Telus Corp. took aim at BCE Inc.’s well-honed reputation as a good corporate citizen Thursday, as it asked Canada’s broadcast regulator to stop BCE’s $3.4-billion acquisition of Astral Media Inc.
The Vancouver-based television provider was just one of a long line of competitors given a chance to publicly air its grievances against the company’s Bell Media division before the Canadian Radio-television and Telecommunications Commission this week.
The competitors are convinced that Bell will use its new-found heft to squeeze them out, either by charging them too much to sublicence popular specialty channels such as TSN or HBO and making it impossible for them to offer Bell-owned programming on other devices besides televisions – even though there are regulations that specifically forbid Bell from doing so.
“The point of all this is that Bell is already big, it has clear incentive and opportunity to behave anti-competitively to the detriment of consumers,” Ann Mainville-Neeson, director of broadcast regulation and corporate affairs at Telus.
“Given Bell’s demonstrated behaviour with its existing content assets, thwarting the commission’s rules and guidelines every step of the way, why would its self-serving behaviour change if allowed to get bigger and more powerful?”
Bell made its submission Monday, and has had to watch as a steady stream of corporate intervenors such as Telus, Rogers Communications Inc., Quebecor Inc. and Cogeco Inc. presented their side of the story about issues such as how much Bell charges competitors for its popular programming and whether it hoards its best offerings to give its own television division a competitive advantage.
Bell gets last word at the hearings, which end Friday. The company is likely to launch a point-by-point defence of its record as a good corporate citizen as it explains once again why it wants to bulk up with Astral. The transaction would see Bell with control of more than 100 radio stations and almost 90 television channels and put a cap on its content costs as it prepares to battle foreign players such as Netflix.
“I think Bell’s history of 130 years in Canada should demonstrate how we behave as a company,” chief executive officer George Cope said on the first day of hearings. “... We wouldn’t be here 130 years later if we didn’t do what the consumer wants and in the end that’s what we have to do every day.”
Federal regulations prevent any vertically integrated company from abusing its heft, but Telus said the temptation to gouge its competitors would be too great if Bell acquires Astral. Ultimately, it said, it would lead to higher prices for consumers.
Telus just emerged from a year-long battle with Bell over TSN, Bell’s top-rated sports channel. Bell wanted Telus to guarantee that it would reach 75 per cent of Telus’s customers before renewing its contract, but Telus claims that only 55 per cent of its viewers actually want the service.
To reach Bell’s requirement, it would have had to move the channel into its basic cable package, which would mean higher prices for everyone whether they want to watch sports or not. The CRTC sided with Telus, and TSN will continue to be offered as an upgrade for Telus customers.
The dispute dragged on for more than a year. While Bell said the decision is a sign that current rules are sufficient to prevent market abuse, Telus said it would like to see heavy fines levied whenever the commission rules against a company if it is found to have broken the rules.
“There could be penalties that go back into the broadcast industry,” said David Fuller, chief marketing officer at Telus. “We need more timely, stricter rules that come with implications for breaking them.”
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