BCE asks CRTC to reject Rogers-Shaw deal

BCE asks CRTC to reject Rogers-Shaw deal

GATINEAU, Qc – BCE on Thursday urged the CRTC to reject the proposed buyout of Shaw Communications by Rogers Communications for $ 26 billion, while independent operators have asked for more guarantees from the regulatory group.

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Speaking on the penultimate day of hearings in Gatineau this week, BCE representatives echoed concerns raised by broadcasters, producers and distributors about the market dominance Rogers would achieve if the ‘deal was approved.

“The market power that Rogers seeks to acquire will have a negative long-term impact that will reverberate throughout this interdependent ecosystem,” warned BCE chief legal and regulatory officer Robert Malcolmson.

“If successful, Rogers will achieve a degree of control over the broadcasting industry to levels never before contemplated, with no clear offsetting benefit to the Canadian broadcasting system.”

Malcolmson referred to the CRTC’s initial rejection of BCE’s acquisition of Astral Media in 2012, due to the size it would have occupied in the market, as a clear precedent to reject, if not at least require commitments from Rogers to divest assets in order to reduce its future market share.

Bell Vice President of Content and Business Intelligence Sarah Farrugia argued that if Rogers were allowed to get 47% of English-language broadcasting subscribers, they would be able to secure the rights exclusive international programs, which it could use to direct subscribers to its online streaming services, to the detriment of the broadcasting system.

“It is very clear that the transaction would allow Rogers to enjoy a dominant position in negotiations for distribution, which in turn would result in reduced revenues for Canadian channels.”

Rogers argued that it needs increased stature to compete with growing competition from companies like Netflix and Amazon, while keeping subscribers within the regulated broadcasting system.

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Independent actors want guarantees

While Rogers’ direct competitors such as Telus and BCE adamantly opposed the deal during the hearings, companies that depend on Rogers and Shaw to host their programming have expressed more specific comments, with many requests focusing on maintaining the status quo for a certain period.

The Independent Broadcast Group has asked Rogers to commit to maintaining 50 independent channels, compared to the 40 the company said it would maintain for three years.

Ethnic Channels Group has asked the CRTC to require subscription revenues for independent ethnic producers not to decline for five years, and children’s television content producer WildBrain has asked the regulator to force Rogers to continue broadcasting. independent shows currently hosted by Rogers or Shaw for five years. Others have asked that Rogers be required to maintain the satellite broadcast services that Shaw currently provides.

Earlier Thursday, the CEO of the Canadian Media Producers Association, Reynolds Mastin, called for more tangible benefits from the deal, saying the $ 5.7 million in total benefits proposed were not commensurate with the chord size.

“The CRTC should ensure that the applicant commits to providing a tangible benefit package commensurate with the size and nature of the transaction, and which clearly and unequivocally benefits Canadians and their broadcasting system.”

Unifor has raised concerns over Rogers’ plans to take back the $ 13 million a year Shaw gives Global News for an expansion of its own CityNews network, saying the plan risks reducing the diversity of voices. in small markets.

The Canadian Radio-television and Telecommunications Commission (CRTC) hearings focus on the implications of the agreement for the broadcasting industry. Other issues raised by the transaction, such as those relating to wireless communications services, will be reviewed by the Competition Bureau and by Innovation, Science and Economic Development Canada.

Rogers is due to respond to questions raised during CRTC hearings since the start of the week on Friday.

Companies in this story: (TSX: RCI.B, TSX: SJR.B; TSX: BCE)

The Canadian Press


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