ANALYSIS: Bell-Astral deal too big, too fast ... too bad

Bell Canada Enterprises (BCE) President and CEO George Cope (L) and Astral Media Inc. President and...

Bell Canada Enterprises (BCE) President and CEO George Cope (L) and Astral Media Inc. President and CEO Ian Greenberg share a laugh after a news conference in Montreal March 16, 2012. REUTERS/Christinne Muschi

Pat Bolland, QMI Agency

, Last Updated: 3:43 PM ET

This train is going too fast. That's, in effect, what the CRTC has said in not approving the Bell/Astral Media merger.

The $3.4-billion deal would have put together a conglomerate of 107 radio stations, two national television stations and 49 pay-TV and specialty channels. The Canadian Radio-television Telecommunications Commission covers everything from the volume of TV commercials to Internet security, not to mention the broadcasting of Canadian content in this country. It saw the merger as stifling competition and limiting consumer choice.

Bell and Astral Media had presented both a patriotic and practical case. The CRTC ruled that foreign, unlicensed competitors are not having a significant impact in Canada, as had been suggested.

Bell/Astral also played into the "diversity of voices" policy at the CRTC by promising to invest heavily in French language content. A practical benefit for sure, but the CRTC has a national mandate, not a provincial one, and took into consideration the impact on the whole country.

The CRTC was very clear that "this transaction would have resulted in an unprecedented level of concentration in the Canadian marketplace" and worried the merged company would use its market power to its advantage.

As a businessman I can appreciate that this is exactly what Bell and Astral were striving for. Get control of as much content as possible and control the means that the content is delivered to the public. And a Bell/Astral axis would have controlled a lot: television, radio, Internet, satellites, cellphones and more.

And this is where the CRTC drew the line. Multimedia platforms are exploding. Things that we use every day didn't exist a few short years ago: think Google, Facebook, YouTube, Twitter ... and the list grows longer, quickly.

The CRTC is saying, with this ruling, that it doesn't know where the applications of the future are coming from, but it sure doesn't want Canadians to only have limited sources of information feeding into that. This ruling supports diversity in content.

Will Bell and Astral try again? I don't think so for two reasons. First they burnt their bridge with the CRTC in their response to the ruling, saying the process was a "mockery."

There's not a lot of kiss-and-make-up room in that. But even if they went back to the CRTC with a new deal - say that they promised to sell off the radio assets for example - the CRTC probably would rule the same. The CRTC didn't leave the door open to approving the merger under certain conditions. Not a mention of that. Door closed, end of discussion.

Canadian media does need more investment, but that investment needs to come from sources without so much concentration of power, both in content and delivery. Other telecom deals will come forward, probably involving Bell, but the CRTC has done the right thing here for consumers. It just make business sense to at least slow the concentration train down.

- Pat Bolland hosts AM Agenda with Alex Pierson on Sun News Network


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