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Vivendi is strengthening its position in media and telecommunications, two business sectors with growth rates which exceed that of the economy. All of the Group’s businesses—music, interactive games, pay-TV and mobile and fixed-line telephony— are focused on customer satisfaction. The Group’s objective is to enhance its businesses by fostering innovation and creativity while building upon their strong operational compatibility.

The number of distribution platforms continues to grow as does the use of digital technology in mobile, satellite and internet applications. Vivendi is investing in:

 creating and publishing exclusive content,
 creating and managing distribution platforms for content and other services aimed at the general public by drawing on its vast expertise
       in management of subscriber databases, building customer loyalty, marketing and distribution networks,
 investing in telecom and pay-TV infrastructure and the technological innovations that will lead their development, particularly for
      mobile telephone and broadband applications.

Vivendi ranks either first or second in nearly all of the markets it serves. This strategy proved successful in 2005. The distribution of digital music tripled at Universal Music Group. Vivendi Games was hugely successful with World of Warcraft game and completed a number of external growth transactions. Canal+ Group boosted subscriptions and announced the plan to combine Canal+ Group’s French pay-TV activities with those of TPS. SFR’s 3G roll-out and the diversification of mobile services were a success, while Maroc Telecom saw continued strong growth of mobile telephony and ADSL.

In 2006, as part of this strategy, Vivendi will focus its efforts on:

 finalizing both the combination of Canal+ and TPS and the agreement with Lagardère,
 resolving its differences with Elektrim and Deutsche Telekom in order to assert its rights with regard to its 51% equity stake in
      Elektrim Telekomunikacja and to eventually increase such stake to 100%, 
  moving further into music publishing, and in certain territories, into the production and distribution of recorded music,
 ensuring the balanced development of Vivendi Games amongst online, console and mobile games.

There are bright growth prospects for third generation mobile telephony and related services, for pay-TV penetration and the development of downloading and interactive exchanges of content (music, games, film and television) over the internet. Vivendi plans to continue investing in all of its businesses in order to benefit from customer demand for innovative products and services.