Edward Rogers, right, chairman of the board of directors of Rogers Communications Inc. and Brad Shaw, executive chair and CEO of Shaw Communications Inc. appears before the CRTC hearing, on Nov. 22, 2021 in Gatineau, Que.Dave Chan/The Globe and Mail
Members of Parliament pressed executives at Rogers Communications Inc. RCI-A-T about the company’s assertions that the $26-billion takeover of Shaw Communications Inc. SJR-A-X will have no impact on local news.
During a House of Commons committee on Canadian heritage Wednesday, Lisa Hepfner, a Liberal MP and former journalist, asked how the telecom and media giant can be certain that local news won’t be impacted by the deal. Ms. Hepfner noted that in the past, mergers have led to news stations being shut down in spite of similar promises.
Colette Watson, president of Rogers Sports & Media, said the only impact of the takeover on local news is that annual payments from Shaw to Corus’s Global News television network would stop.
“Shaw does not own any local television or radio stations, which means the transaction will not result in any further consolidation within Canada’s television and radio industries, nor will it reduce competition,” Ms. Watson said.
The change, Ms. Watson said, is that Corus Entertainment Inc.’s Global News will no longer be affiliated with Shaw. (Although Shaw sold its 38-per-cent stake in Corus in 2019, the Canadian Radio-television and Telecommunications Commission considers the two companies to be affiliated because they are both controlled by the Shaw family.)
The CRTC requires broadcast distributors – companies that deliver television channels through cable, satellite or internet protocol networks – to contribute 5 per cent of their broadcasting revenues to local news and Canadian content. To fulfill part of its obligation, Shaw pays roughly $12-million a year to Corus, the television and radio station owner it spun out as an independent entity in 1999.
Federal committee will urge Ottawa to deny Rogers’s bid for Shaw without sale of wireless unit
Trudeau to ask Canada’s broadcast regulator to review RT’s ‘presence on Canadian airwaves’
Rogers has said that if its acquisition of Shaw goes forward, it will redirect that funding to its own local news channels. Rogers owns 54 radio stations, 7 Citytv stations, 5 OMNI television services and 30 community TV channels, Ms. Watson said, adding that the company plans to add 43 net new journalism jobs post merger.
Corus previously said in a filing to the CRTC that the takeover could have a “detrimental impact on local news production and delivery, including in markets such as Kelowna, Lethbridge, Saskatoon, Regina, Peterborough, Kingston, Saint John and Halifax, where Corus operates local stations but Rogers does not.” As a result, Corus has called on the CRTC to revisit how it allocates funding to local news providers.
Conservative MP Kevin Waugh accused Rogers of “cherry picking” major markets such as Vancouver and Calgary for news coverage while ignoring smaller ones such as Lethbridge, Kelowna, Regina and Saskatoon.
Ms. Watson said Global News is a “top station” in Western Canada with a news budget nearly $100-million a year higher than Citytv’s.
“The long-term viability of local news is indeed in question, but this transaction is not responsible for that reality,” Ms. Watson said. She called on the government to amend the broadcasting act and to expand the existing journalism tax credit regime to broadcasters. The government has introduced Bill C-11, which aims to modernize the Broadcasting Act by regulating online streaming platforms.
Rogers’s takeover of Shaw requires approval from three federal regulators – the Competition Bureau, the Ministry of Innovation, Science and Economic Development and the CRTC.
Rogers has said it expects the deal to close during the second quarter of this year.
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.