News surprised Canadian industry

MONTREAL

To the surprise of most in the Canadian TV biz, the federal broadcast regulator has nixed Bell Canada’s $3.4 billion acquisition of rival broadcaster Astral Media, what would have been one of the country’s largest ever media deals.

Canadian Radio-Television and Telecommunications Commission chair Jean-Pierre Blais said Bell “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.”

If Bell had nabbed Astral, it would have owned 86 TV stations — including prime Astral assets like The Movie Network, HBO Canada and Teletoon — and 100 radio stations,

Bell already owns many of the top networks including CTV, Discovery Canada and TSN.

“We’re surprised given the past decisions of the CRTC,” said Jim Thompson, spokesman for broadcast watchdog group Friends of Canadian Broadcasting.

“The result is that the company has said ‘no’ to one large company and ‘yes’ to another large company,” he added, referring to Montreal-based Quebecor, which, he noted, has a dominant position in the French-Canadian market.

The deal would have given Bell access to that market via Astra’s slew of French-language cable channels including Canal Vie and Canal D.

Quebecor CEO Pierre Karl Peladeau was among many of Bell’s competitors who argued long and hard in front of the CRTC against the acquisition, calling it a bad deal for the TV business.

“This deal will be a point of no return for the future of telecom and broadcasting in Canada,” Peladeau said at the hearings in October.

Bell will still have to pay Astral $150 million, a fee agreed to in the event of the CRTC refusing the deal.

TV producers won’t be pleased by this turn-of-events. As part of the deal, Bell had agreed to spend around $240 million to boost the industry and had pledged to start a French-language, all-news web, a Netflix-like platform to stream content, and provide coin for TV production. All of that is now off the table.

“Those hundreds of millions of dollars are not going to be available to television producers in Canada and that’s significant,” said Thompson.

Meanwhile, Astral remains on the sales block and presumably one of the other large distribution companies — like, say, Rogers Communications — – will step in to try to acquire the prized TV assets. But will the regulator be any more accommodating to the next bidder?

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