While Chirac steals the big media show, it is perhaps the plight of some of the French multinationals that should really be grabbing the attention. Is this another example of French exceptionalism at work, well it would be if the write offs were not equaled by those of AOL etc. I am not convinced that we have sufficiently digested the implications of all this for the business strategy of the conventional corporation yet. In the business it is known as the incumbent's problem.
Shares in Vivendi Universal opened 8 per cent lower on the back of its huge goodwill writedowns and record full-year net loss, having lost more than 4 per cent following the earnings announcement late on Thursday.Vivendi Universal re-took the record for the largest loss in French corporate history from France Telecom, title-holder for all of a day, as goodwill writedowns pushed it €23.3bn ($25.6bn) into the red in 2002.On Thursday, announcing the troubled media group's results to a room filled largely with the investment bankers who picked up €200m in fees from the company last year, chief executive Jean-René Fourtou said the liquidity crisis that almost bankrupted the group last year was over. "It's not that I feel in competition with my friend Thierry Breton [newly installed chief executive of France Telecom] that I announce these results," Mr Fourtou said. "It's the mechanical effect of deteriorating markets on the goodwill on our books."Over the past two years, Vivendi Universal, which lost €13.6bn in 2001, has seen almost €40bn of shareholders' equity wiped out as the group has paid dearly for the ambitions of former chairman Jean-Marie Messier..................Mr Fourtou refused to be drawn on the future shape of the group, except to say: "One cannot consider Vivendi Universal to be a coherent business. It is a basket of assets that have little to do with each other."
Source: Financial Times