04/17/2013 11:25 EDT | Updated 06/17/2013 05:12 EDT

BCE, Astral downplay critics as mainly its competitors in CRTC response

MONTREAL - BCE Inc. (TSX:BCE) and Astral Media Inc. (TSX:ACM.A) fired back Wednesday at critics who think it will control too much of the market if a plan for Astral to sell the bulk of its assets to BCE goes ahead.

Kevin Crull, president of Bell Media, said the primary focus for his company is growth in Quebec and the French-language media marketplace.

"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," Crull said in a statement.

"All of these remaining English and French-language TV services are part of the Astral and Bell Media plan to increase consumer choice and service innovation in Canadian media."

In response to interventions filed with the CRTC, the companies say the biggest opponents to the deal are the "large vertically integrated corporations" cable and telecom companies that compete directly with Bell.

Bell and Astral dismissed concerns that the takeover would hurt access to content and pointed to long-term distribution and affiliation agreements it already has in place with its competitors.

The broadcast regulator will hold hearings in May to consider Bell's revised application to buy Astral, after it agreed to sell some of its television assets to make the deal more acceptable in an agreement with the Competition Bureau.

The Canadian Radio-television and Telecommunications Commission killed the deal last fall, saying it wasn't in the best interests of Canadians.

In rejecting the agreement as it was originally structured, the CRTC said Bell would have controlled almost 45 per cent of the English TV viewership and almost 35 per cent of the French-language market.

Cogeco has said if the revised deal is approved, it would still give an already dominant BCE too large a share of the broadcasting market.

"Canadian consumers of television entertainment can only expect rising costs for their viewing options on fixed and mobile platforms, more forced packaging of BCE services and less choice in the selection of services they actually wish to use," the company said earlier this month.

Last year, Cogeco formed a coalition with Quebecor Inc. (TSX:QBR.B) and cable company Eastlink to block the original deal.

BCE have also proposed a $174.64-million tangible benefits package in a renewed effort to win the CRTC's approval of their plan.

Under its deal with the Competition Bureau, Bell will 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.

The Competition Bureau said without the sale of Astral's (TSX:ACM.B) pay and specialty television channels, the deal would likely have led to higher prices and reduced choices for television programming.

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