Media Beat: Bell Radio Closures Could Mark A Big Win For Private Broadcasters

Bell Media’s announcement that it is selling 45 radio stations and cutting its workforce by 4,800 people across it and parent company BCE elicited icy words from Justin Trudeau, who now famously described it as a “garbage decision.”

With the Liberals now trailing behind the Conservative Party in the polls, the notorious spendthrift perhaps thought the comment would serve him and his party well with the voting public, but his lack of impartiality also underscores the fractured state of the broadcasting industry with the federal government and in particular the CRTC.

Opening communication between Ottawa and the telco, a House of Commons heritage committee has reached out to BCE Inc. CEO Mirko Bibic and several other executives to discuss the cuts and the impacts this will have on newsrooms. It will give Bell the opportunity to explain the crisis media, particularly news media, which finds themselves with ad revenues impacted by interlopers operating global online platforms and the sharp decline in revenues from customers willing to pony up to pay for content, news or otherwise.

Looming questions enunciated by one partial observer with a stick in the game who didn’t wish to be named:

"Is this just the beginning of divestitures for Bell and perhaps other large VIs (Vertically Integrated companies) where radio is now a small subset of their portfolios?

"Secondly, is the business model for advertising-generated revenue broken? If the repackaging of linear TV is now the on-demand streaming of ad-supported channels (e.g. the Global/CTV TV apps/Crave, etc.), the new direction for broadcasters, what is the direction for radio?

"How much are the independent broadcasters going to pay for these acquisitions?

"We will have to wait for the CRTC applications for disclosure of the transaction values. Not all of these stations are profitless. It seems to be a case of synergies. All of the sold stations are in markets that do not have vendor-owned television stations. The exceptions are the AMs in Toronto and Montreal, which survive alongside their FMs.

"Should the CRTC have approved Bell’s acquisitions of these properties, many of which were formerly owned by Astral Media?

"The CRTC and Bell entered into license transfer agreements with the legal commitment to operate these stations to benefit the market to which they are licensed. Bell now looks at these small markets as a poor investment as radio advertising diminishes. It is fair to say the VI’s see profitability threatened by these markets and have, in most cases, reduced real, local programming to the regulatory minimum of 42 hours or 33% of the broadcast week. The other two-thirds of the programming is 'networked' on these generically branded stations from centralized locations with no connection to the local license.

"Local news coverage is also impacted, lessening community awareness and community value. The product becomes less engaging, the revenue slips and from a corporate point of view, there is less value in these properties compared to when they were acquired.

"If and when the transactions are made public, the transaction values remain a matter of speculation."

Below is a line-up of stations to be sold and the companies that are lined up to buy them, subject to regulatory approval.

Arsenal Media is the largest regional broadcaster in Quebec with 18 radio stations and seven transmitters. It hopes to acquire CHRD, Drummondville,

CJDM, Drummondville, CFEI, St-Hyacinthe, CFZZ, St-Jean-Sur-Richelieu, CIKI, Rimouski, CJOI, Rimouski, and CFVM, Amqui.

Maritime Broadcasting: The company’s portfolio includes 24 radio stations across Atlantic Canada. It hopes to acquire CIKX, Grand Falls, N.B.

CJCJ, Woodstock, N.B. (Maritime Broadcasting)

CKBC, Bathurst, N.B., CKTO, Truro, N.S., and CKTY, Truro, N.S.

Vista Radio: The company operates 49 radio stations broadcasting across 63 transmitters located in three provinces and the Northwest Territories. It hopes to acquire 21 radio stations, as follows: CHOR, Summerland, B.C., CJAT, Trail, B.C., CKKC, Nelson, B.C., CKGR, Golden, B.C., CKXR, Salmon Arm, B.C., CKCR, Revelstoke, B.C., CJMG, Penticton, B.C., CKOR, Penticton, B.C., CJOR, Osoyoos, B.C., CICF, Vernon, B.C., CHSU, Kelowna, B.C., CILK, Kelowna, B.C., CKFR, Kelowna, B.C., CKNL, Fort St. John, B.C., CHRX, Fort St. John, B.C., CJDC, Dawson Creek, B.C., CKRX, Fort Nelson, B.C., CFTK, Terrace, B.C., CJFW, Terrace, B.C., CHTK, Prince Rupert, B.C., and CKTK, Kitimat, B.C.

Whiteoaks Comm’s Group: The faith-based broadcaster currently operates JOY Radio (CJYE-AM) and CJMR 1320 serving the GTA. It hopes to acquire CKLH, Hamilton, Ont., and three St. Catharines, ON stations: CHRE, CHTZ, and CKTB.

Durham Radio Inc. currently owns six commercial radio stations across Southern Ontario. It hopes to acquire CKLY, Lindsay, Ont., CKPT, Peterborough, Ont., and CKQM, Peterborough, Ont.

My Broadcasting Corp., headquartered in Renfrew, Ont., the company operates 14 radio stations in small to medium-sized markets in the province. It hopes to acquire CFJR, Brockville, Ont., CJPT, Brockville, Ont., CFLY, Kingston, Ont., and CKLC, Kingston, Ont.

ZoomerMedia: A diversified media company with 2 AM and 2 FM stations based in Toronto, it was founded by Moses Znaimer in 2008 and targets “Zoomers” aged 45-plus. It hopes to acquire CJOS, Owen Sound, Ont., complementing its repeater station in Collingwood.