Bell-Astral Deal: CRTC To Take Second Look At Merger

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Bell is heading to the CRTC for a second time in hopes that its plan to sell off the majority of Astral Media's TV channels will be enough to appease the regulator's worries its takeover of the media company would not be good for Canadians. (CP)
Bell is heading to the CRTC for a second time in hopes that its plan to sell off the majority of Astral Media's TV channels will be enough to appease the regulator's worries its takeover of the media company would not be good for Canadians. (CP)

MONTREAL - Bell is heading to the CRTC for a second time in hopes that its plan to sell off the majority of Astral Media's TV channels will be enough to appease the regulator's worries its takeover of the media company would not be good for Canadians.

A new round of public hearings on Bell's revised plan to buy Astral starts Monday after the Canadian Radio-television and Telecommunications Commission killed the plan last fall, citing concerns it would restrict choice and raise prices for consumers.

Janet Lo, legal counsel with the Public Interest Advocacy Centre, said the revised deal isn't all that different from Bell's first attempt to win approval to buy Astral.

"For us, it raises the same concerns for competition as the first transaction," said Lo, who will appear before the CRTC at the hearings.

This time, parent company BCE Inc. will keep just eight of Astral's 25 specialty channels, including premium Movie Network, and 77 of its 84 radio stations.

Lo said the deal still raises questions about whether independent broadcasters will be able to provide the diversity of voices that Canadians expect.

"We are continually concerned by media concentration and what that means for independent producers being viable, what that means for Canadians being able to access content they want to pick and pay for, and whether a very concentrated market means less competition for consumers."

Bell (TSX:BCE) and Astral Media Inc. (TSX:ACM.A) have pointed out it will control less of the market under the revised deal.

"Even after the sale of half of Astral's French-language specialty TV services, Bell Media would increase its viewing share in this market to 22.6 per cent — still less than the 31 per cent viewing share enjoyed by Quebecor, but a significant enhancement to market competition nevertheless,'' Bell Media president Kevin Crull said recently.

Telecom consultant Eamon Hoey said the question remains whether the acquisition is in the public's best interests.

"It's going to take some guts for the CRTC to turn it down," said Hoey, managing partner at Hoey Associates Management Consultants Inc. in Toronto.

Media concentration is still a big concern, he said.

"It's only moving the pieces of chess around the board," Hoey added.

Cogeco Cable Inc. has said it's still opposed to the deal, arguing that consumers will have higher costs and less choice.

Bell has said it wants to buy Astral to put content from its television channels and radio stations across traditional TV screens, smartphones, tablets and laptops, and to compete with foreign online TV and movie services like Netflix.

Bell already has approval of its revised deal from the federal Competition Bureau to keep eight of Astral's TV channels including the Movie Network, which includes HBO Canada, and TMN Encore as well as the French-language SuperEcran, CinePop, Canal Vie, Canal D, VRAK TV, and Z Tele.

Corus Entertainment Inc. (TSX:CJR.B) has approval from the Competition Bureau to buy the remaining half of Teletoon and other specialty TV interests from Astral.

In addition, Bell said it will also sell the English-language Family including Disney Junior English and Disney XD services, and the French Disney Junior, Musimax and MusiquePlus services.

When the CRTC killed the deal last October, commissioner Jean-Pierre Blais said had the regulator allowed the deal, BCE would have controlled almost 45 per cent of the English TV viewership and almost 35 per cent of the French.

As well, it would have become the largest radio station operator in Canada and would have controlled over half of TV pay and specialty services.

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