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Billion-euro handouts keep French press alive: report

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(PARIS) - France's newspapers are kept in a state of "permanent artificial respiration" by the annual billion euros in state aid they get and badly need to shake themselves up to survive, a report said Thursday.

The government-commissioned report lamented that the massive subsidies had failed to create the "emergence or the presence of political and general press titles that were strong and not dependent on public aid."

The aid even had the effect of discouraging newspapers from trying to find sustainable financial strategies, said the report, which has been handed to France's budget and culture ministers and published online by the government.

The official aim of the report was to "end the perverse effects of some public aid which maintains the press in a system of permanent artificial respiration."

State aid makes up 12 percent of the written press sector's annual turnover of 10.6 billion euros, over half of which comes from sales and the rest from advertising.

Around 400 million euros in aid comes in the form of reduced sales and business tax and 626 million euros in direct subsidies to help with operations such as printing plant modernisation and distribution.

French newspapers, like much of the world's written press, have been struggling due to falling advertising revenues, dwindling circulation, the challenge of new media and the economic downturn.

France has no mass-circulation tabloids and its consumption of daily newspapers is, at 159 titles bought per 1,000 people, low compared to other wealthy nations like Japan at 626 per 1,000 or Germany at 305 per 1,000.

The author of the report published Thursday, Aldo Cardoso, proposed 15 measures to rein in state aid to newspapers and make it conditional on innovation in the sector.

He did not call for an end to public help for the press but said it could be reduced to 835 million euros by 2016 if his recommendations were followed.

The government is due to decide in October which of his ideas it will apply.

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