RFM the exceeded by its host star Coluche

Seen by NRJ, Louis XIV finally is a very romantic hero. "I will make thee my essence, if you want that it is", he sings on the stage of the Palace of Sports. What Mr, his brother, added: "each his injuries and his habits, each in the jungle has its thirst for altitude...". "And, precisely, the altitude is well needs the NRJ group at this time. Because despite the phenomenal success of his musical comedy, with its million spectators and its hundreds of thousands of CDs and DVDs are sold, the King of music radio experienced a difficult year. Departures from leaders, sales and results in lower and corollary to a stock market course regularly loses height.

This is obviously not the end of the world for the most profitable France radio (more than 30 of operating margin in 2005, 20 this year), but the beginning of the concerns. His heart gives its first signs of maturity, if fatigue, while the relays for growth have not yet had the time to plan, or industry growth and profitability.

Number one in its sector in France, the group can no longer hope to grow again in the radio light French quotas in basin of listeners. In addition, the media advertising market, if it is better than that of the press, is no longer in progression and risk even suffer when television will have access from the year next to large distributors, first announcers of radio advertising. Finally, new modes of musical youth, from Internet consumption (the double effect piracy iPod) cast the threat of a decline in the hearing, and therefore advertising, single source of funding for the nuclear heart of NRJ: its four radio networks (NRJ, Chérie FM, laughter & songs and nostalgia).

A situation that is amount not so different from these major groups leaders, Microsoft France Telecom passing by TF1, for growth relay, if possible also cost-effective than their historical activity.

Pragmatic and its group, NRJ already tried the obvious solutions to grow. The first international conquest. But it faces local stresses and remains a home loss. Investment in adjacent areas, where the Group may at best enhance its brand. The scene where he is likely to find its audience. What all media dream of doing. Concerts and events of course, as "Le Roi-Soleil", perfectly formatted for fans of NRJ, but also television, with the string NRJ 12 on DTT, mobile phone, with NRJ Mobile, Towercast scattering and, of course, the Web.

For now, only two already profitable operations are diffusion, benefiting from the boom of the TNT and competition the former monopoly TDF and the organisation of events. But the success of the "Sun King" proves at the same time very stable aspect of such activity, as all the entertainment industry. The only solution to give a little more predictability is to multiply operations of this type, but, as the cinema, they are very intensive capital either to organise recurring events, that can be if possible decline in many products later. This is the case of the NRJ Music Awards, each year in January, rewards the best musicians chosen by listeners. A show of course broadcast on television which is then the subject of a drive to success, and then a variation on the Web. In this case, the radio provides an intensive promotion of the event and its derivatives. On the same idea, the Group has therefore launched the NRJ Ciné Awards. Very visible shows to market a range of provision of services (especially for businesses) also growing.

The other two activities are riskier because they require heavy investments for distant returns in a ultraconcurrentiel environment. Full of bad luck, they had to be launched at the same time, in 2005, to take advantage of the window of opportunity offered by the TNT, on the one hand, and the opening to competition of the mobile phone, on the other hand. In both cases, investments are in tens of millions of euros per year... and also loss (more than 30 million for the single phone this year). In both cases, competition is tough, with players in weight such as TF1 and M6 in television, and Neuf Cegetel, Carrefour, the FNAC or Auchan in the phone. In addition, the "virtual" mobile operator is very dependent on tariff policy of Orange and SFR who do not leave too much oxygen competitors customers who they rent their network (SFR in the case of NRJ).

Finally is the Web, hope and fear at the time. The Group multiplies the "Web radio" specialized and sites. But it's more for the moment of a tool at the service of other activities to an autonomous profit centre. Outpaced by its competitor, Skyrock, holder of the first site of blogs in France, it provides for its entry in the field of interactive and "social" sites in the first quarter of next year.

With all these challenges, Jean-Paul Baudecroux, founder, owner and President of the Council of supervision, and Marc Pallain, its CEO, display the serenity of the victorious veterans. They remember that heroic battles of the FM band in the early 1980 the Group was not the first. RFM the exceeded by its host star, Coluche. Jean-Paul Baudecroux has his tenacity and his flair to win the last time, either television or telephony. Holder of more than 80 of a side group and abundant cash flow, it can wait.

It also relies on the power of its brand and synergies put in place in its group "plurimédia." But it must also avoid three pitfalls that it does not ignore. First, in contrast to the era of the FM, it is not the troublemaker, the new entrant agile and offensive. It is rather in the defensive position, which changes the perspective. Then, the idea of the relevance of a same trademark on all materials is not always found. MTV, the American Queen of music TV has failed to impose himself on the Internet while others, like the RTL Group, prefer to create different brands with media. Finally, the last risk is, as always, the execution. After the changes in this year (new CEO end of 2005, new financial Director, new boss of the television, two successive new patterns for mobile), the stability of the management will be a key element. As Louis XIV, the real, "empires don't keep as they acquire, i.e. by the force, vigilance and work". Of all typical Baudecroux.