Source : Ottawa Citizen

Serious issues await Konrad von Finckenstein when he starts work on Monday

There aren't too many seats in Ottawa that are hotter than the chair of the Canadian Radio-Television and Telecommunications Commission (CTRC). And that makes the overwhelmingly positive reaction to the appointment of federal court judge and former Competition Bureau commissioner, Konrad von Finckenstein, all the more remarkable.

"Konrad has deep, broad public service experience," says Glenn O'Farrell, CEO of the Canadian Association of Broadcasters. "He gets the public policy culture as well as the intricate machinery of government. And even for someone as qualified as he is, there are incredible challenges to face."

Mr. von Finckenstein is regarded as an astute choice for the job for several reasons.

First, he comes to the job with strong relationships at the highest levels of the Harper government. During his six years (1997 to 2003) at the helm of the Competition Bureau -- which is part of the Department of Industry -- he worked closely and successfully with Kevin Lynch, who was the deputy minister there at the time. Mr. Lynch is currently clerk of the Privy Council Office.

The selection of a new CRTC chairman was handled at that very top level of government: the direction to recruit someone with no direct ties to either the telecom or broadcast business came from the Prime Minister's Office.

Mr. von Finckenstein meets that criterion. He has served in the federal government since 1973 -- with no private sector or corporate detours.

Described as a champion of open competition and free markets, he was involved directly in the negotiation and implementation of the Canada/U.S. Free Trade Agreement, as well as the airline and bank merger debates.

These files have not only given him a strong grounding on the business side of the equation, the underlying ideology fits well with the strong free-market views of current Industry Minister Maxime Bernier.

Mr. Bernier raised eyebrows twice last year when he over-ruled CRTC decisions and pushed ahead with deregulation of local telephone markets and the use of voice-over-internet protocol (VOIP) technology.

Mr. von Finckenstein is no stranger to the inner workings of the CRTC for personal reasons as well. His wife, lawyer Ursula Menke, served as secretary-general at the CRTC from 1999 until 2002, when she became deputy commissioner of the Canadian Coast Guard.

In a broader context, the CRTC and the Competition Bureau have a history of working closely together -- most recently on the technical telecom issues of access and networks.

The recent Telecom Review Panel urged an even closer relationship between the two government bodies. That's likely to happen in any case because the federal government , with the passage of Bill C-41, recently gave the Competition Bureau the right to impose fines in the telecom businesses regulated by the CRTC.

Furthermore, under Mr. von Finckenstein, a formal memorandum of understanding was negotiated between the Bureau and the CRTC, clarifying their respective areas of operation.

Certainly, when he moves into his new office at CRTC headquarters in Hull on Monday morning, Mr. von Finckenstein will have to hit the ground running.

His first role may be that of enforcer: the CRTC is currently in the middle of a bitter dispute between the Shaw Communications, Group Videotron and the Canadian Television Fund.

The two cable companies have arbitrarily announced plans to suspend their financial support of the CTF, even though the CRTC requires them to direct five per cent of their annual revenues to the Fund as part of their licence agreement.

Yesterday, Heritage Minister Bev Oda took the unusual step of announcing a two-year, $200-million federal contribution to the CTF. Although the government has been making annual commitments to the fund for the past several years, Ms. Oda said she wanted to alleviate the uncertainty that has plagued the CTF in recent weeks and undermining independent television production schedules -- a pricey slap at Shaw and Videotron

A meeting will be convened in Ottawa Jan. 30, to bring all factions together. And the minister has made it clear she is looking to the CRTC for backup.

"The CRTC is charged with ensuring that licencees respect their regulatory obligations," she noted.

But there are other issues before the CRTC that may also prove contentious in coming weeks as well.

The regulator is responsible for the review of two major industry transactions -- Bell GlobeMedia's proposed $1.7-billion acquisition of CHUM and CanWest Global's proposed $2.3 billion takeover of Alliance Atlantis.

The two deals have broader implications: the issues of corporate consolidation and foreign ownership.

On top of that, on the broadcast side, Mr. von Finckenstein inherits the pending report on Canada's television policy. (Hearings, which covered the controversial fee-for-carriage debate, were held late last year.) There are also policy reviews of the specialty and pay television business and the cable sector on the agenda as well.

There are also a full range of telecom issues to resolve including the fallout from the upcoming changes in the wireless market.

Another imminent challenge is the replacement of as many as seven new CRTC commissioners this year. Four have terms that expire and the regulator has the option of increasing its ranks to as many as 13 commissioners.

At least Mr. Von Finckenstein can look forward to some company on the hot seat.

© Ottawa Citizen