The CRTC is defending the public interest by preventing CTVglobemedia from becoming ‘the 800-pound gorilla’ of Canada’s broadcasting system, says one of the country’s principal media watchdogs.

On Friday, the CRTC announced it will approve CGM’s $1.7-billion takeover of CHUM only on the condition that CGM sells the five City stations operating in Toronto, Vancouver, Edmonton, Calgary and Winnipeg — cities where the CTV parent also runs stations.

The regulator says its decision is meant to encourage a ‘diversity of voices’ in Canada’s media landscape. Allowing CGM to keep the City stations would violate the CRTC’s ‘common ownership’ or ‘two-stick’ policy, which says a licensee can’t operate more than one conventional television station in one language in a given market.

‘[The] decision is a good one for the Canadian broadcasting system,’ Ian Morrison, spokesman for Friends of Canadian Broadcasting, tells Playback Daily. ‘This levels the playing field. If this deal had gone through, CTV would have become much more powerful than Global. It’s much better to have more players dividing things up. It’s good for competition and good for viewers.’

CGM will be allowed to keep the A-Channel group of television stations in secondary markets such as Victoria and Barrie, ON — a decision Morrison also applauds. ‘Those A-Channels are key local news providers. Encouraging CTV to take these assets helps make them competitive. They are in a much better position if they are part of the CTV system,’ he says.

In April, CGM offered to sell the A-Channels and several other CHUM channels to Rogers Communications, but that sale hinged on the CRTC’s approval of the full CHUM takeover.

Following the CRTC’s decision, CGM now stands to acquire seven television stations, 34 radio stations and 20 specialty television services, including Bravo! and MuchMusic.

The specialty channels are the ‘jewel in the crown’ of the CHUM deal, points out Peter Murdoch, the spokesman for the Communications, Energy and Paperworkers Union of Canada. ‘I’m glad that they have to sell the Citytv stations, but CTV is still building their media empire with those specialty channels. Those are very lucrative properties.’

Murdoch believes the federal regulator hasn’t gone far enough to protect Canadian content, however. ‘We have no idea what CTV will do with those Citytv stations. That’s a big mystery. [The CRTC] should be asking prospective buyers what they will do about local programming and news. Right now they are treating this as if it’s simply a business story, but it’s a cultural story. It’s about Canadian programming. Hopefully they will demand more of prospective buyers than they asked of CTV.’

But CRTC chairman Konrad von Finckenstein says any conditions will be discussed with a prospective buyer. ‘There is no sense in imposing conditions of sale beforehand. The purchaser will have to come to us and we will discuss their proposal,’ he tells Playback Daily.

‘The buyers can exhale now,’ says Lauren Richards, CEO of Starcom MediaVest Group. ‘That’s not to say that CTV isn’t a great partner, and we wish them all the best. They’ve done some wonderful things for the buying community. But to have a healthy environment, we need more competition, not less.’

There is much speculation about who will come forward to buy the City stations. ‘It’s like we are throwing a big steak in a tank with a bunch of sharks in it,’ says Morrison. Potential buyers include Rogers, The Jim Pattison Group and Corus Entertainment.

The CRTC requires that the trustee responsible for the City stations, lawyer John McKellar, submit an ‘acceptable plan’ for their sale within 30 days.

With files from Media in Canada