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Canadian producer body calls for caution in Shaw’s Canwest takeover

The Canadian Media Production Association (CMPA) has joined a chorus of industry players urging the CRTC to place limits on Shaw Communications' takeover of Canwest Global Communications Corp.'s TV assets.
August 25, 2010

The Canadian Media Production Association (CMPA) urged the Canadian Radio-television and Telecommunications Commission (CRTC) in an August 23 submission to guard against the ‘potential for anti-competitive behavior arising from further broadcaster consolidation and the need to establish effective safeguards to prevent such behaviour.’

As the CRTC holds September 20 hearings into Shaw’s $2 billion takeover of Canwest Global’s over-the-air and specialty TV assets, the producers also voiced concerns that the regulator put a precise valuation on the transaction, which in turn sets the tangible benefits funds Shaw must provide to secure approval.

The CMPA submission also called on the CRTC to ensure a Shaw-owned Canwest Global and Corus continue to operate at arm’s length once the broadcaster emerges from creditor protection, including making separate programming decisions and indie series acquisitions.

‘An independent producer who attempts to negotiate with a giant vertically and horizontally integrated Shaw/Canwest will be at an enormous – if not insurmountable – bargaining disadvantage,’ the producers warned the CRTC.

Also urging restraints on a Shaw-owned Canwest Global is phone giant Telus Corp., which already competes with Shaw in western Canada to roll out its Internet-based Telus TV service.

‘Given the unprecedented scope of vertical integration which would be created in the approval of this transaction, Telus submits that the CRTC must adopt, as conditions of approval of this transaction, safeguards to limit any abuse of market power and anti-competitive behaviour by Shaw and its affiliates, particularly with respect to matters such as agreements with non-affiliated producers, programmers and broadcast distributors on linear and new distribution platforms,’ Telus wrote to the CRTC.

The phone giant also urged the regulator to impose a $200 million value on the tangible benefits package associated with the $2 billion transaction, and not to allow Shaw to argue that ‘the so-called rescue of Canwest is benefit enough.’

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