Bell Globemedia

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Baton Broadcasting redirects here. For the defunct television system owned by Baton, see Baton Broadcast System.

Bell Globemedia Inc. (unofficially abbreviated "BGM"), to become CTVglobemedia Inc. effective January 1, 2007, ^[1] is one of Canada's largest private media companies. Its operations include such Canadian market leaders as CTV, TSN, The Comedy Network, and The Globe and Mail.

Contents 1 Ownership 2 Operations 3 History 3.1 Predecessor companies 3.1.1 Baton Broadcasting 3.1.2 Baton-Electrohome Alliance 3.1.3 NetStar Communications 3.2 2000 to present 4 Related links 5 References 6 External links

[edit] Ownership

BGM was originally jointly owned by Bell Canada Enterprises with a majority interest, and The Thomson Corporation and The Woodbridge Company Ltd., the family holding company of the Thomson family, with minority interests. Woodbridge later acquired Thomson Corp.'s interests.

As of September 7, 2006, BGM's ownership is as follows:

• The Woodbridge Company (Thomson family) - 40%
• Ontario Teachers' Pension Plan - 25%
• Torstar - 20%
• Bell Canada Enterprises - 15%

Despite BCE's reduced ownership, the name will not change to CTVglobemedia until January 1, 2007, although copyright notices for CTV-produced programming dropped the "Bell Globemedia" credit in fall 2006.

[edit] Operations

Main article: List of assets owned by Bell Globemedia

BGM's core asset is CTV Inc., parent of the CTV television network, Canada's oldest, largest, and (as of 2006) most-watched private broadcast television network, including 21 owned and operated stations. ^[2] CTV is also parent to a number of cable/satellite specialty channels, which include The Sports Network and its French-language equivalent Réseau des sports, Discovery Channel Canada, The Comedy Network, CTV Newsnet, Report on Business Television, MTV Canada, and various spinoff digital channels. CTV also owns 45% of number-three French-language network TQS, as well as the Atlantic Satellite Network, a regional channel in Atlantic Canada, which is based around programming from CHUM Limited.

Many of BGM's specialty channels are operated in partnership with U.S.-based media companies such as Discovery Communications (Discovery Channel), Disney (TSN), Viacom (MTV Canada), and Comcast (OLN Canada).

In addition, BGM owns The Globe and Mail, Canada's largest national newspaper, and websites associated with all of the above properties.

[edit] History

[edit] Predecessor companies

[edit] Baton Broadcasting

For all practical purposes, Bell Globemedia is the successor to Baton Broadcasting Inc. (first word pronounced /ˈbeɪ.tɑn/ or BAY-tawn), which by the late 1990s had become one of Canada's largest broadcasters.

Baton Aldred Rogers Broadcasting Ltd. was originally formed in 1960 to operate Toronto's first private TV station, CFTO-TV. The original investors included the Bassett and Eaton families, Joel Aldred and Ted Rogers, and Foster Hewitt in a much smaller role. Aldred sold his shares in 1961, followed by Rogers by 1970; with the Bassett and Eaton families firmly in control, the company went public in the early 1970s. CFTO became a CTV affiliate in October 1961, and soon after Baton became a part-owner in the network.

In 1972, the renamed Baton Broadcasting began purchasing other CTV affiliates, starting with CFQC-TV Saskatoon. This did not, however, give Baton a substantially higher investment in CTV, which was structured as a co-operative, not a traditional private company. Baton still only had one vote - as did every other CTV affiliate-owner.

In 1987, Baton expanded further into Saskatchewan and into CTV, purchasing CKCK-TV Regina, Yorkton twinstick CKOS-TV/CICC-TV, and CBC affiliate CKBI-TV Prince Albert. A twinstick CTV affiliate was soon launched in Prince Albert, CIPA-TV.

In the late 1980s, Baton applied for a high-power station in Ottawa on channel 60. The licence was approved, appealed by rival broadcasters, and ultimately sent back to the CRTC for review, ^[3] but the licence was surrendered when Allan Slaight instead decided to sell the local CTV affiliate, CJOH-TV, to Baton.

In 1990, Baton purchased the MCTV system of twinstick operations in Pembroke, North Bay, Sudbury, Timmins, and the Huron Broadcasting twinstick in Sault Ste. Marie. In 1993, Baton purchased CFPL-TV London, CKNX-TV Wingham and received a licence for a new independent station, CHWI-TV, in Windsor.

In 1991, the company launched Ontario Network Television, a secondary affiliation carried by Baton's CTV and independent stations in Ontario. This was expanded in 1994 into the Baton Broadcast System, or BBS, which included Baton's Saskatchewan stations. BBS was meant as a backup in case Baton's ongoing acquisitions did not translate into control of CTV itself. CTV had been recently restructured as a traditional private company, meaning that any future acquisitions by Baton would come with all of that affiliate's CTV shares. It was around this time that former CBC executive Ivan Fecan joined the company.

[edit] Baton-Electrohome Alliance

In 1996, the CRTC approved two major deals involving Baton. First was the acquisition of CFCN-TV in Calgary from Rogers Communications, which had recently purchased Maclean Hunter. Second, Baton and Electrohome formed an alliance, under which the companies would share ownership of CFCN, Baton's stations in Saskatchewan and its independent stations in southwestern Ontario, and Electrohome's CKCO-TV Kitchener. The deals doubled Baton's own interest in CTV to 28.6%, but also gave it control over Electrohome's shares, for a total of 42.9%. ^[4]

In January 1997, Baton-Electrohome's "Vancouver Television" proposal emerged as the CRTC's choice for the new independent station in Vancouver, British Columbia, beating out four other competitors. The new station, CIVT-TV, would compete directly with WIC's two CTV affiliates in the market when it launched that fall. ^[5]

On February 25, 1997, the Baton-Electrohome alliance and CHUM Limited announced that several stations would be swapped between them, giving Baton control of CTV. Baton-Electrohome would acquire CHUM's Atlantic Television System (ATV), consisting of four CTV affiliates in the Maritimes, the Atlantic Satellite Network (ASN), and a further 14.3% in CTV. CHUM would receive Baton's independent stations in southwestern Ontario, as well as CHRO-TV Pembroke/Ottawa, which had recently disaffiliated from CTV.

Shortly thereafter, Electrohome announced it would sell its broadcasting assets – including its interest in the alliance, its CTV shares, and CFRN-TV Edmonton – to Baton in exchange for shares in Baton. These two deals were approved by the CRTC in August. ^[6] Baton acquired the remaining CTV shares from WIC and Moffat Communications, which remained affiliates for the moment, that fall.

The BBS brand was summarily discontinued in favour of CTV, and the company itself was renamed CTV Inc. the following year. The Eatons' remaining shares, representing 41% of Baton, were sold off to the general public in early 1998. By the end of 2001, nearly all CTV stations would be consolidated under network ownership (including one replacement).

CTV Inc. continues to exist as a subsidiary of Bell Globemedia.

[edit] NetStar Communications

NetStar Communications Inc. (previously Labatt Communications Inc., and currently CTV Specialty Television Inc.) was formed by Labatt Brewing Company to hold that firm's broadcasting assets, which included TSN, RDS and - as of 1995 - Discovery Channel. In 1995, when the parent company was sold to the foreign brewing conglomerate Interbrew, a consortium of four Canadian investors - Stephen Bronfman (22.5%), Caisse de dépôt et placement du Québec (22.5%), Reitmans (16.5%), and senior management (6.5%) - along with ESPN, with 32%, took over the company. ^[7]

After a takeover attempt by CanWest Global that was vetoed by ESPN, CTV announced its acquisition of the company in early 1999, with CRTC approval the following year.

[edit] 2000 to present

BGM in its current form was masterminded by former BCE chief executive Jean Monty, largely as a response to CanWest Global Communications's purchase of the Southam newspaper chain as well as the trend of media convergence. Monty believed that, to survive in a changing technological landscape, and in particular to drive subscriptions to satellite television provider Bell ExpressVu and internet service provider Bell Sympatico, BCE had to have control over content.

In early 2000, under Monty, BCE acquired CTV Inc. in an all-cash transaction valued at $2.3 billion (CAD). ^[8] Soon after, Monty arranged to have Thomson Corp. transfer control of The Globe and Mail, the Toronto-based national newspaper, to BCE in exchange for a significant (20%) interest in the company that would become Globemedia. The Thomson family, which originally held a direct 9.9% interest, later bought Thomson Corp.'s interests itself.

The resulting company, known as Bell Globemedia, consisted of CTV, The Globe and Mail, and the internet portal then known as Sympatico-Lycos (Lycos was later replaced by MSN). Fecan was named the combined firm's president and CEO, a role he continues in today. After Monty resigned and was replaced by Michael Sabia in 2002, it became clear that Monty's vision was not producing anything near the desired results, notwithstanding the good results for the individual units, particularly the CTV network.

The following years provided a few cosmetic changes in BGM's assets. In 2001, CTV acquired CKY-TV in Winnipeg and CFCF-TV in Montreal, and moved the CTV affiliation in British Columbia to CIVT, replacing two affiliates that had been purchased by CanWest. That fall also brought the launch of the first digital specialty channels, including several owned by CTV.

The company acquired partial ownership in TQS in 2002, the Sympatico portal was sold back to Bell Canada, while a further investment from the Thomsons (whose ownership increased to 31.5%) funded the acquisition of 15% of Maple Leaf Sports & Entertainment. However, since BGM was first termed a non-core asset by BCE management in 2003, much attention has been given to its likely sale, and possibly a breakup into several different pieces.

On December 2, 2005, BCE announced it would sell an 8.5% interest to Woodbridge (increasing their total ownership to 40%), a 20% interest to Torstar, and a 20% interest to Ontario Teachers' Pension Plan. BCE will retain 20% of the group - a condition that would ensure that ExpressVu, Sympatico, and other Bell units continued to have access to Globemedia content. The transaction closed on August 30, 2006. ^[9]

This deal suggests any breakup is unlikely in the near future. However, Torstar's interest may raise further media concentration concerns, although that firm insists it is committed to maintaining the editorial independence of the Globe and its own Toronto Star.

On July 12, 2006, Bell Globemedia announced a friendly bid to take over CHUM Limited for an estimated $1.7 billion. Although likely to face immense regulatory scrutiny, the acquisition would bring a secondary broadcast system (Citytv), as well as brands such as MuchMusic, Bravo, and SPACE, into the BGM fold. CHUM's A-Channel stations will not be retained by BGM.

On September 7, 2006, in order to pay for the CHUM acquisition, BGM sold additional shares to its existing shareholders. BCE did not participate in the refinancing; the net effect was an increase in Teachers' ownership to 25%, while BCE's interests are now 15%. ^[10]

[edit] Related links

• Bell Canada
• Torstar Corporation
• Ontario Teachers' Pension Plan

[edit] References

[edit] External links

• Official Site
• Restructuring announcement
• CRTC Chart of Bell Globemedia's assets (PDF)