Bell Acquires Astral Media for $3.38 Billion: Premium Content Monopoly

According to several media sources including the Toronto Star, Bell Canada Enterprises has acquired Astral Media for $3.38 billion. The deal is pending CRTC approval, but has some observers worried about the potential monopoly that Bell will control when the deal is completed in six months. 

Astral owns The Movie Network, has the rights for HBO in Canada, and the deal will allow Bell ownership of a couple dozen Canadian specialty channels. This comes at a time when Bell recently announced their entry into Mobile TV.

Astral has announced their definitive agreement in a press release. President and CEO Ian Greenberg says, “after 15 years as commercial partners, we know each other well and share many important values. The fit between our two companies is a natural and I look forward to seeing our brands become even stronger as part of the Bell family.”

With Bell having already re-acquired CTVGlobemedia last year, does the acquisition of Astral Media make Bell far too much of a monopolistic player in the media world for Canadians’ tastes? The deal will allow Bell to finally have a firm footing in Quebec where they have lacked presence as much of Astral’s properties are from the French-speaking province.

At the very least, they will have to sell some English radio stations to comply with CRTC regulations as the deal would give them six radio stations in Toronto and seven in Vancouver when you can only have four. 

Further, Techvibes recently reported that 10% of Canadians could cut the cord by 2015, meaning that they will get rid of satellite and cable service in favour of Internet or Mobile TV. The new CRTC regulations state that in mobile TV the content cannot be the same as to what’s currently on cable or satellite – content providers must offer the competition fair access to their content and include a certain percentage of independents. 

With Bell acquiring HBO’s rights, CTVGlobemedia having most of the highest viewed shows in the country, and The Movie Network being the premiere destination for Canadians to watch movies they certainly have a monopoly on premium content that they will not only showcase- but now also forcibly sell to other content providers. 

Still, the content world continues to become increasingly fragmented as there are more content curators than ever before in the YouTube era. It’s possible that the acquisition of Astral Media could prove to be short sighted if revenue models continue to change in the media industry as content shifts online and towards mobile devices. 

There’s a chance, as it becomes less expensive to host video online that premium content providers of old could be beaten by new upstarts. 

For now the deal certainly makes sense but only time will tell if one of the biggest Canadian media deals in history will prove to make or break Bell Canada Enterprises.