The Marxist-Leninist Daily

Hamilton steelworkers rally outside the office of Conservative MP David Sweet (Ancaster-Dundas-Flamborough-Westdale) on March 19, 2011, to demand the government hold U.S. Steel to account for its commitments under the Investment Canada Act. Sweet is Chair of Parliament's All-Party Steel Caucus and
Chair of the Commons Standing Committee on Industry, Science and Technology.

Canadian Political Elite Go Crazy Unconcerned

The squabble over Chinese companies operating in Canada would be funny if the ultimate consequences were not so serious. Just mention the words Nexen and Huawei and the brains of certain members of the political elite boil in consternation and even hatred. The working class should look carefully and calmly at why inter-monopoly and inter-imperialist contradictions seem to drive the political elite wild and bring out their worst behaviour.

First, the people are told routinely that competition and globalization are wonderful for the world and leading factors for prosperity and progress. The next minute, the people are bombarded with screams of angst that Chinese companies have entered the global competition and must be stopped. Canadians should not tolerate this hypocrisy and double standard.

Most Canadian workers in large companies are fully aware that they are mostly owned and controlled from abroad. Those foreign owners routinely put their private interests ahead of the public interests of Canadians and the rights and security of workers and Canada's economy. U.S. Steel has decimated the Canadian steel industry with shutdowns at the two Stelco mills it seized in 2007 and through the power it brandishes from its ownership of a dozen U.S. mills constantly demands concessions from workers. Under the banner of good global business decisions, it services many of Stelco's former steel customers with product from its own U.S.-based mills even while the Hamilton Stelco blast furnace is still shut down. Unless restricted, all global monopolies follow essentially the same monopoly outlook, aim and practices as U.S. Steel to serve their own private interests in opposition to public right and interest. The U.S. auto monopolies routinely use extortion threatening to move facilities to extract concessions from auto workers, and public pay-the-rich funds and lower corporate taxes from the federal and Ontario governments. Rio Tinto Alcan is demanding more concessions from workers in Canada in the name of a global restructuring campaign.

What does the situation call on the workers to do to restrict the bad behaviour of global monopolies? The Investment Canada Act is a weak and without serious enforcement, the global monopolies act with impunity. All monopolies, no matter where they originate including Canada should be held to the same standards. What it means to benefit Canada should not be made synonymous with what is beneficial to the monopolies at the expense of the workers and the natural and social environments. Furthermore, the monopolies must be held to account for written public commitments to act in ways that are verifiably beneficial to Canadian public interests. These commitments must recognize the rights of the working class and provide them with a guarantee. Failure to meet the commitments must be compensated as when a government does not meet its commitments to a monopoly and then pays millions of dollars in compensation. If a monopoly violates the commitments, as U.S. Steel has done, the government must hold the company to account and the working class must hold the government to account to enforce the agreement and remedy the complaint. Relationships can be brought back into equilibrium only if they are based on understandable definitions of mutual benefit and recognition of the rights of the working class.

Note also that most of these takeovers, such as U.S. Steel's seizure of Stelco, involve a transfer of money from one company (usually larger) and its ownership to another company and its ownership with the money often ending up outside Canada. They are not investments in the sense of new money coming into Canada to build something. Often, as in the tech or any industry other than resources and direct services, the buyer moves the smaller company out of Canada wrecking the manufacturing base.

Canada has the example of the outrageous behaviour of the U.S. monopolies John Deere and Caterpillar that wrecked perfectly good manufacturing facilities in Canada and yet continue to sell their equipment made outside the country into the Canadian market. The rules of engagement should be perfectly clear: if a particular monopoly does not manufacture in Canada, then no sales in the Canadian marketplace should be permitted for that company.

In all sectors of the economy, monopolies must agree with public rules and regulations guided by a mutually beneficial relationship and recognition of the rights of the working class if they wish to operate in Canada, including the sale of their commodities, which means that the wholesale and trading sector must come under public scrutiny and control. The government is duty-bound as custodian of the public interest to hold all companies to account and punish them if they do not comply with written agreements that are clear and transparent for all to see. All the other hysteria about this or that company from China or elsewhere is a diversion from the practical politics the organizations of the working class need to work out and implement to defend the public interest, rights of all and economy from monopoly right.

Nexen Inc. is a U.S.-owned and controlled company listed on the New York stock exchange as NXY. Occidental Petroleum, a Los Angeles-based oil company owned 80 per cent of Nexen back in the eighties when the company was called CanOxy. Ironically some might say, in the 1990s, the U.S. company now called Nexen seized control of an originally Canadian state-owned public enterprise, Wascana Energy Inc., more famously known as SaskOil, and annexed it within Nexen (CanOxy). The Saskatchewan NDP government of Premier Allan Blakeney created SaskOil in 1973.

Nexen Inc. now controls vast quantities of global oil production and distribution in Alberta, Saskatchewan, the Gulf of Mexico, Yemen, Nigeria, the UK North Sea and elsewhere. The proposed change of control and ownership of globalized Nexen Inc. from one foreign company to another, the China National Offshore Oil Corporation (CNOOC) has sent members of the political elite, especially members of the NDP and Green Party, into a disingenuous tizzy.

The noise over the Chinese global companies Huawei and ZTE is equally specious. One former Nortel executive has even gone so far as to blame the collapse of Nortel on Huawei to deflect criticism from a failed economic system, and to defend certain Nortel executives who are on trial for overt criminal and corrupt practices.

What monopoly does not engage in spying on its competitors to gain an edge? That's the name of the competitive game for heaven's sake. That is another reason why the rules of engagement for all monopolies in Canada should be transparent and rigidly enforced. Do members of the political elite think Canadians are so naïve as to believe that only Chinese companies and the Chinese government engage in spying or wining and dining clients for the benefit of their monopolies and owners of capital represented within their government? Are they suggesting that Canadian, U.S., British, French, Japanese and German monopolies and governments representing their private monopoly interests do not engage in spying or wining and dining to benefit the most powerful monopolies and owners of capital who are represented within the government? What planet do they think we live on?

Canadian political parties, the military and spy agencies do not even hide the fact that they work with spies from the U.S. and U.K. Harper quite openly is moving to integrate Canada into U.S. Homeland Security. Not surprising then that leading the charge against Nexen and Huawei have been present and former U.S. and Canadian state agents and a political elite that conciliates with Harper's annexationist mission and imperialist politics in the name of humanitarian causes and homeland security.

The political elite who refuse to question much less oppose or even restrict the system of inter-monopoly and inter-imperialist competition for markets, raw materials and spheres of influence and the annexation of Canada into the United States of North American Monopolies should be denounced for their incitement of Canadians to side with one monopoly, monopoly group or imperialist power over another. Such activity is diverting attention from the disastrous path along which the country is being led to even greater crises and war. It diverts attention from the fact that public right is blocked from restricting monopoly right. It stalls a new pro-social direction for the country from coming into being. Those same members of the political elite who pick and choose most favourite or hated monopolies and nations refuse to engage the working class in decisions which can bring all monopolies under public restrictions of their behaviour.

The working class must not give the political elite a free pass on this important issue. Members of the political caste or any others for that matter who declare themselves for inter-monopoly and inter-imperialist competition, or at least conciliate with it in practice, and then turn around and choose this or that imperialist or monopoly as favourite or most hated, act as if possessed by a schizophrenic mental disorder forgetting suddenly that they are for inter-monopoly competition and globalization. A political leader accused China of producing almost everything Walmart sells yet said not a word about the responsibilities of Walmart! Their fanaticism turns them blind. Worse, they refuse to join with fellow Canadians to restrict all monopolies and enforce relationships based on mutual benefit, the public interest and recognition of the rights of the working class.

The working class should demand that politicians and business leaders be consistent in their promotion of competition and globalization as positive. If it is their belief that it is positive why waffle and side with this or that monopoly or imperialist and declare some good and some bad? Especially silly is to invoke something so hypocritical, subjective and one-sided as national security in these matters all the while siding with members of the Anglo-U.S. Empire and its spy agencies and war hysteria in opposition to Canadian public interests and security against imperialist exploitation and control especially coming from down south.

Lining up with this or that monopoly or imperialist against other monopolies or imperialists is against the national interests of Canada and leads to war and can only be considered downright irrational and crazy. For a political person who is for inter-monopoly competition to denounce CNOOC or Huawei and prohibit them from doing business while allowing other global monopolies to operate in Canada for the most part without any public and transparent restrictions indicates a racial or chauvinist bias or a hidden interest in the form of money invested with a competitor, in this case a competitor of CNOOC or Huawei such as U.S.-based companies Cisco Systems, Juniper Networks or Hewlett-Packard. The Washington Post quotes Cisco chief executive John Chambers as saying, "Huawei is our biggest long-term threat." The same newspaper then notes with a hint of sarcasm, "Much of Cisco's own technology is manufactured in China."

The working class should raise why these members of the political elite are not fighting tooth and nail for written rules and regulations governing all monopolies in Canada, which are rigidly enforced, and why they are not discussing a new pro-social direction for the Canadian economy that features self-reliance, independence of thinking directed towards humanizing the social and natural environment, trade for mutual benefit and consistent practical politics that uphold public right not monopoly right and public interest not private monopoly interest.

Time for Auto Workers to Break New Ground in
Defence of Their Rights

CAW Locals at GM, Ford and Chrysler have settled a four-year contract with the global auto monopolies. The contents of the agreement are important but most would agree that the crucial question for the working class is how to turn the situation around in its favour. Many workers had little doubt that this collective agreement would bend in favour of the monopolies and against new hires, the most vulnerable of auto workers. That has been the case, with a sledgehammer falling on workers entering the auto workforce.

Unnecessary to list all the concessions other than to say the wages for newly hired production workers will be only 60 per cent of established workers and remain below their co-workers for ten years while other benefits and pensions will stay inferior indefinitely. New hires will have to pay into a defined contribution pension fund at increasingly larger amounts reaching a deduction from wages of around six per cent in ten years.

The wages of current workers remain frozen until September 2016. A $3,000 signing bonus and three yearly $2,000 lump sum payments replace the COLA. This means that the basic wage on which negotiations will begin in 2016 will not have risen in almost a decade regardless of price inflation.

Promises of investment are contained in the GM and Ford agreements that last until 2016 but these are apparently contingent on $400 million dollars of Ontario and Federal government money flowing to the monopolies through pay-the-rich schemes. Insecurity of employment and auto production after 2016 is apparent and already being milked to prepare conditions to extort yet more concessions at that time.

Auto workers are outraged that their security of livelihoods and bargaining for wages, benefits, pensions and working conditions suitable to themselves as a collective and individuals have been reduced to extortionary threats from the monopolies, governments and mass media. Not a day goes by without dire warnings that the monopolies will move their operations to more "business friendly" venues if the workers do not agree to concessions. This neo-liberal regime of intimidation and insecurity is not how workers should live in a modern Canada. Change is necessary but the key question is how do workers break new ground to defend their rights and bring pro-social change into being.

First is not to dwell on the disappointment of the present and overestimate the ability of the regime to maintain the neo-liberal status quo. The ball is in the workers' court. Workers are not directly in control of what the owners of monopoly capital and their political representatives may do but they can be in control of their own thinking and actions. Modern workers are beings of the rising independent dynamic class capable of transforming all aspects of their world including politics, as they have already shown through their work to transform the previous economy based on petty production into industrial mass production.

The working class is the rising class that needs to develop its own independent sense of the modern economy and politics and how they function. Important to this new independent sense of economic and political life is the ability to think and analyze. The situation workers confront is not without remedy and no one should feel depressed or demoralized. Workers are not a dying ruling elite such as Shakespeare's Lady Macbeth who laments the situation, and encourages her husband to forget their crimes as if they bear no responsibility: "Things without all remedy should be without regard: what's done, is done."

But shameless to a fault, she repeats her desperate actions and cries anew two acts later, "What's done cannot be undone."

The modern working class is not of this dying ilk that lives in regret, refuses to accept responsibility for problems or change its ways. The past holds lessons of how to proceed in the future and remedy what has to change. The issue is not to cry about the contract but to study why workers are in this weakened position on a seemingly out-of-control downward slide. What's done is done but what are the necessary factors workers need to address to make sure next time what's done is in their favour.

For example, workers can stop thinking of themselves as a cost of production that must constantly be lowered to make the monopolies more competitive. This is a deathtrap for workers that they must repudiate. Workers are the centre of all production and the essential human factor in the economy that produces all value and services.

The following sentence in the collective agreement is a big lie that should be denounced and struck down as readily as any statement that says management has the right to act as it pleases without restrictions:

"The Company acknowledges that the recently negotiated new hire provisions substantially enhances the labour cost competitiveness of new employees in the Canadian operations, which is one of the several important factors of consideration for investment."

The company can acknowledge whatever it wants but workers, whether new hires or not, are not costs to anyone but on the contrary the source of all new value. Investment and relations of production built on the notion of workers as a cost of production are doomed to crisis, disequilibrium and failure. That is no way to build a modern economy and nation. Workers want equilibrium, security and a new direction for the economy. A remedy is to be found within the situation but it will not come from the ruling elite and its politicians and experts; it must come from workers themselves organized in their collectives and from their independent thinking, outlook and agenda.

What's done is done but workers cannot and do not live in regret and tear each other and their organizations apart because of the conspiracies of the ruling capitalist class. Workers are optimistic and energetic about changing the world to favour themselves and society. Let auto workers organize now and sort out their independent thinking, outlook and agenda so that in 2016 and the years in between, they will be in a position of unity and strength to break new ground in the defence of their rights and the rights of all.

Rio Tinto Alcan Destroys Under Guise of Restructuring

Citing lower aluminum prices on the world markets and increased competition between the industry's monopolies, Rio Tinto Alcan (RTA) is implementing a global reorganization campaign that includes the sale and closure of alumina and aluminum plants, anti-worker reorganization of work in the remaining plants and massive cuts to managerial staff. Rio Tinto Alcan is placing the burden of the industry's problems on the backs of the workers and communities even though they are not responsible for the problems. It is aggravating the working and living conditions of the workers and people and undermining economic development in the regions. The workers are militantly opposed to Rio Tinto Alcan's claims that it has the monopoly right to make any decision it wants with no regard for the damage it causes to the people and the economy. They are militantly opposing secret deals signed by the Quebec government, Hydro-Quebec and Rio Tinto which enable the monopoly to act with impunity. While Rio Tinto is not presently demanding the contract it signed with the Alma workers be reopened to accommodate its restructuring, it is attacking the Arvida workers and all Rio Tinto workers are fighting back. The Saguenay-Lac-St-Jean and Mauricie regions are known for their fighting spirit in defence of the rights of all and the workers are meeting this new attack on their livelihoods and future, determined to make sure the anti-worker and anti-social reorganization is not carried out at their expense.

Arvida Complex Cathode Production Centre Closure

In late September Rio Tinto Alcan announced the indefinite closure of its cathode manufacturing facility in Arvida. Cathode production will be reduced gradually until the closure, scheduled for late 2012, the company said. Cathodes are electrodes used with anodes to conduct electrical current in the vats where electrolysis reduces alumina to molten aluminum. The company will now import cathodes from its French subsidiary Carbone Savoie. It has declared 50 jobs at the Arvida plant redundant. RTA has promised not to lay off workers but to relocate them elsewhere in the plant.

The workers, represented by Le Syndicat national des employés de l'aluminium d'Arvida (SNEEA), affiliated with the Canadian Auto Workers, are now also informed that the plant will not be heated during the winter -- a sure sign that work there is not going to resume.

Uncertainty Over Arvida's Future

Uncertainty about Arvida's future is pervasive, the workers say. For environmental reasons, the plant's 800 prebake tanks must be closed at the end of 2014. This closure will affect about 1,000 workers the union says; 700 tank workers and 300 workers that prepare the anodes and the electrolysis equipment. Rio Tinto Alcan is modernizing the electrolysis technology, increasing the amount of aluminum production and making the process cleaner, but it is delaying the process citing market conditions. The technological modernization must be done in three phases, but only phase 1 has begun and it only includes 38 new tanks employing only about 80 workers. No announcement has yet been made for phases 2 and 3. The union estimates that it will take about 32 months after the work begins to complete phase 2, which would not give enough time to replace the old tanks even if construction were to begin immediately. This has created what the union is calling a "black hole" for some 1,000 workers it seeks to place. The union has asked the government to grant an extension to tank operations beyond December 31, 2014 to avoid massive job losses; meanwhile the union is maintaining pressure in the region to make Rio Tinto make the necessary investments.

Concerns Over Premature Closures Under Secret Deal

The secret agreement signed between the Quebec government, Hydro-Quebec and Alcan in 2006, which was renewed when Rio Tinto purchased Alcan in 2007, included major hydroelectric privileges for the monopoly and other privileges such a $400 million interest-free loan in exchange for investments by Rio Tinto in Quebec. The agreement also included a section that permits Rio Tinto to close plants that pose what the agreement called a "sustainability challenge" without losing its privileges. The agreement as signed in 2007 identified four plants: the smelters in Shawinigan and Beauharnois and the prebake sections at the Arvida and Vaudreuil alumina refineries, both of which are in the Saguenay region. The agreement stated that these plants have an outdated polluting technology and should eventually close because of new environmental regulations. The agreement did not oblige Rio Tinto Alcan to renovate the technology for these plants in keeping with environmental standards. On the contrary, the potential closure was considered a fait accompli. The agreement even added than Rio Tinto would be permitted to close before the axe falls with regard to environmental laws if market conditions deteriorated to the point where a tonne of aluminum would sell for less than U.S.$1,800 on the global market.

This section of the agreement permitted the closure in early 2009 of the Beauharnois plant, which was to remain in operation until the end of 2010. This part of the agreement was made public at that time.

Currently, the Shawinigan plant and prebake tanks at the Arvida plant are to close at the end of 2014 for environmental reasons. Workers and the union locals fear that Rio Tinto will once again cite lower aluminum prices on the markets to close these facilities even before that date. All of this will drastically increase unemployment in the region. This closure was also inferred by Rio Tinto Alcan's spokesman, contributing to an atmosphere of instability and anxiety which are geared to get the workers to accept a sense of hopelessness, helplessness and humiliation as if this is "inevitable."

Major Reduction to Managerial Staff

Rio Tinto Alcan is also planning a massive reduction in managerial staff in all its facilities around the world. Local media in the Saguenay-Lac-St-Jean region talk about a 20 per cent reduction in the total number there. The monopoly's spokespersons have not confirmed this number but speak about a major reduction to be made by attrition, using layoffs to accelerate the process. According to them, the staff reductions will be made among the so-called support staff and not workers involved in production as such. The workers understand this to be a clerical downsizing and reduction of various services, similar to what RTA has already done by eliminating its regional purchase services.

"Some say we should be happy to learn that a managerial staff reduction program exists," said Marc Maltais, President of the Syndicat des travailleurs de l'aluminium d'Alma. "On the contrary. We fought for quality jobs in the region. Regardless of whether the jobs are unionized or not, it is these quality jobs that the region will lose. We can't now turn our backs on this battle because it is managers who will lose their jobs [...] It could result in an unfortunate cut to services, decentralization, outsourcing and a loss in employee services."

Meanwhile, the monopoly continues what it calls "job restructuring" in its factories. Alma workers know what this means, as since their return to work following the end of the lockout they have been fighting the job restructuring which the company is carrying out without their consent. The restructuring increases the risks posed to the workers' health and safety and is simply not acceptable, the workers point out.

Rio Tinto Alcan is gaining a bad reputation for citing problems "in the market" to explain its attacks on the workers who produce the wealth in the first place, as well as the populations of the regions and countries where it operates. Economic problems should be provided with real solutions, not short-sighted measures on the workers' backs. Rio Tinto Alcan receives huge concessions in terms of its hydro usage. It should not be permitted to steal the resources with no return for the workers and economy of the regions and the country.

Proposed Bell Takeover of Astral Reveals Sharpening Inter-Monopoly Contradictions

A major fight in the media and telecommunications sector is underway. Bell and Quebecor are before the Canadian Radio-television and Telecommunications Commission (CRTC) contesting the purchase of Astral Media by Bell. This transaction mainly pits Bell and Astral and their presidents, George Cope (Bell) and Ian Greenberg (Astral), against Quebecor and its president Pierre Karl Péladeau.

The CRTC hearings were held in Montreal September 10-14 to determine the share of the television market that Bell would control if the telecommunications giant's $3.4 billion purchase of Astral Media was authorized.

The proposed acquisition would create a media empire that would possess 33.5 per cent of the English-speaking television market and 24.4 per cent of the French market, in addition to providing digital content to consumers via online services for computers and mobile devices such as smartphones and tablet computers.

A 35 per cent presence in a market is generally considered acceptable by regulatory authorities. The transaction must be approved by the CRTC and the Canadian Bureau of Competition in order to be finalized. Astral shareholders have already voted in favour of the sale of the company.

The CRTC heard from businesses in the multimedia, telecommunications and radio industries, as well as producers, film groups and consumer advocates, several of whom are opposed to the transaction. According to CRTC President Jean-Pierre Blais, the CRTC received 1,667 submissions and more than 8,000 letters, reflecting the concerns arising from the transaction.

News reports indicate that the CRTC is aiming to issue its ruling by early November.

Bell's bid to purchase Astral reveals the sharp contradictions between monopolies and amongst other players and how various concerns relating to media concentration are posed. Professor Yves Rabeau, associate professor at the Université du Québec à Montréal's School of Management Executive Education Centre, wrote an article published September 10 in Le Devoir entitled, "Bell-Astral Transaction -- Disturbing Concentration of Content," which explains the impact of the concentration should the purchase be approved by the CRTC:

"Bell's transaction to acquire Astral's English and French channels would put Bell in a dominant position in the media sector of Canada and Quebec. In Canada, with 51 specialty channels and its 28 conventional stations, Bell would have major purchasing power in content and advertising. [...]

"In Canada, Bell would collect 40 per cent in royalties from the specialty channels for more than $1 billion and 45 per cent of the advertising revenue of these channels. [...]

"In Quebec, Bell would hold 8 of the 10 most popular French specialty and pay-per-view channels [if the transaction were approved by the CRTC.] It would then have 63 per cent of the French and English specialty channel audience in Quebec. Bell would control nearly 80 per cent of the amounts dedicated to acquiring content for the French specialty channels in the country. Bell would become the largest owner of radio stations in Canada, with 117 stations, including 99 music channels. [...]

"In addition, several of Astral's specialty channels in the acquisition are CRTC constructs, which granted them a thematic monopoly or obligatory distribution. The channels also [provide access to royalty fees from local cable or satellite providers]. This creates a bias in the market with regard to the regular channels which are major suppliers of original Canadian content, but do not have access to royalties.

"But in addition to these revenues, specialty channels also receive advertising revenues so they can modulate rates to attract advertisers, thanks to income from royalties. These advantages permitted Astral to achieve a profit margin of around 38 per cent during the last fiscal year. Already an owner of many specialty channels in Canada, Bell would benefit from acquiring Astral and its monopoly-like profits, to support its own strategies in the Canadian market.

"Thanks to its dominant position in the Canadian market, Bell Media could become a dominant [power] for advertisers, being able, thanks to the volume of demand and the fees of its multiple channels, to offer them at discount prices. This downward pressure on prices would reduce the advertising revenues for other competitors and weaken their positions in the market.

"Bell could then, thanks to the profitability of specialty channels, cross-subsidize its other services for consumers and lead to unfair competition for other market players in telecommunications and broadcasting. Bell could, for example, offer packages for all of its services that would defy all competition.

"With a broad content portfolio, Bell is in a unique position to provide protected content on all electronic platforms and in particular to its wireless subscribers, and recover additional advertising revenue on the growing mobile market." [...]

"It is not Bell's business model that is at issue here, but its dominant position in the market, which not only poses a major problem of competition, but also goes against some of the principles supported by the regulator. The Bell-Astral conglomerate would dominate broadcast rights purchases for English and French programming from suppliers of Canadian content. The high concentration of content raises the question of the diversity of voices and public access to diverse content and quality. There is also protection of the consumer, who should be able to freely choose their media at affordable prices through healthy competition." [...]

Bell Canada

Bell Canada, commonly known as Bell, is a telecommunications and media enterprise, founded in 1880 by Charles Fleetford Sise and headquartered in Montreal. In 2010, its revenues were more than $18 billion and in 2011 it employed 55,250 people. Bell is part of the conglomerate Bell Canada Enterprises (BCE). In addition to its telecommunications operations, BCE owns Bell Media, which operates several media outlets and owns CTV Television. BCE also owns 18 per cent of the Montreal Canadians Hockey Club and is a shareholder of the Bell Centre in Montreal. Bell controls one-third of the pay-per-view and specialty channels in Canada. With the purchase of Astral, it would have 51 channels in all.

In 2011, the Forbes Global 2000 list ranked BCE in the 262nd place. Bell is affiliated with AT&T, in which it has an ownership stake of approximately 39 per cent. In 2006, AT&T had revenues of over $300 billion and 1 million employees. AT&T was bought for $19 billion in 2005 by Baby Bell SBC Communications, which was soon renamed AT&T Inc.

In Bell's case, since the 35 per cent market presence generally considered acceptable by the regulation authorities is indeed exceeded and the effects of its dominant position as a result of the purchase of Astral are so ubiquitous in the media economy as a whole, the authorities should simply block the transaction. In the Anglo-Canadian market the new group would hold a position of power -- a market share of between 34 and 43 per cent, depending on the methodology used to calculate it.

On September 10, Bell argued before the CRTC that it was the only company able to absorb Astral without immediately having to sell off some of its divisions. For his part, Astral President Ian Greenberg said that the founding family wants to sell the company and in the absence of a strong buyer such as Bell, Astral would become prey to vultures that would dismantle the company in a "financial engineering" exercise.

But at the insistence of the CRTC, Bell conceded that if the deal went ahead, it would sell ten radio stations in English Canada, seven of which would be acquired from Astral. The stations are mostly FM stations, located in Ottawa, Toronto, Winnipeg, Calgary and Vancouver.

Astral Media

Astral Media Inc., or Astral, is a Canadian media enterprise. It is the largest leading broadcaster with 83 radio stations in eight provinces. It was founded in 1961 by Ian Greenberg who is also the current president. Astral is a major player in specialty television in Canada, with The Movie Network, Super Ecran, Family Channel, Teletoon, Canal D, Canal Vie, VRAK.TV, Series +, Ztélé and more.

In Quebec it has 24 stations in Montreal, including CHOM, CJAD, CJFM. Elsewhere in Québec it owns the NRJ network, Rouge FM network, Boom FM network and a network of 10,000 billboards.

On March 16, 2012, Astral accepted Bell Media's purchase offer of $3.38 billion. Astral shareholders voted 99.8 per cent in favour of Bell's offer. This is the reason for the CRTC hearings.

Both players see this transaction as a way to stay competition from foreign newcomers such as Netflix and Apple. This view is strongly disputed by Telus and Rogers in particular.

Opponents

In this group we find Quebecor and its president Pierre Karl Péladeau, as this Quebec quasi-monopoly is seriously threatened by Astral going to Bell. Joining Quebecor on the website "Say No to Bell" are Rogers, Cogeco Cable, Eastlink, Communications, Energy and Paperworkers Union of Canada (CEP), Vidéotron, Telus, l'Association québécoise de l'industrie du disque, du spectacle et de la vidéo (ADISQ), Option consommateurs, and several small cable operators including, Déry Télécom Inc., Câcle-Axion Digitel Inc., Cooptel, Coopérative de câblodistribution de l'Arrière-Pays, VidéOptique Inc., Cablovision Warwick Inc. and Duclos Michaud Télécom.

The small cable operators' position is clear. They oppose the CRTC consenting to Bell's purchase of Astral Media.

In a September 5 item in Le Devoir, seven small cable operators with a total of 74,500 subscribers wrote: "For many people, the Bell-Astral transaction and opposition to it are a matter of major players wanting to become larger. Reducing the stakes of this transaction to a mere 'war of empires,' we tend to forget that the market for cable television and internet access is not only the giants' domain." [...]

"[Bell's acquisition will result in] major price increases and restrictions in terms of what packages we can offer to our customers. What will happen if Bell is allowed to buy Astral is less choice, less flexibility and higher prices for our customers. Nothing to help us remain competitive.

"Ultimately the concentration of so much bargaining power in the hands of a single company would mean the disappearance of small cable operators like us, and with us, telephone services and Internet access for which we are often the only alternative to the monopoly of major suppliers.

"That's why we are asking the government and the CRTC, and anyone committed to maintaining competition and consumer choice, to stand against the purchase of Astral by Bell before it is too late and marks the death knell for small cable operators."

This article was signed by representatives of Télécom inc. (25,000 subscribers); Câble-Axion Digitel inc. (23,000); Cooptel (1,500); Jacques Coopérative de câblodistribution de l'Arrière-Pays (14,500); VidéOptique inc. (7,000); Cablovision Warwick inc. (2,000); Duclos Michaud Télécom (1,500).

Quebecor

Quebecor Inc. is a Quebec company specializing in commercial printing, media (newspapers, magazines, radio and television) and telecommunications, including cable, Internet and telephony. The company headquarters is located in Montreal. It was founded in 1965 by Pierre Péladeau. Its sales figures were approximately $10 billion in 2006 and it had 17,000 employees.

The sum of this conglomerate's activities are found in its subsidiary Quebecor Media, consisting of a group of companies providing services related to the field of mass communication, including newspapers, books, magazines, television, cable television, radio, Internet, etc. The company operates through eleven subsidiaries: Videotron, Sun Media, Osprey Media, TVA, Messageries Dynamiques and more.

According to the Canadian Press, Quebecor CEO Pierre Karl Péladeau painted a particularly bleak picture of the Canadian media should the CRTC endorse the transaction between Bell and Astral.

"The competition prevailing in the media world could suffocate in the coming years, if the CRTC authorized the purchase of Astral by Bell.

"Canada would become not only one of the countries with one of the highest concentrations in the field of broadcasting, but it would also be the only one where regulators accepted a combination of the largest telecommunications company, built on a state-granted monopoly for more than a century, with a broadcasting pole whose concentration approximates that of the conglomerate Mediaset in Italy."

According to recent data from the CRTC, Quebecor holds top rank in Quebec, with 30.5 per cent of the television market, followed by Astral with 18.3 per cent, the Canadian Broadcasting Corporation with 16.6 per cent and Bell with 8.3 per cent.

The CRTC's chairman asked Péladeau if all the big companies aren't all just the same when it comes to maximizing profits. "You are aware that you are also a giant in the media market and use your weight to maximize shareholder value. Some would say that this is what Bell and Astral are also trying to do."

Péladeau responded, "I agree, but there are many ways to act. Certainly the precedent that would be set, if you were to authorize the transaction, is a dominance over the Anglophone and Francophone market. A precedent that does not exist today. Each market is very competitive."

Quebecor and its president are in a difficult position. They have made themselves the apostles of media consolidation and convergence since 2001, arguing before the CRTC for Videotron's acquisition. "Size does not guarantee success, but admittedly, it is an essential element of the global media landscape, where consolidation appears as an irreversible process." His right hand man at the time, Luc Lavoie, said, "We must allow Canadian companies to be strong enough to provide a quality media product comparable to what is best in the world."

In Quebec, the Bell-Astral group would have a market share equivalent to Quebecor's. Péladeau said he fears the end of competition in the Canadian market. The reality is that what the latter fears is the emergence of real competition in the Quebec market, where Quebecor was, until now, the only one of its size.

Telus

The telecommunications monopoly Telus asked the CRTC on September 13 to block Bell's purchase of Astral. Ann Mainville-Neeson, Director of Regulatory Affairs for Telus, told the CRTC that to allow Bell to expand would be detrimental to its rivals and consumers. Telus added that Bell has refused or complicated the acquisition of rights to content on different platforms such as mobile devices, computers and television. Telus has warned that additional measures are necessary to prevent Bell from using its strong position in the market if the transaction is authorized.

Telus disagrees with Bell's affirmation that the price for the rights of all mobile platforms is $3 million per year. According to Telus it is $8 million per year.

Telus said that Bell does not need to become larger to compete with the U.S.-based Netflix internet streaming service for online TV services. "Bell has built an imaginary enemy, a bogeyman to justify the acquisition of Astral."

Others

Rogers and Vmedia Inc. have emphasized the context of anti-competition that the Bell-Astral transaction will create in Canada.

Rogers has refuted Bell's assertion that it wanted to acquire Astral Media to help provide Canadians with an alternative solution to foreign online businesses.

The Communications, Energy and Paperworkers Union of Canada stated that the concentration of media in the country would have serious consequences. "Media concentration, in addition to reducing diversity and weakening competition, reduces employment opportunities in the field of content creation," said Peter Murdoch, vice-president of the union.

According to Murdoch, the CRTC should demand Bell invest $43.5 million in new productions for radio and television.

Only Shaw Communications of Calgary supports the acquisition of Astral by Bell. The Alliance of Canadian Cinema, Television and Radio Artists (ACTRA), the union that represents artists from across the country, supports the transaction, subject to certain conditions.

Political Positions

Parti Québécois MNA Maka Kotto said his party "would commit to using every means at its disposal" to prevent what it describes as "a Toronto takeover of broadcast channels in Quebec."

Former Quebec Premier Jean Charest claimed to have concerns over the transaction, which were forwarded to the Competition Bureau, in which the Quebec government would have demanded guarantees for jobs to be maintained at the company's headquarters and business operations.

François Legault, the leader of the Coalition Avenir Quebec (CAQ), expressed similar concerns. "I think this deal is bad for Quebec and Montreal," he said.

According to NDP spokesman Pierre Nantel, "The situation is particularly worrisome in Quebec because the pan-Canadian rules do not sufficiently take into account the specificity and uniqueness of the French market when it comes time to study the impacts of a transaction."

(With files from Le Devoir, Canadian Press, CARTT. Translated from original French by TML.)

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