The Competition Bureau approved Bell’s proposed $3.38 billion takeover of Astral Media Inc. on Monday, under conditions that the company first sell several of its pay and specialty television channels.
Under the Consent Agreement, Bell will have to sell channels such as Teletoon, the Family Channel, and Disney XD, as well as a number of radio stations.
In a statement announcing the decision, the bureau said that without this agreement, Bell’s acquisition of Astral’s pay and specialty television channels “would likely have led to increased prices, less innovation, and reduced choice for television programming.”
“Today’s agreement is essential to preserving choice for consumers and ensuring continued and effective competition in this area,” said John Pecman, interim commissioner for the Competition Bureau.
The Consent Agreement also puts additional restrictions on Bell, including a prohibition on imposing restrictive bundling requirements on any provider seeking to carry The Movie Network or Super Écran.
Bell has indicated that it will divest itself of a number of radio stations to comply with the Canadian Radio-television Telecommunications Commission’s (CRTC) Common Ownership Policy.
Even with the divestiture of assets, the safeguards to prevent abuse of market power simply aren’t there.
— Lindsey Pinto, OpenMedia.ca
“This positive news from the Competition Bureau is a major step forward in uniting Astral and Bell Media and delivering on our promise to grow investment and competition in Canadian broadcasting,” said George Cope, president and CEO of BCE Inc. and Bell Canada.
The divestitures are not enough to assuage critics, however, who say the deal will limit choice in media content and delivery and restrict the diversity of voices within Canada’s already highly concentrated media market.
“Even with the divestiture of assets, the safeguards to prevent abuse of market power simply aren’t there,” Lindsey Pinto, communications manager of open Internet advocacy group OpenMedia.ca, said in an email.
“We want a market that encourages innovation and choice for Canadians, not one where the big guys just get bigger.”
The more telecom companies become concentrated, Pinto adds, the more they will be able to dominate all aspects of the market, leaving little room for innovative products and independent content.
“It’s clear that if this big telecom conglomerate owns more media content while also controlling the means of media delivery, it will be further incentivized to restrict access to content it can’t control,” she says.
The merger remains subject to approval by the CRTC—now the only regulatory approval required.
The CRTC rejected the deal last year saying it would threaten the competitive media landscape, but Bell has since revised its proposal in hopes the new version will be approved.
“Together, Astral and Bell Media will have the scale to invest, compete, and deliver on the opportunities ahead for all Canadians in this rapidly changing media landscape, and I look forward to continuing to work in close collaboration with Bell’s team towards securing CRTC approval for the transaction,” said Astral president and CEO Ian Greenberg in a release.
Astral operates 25 television services, 84 radio stations, and more than 100 websites and digital media properties.
Bell operates 28 conventional TV stations, 30 specialty channels, and 33 radio stations, and broadcasts media content across multiple platforms, including television, the Internet, and mobile phones.
Overall, the divestitures will result in Bell Media having a 35.7 percent share in English-language viewership, two percent more than its current share. Its French-language share would be 23 percent.
According to Columbia University research examining 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.
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