Industry critic says previous reports have not focused on convergence of communications companies

Source: Globe and Mail

The federal Liberals will not support any move to ease foreign ownership restrictions in the telecom sector that might endanger Canadian culture, says the party’s industry critic, Marc Garneau.

That’s why, when MPs return to work in the fall, the Liberals will recommend that the issue should be studied further – despite the existence of four official reports that recommend doing away with foreign ownership caps in the regulated sector, as well as a public consultation process currently under way.

“There have been lots of studies on increasing competition, but they have not looked at the highly converged state of our communications companies,” the Montreal MP said in an interview.

“We need to do one final study. I’m not talking about an industry committee thing,” he added, referring to a report issued just last week by a parliamentary committee of which he was a member.

Mr. Garneau said such a study could be done quickly. “We should take the time to do that before we take the next step.”

Industry convergence between content distribution (such as cable and wireless) and content creation (such as broadcasting and publishing) makes foreign ownership a hot-button political issue. Many cultural lobby groups are against opening up the sector, and there is widespread feeling that cultural issues sunk the Conservatives in Quebec in the last election.

The timing of the government’s move on foreign ownership is a sore spot for many in the industry, who have watched as political concerns repeatedly overtook possible change.

“It’s more politics than it is industrial strategy,” one industry veteran said. “I’m quite convinced that we could dust off the first submissions made on this issue, disguise them in terms of timing, and submit them today. I don’t think they’d be different in any meaningful way.”

But convergence is a reality in the sector, as the telecom regulator’s chairman, Konrad von Finckenstein, keeps telling politicians. Rogers Communications Inc., for example, owns both cable and wireless networks as well as media properties such as CITY-TV and Maclean’s magazine.

Mr. von Finckenstein has argued that it makes no sense to deregulate the telecom sector without broadcasting, but Industry Minister Tony Clement has said he will not touch broadcasting regulations.

© Globe and Mail