Konrad is not a friend of ours and this is not a ‘dear Konrad’ letter. Konrad von Finckenstein is chair of the Canadian Radio-television Telecommunications Commission (CRTC). Last time we saw Konrad, he was looking very bored as a group of citizens were giving their opinions about the role of small market television stations and whether cable and satellite customers should contribute to the revenues of small market stations. Carried to its logical conclusion, the discussion was about a proposal to annually give hundreds of millions of dollars of consumers’ money to Canada’s television networks.
Konrad, a long-serving civil servant, is under the gun from Prime Minister Stephen Harper, who appointed him chair of the CRTC. Either Konrad comes up with a way to get the money to the television people or the Privy Council Office (under directions from the Prime Minister) will make it happen without Konrad’s help. Rather than lose face, Konrad is now waiting for the Supreme Court of Canada to tell him that he has the right to order the broadcast distribution undertakings (BDU—which are mainly cable and satellite companies) to the table to arrange to give the television networks some of their customers’ money.
It is all very complicated because on top of everything else, the BDUs have turned around and bought all the television networks—except the CBC. (And if you want to buy the CBC, you should be quick to make an offer to the Prime Minister before he cuts all funding and starves it to death.)
But this letter to Konrad is about the BDUs’ take-overs of television networks. Shaw Cable taking over Global Television was one thing but Bell Canada taking full control of CTV is an entirely different situation. Shaw Cable taking over Global was an act of mercy to rescue Global from being pulled under with the rest of the crumbling Asper media empire.
But Bell Canada running CTV is a recipe for disaster. Not since Bell’s then chairman, Jean Monty, dumped Nortel’s shares from the Bell Canada Enterprises portfolio has Bell made a good business decision. Monty used to talk about convergence of technologies and ever since he left the company in 2002, the company has meandered aimlessly in search of a strategy. The problem has been that Monty was mistranslated. He was actually talking about confluence. Confluence is when two streams meet and combine to create a larger river.
When Bell’s public relations people translated what he said, they thought he meant convergence. When two objects converge, they try to occupy the same space and time. Convergences cause train wrecks and other awkward events.
CTV and Bell are a train wreck rushing toward each other on the same track. The only good news about the proposed re-jigging of Bell’s media interests is that the Thompson family get to take back the Toronto Globe and Mail. If there is any business acumen left in the family’s gene pool, they might be rescuing one of the major assets in the portfolio.
The other good news in the Bell takeover is the forthcoming departure of Ivan Fecan from CTV. Ivan is the guy running CTV at the moment and he is not only famous for that floor-mop hairdo but he is the guy who bid $100 million too much to take the Vancouver Olympics away from the CBC. It must be inflation that you can now say ‘What’s a 100 million dollars?’
The point here for Konrad is that Bell’s stated purpose in controlling CTV is to have access to CTV’s programming capabilities to enhance Bell’s mobile and home TV offerings. This implies exclusivity and a serious potential for unfair business practices. Back when promoting the concept of the CRTC some 50 years ago, the idea was to stop this type of media control from happening. Every time media concentration has been studied over the past 60 years, the answer has always come back that it is a very bad idea. Media concentration in the hands of incompetent management is even worse.
Tell you what Konrad, before you approve the takeover of CTV by Bell Canada, let’s get together and talk about what a well-run, public-spirited, fair-minded, patriotic, honest and upstanding corporation Bell Canada might be if it had management that gave a damn.
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