MONTRÉAL, July 25, 2019 /CNW
Telbec/ - The acquisition of the over-the-air network V and its
digital assets by Bell Media (Bell) will further undermine an
already precarious ecosystem by allowing a dominant player to
become still more so. The transaction will significantly alter the
balance of power between media companies and have major
consequences. Bell, the largest vertically integrated provider of
telecommunications and broadcasting services in Canada, already holds a dominant position in
both the French and English specialty channel markets and the radio
market across Canada. It will now
be able to dramatically increase its power and dominance in the
French-language market in terms of competitive posture, advertising
revenues and content offerings, ultimately at the expense of the
consumer.
The issues with this transaction are not limited to the market
share numbers. The impact on the competitive landscape and the
implications of across-the-board media concentration in the hands
of Bell, in both the English- and French-language markets, must
also be considered.
In May 2018, the Competition
Bureau blocked Bell's acquisition of the specialty channels Séries+
and Historia in order to prevent "a substantial lessening of
competition." Applying the same reasoning, the acquisition of a
conventional network and its digital assets by a giant such as Bell
should raise even graver concerns.
"Bell was originally a monopoly and its actions of recent years
appear to be aimed at becoming a monopoly again and adopting a
business model based on the elimination of all competition," said
Pierre Karl Péladeau, President and CEO of Quebecor. "The
acquisition of a French-language conventional network will not only
increase Bell's dominance but prevent other players from being
competitive in content acquisition and advertising offerings. After
the absorption of Astral by Bell, yet another Québec head office
will be swept away by a Toronto-based giant. At the end of the day,
Québec television viewers will lose out. Is this the future we want
for Québec television? As a shareholder in V through Investissement
Québec, the government of Québec must intervene to block this deal.
In the long run, this takeover would threaten our ability to
maintain the requisite resources to sustain our newsrooms and our
expertise in news coverage, one of the foundations of a healthy and
vibrant democracy."
Dangerous advertising market concentration
A central concern is Bell's ability to use its immense market power
to control the advertising market as it pleases. With its
preeminent position in the conventional television, specialty
channel, pay TV, radio, distribution, Internet, mobile, digital
media and out-of-home businesses across Canada, its control over pro sport teams, and
more than a billion dollars in annual television advertising
revenues, Bell will be in a position to dictate market trends and
prescribe advertising rates. History also shows that Bell is
prepared to engage in anti-competitive practices. It must be borne
in mind that advertising is the main source of revenue for all
conventional television stations.
Impact on content offerings
Bell's market domination will also produce a serious imbalance in
bargaining power in the race for television content and enable Bell
to drive up the price. With its presence in the French- and
English-language markets, Bell will easily be able to sign
agreements for multiplatform rights in both languages.
"It is short-sighted to think that this transaction will
strengthen Québec's television ecosystem," said France Lauzière,
President and CEO of TVA Group and Chief Content Officer of
Quebecor Content. "As in the case of the acquisition of Astral's
specialty channels, the addition of an over-the-air network will
only increase Bell's bargaining power and lead to a market
controlled by one dominant player, negatively affecting consumer
choice."
Quebecor plans to make its case to the appropriate bodies.
About Quebecor
Quebecor, a Canadian leader in
telecommunications, entertainment, news media and culture, is one
of the best-performing integrated communications companies in the
industry. Driven by their determination to deliver the best
possible customer experience, all of Quebecor's subsidiaries and
brands are differentiated by their high-quality, multiplatform,
convergent products and services.
Québec-based Quebecor (TSX: QBR.A, QBR.B) employs more than
10,000 people in Canada.
A family business founded in 1950, Quebecor is strongly
committed to the community. Every year, it actively supports more
than 400 organizations in the vital fields of culture, health,
education, the environment and entrepreneurship.
Visit our website: www.quebecor.com
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SOURCE Quebecor