Round Up the Children, Louisa. The Canadians Are Coming!

Michael Hedges September 8, 2005

The UKs first foreign-owned radio broadcast license is awarded to CanWest, the Canadian media giant. Will ice-hockey be forced on unsuspecting British listeners?
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The Ofcom (Office for Communication) Radio Licensing Committee announced Monday (September 5) the award of a 12 year concession to broadcast in the Solent region of southern England to Original 106 FM Ltd.

The programming authorized by the concession will target 40 to 59 year olds with “adult alternative” music, 24 hour local news and “significant meaningful speech,” presumably during mornings and afternoons. Ice-hockey broadcasts or promotions were not disclosed in Ofcom documents.

CanWest MediaWorks UK, wholly owned by CanWest Global Communications, owns 95% of Original 106 FM. The remaining shares are owned by Seven Broadcast, two radio consultants who earlier launched Isle of Man station 3FM. The Solent region includes the Isle of Man.

CanWest Global is the largest daily newspaper publisher in Canada with a television network – Global Television Network – and 3 radio stations. The company also owns broadcast operations in Australia (Network Ten TV), New Zealand (radio) and Ireland (TV3). The company is not believed to own an ice-hocky team but it does sponsor various ice-hockey awards in Canada.

It has been more than two years since the UK changed media ownership laws to allow foreigners majority and controlling interest in broadcast outlets. CanWest now becomes the first to challenge the fears of UK broadcasters and media critics that a North American broadcaster will destroy British culture. When the laws were changed most of that fear was directed at US media giants, notably favorite punching bag Clear Channel but also Viacom and Time Warner. Indeed the merger of Capital Group and GRW creating GCap was sold a something of a poison pill to prevent a take-over of either by something big and ugly. Clear Channel became the emblem of everything terrible because they bought everything in sight and sold lots of ads. And, yes, there was that great urban (radio) myth that Clear Channel CEO Lowry Mays inquired about buying the BBC. Clear Channel sold all its European radio holdings, concentrating on the outdoor advertising business. Billboards have never been designated as cultural intrusions. Wait! Hold that thought!

Competition: Vast cultural differences

Two foreign (non-UK) companies wait in the wings, applying for the better of the new licenses or looking for opportunities for purchase. Australian Macquarie is primarily interested in infrastructure investments; towers, transmitters and such. One division purchased BBC Broadcast. Another purchased NTL. American broadcaster Emmis Communications has hired consultants, like CanWest, and made bids for newly offered radio franchises. Neither company is known for offensive habits, indeed Emmis is consistently rated the best US broadcasting employer. New York stations owned by Emmis occasionally attract fines but has anybody listened to Johnny Vaughn recently? Any association with ice-hockey by either Emmis or Macquarie has not been disclosed.

Both Emmis and CanWest participated in Talk Radio UK in the days when foreigners could not hold controlling interest in UK broadcast operations. In notes from a 1996 CanWest board meeting the write-off of the Talk Radio investment is referred to as a “disposal.”

One cultural tip-off overlooked by the UK media press reporting the CanWest radio award is ominous.  CanWest is not headquartered in erudite Toronto or Montreal. Look west to Winnipeg, in the prairie, with real cowboys not like the show-biz cowboys in San Antonio, Texas, where Clear Channel calls home. And when real cowboys gather it’s for rodeo, far different from a British horse show.

Ofcom also awarded licenses to Ridgeway Radio, owned by the Local Radio Company, for NOW FM broadcasting to Swindon and to Palm FM for a license to broadcast to Torbay. Palm FM is owned by a joint venture, London Media Company, of Sunset Radio and Palm Radio.

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CanWest Newspaper Trust Fund Raises US$465 million – October 15, 2005

The CanWest MediaWorks Income Fund launched on the Toronto markets, raising about US$465 million to be used to retire debt.

The offering had been cut back by about half from original plans after the Canadian government, showing its displeasure at these types of income funds that it considers as a way to dodge corporate income tax, declined to provide a prior tax ruling on the fund.

CanWest Goes to Turkey – September 21, 2005

Media giant CanWest jumped ahead of the media pack, buying 25% of Super FM, Turkey’s leading national FM radio channel, through a consortium of Turkish investors. CGS Televizyon Ve Radyo Yayinciligi Ticaret Anonim Sirketi (CGS) purchased the radio broadcaster for €27.1 million, according to Reuters. ...MORE

CanWest to Raise U.S.$1.2 Billion To Retire Debt - September 14, 2005

CanWest says it expects to raise about US $1.2 billion by spinning off a 28% stake of its newspaper business and interactive media business into a public income trust, a popular corporate tax-savings structure in Canada.

The CanWest MediaWorks Income Fund will include the newspapers Vancouver Sun, Edmonton Journal, Ottawa Citizen, and The Gazette, its investment in Metro and its classified advertising online sites. It will not include the National Post newspaper, any international media business, nor its Canadian broadcasting operations.

The markets saw the move as positive in reducing the company’s debt.