In an article last week, contributing columnist Dwayne Winseck criticized a recent C.D. Howe report on foreign ownership of telecom and media industries in Canada, including the make up of the C.D. Howe's Competition Policy Council and Prof. Jeffrey Church, one of the Council members. In reply to Mr. Winseck's column, Mr. Church has sent a letter of rebuttal and has identified some factual errors, which have been noted and corrected in Mr. Winseck's original column.
I write to express my concern over factual errors and inaccurate characterizations in the online column by Dwayne Winseck, " Slim and skewed: C.D. Howe report on media ownership misses big picture." In particular:
1. The column states that I am a University of Alberta economics professor. My position is at the University of Calgary.
2. The column states that I am an advisor to the "Big 3Ps"-Petroleum, Pork Producers, and Pharma. I have never been an advisor to Pork Producers.
I have, however, written reports for the European Commission and the OECD on the economics of vertical integration and I have been involved in more than 10 different matters involving telecommunications in Canada. Mr. Winseck's insinuation that my involvement with the petroleum and pharma industries mean that I am not a qualified source of "new thinking for new media" has no basis.
3. The column contains a reference to page 5 of my expert report submitted to the CRTC on vertical integration where it claims I asserted that "vertical integration is good for consumers and for Canada." This appears to be a simplification of my assessment "that there is a strong presumption, both on theoretical and empirical grounds, that vertical integration is beneficial for consumers."
My report goes on in the following paragraphs to explain that vertical integration can be harmful, that the key policy issue is adopting a framework to distinguish when it might be harmful to consumers, and that the appropriate policy approach is likely not to always forgo the benefits associated with content exclusivity in the development of new distribution platforms (by, for instance, always prohibiting exclusive content), but instead to examine the costs and benefits on a case by case basis.
4. The column claims that "the Council of 15 wise men and one woman . . . is the same crowd braying for the withdrawal of any meaningful conception of regulation or state intervention." There is no supporting evidence that the Competition Policy Council is "braying" for compete deregulation. The Competition Policy Council has meet once and discussed only foreign ownership restrictions.
5. The column claims that "three of the same writers" have promoted more targeted measures. The three writers named are Hunter, Trebilcock, and Iacobucci. Trebilcock is not a member of the Competition Policy Council and Hunter did not participate in the meeting and discussion on foreign ownership - as was clearly indicated in the Report of the Competition Policy Council.
6. The column claims that I am Bell's hired gun. My vertical integration report was commissioned by Bell, but the views are my own. Expert reports are only useful in so far as they are, and are seen to be, unbiased. Experts have an ongoing interest in developing and maintaining reputations for independence. Their role is to assist the decision maker: they are not advocates for anyone and if seen to be their evidence will be ignored.
7. The column claims that there is a "whiff of something not quite right about it" - implying influence by Bell at the C.D. Howe Institute. In its submission to Industry Canada, Bell indicated that they were not convinced that there was a need for reform of the foreign ownership restrictions, and if reform was required, then their preferred option (of the three under consideration by Industry Canada) restricts foreign ownership to 49 per cent.
Jeffrey Church is a professor of economics at the University of Calgary and a member of the C.D. Howe Institute's Competition Policy Council. His areas of expertise include several subjects of interest to Globetechnology readers and he has been invited to write columns on foreign ownership in telecommunications and vertical integration between content and new distribution platforms, which will be appearing online in the near future.