FrenchTech: One step forward, three steps back

FrenchTech: One step forward, three steps back

game over_wFor entrepreneurs and investors in the French tech ecosystem (and even potentially for outsiders looking in), it has been a discouraging couple of weeks for us.

While I still believe that 2016 will be the year of the European entrepreneur, I sincerely hope that politicians do not thwart France’s momentum in innovation when we’re just getting started.

Three recent legislative maneuvers concern me.

The first and perhaps most ostentatious is the prohibition of any new VTC drivers, in appeasement to the monopolistic French taxi unions that are striking today. The ruling essentially curtails the key input to required for on-demand transportation apps in France like Uber, SnapCar, and ChauffeurPrivé to function (i.e. the chauffeur). Read more about the topic in Parisian Taxi Strikes: Tears for a Corpse. For those interested in expressing your displeasure, the mobile app startups drafted a petition.

Another development some of us veterans of the community find laughable is the announcement of a plan to create a sovereign French computer operating system (i.e. “le Windows Français”). I can’t help but recall the failed attempt some years back to produce the French Google.

Finally, perhaps less visible and mercifully still preliminary is a stipulation in the current projet de loi numérique d’Axelle Lemaire (the draft digital law of France’s Minister for the Digital Economy) governing the nascent new domain of competitive gaming (i.e. esports).

The draft legislation proposes to prohibit prizes for esports games that are not on a previously-approved government list. Games that are not on the list, as well as any tournaments not held in physical arenas (such as those online), would not be allowed to offer prizes. In a twist of irony for the country that hosts the Tour de France, the draft law would also require the various video game associations to prove the implementation of sophisticated drug-testing procedures.

We’ve seen this horror flick before. Placing excessive regulatory burdens on an industry still in its infancy renders a potentially innovative new sector stillborn. It’s unfortunately not an unfamiliar French government approach to think it can define a market. Certainly, some regulation on the burgeoning esports sector will be a good thing, for example to reduce fraud, provide recourse for cheating, ensure safety, and yes even protect players from performance-enhancing drugs. However, imposing a comprehensive regulatory framework on a sector that is still emerging is a good way to snuff it out at home and send it abroad.

In stark contrast to and coincidentally during the same week of the French government’s esportsannouncement, Twitter launched @TwitterGaming for esports and ESPN announced a veritable push into the sector.

Yes, Disney’s flagship cable sports network is now building a professional team of broadcasters to cover esports events. “Fans will find the same level of quality content and journalism that users of have come to expect, including in-depth looks at the competitive gaming world and on-site reporting from the major tournaments,” ESPN The Magazine editor-in-chief Chad Millman explained.

Research firm Newzoo, forecasts that esports audiences in the U.S. should reach NFL (National Football League) levels by 2017, with a projected value of $463 million this year. In Europe, they estimated the esports market at $73.1 million in value in 2015, expecting it to rise to $99.6 million this year.

I would submit that, regardless of the government’s view, French gamers exist and won’t suddenly lose interest in esports because their game doesn’t fall on some arbitrary government white list.

For a potentially lucrative new sector of innovation in France, let’s hope this tentative legislation doesn’t spell Game Over.