, and we can,
frankly, use that footprint to have more access in other places where we don't
have such a strong footprint because there is no music company in the world,
including that of the one or two that may be owned by AOL Time Warner, that
aren't going to want access to the footprint that we have in Europe.
And you know that old joke about "Not so fast." They have a footprint here,
and we, obviously, want access to it as well, and while there's a lot of talk
about open access in the AT&T arrangements and in the AOL Time Warner
arrangements, there's a difference between open access and equal access. We're
interested, obviously, in equal access, as I think they might be with our
footprint in Europe.
MR. MESSIER: We have lots of underground ideas there. One that we have
already explained in Europe is that we can use in the coming years, as soon as
the combination is completed -- when Universal Music is selling, each share in
Europe accrues in number, in fact, its share in Europe, but today close to 300
million CDs.
We can at about no cost -- use each of these CDs, as at the same time the
free interconnection to get access on your PC to the artist web site or to
Vizzavi or to most of them. That's that kind of idea that we will develop
together.
When I am hearing a lot of fears in the music industry or outside our
world, all business is saying, you know, that people like NAPSTER are going to
destroy the music business. That's exactly the reverse.
When we are looking to the piracy question, obviously, you have to deal
with the legal situation. We are in a very strong situation there. You have to
deal with the technology problems. We are also in a very strong position there,
but don't forget one thing.
We are here to be offensive. We are here to be offensive vis-a-vis one
single goal. What does the customer want? And if you take the NAPSTER proposal,
NAPSTER is just delivering to us, to each of us, the no constance care service,
not reliable with a low-quality MP3FILE.
What can we expect to deliver to the customer? We can expect to deliver him
much better quality, fine, real customer care, reliable networks, and on top of
that, not only giving to the customer, not only selling to the customer the
music, but the services around. Services around it means photographs. It means
deliveries. It means the production notes. It means added value like access to
the ticketing for the next tour of the artist, links with the artist's web site.
We have a lot of things to learn to build and to reinvent in the music
business, and not only -- I'm not looking at music and Internet as a fear. I'm
looking at music and Internet like really music was born for the Internet, and
that's a tremendous opportunity to develop our business, and we will be strongly
committed to that.
MR. LESCURE: And it will be, Jean-Marie, the same thing, of course -- we
are talking music, but it will be the same approach in talking about the video
and Canal+ because we have subscribers. We are, deeply and strongly,
technologically legally involved since the beginning of Canal in the protection
of copyright. So it's our concern, too, and we have a department working on that
basis already.
MR. BRONFMAN: Thank you.
MR. BORGIA: Our final question from the panel is from Bonita.
MS. CHAN: With the announcement that corporate headquarters for
Vivendi/Universal will be in New York and Paris, what is the anticipated effect
on the corporate function in Los Angeles?
MR. MESSIER: Okay. As I told, this is not a merger, a combination whose
success is going to be based on cost savings and on loss of jobs. What we have
is to build. We will have some purchase economies. We will have some IT savings.
We will have some logistic savings.
Obviously, when we spoke about the corporate headquarters, first of all,
it's much too early to give any precise indications. The basic message that we
wanted to say and to send is, Don't look at Vivendi/Universal as a French
company with U.S. subsidiaries. That's not the way the group is going to be
managed. The message that we wanted to send is, basically, This is a global
company which is going to be managed on a global basis, which means that, even
if on a legal basis, Paris will be the headquarters of the Vivendi/Universal, we
will need a strong organization in the States.
And just to give you an example of the way we are reacting within Vivendi
and, tomorrow morning, Vivendi/Universal, when we acquired last year in Torrance
not very far from here Sundance of 12 -- the interactive games company with
6,000 people working in the gamings and the educational software studios, we
had, obviously, an interactive subsidiary headquartered in Paris.
Now, on a worldwide basis, this business is headquartered in Torrance just
because that's the right place to headquarter and to manage the studios on the
gaming side and to manage that business.
So I just want to convey that's my intimate conviction -- is that going
forward, when you will look to Vivendi/Universal, you will find some businesses
headquartered in Paris. You will find some businesses headquartered in the
States. There is no reason, for example, to move the Universal Music Group
headquartered from where they are now because they are well located and at the
place where you need to be.
That's the same for the studios, and we will have at any time this
approach. We want not to create a global French group. We want to create a
global group, period.
MR. BORGIA: Thank you. On behalf of all the employees, I would just like to
thank Lestor and Ouida and Bonita and Kirk and Kevin for your good work today
and for your weekend spent here, going over that.
This would be a great time to stand up and stretch and give your colleagues
a standing ovation as they leave the stage.
MR. MESSIER: When you are organizing a show, there is always a period of
time where you need to have the chairs out of the stage and so on. So I've been
kindly asked to find something for a few minutes between the two parts of the
question-and-answer session.
So I've decided just to show you -- that's on the basis MAP was the code
name of Vizzavi. It was a code name for multi-access portal. MAP, by the way,
was a very good brand name, but it's very difficult to have it as a free brand
name. That's the reason why we switched to Vizzavi because Vizzavi is someone
who is going to help me in the Internet universe.
I just want to show you what MAP -- what this Vizzavi is about by taking a
few examples of the services which are already offered. I will tell you when --
that's only future -- which are already offered in Europe, and I will start with
MAP Traffic.
Let's imagine that Stacey Snider -- you are Stacey at home in your morning.
You want to know how to get to your office very fast because you are a little
bit in a hurry. Okay? So just look to your TV set, and you will get the
information of what's the best way today to get to the office.
(Video presentation)
MR. MESSIER: So that's good. In Europe, that's based on the traffic
information which are updated every 15 minutes. That's, obviously, Stacey,
knowing the way that you have to take this morning is fine, but then you are in
your car. So you just need to have this information. That's the obvious strategy
of this multi-access portal. This information that you found on your TV set --
you want to have it available in your car. In your car, you may have a car
screen, but you may have to use just either your mobile phone or your PDAs, and
as you are in your car, there is something very important. That's voice
recognition. Not to look every time to a screen, but to hear the indications
relating to the screen, and as it is a multi-access portal to portal, you get
access to your mail, but at the same time, while you are in your car, all your
mail is just better. So, Stacey, you are now in your car.
(Video presentation)
MR. MESSIER: Okay. And now, what's the next step? Finally, Stacey, you are
in the office at the right time, and you just went through all your mail. You
realize that you missed organizing the lunch place for one client.
So you arrive in the office, and you do at that time -- after the TV, after
the PDAs on your PC screen, you do the rest of your work.
(Video presentation)
MR. MESSIER: Two additional points there. The first one -- something that
none of the AOL or Yahoo are able to provide. That's when I'm using my mobile
phone. I want to get very localized service.
If I'm going out and I want to see GLADIATOR, I do not want to get on my
screen the list of the theaters of the town. I want to know which one is the
closest. I want to be able to book my seat, and I want to get a map on my screen
to know how to get there. Only the mobile operator is able to do that, and
that's the core strength of Vizzavi.
And the last comment is that the video mail -- that's down the road 18
months. This is the only part which is not available today. That's the third
generation. It will start in Europe, basically, August 2001 in Spain, and you
need for that -- in fact, PDAs or mobile phones with a very small web camera.
I'm not going to go over every one, but perhaps two last. The first one, I
have to tell you that, obviously, I am sorry for presenting it to you. This has
been organized to explain MAP at the time where the deal with the combination
with Seagram was not known, where we didn't want to see the analysts thinking
that it may happen. So you are going to hear -- that will be the only time of
the day -- non-Universal Music Group music.
I can tell you that if you call already by phone, Vivendi, you will hear
that as a music, we have made the best of Universal Music Group of one hour. So
anytime of the day you call to Vivendi, you will get different music. Let's see
that.
It will show you another point, multi-access portal. You will see a young
boy playing games on the TV screen with a small pig, which credits Vizzavi to
what's Vizzavi. You will see a young girl choosing music for her brother's
birthday on the mobile and, then, through MAP, through Vizzavi, downloading it
directly on the TV screen at home. That's what Vizzavi is about. That's why
multi-access portal is just much better than only the usage of the PC.
(Video presentation)
MR. MESSIER: That's a smiling family just the day of the birthday. That's
not every day, but you see all the ideas that we can suggest to people through
this Vizzavi approach. I will end up with a very last one. We will go back, for
example, to Canal+ sports, right. Today on the mobile, you can get live scores,
but just imagine when you are out of your home, the day of a great match. Let's
imagine what it will be if you can just have a look to the goals on either your
mobile or PDA screen.
(Video presentation)
MR. MESSIER: Okay. That's what Vizzavi is about. Don't you think that you
will like it?
MR. BORGIA: We're now going to start the interactive portion of the
meeting. As you may have guessed, we are running a little bit behind, but we're
going to take questions from the floor, from New York, from our satellite
locations, and we have some coming in on the web.
We will promise you this. If we don't get to your questions, we will answer
them. We will answer them individually. We will answer them over Pathways or
over VOX, or somehow we'll get to you.
Now, what we're going to try to do here -- as you came in today, there were
little cards and pencils. We'd ask you to write your questions down and then
proceed to one of the microphones. I'll call on you. Please identify yourself
and then go for it. Our first question is from the amphitheater. Please.
THE AUDIENCE: Hi. My name is Terry Kwan. I'm in the television and networks
group, and it's a two-part question. The first one is: What we've seen of
Vizzavi so far seems to be focused internationally, and the first part of the
question is: What are the plans for rolling it out, target towards the U.S. and
English language?
And the second part of the question is: We have a lot of incumbent players,
such as Yahoo, as you know, and AOL are making movements, also, in the wireless
front as well. How do you intend to compete with them on that level?
MR. MESSIER: Very quickly, obviously, Vizzavi will be developed in, as of
today, in 15 different European countries and, obviously, in each country in the
native language. It doesn't work if it is not English in U.K.; Spanish, in
Spain, and so on. So that's local language for everywhere.
I do hope that we will be able to go back to the States very soon. In order
to develop this multi-access portal strategy, you just need to have an efficient
global, national network and coverage in the States. The partnership that we
have with Vodafone AirTouch -- that's the same here in the States with Verizon
-- will definitely help to develop this Vizzavi, this multi-access portal
approach, in the States. Maybe that will happen before two, three years, but
obviously, we have a global vision there.
I've been told about AOL and Yahoo being interested in going to the
multi-access approach, and I have heard even Bill Gates saying now is the right
time to go out of the PC environment to go to the wireless and TV environment.
That's very fine, but there are two things that you have to remember. The
first one is that in order to deliver to the customer these very localized
services that we just looked at a few moments ago, you need to be a mobile
operator.
If you are not a mobile operator, you don't know where I am standing. You
cannot send me the most accurate, the most localized information that I am
looking to, which means that you may be the strongest brand around the world --
and Yahoo and AOL are obvious strong brands.
If you are not a mobile operator by yourself or strongly backed by a mobile
operator, you cannot just deliver these very localized services. That's where
the strengths of having in the same group the wireless approach, the wireless
strategy, and these portal strategy makes a lot of sense, and the last comment
on your question is just look to the numbers.
Vizzavi has a global reach as of today of 80 million customers/subscribers
in Europe. By summertime 2001, based on organic growth, that's going to be 100
million. In front of that, AOL has four million PC-only subscribers in Europe.
That's where our competitive edge is lying. We start with the largest footprint
that you can even dream of, and we start directly from the multi-access
approach, including the wireless world, not on a PC centric. If we are good, if
we are dedicated to our job, Vizzavi starts with two major competitive agents,
even against all the AOL or Yahoos of this world.
MR. BORGIA: That's great. Thank you. Our next question is from New York.
New York, go ahead.
THE AUDIENCE: Good afternoon, from New York. This is Ron Martin. Here is a
question submitted by one of my colleagues gathered here on Seventh Avenue.
Is there a plan to build or purchase a telecommunications infrastructure in
the United States?
MR. MESSIER: The answer is -- let's be simple -- no. We have with Edgar,
with Pierre, with Doug, with Ron, with Phillipe that you saw on the videos.
We have enough on our plate. You saw on the videos, we have enough on our
plate. We have a lot of things to achieve together. Let's work to that. Let's
work to the implementation of this wonderful project. We will find at the right
time in the States the agreements and the commercial agreements with the
telecommunication operators to have Vizzavi available.
We have already this partnership with Vodafone AirTouch, which will help us
a lot, but let's put it that way. Let's make a success from Vivendi/Universal.
Don't expect any major further move acquisitions on our side for some time.
MR. BORGIA: Thank you. Our next question has come in through the Internet,
and I'm going to read it here.
"Will there be opportunities for other positions across the Vivendi
companies?
MR. MESSIER: I am welcoming the idea. If the one who sent the question can
confirm that he or she is interested in, more than welcome. We have within
Vivendi a web site on which every proposal, every opportunity of jobs within the
group which are available. I do think that you have something quite similar,
John, and that we will have to just merge them.
I do think that's one of the interests of such a combination -- is to offer
people opportunities of careers in the group. That is to say, if you want, at
some point of your career, to change a business, to change a country, you need
to be able to do it. The more flexibility, the more fluidity we will have
between our teams, the more efficient the integration will go. So more than
welcome.
MR. BORGIA: I'm going to actually add to that. Ken Kahrs and I met last
week with Jean Francois Colende and Phillipe Germond, who are the HR heads of
Vivendi and Canal+, and we're going to have job posting around the world across
the company. So you can look forward to that.
Our next question is from the Amphitheatre, please.
THE AUDIENCE: Hi. My name is Vivi. With roughly 80 percent of Universal
Television business in Europe, it's difficult to imagine that the current
Universal Television and Networks division will stay the same. Will some sales
activities be eliminated for the sake of efficiencies, and what are your initial
plans for the television and networks group?
MR. LESCURE: I think you are not surprised if I answer you that we have
absolutely no plan to change anything today. What we have in mind is that with
11 countries where we are delivering television premium channels in terms of Pay
TV all over Europe, with five digital platforms where we are distributing, among
others, 13 channels, which is a very huge success in Europe and one of the
brands which has the best perception by our digital subscribers all over Europe,
I think, after a while, when we will have started to work together with your
television companies, I think we will talk about maximizing and developing the
things, not cutting them.
MR. BRONFMAN: I think one of the hidden benefits to this merger -- we talk
a lot about music. We talk a lot about movies. All those things get the
headlines, but in fact, Blair and his team have launched eight channels now in
Europe. We have 27 million subscribers watching Universal channels or joint
ventures around the world.
The opportunity to make those channels, those eight European channels more
profitable more quickly as a result of aligning it with the distribution
platform is tremendous, and frankly, we have the opportunity, thanks to the work
that Blair and his team have done, joining with the work that Pierre and his
team have done to create an equivalent, not a cable network system because it's
not cable. It's satellite-delivered, but a network business in Europe which can
be more profitable much more quickly and create enormous value for shareholders.
It's not something that we focus on a lot, and certainly, the press don't, but
there's a real opportunity for the combined company.
MR. BORGIA: Our next question is from Orlando. Orlando you're on the line.
Go ahead, please.
THE AUDIENCE: Thank you. Hello from Universal Orlando. Our question is:
Vivendi has stated that the acquisition of Universal Music and film is part of
an Internet strategy. Do you see theme parks as being strategic assets? If so,
how specifically? If not, what is the intended plan?
MR. MESSIER: That kind of question -- let's always be very clear. The
answer is yes. Theme parks are always strategic and are core to
Vivendi/Universal. That's good business. You are tremendously efficient at this
business. That's a very profitable business on top of everything else and
increasingly profitable business, and on top of that, I think that on one hand
theme parks are so much linked with Universal Studios, with the views of all the
old characters, of all the image. I never forget that the theme parks -- that
dozens of visitors who are spending there one day, two days, one week, who are
in contact during all their trip, and all theme parks and your theme parks who
are in contact with our brands, with our characters -- that's just great assets.
That's a core asset, and I may ask that within the team of
Vivendi/Universal, if Eric Licoys was here, Eric would tell you that he has
launched in France -- created, developed, managed a theme park, a very Franco
French theme park based on Asterix, which is, now after now, after Disney, the
second largest in France, and that he just loves this business of theme parks.
So, yes, don't be afraid of that. The answer is very clear -- that's a long-term
answer. Theme parks are core to Vivendi/Universal.
MR. BORGIA: Orlando, thank you for that question. You have a smiling Tom
Williams in the front row here in California and deservedly so, deservedly so.
Our next question is from the Amphitheatre up top there.
MR. MESSIER: I will have the pleasure in a few weeks from now -- all the
kids of my family who don't know yet the park here to be there.
THE AUDIENCE: Good morning. I'm John Grantham, and I work with the Wild
West Stunt Show here at the park. So we are very excited with your last answer
to a question, but in regard to the open U.S. markets with our content in Europe
-- obviously, that's very important -- will there be a reciprocal approach to
opening the European markets to the U.S., and if so, as a home satellite
subscriber, will Vivendi/Universal look into acquiring one of the current U.S.
satellite companies, or will there be a need to launch our own system?
MR. MESSIER: I'm going to answer one more time to this question. Frankly,
you can always imagine more, and your question -- when you are speaking of
acquiring a satellite TV company, I do think that the list is not very long.
There are not many of them.
I do think that for us that's the highest priority -- is to implement the
combination between us. We have already so many things to do and to imagine
together so many ways of building commercial agreements in different fields.
Let's just wait. Let's just implement that before thinking of any further move.
We will start as the number two worldwide communication group. We can even
defeat AOL Time Warner without having to make further acquisitions. I do
strongly believe that.
MR. BORGIA: Okay. Thank you. Our next question is from north of the border
in Toronto. Toronto, you're on the line.
THE AUDIENCE: (A few French words spoken) As you can see, everybody in
Canada speaks French. I do have a question for you, but first of all, I'm
standing in a roomful of people who just wanted to let you know how excited
everybody is about this new venture. (Applause from the audience.)
MR. BORGIA: There you go.
THE AUDIENCE: Given that Canada's population is 30 percent French speaking
and that there's a considerable amount of interest in French language product,
can we expect that we will get Canal+ productions distributed in Canada?
MR. LESCURE: If you are needing the puppets' production, you saw this
morning we can deliver it very quickly, but as you know, we have a lot of
exchange in terms of TV productions already, and during the life of Canal, we
had a lot of change with Canadians speaking English or French speaking Canadian,
but it's on our mind, of course, to develop more and more with you, and
especially with you, the change and the separation of products coming from
Canada or coming from France.
From a general point of view and so you are adding something to what
Jean-Marie just delivered to you a few minutes ago, I am totally on the same
line, of course, than Jean-Marie and Edgar. During those months of talks, we did
not see many lapses. We saw so many additions, so many complementaries between
our businesses -- in terms of business, in terms of geographic, in terms of
techniques, and even in terms of timing.
So we have so much to do together. Wherever you were and what could be your
business today, we have so many things to build, to add, and to maximize. So the
question you ask is, perhaps, one of the simplest to solve, but when we were
talking about acquiring another satellite in the U.S., we have so many things to
do. It's so exciting. Let's achieve it.
MR. BORGIA: Pierre, thank you. Our next question is from Egg Harbor.
THE AUDIENCE: Hello and bonjour. This is Karen Mitchell from Spencer Gifts
in Egg Harbor Township, New Jersey, and our question is: In Mr. Bronfman's
e-mail to all employees, he stated that non-core businesses would be spinned
(sic) off. Is Spencer Gifts a non-core business?
MR. BRONFMAN: I was referring, actually, to the Spirits and Wine business,
and also, talking in terms of the Vivendi/Universal combination to the
environment business, which is actually going to be completing its IPO this
week. So those are the two businesses to which I was referring.
Actually, as you can imagine, Spencer Gifts is a business which in some
ways doesn't naturally fit into the entertainment business, and we took a hard
look at Spencer Gifts to try to make a determination as Seagram management
whether or not it was a core business, and frankly, because the management there
is so good, because it gives us the opportunity to interface directly with
customers at retail, because it's a great source of information, and because we
believe that as an on-line business, it has a great opportunity to grow, in
addition to its organic growth, both in Canada and now internationally, as well
as the U.S., it is a core business for Universal. We do intend to hold onto it,
and we look forward to having Spencer Gifts as part of the Vivendi/Universal
family for many years to come.
MR. BORGIA: We're going to try to go to the three-minute drill now to try
to get as many questions as we can in before we close. We have one on the web
that just came in, and it says, "Please, clarify the working relationship
between Studio Canal and Universal Studios."
MR. MESSIER: I'm not surprised about your question, as you can imagine,
especially after the announcement made by Michael Ovitz two days ago, but I'd
like to start from the beginning. We have already very good, important, and
positive relation between Universal Studio and the Studio Canal. We are working
together on working titles.
We cofinance together, and we are so happy on U571, and I think, Stacey,
the studio did it well in Europe, distributing the movie and commercializing the
movie, first. Secondly, I think it's a very good chance for a group like
Vivendi/Universal to have a lot of friends and to have, too, so different
studios, one which is not at the level of Universal Studios, but which is
dedicated to Europe and will work and will make so many good developments in
Europe and which has a lot of cooperation, cofinancement operations, limited,
but precise and personalized, with some American independents, and we have
Universal Studios.
When we are talking about distribution, of course, we will have a lot of
maximization and cooperation. It was last week because I am looking to Vincent
Limon, who was running the Studio Canal. Two days ago, he renewed his contract
with Miramax and our big friend, Harry Weinstein, asked, So, now, you are an
exclusive UIP, and Vincent said, No, no. You will have the choice, but for some
of you, with movies you will be very happy with an enormous pipeline of UIPs.
Sometimes you will be more happy with the little pipeline we have all over
our 11 or more than 11 countries for distribution for Studio Canal in Europe. So
I think, step by step, the cooperation through the dialogue will be, as Edgar
said at the beginning of this meeting, one plus one will deliver more than two.
About two days ago, to be absolutely frank with you, the deal was closed
before our announcement. One is knowing very well Mike Ovitz. It has been a
miracle that during 10 days he did not say anything because we had in mind it
could be confused to announce at that same moment the deal Studio Canal made
with EPG, one of the subsidiaries of Mike Ovitz AMG, and our major announcement.
So during 10 days, he did not say anything. We, Vincent and Mike, convinced
him to don't talk about numbers. You know Michael talked about numbers, and he
did not deliver the right ones. Our investment of Studio Canal in the deal with
Mike Ovitz will be less than one third of what it announced in a period of three
years. So we are not talking about the biggest deal west of the Colorado River.
MR. BORGIA: We're going to take two more questions, and our next question
is from here in the Amphitheater.
THE AUDIENCE: Good afternoon. My name is Maria. I work in the home video
division. Following Seagram's acquisition, the company went through a period of
reengineering, using outside consultants.
Do you anticipate engaging outside consultants to reorganize, restructure,
or promote efficiencies, and if so, which companies?
MR. BORGIA: Here's the question.
MR. MESSIER: Did you say when, how much, and for how long? I don't know if
in your question it was positive or negative.
MR. BRONFMAN: Just so you know, they loved reengineering.
MR. MESSIER: My answer will stay in one word. I think that all of us, as
managers, in our day-to-day job -- we have to reinvent our business every day. I
do think that when you are looking at the path of growth, the path of change
around us, around the Internet, no other way to do.
So consultants may be, from time to time, on various specific short basis
of help, but we have, you have, as teams in your businesses to take charge by
yourselves how to reinvent every day your business. That's the only management's
route -- reinvent your business every day.
MR. LESCURE: As a subsidiary of Vivendi since longer than you, he's saying
that, but he's doing that.
MR. BORGIA: Our final question is from New York. New York, you're on line.
Go ahead, please.
THE AUDIENCE: Yes. The following is another question submitted by a person
here at the Equitable Building. When will the regulatory reviews be completed,
and when do you anticipate that the shareholder votes will be taken?
MR. MESSIER: The regulatory approvals are all on their way. We do not
expect with Edgar any significant difficulty, neither here in the States,
neither in Canada, and we do think that the EU regulatory review is just more
simple than for all the deals and all the combinations like the AOL Time Warner
and my links with Bertelsmann. No. Very simple on the AOL side. We do think that
it will go well and quick, even in the businesses where we have overlaps, like
movies and TV.
There is no one single country where the combined company will have more
than 15 or 17 percent of the relevant markets which has to be fine with the EU
regulator. Obviously, you can always feel a political decision to postpone a
little bit, but we do think that we have a chance to go fast track there.
The earliest that it may lead us, in terms of shareholders' meetings and
votes is end of September, beginning of October. If it was not the fast track on
the EU side, it will lead us to the end of November, very beginning of December.
So that's the timetable.
As a challenge, we may end up with this combination being the quickest and
the fastest of the recent history on the communications business.
MR. BORGIA: Okay. Thank you all very much for participating, especially all
you in your satellite locations in Toronto and Egg Harbor and New York. We
appreciate that.
Before we go to the reel of some upcoming product, on behalf of the 10,000
employees that participated today, I would just like to thank you guys. We
appreciate your effort. You've come a long way to be here today. You've had 100
other things you could have done, and you chose to spend it with us.
We admire you for your openness and courage, and we look forward to your
leadership in the future. Thank you very much. Okay. Now, we've got a reel of
some upcoming product, including some trailers you may be seeing for the first
time. Right after that, Jean-Marie and Edgar will be back out. Thank you all.
(Video presentation)
MR. BRONFMAN: Just a few quick closing remarks from JM and myself. In the
five years, almost exactly five years, that Seagram has owned Universal, the
business has really grown dramatically.
If you look at those videos and you think about how we reinvented and have
an infinitely more valuable television business today, which we didn't have when
we started, if you think about the expansion of the theme park business, making
the commitment to the expansion in Florida and Japan, and acquiring span, if you
think about the turnaround in the motion picture area, a business that, I think,
has a great heritage but was weaker than it should have been when we bought it,
stayed weaker than it should have been longer than it should have, but under new
management finally getting it right with a great team, we have a terrific
business ahead of us in creating the number one music company in the world from
what was not even close to the number one music company in the world.
And I guess I'm proud of that, but I just wanted to say thank you. You did
it, and I appreciate it. This is a historic day because soon, when we close this
merger, these assets go on in a bigger, greater more robust, more exciting, and
more defining company for the 21st Century. I'm very, very excited about that.
I'm very happy to be working with Jean-Marie and everyone else, and I think
every transition is difficult, but this is exciting. This is a new, great
company, and I'm thrilled to be a part of it and thrilled, most of all, that you
are going to be a part of it. Thanks again.
MR. MESSIER: Frankly, it's very difficult to add anything to the wonderful
cast that you have just looked at because that's Universal. As Edgar said,
that's what you are doing. That's what you did. That's what you are doing and
what you will do.
I was beginning by telling you a little bit about why I think that
Vivendi/Universal is going to be an extraordinary company. I told you also that
this was an emotional moment for me. I think that I am not a cold fish. You may
have heard it in my voice, as right now, that just because I do think that's the
business you are in, whatever it is -- the music, the theme park, the movies,
all Universal business, all the TV business, all the businesses which are
gathered now in Vivendi/Universal -- we are not doing ordinary business.
We are bringing information on one hand, but we are bringing the most
important that you can look for in your life that's entertainment and fun.
That's just great to be in those businesses, and Edgar told, in his words -- I
would also like to add in my words about the same idea. We, both of us -- we
have been congratulated hundreds of times over the last few weeks for this
combination.
What I want is to congratulate and to thank you because if we are doing
this combination today, that's because Universal is just tremendous, an
outstanding content company and that you can be proud of what you are doing at
Universal.
So maybe we have been congratulated hundreds of times. You deserve this
congratulations. You deserve it, and just thank you for what you have built.
Thank you also for what we are just going to build together. I do not consider
the meeting of today as anything else that's a two-way welcome. That's in that
spirit that I want to build with you, with all of you, this wonderful story that
Vivendi/Universal is going to be.
Believe me, we have all the skills. We have all the talent. We have all the
creativity to make a tremendous success from Vivendi/Universal. I just want you
to share with me this enthusiasm. I just want you to share this great vision for
the future, and I just want to express my thankfulness for your very warm
welcome of today to tell you that you will find me always available with Edgar
and all the team just to help you develop the business, just to help you develop
the products, all what you are doing, the way you intend to develop it. That's
on that basis that we will make a success from Vivendi/Universal.
So let's create Vivendi/Universal together. Let's be Vivendi/Universal. We
are Vivendi/Universal and vive Vivendi/Universal. Thanks a lot to each of you.
* * *
