Bell Canada back in the content business with CTV bid

Bell Canada Enterprises (BCE) Inc. is getting back into the content business by agreeing to buy the CTV television network for $3.2 billion.

The television assets are currently owned by CTVglobemedia Inc., which in turn is held by BCE, Ontario Teachers Pension Plan, Torstar Corp. and the Woodbridge Co. Ltd.  If the deal is approved, BCE would buy out the other owners and get 100 per cent of CTV. Meanwhile, The Globe and Mail newspaper, currently part of CTVglobemedia, would be spun off into a different company. Woodbridge is owned by the David Thomson, who is also chairman of Thomson Reuters Corp. Thomson’s father, who died in 2006, is Ken Thomson, who is the son of the late Canadian media tycoon Roy Thomson, who once controlled a large chain of Canadian newspapers including The Globe and Mail.
In 2000, BCE acquired a controlling interest in The Globe and Mail from Thomson Corp., combined it with CTV and named it Bell Globemedia Interactive. BCE later diluted its ownership by selling parts to Teachers and Torstar, the holding company that owns the Toronto Star newspaper and other publishers, including the Harlequin romance books.
The combination of telecommunications and media firms has been a bugbear for the Canadian Radio-television and Telecommunications Commission which regulates facilities-based carriers, radio and television stations. Other firms, such as Rogers Communications Inc., also own television and radio stations, plus wired and wireless networks.

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Last year, the CRTC ruled telecom carriers and cable providers who also provide wholesale and resale Internet service are allowed to throttle certain types of traffic using technologies such as deep packet inspection. This ruling resulted from hearings which in turn resulted from complaints from small ISPs who do not operate networks but who buy wholesale access from firms such as Bell and Rogers.
Although television and radio content is regulated by the federal government, information delivered by so-called new media firms is exempt from the Broadcasting Act. In 2009, the CRTC extended the exemption first declared in 1999.
Last month, the CRTC issued Broadcasting Regulatory Policy 2010-582, which requires “new media” firms whose owners are also broadcasting to report their revenues and expenditures to the CRTC. In the same policy, the CRTC also said it will establish the New Media Reporting Working Group, which would develop definitions and metrics for reporting content such as the type, origin, genre, accessibility and language of content published on the Internet. This was due to concerns from lobby groups representing artists, including the Canadian Independent Music Association (CIMA) and the Alliance of Canadian Cinema, Television & Radio Artists (ACTRA). It is not clear exactly how new media firms will gather and report such content.
The ruling minority Conservative party has stated it intends to loosen the foreign ownership rules for telecommunications carriers. This came after Cabinet overturned a CRTC ruling on Globalive Wireless Management Corp., which launched the Wind Mobile cellular service last year. Globalive is majority-owned by its chairman, Anthony Lacavera, its minority shareholder is Orascom Telecom Holdings SAE of  Egypt, which loaned the firm money to start operations.


During a hearing before the House of Commons Standing Committee on Industry, Science and Technology, CRTC chairman Konrad von Fickenstein said the rules for broadcasters and carriers should be the same because of firms such as Bell and Rogers who control TV stations and the networks over which content is delivered. Bell’s acquisition of CTV helps bear out von Fickenstein’s argument but the fact remains, firms such as Globalive do not operate broadcasting companies.


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