OTTAWA – Telus, Cogeco, Eastlink and MTS Allstream have all told the CRTC that they are opposed to BCE and Rogers’ proposal to take control of sports channels Leafs TV, NBA TV Canada and Gol TV Canada from parent Maple Leaf Sports & Entertainment (MLSE).
The interventions filed by the independent distributors claim that the move, which comes as part of the BCE/Rogers $1.32 billion bid for a majority stake in MLSE, “are bad for the Canadian broadcasting industry, further extending the control exerted by these large vertically integrated conglomerates”.
“Increasing the already extensive market power enjoyed by vertically integrated programming undertakings, especially in the area of popular sports programming, will further disadvantage Canadian consumers who wish to exercise choice in the television distribution market and will ultimately drive up prices”, wrote MTS Allstream in its comments to the CRTC due last week.
Cogeco Cable said that it is “greatly concerned with the accelerating trend towards ever increasing concentration of ownership and vertical integration within the converged broadcasting and telecommunications industries in Canada involving BCE Inc. (“Bell”) as the purchaser”.
Referencing the ongoing dispute between Bell Media and a group of independent distributors known as the Canadian Independent Distributors Group (CIDG), of which it is a member, Cogeco asked that Bell “not be rewarded with a further enhancement of its market power” after “having already clearly abused its significant market power on the strength of CTV’s extensive portfolio of licensed programming services”.
Cogeco also suggested that the MLSE acquisition be subject to a full public hearing at the same time as Bell’s proposed purchase of Astral Media to allow for “regulatory scrutiny of the aggregate result in terms of the impact on competition, the consumer, the Canadian broadcasting system and Canadian telecommunications.”
Halifax-based Eastlink centred its concerns around Bell’s and Rogers’ current ownership of the country’s two largest sports networks, TSN/RDS and Sportsnet, in addition to Rogers’ ownership of the Toronto Blue Jays and Bell’s minority interest in the Montreal Canadiens.
“The proposed acquisition will provide the Applicants with the ability to design the content rights as they wish”, reads its comments. “Because these companies will own the teams, the facilities and the programming services, they will not have to compete with any other parties for the rights to the content. Rogers and Bell will be able to design rights agreements that are extremely favourable to them while limiting independent distributors from being able to access the content on reasonable terms.”
Telus echoed that sentiment, urging the Commission to fully consider “the significance of this transaction in further entrenching Canada’s “sports duopoly”.”
“The acquisition of the sports rights relating to some of the top sports teams as a result of their acquisition of MLSE will act as a further barrier to entry for other mainstream sports programming services”, reads its intervention. “Bell’s and Rogers’ market power in the sports services market is further compounded by the fact that both Bell and Rogers are also major television distributors (BDUs). The vertical integration of the top sports programming services with the largest distributors creates incentive and opportunity for anti-competitive behaviour, some of which is already being felt in the market.”
It also called on the CRTC to be “doubly vigilant in enforcing its Vertical Integration Policy and accompanying Code of Conduct”.
The CRTC’s involvement in the transaction is limited to the transfer of the three sports channels and two licences for yet-to-be-launched services held by MLSE to BCE and Rogers. The Competition Bureau and the NHL have already approved the deal.
– Lesley Hunter
