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BCE says any ban on exclusivity 'preposterous'

Bell TV's head of regulatory affairs Mirko Bibic watches as CBC presents during the CRTC hearings in Gatineau, Que., on Tuesday November 17, 2009. Mr. Bibic spoke at the CRTC[s vertical integration meetings Tuesday, June 21, 2011.

Sean Kilpatrick/The Canadian Press

It is a "preposterous" idea that Canadians should have the right to see all the TV content they want on their cellphones or tablets no matter which wireless provider they choose, BCE Inc. says.

BCE called for less regulation, especially on new platforms such as mobile devices, at its presentation before the Canadian Radio-television and Telecommunications Commission on Monday. The Montreal telecommunications company bought CTVglobemedia Inc., the country's largest private broadcaster, with a plan to sell news and entertainment over mobile devices.

"Competition is what's delivering value … Let market forces work," said Bell's senior vice-president of regulatory and government affairs, Mirko Bibic.

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The major media industry players are in Gatineau, Que., this week and next to discuss the impact of "vertical integration" – cable and satellite providers owning more of the television channels that come through their TV distribution services. The hearings were called after BCE bought CTV and Shaw Communications Inc. snapped up the former CanWest TV stations for $2-billion.

Bell Media president Kevin Crull responded to concerns that integration could lead to anti-competitive behaviour, including companies hoarding content they own to give themselves an advantage.

"The word 'exclusive' has been erroneously confused with 'anti-competitive,'" Mr. Crull said.

Some media content would never be created without the ability to benefit from making it exclusive on mobile devices, Bell executives told the hearing. For example, Bell struck a deal for exclusive mobile rights to Vancouver Olympic Games video content.

"It wouldn't have emerged if an exclusive wasn't possible," Mr. Crull said. "There was … investment required in order to deliver that service and it was not money-making in its initial product."

The Olympics deal – as well as other exclusive mobile deals Bell has done, including for sports content with the NHL and the NFL – happened before Bell ought the CTV assets, the company reminded the CRTC.

But CRTC chairman Konrad von Finckenstein dismissed this point. "Vertical integration accentuated these problems," he said. "... [the industry]being in four hands, by all intents and purposes, makes it more acute."

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On Monday, Rogers Communications Inc. - which also owns TV assets - told the CRTC that the dearth of regulation on new media platforms is like a "wild west." Mr. Bibic rejected this claim, saying that the regulator has general rules which also apply to new media.

BCE was followed at the CRTC hearing by the company that has been the most vocal opponent of integration: Telus Corp.

Telus has said that unlike its competitors, it has no desire to own media assets. It has also repeatedly told the CRTC that integration is dangerous for the industry.

"The problem with exclusivity is you limit audiences to the broadcasting system, in order to give yourself a competitive advantage in non-broadcast markets - wireless, broadcast distribution, Internet … It's using your vertical integration to foreclose competition," Telus's senior vice-president of regulatory and government affairs, Michael Hennessy said in an interview following the presentation.

BCE could demand higher prices for its content, generating extra revenue and squeezing competitors' profits. If they refuse to pay, BCE could pull its channel from cable and satellite providers' services, giving itself an advantage because it has content that other services do not.

Telus proposed a code of conduct that should apply across the industry, including a prohibition against exclusivity on mobile devices.

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"Programs online and on mobile are starting to become more and more like broadcasting … the no-exclusivity rule should apply no matter which platform it derived from, because it will all ultimately flow to all platforms," Mr. Hennessy said.

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About the Author
Media and Marketing Reporter

Susan covers marketing and media for Report on Business. Before joining The Globe and Mail in 2009, Susan worked as a freelance reporter contributing to the Ottawa Citizen, the Montreal Gazette and other publications, as well as CBC Radio's Dispatches and Search Engine. She has a Masters degree in journalism from Carleton University. More

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