Friday, 19 October 2012

CRTC turns down Astral/BELL deal. Toronto radio scene can go back to sleep now.


On October 18 the CRTC announced it's much anticipated ruling on the proposed merger of BCE and Astral Media. For the better part of a year there has been a serious lobbying and media campaign to stop the deal led by competitors such as Cogeco, Eastlink, and Vidéotron. The last of which are owned by the right wing Québecor Média (QMI), who also own SUN Media and have become notorious for their campaigns attacking the CBC as well as government grants and funding for the arts in general, all on behalf of the poor oppressed tax payers of course. Mind you this is even while QMI blithely takes millions of taxpayer funded grants themselves (something the CBC famously revealed and which I have already written about).
In fairness the anti-merger group did have some genuine grass roots support from consumers groups worried about concentration of media ownership and raising fees as well as less choices in programming. But I'm pretty sure they weren't behind all the anti-merger ads I've been seeing.

Still most smart money has been confidentially predicting that the merger would be rubber stamped, and that's not even counting the usual suspects with their conspiracy theories about the CRTC's "EVIL CORPORATE AGENDA" (cough..NCRA..cough) which makes the CRTC's ruling a bit of a surprise.


From the CTRC ruling;
67. The Commission has reviewed BCE’s proposal, as well as the comments received in response to Broadcasting Notices of Consultation 2012-370, 2012-370-1 and 2012-370-2. As noted above, the Commission must evaluate applications for a change in effective control against the objectives set out in the Act, as well as its own policies and regulations. The Commission considers that the concerns related to competition, ownership concentration in television and radio, vertical integration and the exercise of market power are very substantial and fatal to the application.
68. The Commission finds that BCE has not discharged its burden and demonstrated that, on balance, this transaction is in the public interest. The benefits proposed would advantage BCE and its services, but the Commission is not persuaded that the transaction would provide significant and unequivocal benefits to the Canadian broadcasting system and to Canadians sufficient to outweigh the concerns described above.
69. Accordingly, the Commission denies the application by BCE Inc., on behalf of Astral Media inc., to change the effective control of Astral and its licensed broadcasting undertakings so that it is exercised by BCE (application 2012-0516-2). In light of its decision, the Commission has not made determinations on other aspects of BCE’s application, including the value of the transaction.
70. The Commission notes the objections of numerous interveners with respect to the application by Bell Media Inc. and 7550413 Canada Inc., partners in a general partnership carrying on business as Bell Media Canada Radio Partnership, to convert CKGM Montréal from an English-language to a French-language commercial radio programming undertaking (application 2012-0573-2). These objections related to, among other things, the integrity of the Commission’s licensing process and the loss of an English-language broadcasting service to an official language minority community. At the public hearing, BCE indicated that in the event the proposed transaction was denied, it would continue to operate CKGM Montréal as an English-language station. As a result, the Commission denies this application. Therefore, the licensee will continue to operate CKGM Montréal under the terms and conditions in effect under its current licence.
71. Similarly, the Commission denies the following related applications, which BCE indicated were contingent on approval of the proposed change of control of Astral:
applications by BCE Inc., on behalf of certain of its licensed broadcasting subsidiaries, to effect a multi-step corporate reorganization involving the transfer of the assets of 33 Bell Media radio stations to seven partnerships or corporations, requiring the issuance of new broadcasting licences (applications 2012-0701-9 and 2012-0736-6); and
application by BCE Inc., on behalf of Astral Media inc. and certain of its licensed broadcasting subsidiaries, to effect a corporate reorganization involving the transfer of the assets of certain broadcasting undertakings to companies to be incorporated, requiring the issuance of new broadcasting licences (application 2012-0735-8)."


What this means for radio is that a number of radio stations which Astral would have had to divest (sell off) in order to comply with existing ownership rules will now stay where they are.
BCE owned stations in Toronto include 1050 CHUM AM (TSN), 104 CHUM-FM and CKFM (Virgin Radio);


Informed speculation about the FM stations BCE were most likely to divest following the purchase of Astral Media based on performance are as follows:

City ~ Call letters/freq. ~ Station name and format ~ Share/Rating
1. Vancouver CHHR/104.3 Shore-FM, AAA 1.6/16th
2. Vancouver CKZZ/95.3 Virgin Radio, adult contmp. 7.2/5th
3. Ottawa CJOT/99.7 Boom, classic hits 1.5/14th
4. Ottawa CKQB/106.9 The Bear, active rock 3.5/11th
5. Calgary CKCE/101.5 Kool, adult contemporary 3.4/13th
6. Winnipeg CHIQ/94.3 FAB, ’60s/’70s hits 4.9/10th
7. Toronto CHBM/97.3 Boom, classic rock 5.7/7th
8. Toronto CFXJ/93.5 Flow, hip-hop 1.4/19th
Or they could have sold off the latest money loosing version of the former iconic CHUM AM, now an all-sports station called "TSN 1050". (I have already written about this as well).


Note the two Toronto stations. ASTRAL also had originally put in an application for the vacant 88.1FM frequency last year but then withdrew once the proposed merger was announced and before they had a chance to reveal what exactly they had in mind. Not that there was any guarantee they would have beaten out the winning INDIE 88FM application anyway.
Speaking of which the CRTC also recently announced that the call-letters for the new INDIE 88 will be "CIND".

At any rate this means that the after three years of uncertainty in the Toronto radio scene the status quo has been settled. The FLOW and BOOM 97 are not being sold, and probably not changing format either. Unless ASTRAL change their mind of course, but at least they don't actually have to. Some of those various corporate types who applied for the 88.1FM frequency and got turned down and who have been lurking around to see if they might get a second bite at the apple by buying one of ASTRAL's cast-offs can now go home thanks.


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