Astral will make Bell more competitive in a borderless world
During hearings last week on Bell’s purchase of Astral Media, several of our competitors urged the Canadian Radio-television and Telecommunications Commission (CRTC) to block the deal. Bell’s growing competitiveness and our success in playing by the rules, they said, means there should be new rules to keep Bell from succeeding.
We think that would be bad for Canadian consumers and creators. Bell is committed to Canadian broadcasting, spending more on Canadian content than any other private broadcaster. And our hope is to invest more with Astral, broadening the viewing and listening options for all Canadians. In a fast-changing media marketplace, we are committed to ensuring that Canadian content and the ways you watch it will just get better.
Astral joining with Bell enables us to do just that. We’ve announced multiple benefits that will flow from the transaction, including a new made-in-Canada service to compete with Netflix, Apple and Google; a four-year commitment to keeping all local conventional news stations open; $127-million in new French-language TV content and a new national French-language news channel; and more than $60-million in new funding for TV content creation and radio innovation, among other planned initiatives.
Bell is buying Astral to be more competitive in an extremely competitive broadcasting marketplace. We seek new opportunities to compete on a global basis for content rights, while levelling the playing field with the large “vertically integrated” cable companies here at home. This is especially true in Quebec, where Bell Media’s lack of French-language programming beyond the RDS sports properties left us at a distinct disadvantage versus Quebecor, by far Quebec’s largest vertically integrated media/cable company.
Bell’s goal is to be recognized by customers as Canada’s leading communications company, and we make no apology for wanting to be the best at what we do. In our increasingly borderless business, we face growing challenges from international operators, as well as the big cable companies. In response, no company has invested more than Bell in new infrastructure, new content and new broadband communications products to drive competition and consumer choice.
Despite a challenging economy, Bell has invested more than $15-billion over the last five years in network expansion and Canadian R&D. We’ve invested in Canada’s best content, as our business shifts from landline phones and other declining product lines to a complementary suite of broadband services offering consumers the content they want on the screens of their choice. We now offer TV and Internet consumers a real competitive alternative to the large cable companies.
If we want to continue to invest in homegrown talent and make programming decisions here, we need Canadian companies with the scale and commitment to compete with international giants and ensure choice for consumers.
Canada now has four large vertically integrated companies offering both media and communications services. Of the other three, two oppose the Astral deal, while Shaw supports it. Why the difference? We all compete as broadcasters, but Rogers and Quebecor compete directly with Bell for TV subscribers in Ontario and Quebec. With the launch of Bell’s new Fibe TV service, both are seeing their long-dominant position in the urban TV marketplace under threat.
But let’s be clear — this transaction is absolutely within CRTC rules. Combined, Astral-Bell will account for 33.5% of total English-language TV viewing by Canadians, below the 35% threshold at which the CRTC would normally quickly approve transactions, and comparable with the Shaw-Corus share of 30.2%. And Bell-Astral’s combined 24.4% of French-language viewing would still be well below Quebecor’s 30% share.
Bell’s investment strategy is focused on growth and, unlike international players like Netflix and others, it’s focused on Canada. In addition to our industry-leading network spending, Bell acquired The Source from a bankrupt U.S. owner, saving thousands of Canadian jobs. We partnered with several companies in the acquisition of data-hosting company Q9 Networks from a U.S. private-equity owner. We helped bring ownership of the Montreal Canadiens back to Canada, and partnered with other companies to ensure that MLSE stayed Canadian.
Bell is committed to Canadian broadcasting and we’ve shown that we are willing to step up to invest and innovate. We look forward to building on this all-Canadian record of success by joining with the team at Astral.
Mirko Bibic is chief legal and regulatory officer and executive vice-president at BCE Inc. and Bell Canada.