Blog

Goal

To oppose the acquisition of CHUM Ltd. by Bell GlobeMedia; at minimum necessitating the divestiture of five CHUM City-TV stations in order to preserve healthy competition.

The Issue

In 2006, Bell GlobeMedia undertook to purchase CHUM Ltd., which owned 33 radio stations, 21 specialty stations and 12 television stations.

The purchase offer, which required approval from the Canadian Radio-television and Telecommunications Commission (CRTC) and the Competition Bureau, was a concern for marketers because it would lessen competition and lead to increased costs for TV time. The inclusion of the City-TV properties would mean Bell GlobeMedia would control two major local TV stations in the important Toronto, Winnipeg, Calgary, Edmonton and Vancouver markets.

Actions

ACA vigorously opposed the sale with the Competition Bureau, yet the Bureau approved the sale. At the CRTC, however, it was a different story.

In April 2007, ACA submitted a written intervention to CRTC outlining the implications for marketers and requesting to appear during the oral phase of the hearings. At those hearings, ACA emphasized the importance of curtailing market dominance by one media company and ensuring healthy competition.

Outcome

ACA’s intervention directly led to CRTC approving the ownership change, with a big caveat: Bell Globemedia had to divest itself of the City-TV stations. With that win, marketers’ concern about limiting competition in key local TV markets was allayed and marketers were saved an estimated 3-to-5% increase on their TV budgets.

The CRTC decision was also an important precedent for future cases where merger proposals threaten to eliminate competition.

For more information on this issue, contact Judy Davey, Vice President, Media Policy and Marketing Capabilities at (416) 964-2791 / 1-800-565-0109 / .