CRTC Says Bell+Astral = NO GO!

OK, so I'm not sure if this really pertains to anyone outside of Canada, but it was quite the stir up in the news today.  For any fellow Canadians paying attention, Bell Canada (subsequently BCE) has been in the works for some time with Astral Media and their $3+ billion merger that would ultimately make Bell the (hands down) largest telecom company in Canada.  Initial reactions of course were negative (much to my own) and found this to be the starting of another gouge in the Canadian market and ultimately taking competition out in the midst of the merger.

For those unaware, here is what Bell has been up to prior to the announcement of this merger:

- Bell Media operates 28 conventional stations as well as 30 specialty channels, including Business News Network, Discovery Channel, Much, MTV, The Comedy Network, Space, and TSN and RDS. [1]

- It also owns 32 radio stations, including TSN Radio, and Dome Productions, a mobile broadcast facilities provider, and dozens of news, sports and entertainment websites including sympatico.ca. [1]

- It also has acquired a minority stake in the Montreal Canadiens, and it is joining with rival Rogers Communications to buy a chunk of Maple Leaf Sports and Entertainment, which is due to close in mid-2012. [1]

Among other various assets they have obtained in the past, they seem to have a good stranglehold on the telecom/music/video industry as is and show no signs of stopping that, all the basis that this is 'good for Canadians'.

This merger would mean that Bell would have bought 25 channels, including The Movie Network, HBO Canada and French-language Super Ecran, Family Channel and Disney Junior and more than 80 radio stations.

There is just too much info on faux pas that Bell has done over the years.  Remember when Bell was giving exclusive content to its mobile subscribers from NHL, NFL, etc?

“Canadians shouldn’t be forced to subscribe to a wireless service from a specific company to access their favourite content.  Healthy and fair competition between service providers will promote greater choice for Canadians.” -Konrad von Finckenstein, Q.C., Chairman of the CRTC

I am not sure if you folks remember or not in the past the situation arose where Bell also filed lawsuits against 3rd party ISP companies because they were offering high and unlimited amounts of bandwidth?  This was something Bell could not compete with, and ultimately forcing consumers to sign with independent ISPs rather than Bell.  Since this cut into Bell's profit margin, the lawsuits were filed, lobbying the CRTC (as well as Telus and Rogers) to put a cap limit on 3rd party ISP internet plans.



Open Media, as well as other websites, had 500,000 supporters strong against this lawsuit, finding it a manipulation in the market, and so the CRTC caved from public pressure rather than lobby pressure from media conglomerates such as Bell, Telus and Rogers.

So if something like this happened, are we to 'trust' that Bell will deliver good, healthy competition in the Canadian market, or is it smoke and mirrors to get that extra couple of buck out of our pocket?

Anyways, back to today's news.  The CRTC felt the same way as the average Canadian reading their news paper and thinking 'this might not be a good move for Canadians'.

“BCE failed to persuade us that the deal would benefit Canadians.  It would have placed significant market power in the hands of one of the country’s largest media companies. We could not have ensured a robust Canadian broadcasting system without imposing extensive and intrusive safeguards, which would have been to the detriment of the entire industry.” -Jean-Pierre Blais, Chairman of the CRTC

I find this to be a great win for the average Canadian here, as I don't feel that I would see a difference in price, service or quality of programming, regardless of what 'promises' Bell uses. (Like how many times I use ' in an article? haha)

"BCE already controls numerous television and radio services, as well as a national broadcasting distribution service. It is the largest Internet service provider in Canada, the second largest wireless service provider and the third largest television distributor. The acquisition of Astral Media’s services would have created a situation where a company of BCE’s size and scale would be able to exert its market power unfairly and hinder healthy competition." -CRTC

(Bell Canada Enterprises (BCE) President and Chief Executive George Cope (L) and Astral Media Inc. President and Chief Executive Ian Greenberg (R) attend the CRTC hearings in Montreal September 10, 2012. *PHOTO: REUTERS/CHRISTINNE MUSCHI)

Now of course Bell got some sour grapes in the process and was not happy with the ruling.  With President and CEO of Bell Canada and BCE (George Cope) stating:

"We met all the CRTC’s rules, indeed our acquisition of Astral was based directly on the CRTC’s currently in-place Diversity of Voices policy.  The wide-ranging benefits to Canadians of the transaction are clear, but the CRTC has told consumers that they and the rules in place just don’t matter."

Since the decision, Bell/BCE will seek an appeal from the Canadian federal cabinet, in hopes it will overturn the CRTC's decision.  Just like a little kid that doesn't get his way, they seek higher authority in hopes that they will eventually get what they want, regardless of the reasons behind the CRTC's decision.

As for the music side of things, The Toronto Star did happen to bring to light some of the radio stations (for example), even in Toronto, that would be affected by this merger.

"Some properties may need to be sold off, notably among radio stations in certain markets. In large markets, rules say a single company cannot own more than two AM and two FM stations in the same market. That would impact many big cities including Montreal, Ottawa and Toronto.

- In Toronto, Astral Media owns 99.9 Virgin Radio, 97.3 boom and Newstalk 1010

- Bell owns: 104.5 Chum FM, Flow 93.5, TSN Radio 1050"

Now I don't this article to be a witch hunt against Bell/BCE, but more of a friendly reminder to you all what is going on behind the scenes.  These decisions may not affect your day to day operations and work, but it will eventually come out of your pockets if you (like us) keep yourselves up to date on current telecom issues.  Who knows, maybe down the road you might have to pay to get your band heard on Canadian internet.  Seems far fetched, but with the former situations involving Bell and the CRTC, is it really that far fetched?