With a CRTC decision on Bell Canada’s $3.4-billion deal for Astral Media expected in the fall, a coalition comprised of prominent Quebec and East Coast-based media companies is urging the public to speak out against a transaction it deems a “bad deal” for consumers, for competition, and even for Canada.
The group, led by Cogeco Cable president and CEO Louis Audet, Eastlink Communications CEO Lee Bragg, and Quebecor president and CEO Pierre Karl Péladeau, kicked off the initiative Tuesday with a full-page newspaper ad positioned as “An open letter to Canadian TV viewers.”
The ad claimed that in addition to giving Bell a dominant share of Canadian TV viewing, the Astral Media acquisition could result in a situation where it could charge consumers exorbitant fees for access to top-rated programming, and exert pressure on them to take up other Bell channels—and even additional products such as phone, wireless and internet—to be granted access to popular programs.
The group also claimed that the deal could result in the creation of fewer original Canadian programs, leading to fewer jobs in the Canadian production industry, and an increase in ad rates—costs that would ultimately be passed on to consumers.
Astral is a major player in both specialty TV (where its assets include The Movie Network and HBO Canada) and radio, where it is the country’s largest broadcaster with 84 stations in eight provinces. The company also operates an out-of-home advertising business.
According to the “Say No to Bell” group, a combined Bell Media/Astral Media entity would own 79 TV channels—giving it a 45% share of English language audiences and 35% of French language audiences—107 radio stations and more than 100 websites. In a release, the group also claimed that the company would control 38% of Canada’s total TV ad market and 31% of the radio advertising market.
The group claims that its purpose is two-fold: Warning the public of both the risks to them as consumers and the potential harm to the Canadian television industry, and to encourage Canadians to contact the Competition Bureau and the CRTC to voice their concerns.
The newspaper ad drives to the website SayNoToBell.ca, which features an online petition and outlines the impact of the deal for TV watchers.
The deal could mean escalating costs for commercial advertising on TV and radio and also force advertisers to endure “forced buys” on multiple Bell Canada advertising platforms.
“Bell Canada’s ability to take advantage of its competitors could have grave implications for competition and consumer choice,” the site states.
Concerns about an Astral-Bell merger surfaced as soon as the deal was announced in March. However, more than a few observers noted the new company would actually serve as a counter-balance to the powerful Quebecor, which dominates in Quebec. Its media assets include the market-leading TVA network and newspaper and magazine properties.
Clearly this will be one of Bell’s rebuttals to the new attack. In an e-mail interview with Marketing, Bell Canada spokesperson Jacqueline Michelis said the Bell-Astral deal intensifies competition to consumers’ benefit, particularly in Quebec.
“We’re actually leveling the playing field with the long-dominant media company in Quebec—Quebecor—and that clearly has our competitor concerned,” she said. “There’s no better proof of that than today’s efforts by our rivals.”
Michelis said the transaction meets all of the CRTC’s rules regarding media ownership. The combined Bell Media/Astral Media entity will boast 33.5% of English TV viewing and 24% of French, she said, both of which are within the CRTC threshold of 35%.
“It’s important to note that even after the Bell-Astral transaction, our largest competitor in Quebec—Quebecor—retains a significantly larger French-language viewership. They’ll still be largest in the market, versus Bell-Astral’s 24%, but with a less overwhelmingly dominant position,” said Michelis.
She also dismissed as “silly” the group’s suggestions that Bell would restrict content. “Bell Media is in the business of providing content to [cable companies] like these and other TV providers,” she said. “Our business depends on it, consumers want it, so we work to make content as widely available as possible across multiple platforms. In fact, Quebecor buys both Bell Media TV and now mobile TV content from us, and we buy content from them. We obviously don’t see that changing.”
