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The power of media concentration - Michael Atkins (12/03)

Some years ago a colleague of mine invited me to a cocktail party at one of the big downtown hotels in Toronto.
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Some years ago a colleague of mine invited me to a cocktail party at one of the big downtown hotels in Toronto. I can’t remember the purpose, but it was one of those innumerable events you attend where you know eight or nine people and the rest are in the same industry, but not known to you. I arrived and plunged into discussion full of enthusiasm and good cheer. I met some great folks. About a half an hour in I knew something was very wrong.

What was wrong, was that I was in the wrong room talking to the wrong people. The only thing worse than having to make your way out the door, hoping no one appreciates your stupidity, is not being permitted to make your way out the door because someone decides you are his new best friend and wants to introduce you around to even more baffled people. Something akin to this faux pas happened to me a few weeks ago in metropolitan Elora, Ont. I found myself assigned to an Ontario Community Newspaper Association discussion panel where the topic of the day was personal ethics, values, strategies and vision of certain industry notables.

All of this was moderated by a chirpy person named Paula Todd, whose day job is Host of Studio Two on TVO.

The notables on the panel were Michael Sifton, the president of Osprey Media (a competitor of mine) and Murray Skinner, the president of Metroland (the community newspaper subsidiary of Torstar). I was the un-notable replacing Pierre Francoeur, the president of Sun Media. I am a relic; one of the last independent suburban newspaper publishers in Ontario, with a newspaper in Sudbury. I own exactly three newspapers. The notables (when we include Pierre) own virtually everything else in the province, with the exception of some poor guy who is beating his brains out in London, Ont., and Fraser Dougal, who can afford the luxury of a suburban weekly in Thunder Bay because he owns all of the television, and most of the radio in town.

The concentration of media ownership in Ontario and Canada is astonishing. In Newfoundland and Nova Scotia, one company, Optipress Publishing, owns more than 90 percent of the weekly newspapers.

In New Brunswick, a more ominous configuration of ownership has the Irvings not only owning virtually all the daily newspapers in the province, but also buying up all the weeklies. Of course, they own a huge part of the economy of New Brunswick as well. You can rest assured none of the newspapers in New Brunswick will be covering much about groundwater pollution from Irving oil plants any time soon. I know the territory. I used to own the Brunswick Business Journal in Moncton. It was a lonely vigil.

In Quebec, the weekly ownership is split between two public companies, Quebecor and Transcontinental.

In British Columbia, my old friend David Black owns almost everything in the province, and Torstar owns a piece of him.

Anyway, you get the picture.

There is very limited newspaper competition in Canada. Where there is, it is now between the behemoths, who battle it out for a while, and when it gets too annoying, they trade assets to limit competition. There is no competition legislation in this country that is enforceable, and so anyone can do anything.

All of this elimination of competition makes perfect economic sense for the protagonists.

Why beat one another over the head if you can calm a market by controlling both the weekly and the daily.

And so you get this odd checkerboard. In Ontario you have some markets where there is fierce competition, usually between Osprey and Torstar (like Barrie and Peterborough) and other markets where an accommodation is found (like Kingston and Hamilton, where these companies recently traded assets). In Hamilton, Torstar doesn’t even trust the job of running the weeklies to their own weekly division, for fear some unsightly competition might break out among friends.

Needless to say, you can imagine the change in mood on our panel when I proposed for discussion the matter of potential predatory pricing (where little guys like me compete with big guys), and fixed pricing for retailers in markets where little guys like me no longer exist. It was being at an annual Thanksgiving dinner and bringing up the name of that distant cousin on your father’s side who went to jail for shooting his sister.

As I recall, so fast that it made my head spin, we segued to the role of the Ontario Press Council, which of course had nothing to do with the question at hand.

It was at that point that I began to wonder if I’d come to the right meeting.

The last time I participated seriously at an OCNA panel

Discussion, it was a brawl. I was chairing it, most of us were drunk, and as I recall we were yelling at Bob Rae to go home and take his new labour legislation with him. It was raucous and full of independent publishers, most of whom are either dead, or comfortably retired in the hinterland wishing they’d never sold.

Life has changed. The weekly newspaper industry will be defined by a handful of public companies. Their ethics, their vision, their values and their strategies will set the tone.

I have a feeling my days as a panelist are coming to a close.




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