Aspers seek to avoid bankruptcy protection, keep control, of CanWest

CanWest is in crisis. Reports the Globe and Mail:
“Leonard Asper is scrambling to secure a financial lifeline for CanWest
Global Communications Corp. before the end of the month to prevent his
family-run media empire from sliding into bankruptcy protection.”

The price of a financial lifeline, noted the Globe, could cost the
Aspers control of CanWest. “At least one investor weighing a proposal
said it would insist that Mr. Asper step aside as chief executive
officer and that he and his siblings eliminate the dual-class share
structure that gives them control of the company, according to sources
familiar with the matter.”

What might Canadians lose or gain from a CanWest upheaval? Would
control of CanWest by others be worse for Canada’s public information
media than control by the Aspers?

In terms of journalism, when the Asper regime took over the family
imposed its own ideology of the role of Canada’s press: examples that do not cover any attempt to assess quality and bias in Asper-owned media
outlets include:

  • imposing national editorials on its big daily newspapers (an issue that has since faded)
  • cutting newsrooms to the bone
  • dropping the Canadian Press cooperative to set up its own internal news service
  • constant lobbying for less CRTC regulation
  • incessant loud opposition to the public broadcasting role of the CBC.

An assessment of business acumen is muddy in these globally troubled
times. Two clear indicators are share price and the result of the
family’s long-term business managements

  • Regarding shares: CanWest Global Communications Corp. on the TSX 
    has been on a downward trajectory since a high of about $16.00 in April
    2007. Shares were selling at .365 at the time of this posting, compared
    to a 52-week high of 6.110 and a low of .34.
  • Long-term business: I’ll quote a paragraph in the Globe story:
    “CanWest borrowed heavily to acquire a nationwide newspaper chain and
    specialty television network, Alliance Atlantis Communications, bought
    in 2007 for $2.3-billion. Mr. Asper anticipated paying down loans with
    the cash flow that comes from advertising in near-monopoly properties.”

Personally, it’s the “near-monopoly properties” of CanWest that I
object to. All the rest of it would be of negligible public interest
without the fact that CanWest is a behemoth that controls a shocking
amount of the information that Canadians can access. On its own web site CanWest describes itself as “Canada’s leading international media company” with:

  • conventional television networks Global Television and E!, which reach almost 100% of English-speaking Canadians.
  • 26 specialty networks capturing a 30.1% share of commercial specialty network viewers in Canada.
  • one of Canada’s largest newspaper chains reaching 4.9 million engaged readers on a weekly basis
  • several online properties under the network which averages over 4.5 million unique visitors per month

My earlier question, asking whether control of CanWest by someone other
than the Aspers would be worse for Canada’s public information media,
is perhaps the wrong question. One right
question might be whether CanWest — or any other entity — should
control so much of Canada’s public information media, especially given
that Canada, by some accounts including that of a Senate report, has the highest concentration of media ownership in the developed world.

That concentration, I suggest, makes Canadian citizens vulnerable in
all the areas where journalism matters. That CanWest is now in crisis
simply makes our vulnerability more visible — in ways not unlike the
way the crisis in the American financial sector revealed the fragility
of the global economic system.

Another question, the big one: are there opportunities for improving Canada’s public information in a time of crisis?

For context, CanWest is not alone in having a crisis. More context: a 2007 J-Source post including historic information and links is here.

For more context, CanWest has proved that it will fight back against anyone who criticizes it — this post illustrates
why even writing about CanWest in this space, set up by a project aimed
at excellence in journalism and for the discussion of journalism in
Canada, feels like a risky thing to do, even in a country with a constitutional guarantee of freedom of expression.

(Disclosure: I’m a former member of the editorial board at the
Vancouver Sun, which was taken over by CanWest during my time there. By
my own choice I am employed elsewhere as an independent and receive no
income from CanWest holdings.)