The crtc approval of bce’s $2.3 billion acquisition of ctv is more than welcome news for the Canadian independent production community and essentially all proponents of industry convergence. The takeover unleashes millions of production and development dollars and breaks the regulator’s longtime habit of inhibiting synergies between producers, broadcasters and cablers.

The most significant addition to the crtc decision, which included few changes from the original proposal, is that 95% of the $140 million devoted to the development and production of priority programs must be directed to independent producers.

During the hearing, ctv was pushing for an 80-20 split between unaffiliated and affiliated producers, but ‘keeping it arm’s length is more in line with what a benefit should be,’ says cftpa president and ceo Elizabeth McDonald. ‘It’s a great opportunity for Canadian programming.’

An independent producer, as defined in the decision, is a producer in which ctv owns less than 30%.

ctv currently owns 50% of Landscape Entertainment, but is expected to drop its interest in the production company to 33%, once an agreement with a third-party investor is finalized. Either way, Landscape will not be eligible for 95% of the development and production money earmarked in the benefits package.

‘The [ctv/bce decision] creates a new paradigm for ways for producers and broadcasters to communicate,’ says McDonald.

The cftpa, acknowledging the changing business models within the Canadian television industry, has recently opened its membership to a wider variety of content creators, including broadcaster-affiliated producers, interactive media producers and emerging producers. Its renewed bylaw also fosters a necessary level of transparency whereby the new entries are required to declare their conflicts of interest.

Another triumph for Canadian producers is the commission’s expectation that ctv enter into terms of trade discussions with the cftpa, which will include working out issues relating to the bundling of Internet rights with broadcast rights by broadcasters with multiple platforms. The crtc requires the broadcaster to report on progress in this area at its group renewal proceeding next spring.

‘It was a very smooth decision with not a lot of conditions, but the reporting is very rigorous,’ says ctv exec vp Trina McQueen. ‘They demanded a strenuous regime for how we spend our money.’

Nonetheless, the commission’s approval of the deal signifies an unprecedented freedom for media companies to grow and compete on the international market.

‘We think the [bce/ctv] decision is an indication that the crtc is supporting strong, well-funded media companies, a theme we’ve been developing for some time,’ says John Cassaday, president and ceo of Corus Entertainment. ‘Although it would be a stretch to say anyone was surprised.’

As a result of the bce/ctv deal, Corus is reapplying to the crtc for the 50% interest in Family Channel acquired as part of the wic split.

Corus was required by the crtc to divest of its interest in Family by Jan. 6 for reasons of undue preference, but Cassaday is confident the regulator will now reconsider its position. In early December, Corus also submitted an application to increase its interest in Teletoon to 40% from 20%.

The decision to allow bce to buy ctv essentially lifted the crtc’s ban on common ownership of distribution and content as Bell ExpressVu and ctv now fall under the same umbrella.

Even more, the Montreal-based telecommunications company plans to incorporate ctv, the Sympatico-Lycos Internet portal, The Globe and Mail, and The Globe Interactive Websites into a $4-billion new media company to be launched in January, with ctv president and ceo Ivan Fecan at the helm.

It will be 70.1% owned by bce, 20% owned by Thomson Corp. and 9.9% owned by Woodbridge, a private holding company of the Thomson family.

The Competition Bureau is currently reviewing bce’s ctv and Thomson deals.

The crtc will consider the issue of protecting the diversity of voices in society in the licence renewal hearings for ctv, Global and tva, next spring. *

-www.bce.ca

-www.ctv.ca