Bell Media reps face grilling on MTS at House committee

OTTAWA — Parliamentarians hoping for answers to outstanding questions about Monday’s news that BCE Inc. had struck a deal to acquire Manitoba Telecom Services Inc. were left disappointed when representatives from Bell’s media division appeared on Parliament Hill Tuesday morning. Winnipeg-area Liberal MP Dan Vandal was looking for “some measure of comfort that there will not be massive layoffs as a result” of Bell’s $3.9-billion proposal to absorb MTS and its related plan to sell one-third of postpaid wireless customers and dealer locations to Telus Corp. But the Bell Media delegation didn’t have any answers for the House of Commons standing committee on Canadian Heritage. “I can’t speak specifically to what the plans are relating to the jobs. I think we’re very committed to that and we’re sensitive to the overall issue you raised,” Kevin Goldstein, Bell Media’s vice-president of regulatory affairs, content and distribution, replied. “It’s somewhat beyond the area this group focuses in.” Vandal received similarly vague responses to inquiries about the proposed $1-billion investment in broadband and the potential for increased wireless prices at the conclusion of the transaction. “I think in theory, the concept of having four players and more competition may lead to lower rates,” Goldstein said. “But I think you could also say the same thing in terms of having competition between three relatively sized players will also lead to potentially better service for the community.” Vandal said he was “very disappointed” that “one day after publicly rolling out a $4-billion acquisition in Manitoba, senior executives of Bell come to this table with no information.” Committee chairwoman Hedy Fry echoed Vandal’s disappointment. “I think one of the issues we’re looking at here is not simply local news, it’s also about the effects of media consolidation and this was a question on media consolidation,” Fry said. Goldstein noted that the Bell-MTS deal was “largely a telecom transaction and not one overly focused on the media space.” He added: “The broadband acquisition is very important; it helps in terms of the broadening of the digital infrastructure and advancing of the digital economy and that certainly touches on the media space but it’s not a media kind of concentration or transaction issue.” Bell had three recommendations for the committee’s study of the media and local communities, which included reiterating its Let’s Talk TV proposal to redirect money for a local-TV fund, echoing the plea for compensation from the 600 MHz spectrum auction that Rogers Communications Inc. reps made last month, and advocating for a review of the CRTC’s Super Bowl simultaneous substitution decision. Company representatives also highlighted how the shift to digital is affecting Bell’s bottom line, despite still having high-rated newscasts. “We’re trading in big advertising dollars for digital dimes. They’re moving their money over to digital,” Wendy Freeman, CTV News president, told the committee. “We’re getting dimes now instead of dollars, even though we still have a lot of eyeballs on all our shows.” Local programming may not even be getting those dimes from local advertisers as they look elsewhere to promote themselves, according Richard Gray, Bell’s vice-president and general manager of radio and TV for Ottawa and Pembroke. Since 2011, TV and radio ad revenues are down 12 and 20 per cent, respectively, in the Ottawa market, Gray said. This is due to people adopting new online shopping habits and brick-and-mortar businesses are feeling the pinch, he said. “The other big fundamental change that is going on in the advertising world is that dollars to digital don’t necessarily mean dollars to digital advertising,” he said, noting that local businesses are using what were traditionally advertising budgets to build and maintain websites, create a social media presence or focus on search engine optimization. Gray estimated that the impact in Ottawa is $2.6 million annually and “it’s growing fast.” “These are changes that no matter what I do, no matter what my staff does, we can’t influence a difference,” Gray said. “Because what we’re talking about is fundamental structural changes in the manner by which the economy functions in this country at the local level in communities like Ottawa, like Winnipeg, like Calgary, Brandon, Man., Halifax, N.S. This is going on across this country from coast to coast.” — With reporting by Charelle Evelyn at cevelyn@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Bell Media reps face grilling on MTS at House committee

Broadcast | May 3, 2016

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Bell Media reps face grilling on MTS at House committee

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