BCE’s acqusition of CTV: what it means

BCE Inc. is the latest telecom to join in North America’s broadcaster acquisition spree, as phone and cable companies attempt to catch up with the myriad ways people consume media.  

In a friendly $3.2-billion takeover, BCE upped its 25% stake in CTV to 100%, buying out the Thomson family’s Woodbridge.Co., Ontario Teachers’ Pension Plan and Torstar Corp. (Torstar’s stock went up 25% on the announcement.) BCE will control CTV’s 27 television stations, 34 radio stations, 30 specialty channels and several websites. The Globe and Mail will be controlled by the Thomson family once again. An analyst writing for the Toronto Star writes that Canada is “in the midst of an industrywide convergence trend that is changing the way subscribers receive (and pay for) new content.”

This isn’t the first time BCE has tried its hand at content generation. In 2006 the company sold most of its majority stake in CTV after its convergence strategy fell apart. It remains to be seen how the BCE deal will shape the media landscape in Canada, but there’s little doubt it will. For one, it renders the fee-for-carriage debate somewhat moot. A Globe writer notes that “With CTV (to be) owned by Bell, and CanWest (to be) owned by Shaw, expect a lot more [free online] content to be locked up and available only to their own customers.”

There are already signs that the news may be beneficial to mobile start-ups too. Industry Canada is considering removing foreign ownership caps on telecommunications companies, while keeping them in place for broadcasters. BCE’s acquisition means that now most of Canada’s largest telecommunications companies own broadcasters, so would still be governed by the same ownership restrictions.