Oct 01 2012
The Competition Question
The proposed $3.4 billion acquisition of Astral Media by BCE Inc. has media giants on high alert. If the deal is approved by CRTC, it would leave Bell Media in control of more than 100 radio stations and almost 90 television channels. Bell’s closest competitor, Shaw, owns just 18 specialty channels and one network.
The major issue of BCE’s takeover of Astral is one of media concentration. If Bell becomes larger, chances are that companies that rely on Astral’s content or Bell’s networks will become marginalized or forced to accept unreasonable deals with Bell in order to keep their services running. If the BCE-Astral deal goes through, Bell will have 33.5% control of English-language television and the capacity to eliminate most domestic competition, which is essential in a market economy. Without a diverse market, there is nothing stopping Bell from charging higher prices for its services, or withholding content from competitors. With strict CRTC regulations against foreign ownership, Bell would have the capacity to run the market as they wish.
If the CRTC allows the transaction to go through, stricter regulations must be put into place against content hoarding to ensure that Bell does not have exclusive rights to content that other service providers rely on. With honest competition, Bell’s expansion could be good news for local film and TV companies, which could gain competitiveness in areas like online entertainment and target a larger audience. In the case that Bell fails to obey market rules, both consumers and competing companies will pay the price.