More on FOX News comes to Canada

The CRTC document explaining its rationale for allowing the FOX News channel — and the NFL Channel (hooray!) — to be added to the digital lineup of channels offered by Canadian cable and satellite television operators has been posted online. In it, the CRTC notes that it received “… 531 comments supporting the addition of Fox News to the digital lists from individuals, and from such national organizations as Focus on the Family, REAL Women of Canada and B’Nai Brith Canada. Also in support of the proposal were such distributors as Vidéotron and Bell ExpressVu Inc. …”
Opposed to the idea of having FOX News on the menu in Canada were “82 parties, including individuals and the Canadian Association of Broadcasters (CAB).”
Oddly enough, the owner of the businesses of I work for was on both sides of the fence on this issue. Bell Canada Enterprises Inc or BCE owns Bell Globemedia, whose main assets are CTV Television and the Globe and Mail. As the largest private broadcaster in Canada, CTV is a member of the CAB which opposed the arrival of FOX News.
CTV has its own application before the CRTC to modify the conditions of the license it holds for its all-news cable channel Newsnet. CTV feels the license is too restrictive and hamstrings Newsnet in covering live, breaking news events. It had hoped the CRTC would modify the Newsnet license before allowing yet another all news cable channel into the country.
Meanwhile, BCE also owns Bell ExpressVu, the satellite television company. Satellite and cable TV owners are better off if their systems offer more choice. ExpressVu, then, was in favour of getting FOX News into Canada.
This paradox is a good illustration of BCE CEO Michael Sabia's de-convergence strategy. Sabia inherited BCE from Jean Monty who had a convergence strategy in which the “wires” business — data, voice, mobility, television — would deliver enhanced and unique content that it would have exclusive access to through Bell Globemedia. Monty's model closely mirrored some of the early convergence thinking at AOL Time Warner (later to become just Time Warner).
A disastrous investment in Teleglobe, though, led to Monty's ouster from BCE and Sabia took over.
Sabia — I think it's no secret to say — is less enthusiastic about convergence but, it seems to me, in no rush to undo Monty's convergence strategy simply for the sake of undoing it. Sabia has said that, in his view, the “wires” business is BCE's core business. The “wires” or “pipes” business is all about distribution. Others will create content and those in the distribution business will distribute it. For pure plays in the distribution business, the idea is to get as much content on your system as possible. It doesn't really matter where it comes from or whether it's quality content. More content, for those who own the pipes, is always better, in Sabia's view. Hence, ExpressVu's interest in adding FOXNews and the NFL network.
But over in the content creation part of the business — in Bell Globemedia — the value of the business improves if we can restrict consumers only to our content. We want more viewers and readers than our competition. In fact, our business booms when people watch and read only content created at our company. So if there is another television channel on the dial and it is not a Bell Globemedia channel, that does not help value creation in the content part of the company because you assume that there will be at least one viewer who might have been watching something on CTV that is now going to watch something on the new channel.
Sabia outlined this paradox early in his tenure at BCE shortely before asking each business within BCE to be the best in its own vertical and not worry so much about finding new revenues by teaming up with other business units in the BCE empire (as Monty had asked his leaders).
So, in Sabia's BCE, CTV should be the best television company it can be and its executives should focus entirely upon that goal. The Globe and Mail should be the best newspaper it can be and its executives should focus on that. And so on.