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Telecom changes won't affect Canadian content in broadcasting: Clement

OTTAWA - The Harper government is committed to preserving Canadian content on television and radio while allowing for a greater foreign presence in the telecommunications sector, Industry Minister Tony Clement says.

OTTAWA - The Harper government is committed to preserving Canadian content on television and radio while allowing for a greater foreign presence in the telecommunications sector, Industry Minister Tony Clement says.

The minister told a House committee Thursday it is possible to separate the two.

"I'm not saying it's easy, but it certainly isn't impossible," he said.

"There's no question there's been convergence in the industry between those who are providing telecommunications and the broadcasting, but in our view it is possible to deal with those separately."

Ottawa signalled in the throne speech in March that it wants to increase competition in the telecommunications sector, such as wireless services, by opening it to more foreign investment.

Federal law currently requires both telecom providers of cable, satellite and wireless services, and broadcasters like CTV and Global currently to be owned and managed by Canadians, although the rules allow for a majority foreign, non-voting stake.

The government has suggested it wants to change the foreign ownership limits in the former but not the latter.

Some critics have said that since companies like Rogers Communications (TSX:RCI.B) provide both content and distribution of content, the two functions cannot have separate rules.

Those have included CRTC chairman Konrad von Finckenstein, who has argued the two industries are now joined at the hip.

But Clement says good policy can separate the two, although he offered no hints as to how this could be accomplished.

The minister said the government has not made up its mind on what the new rules would entail, adding that the next step is to consult widely.

Under skeptical questioning from Liberal and New Democrat MPs, Clement also defended his controversial decision to allow new cellphone operator Globalive Wireless to start up in Canada.

Last fall, the Canadian Radio-television and Telecommunications Commission ruled Globalive could not operate in Canada because it was essentially owned and operated by Egypt-based Orascom Telecom. But the Harper cabinet overruled the CRTC.

Clement insisted the decision was not setting a precedent or changing the rules but was made on the merits of the case.

He said he favours greater foreign participation in the telecom sector because it will lead to greater competition, better and more diverse services, and lower costs.

Independent studies have noted for years that Canada lags Europe in wireless penetration, variety of services and in cost, although the industry responds that the two markets cannot be easily compared.

"In their quiet moments, the incumbents realize that competition can be a good thing," Clement told the committee.

 
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