The feds’ Throne Speech commitment to phased liberalization of foreign ownership rules for telecoms has sparked industry debate on possible fallout for domestic cable and broadcast players.

ACTRA national executive director Stephen Waddell says increasing industry consolidation and convergence where telecoms buy and hold broadcast networks and stations makes it inevitable that changes to the Telecommunications Act will impact legislation for elsewhere in the media sector.

‘I don’t think you can silo telecommunications away from broadcasting. It will be a real challenge if they [Conservatives] do go down this road,’ he argues.

The Throne Speech did not address directly foreign ownership rules for broadcasters.

Peter Murdoch, vice-president of media for the Communications, Energy and Paperworkers Union of Canada, echoes warnings that telecoms like Rogers Communications, Telus and Bell Canada are inextricably bound up with Canadian broadcasting, and should not be allowed to land in foreign hands.

‘Telecommunications is now an integrated industry with the rest of the media; the sector is key for our cultural sovereignty and national security,’ Murdoch says.

Telecoms offered no comment on the Throne Speech commitment to ownership rule liberalization.

But analysts say any easing of foreign investment restrictions will likely help new mobile entrants like Globalive, DAVE and Public Mobile grow, and not greatly benefit larger players like Rogers and Bell, at least in the short term.

‘We do not see much foreign strategic interest in Canadian incumbents. This is because large U.S. carriers like AT&T, Verizon and Comcast still seem focused on domestic operations,’ Dvai Ghose of Genuity Capital Markets said in an investors note.

But analyst Phillip Huang of UBS Securities Canada, while agreeing smaller players stand to benefit most from opening Canada’s doors to more foreign investment, adds that incumbent players like Bell and Telus may eventually be bought by foreign strategic players.

‘The Canadian telecom sector may be less attractive to foreign strategic players today versus several years ago as the industry is maturing and growth is slowing, and their shares are generally trading at a discount to their Canadian peers,’ he adds.