Opposition Growing to Bell-Astral Merger

More voices are joining the crescendo of criticism over Bell Canada’s proposed acquisition of Astral Media Inc., which would see the telecom giant grow to more than twice the size of its closest competitor.

Consumer, industry, and activist groups have all raised the alarm over the $3.38 billion takeover, which is currently under review by the Canadian Radio-television and Telecommunications Commission (CRTC) and the Competition Bureau.

On Tuesday, telecommunications competitor Telus announced it is joining the campaign to quash the deal, saying it is not in the public interest.

“Without proper regulatory safeguards, consumers could soon be facing increased costs and reduced choice in their TV viewing options,” reads a statement from Telus.

Astral Media is one of the last large independent television groups in Canada. If the acquisition is approved, Bell will own 79 TV channels, 107 radio stations, and more than 100 websites—totalling 37.6 percent of the national broadcasting market.

By comparison, the largest communications companies in the United States, Australia, and France have 18.9, 24.9, and 26.1 percent market shares.

“This will change the media landscape in Canada,” says Lindsey Pinto, communications manager for OpenMedia.ca, a non-profit group that advocates for accessible and affordable communications systems in Canada.

“Canada’s media system is already one of the most highly concentrated in the industrialized world, and the Bell-Astral deal will serve to further that. In short, fewer media and telecom choices, higher prices, and less opportunity for free speech.”

Last week a coalition of communications companies including Québecor Inc., Eastlink, and Cogeco Cable Inc. came together to launch their saynotobell.ca campaign—a website and series of newspaper and radio ads that asks the Canadian public to lobby Ottawa to block the merger.

“If this transaction is approved, Bell Canada will pose a very serious threat to the Canadian broadcasting industry,” said Louis Audet, president and CEO of Cogeco Cable Inc., at a press conference in Ottawa on Aug. 7.

“Competition will be severely reduced and the broadcasting market as we know it today will essentially be handcuffed. The power will shift out of the hands of consumers and into the hands of the Bell conglomerate.”

Pierre Karl Péladeau, president and CEO of Quebecor Inc., noted that if the deal goes through, Canada will have similar levels of media ownership concentration to countries such as Mexico, Italy, and Brazil.

“Few of the world’s major economies have permitted the private broadcaster to acquire such a major share of TV viewing,” he said.

Rogers, MTS Allstream, and the Canadian Independent Communications Alliance—which represents over 100 cable companies—have also recently come out publically against the merger.

“The fact that these media giants are threatened is a huge indicator of how this deal stands to harm diversity in the media,” says Pinto. “Think about how scared independents must be if [large companies like] Québecor are saying that they’re going to face some problems.”

Misinformation Campaign, says Bell

In an Aug. 7 statement, Bell called the merger opposition and launch of saynotobell.ca a “public misinformation campaign” and “clear evidence that the competitive landscape is changing.”

“While it’s understandable that our rivals would try to eliminate the competitive threat posed by Bell, consumers benefit when companies innovate, invest and compete in the marketplace, rather than playing regulatory games,” said Mirko Bibic, Bell’s chief legal and regulatory officer.

“The CRTC already has clear and extensive rules governing how Bell Media and other content providers sell our services, and how other distributors package them for consumers—rules we obviously respect.”

Martine Turcotte, Bell’s vice chair in Québec, said the acquisition means Bell is “actually levelling the playing field with the long-dominant media/cable company in Québec, Québecor, and bringing new investment and increased competition to the media marketplace.”

According to Columbia University research that studied international media ownership, Canada currently has the second-highest level of cross media ownership and vertical integration among 32 countries. If the Bell-Astral deal goes through, Canada would easily move to the number one position.

Last week, four consumer and public interest groups filed comments publically opposing the acquisition.

The Public Interest Advocacy Centre (PIAC), Consumers’ Association of Canada, Canada Without Poverty, and Council of Senior Citizens’ Organization of British Columbia, stated they believe that the transaction would not benefit consumers.

Some of their concerns include the impact on the diversity of voices in the Canadian broadcasting system; increasing levels of media concentration in conventional television and pay and specialty television services; increasing costs for “basic service” television programming; and increased vertical integration, leading to weakened competition in broadcasting services.

“If this transaction is approved, consumers will be offered even less flexibility in packaging and fewer choices to pick and pay only for the television services they want to watch,” said PLAC counsel Janet Lo.

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