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V to buy MusiquePlus and MusiMax, the last of the Bell-Astral castoffs

The announcement Tuesday from both Bell Media and V that the latter has won the bidding to purchase music specialty channels MusiquePlus and MusiMax means that all of the assets that the CRTC forced Bell to get rid of as a condition of the Astral acquisition now have prospective new owners.

Neither company revealed the amount of the sale, but we’ll know it when the matter comes before the CRTC. La Presse reports it’s $15 million total, which is low for a well-known specialty channel (much less two), and well below the price it was evaluated at when Astral acquired CHUM’s 50% share of the channel for $34 million in 2007.

To recap, here’s what is being sold, and the status of those sales:

To Corus Entertainment:

  • 50% interest in Teletoon (includes four Teletoon channels and Cartoon Network Canada), for $249 million total (Corus already owns the other half)
  • 50% interest in Historia and Séries+, for $138.6 million total (Corus is also acquiring Shaw’s 50% interest for the same amount)
  • CKQB-FM Ottawa (106.9 The Bear) for $10 million
  • CJOT-FM Ottawa (Boom 99.7) for $3 million

All of the acquisitions listed above (with a total purchase price of $400.6 million) were dealt with at a CRTC hearing that began Nov. 5. We are now awaiting a decision. The acquisitions were approved in December and January.

To Jim Pattison Broadcast Group:

These acquisitions were announced on May 16. The purchase price is unknown. The CRTC has not yet set a hearing date for this acquisition. UPDATE (Jan. 15): The total purchase price is $25.5 million (but valued by the CRTC at $29.8 million). The transaction was approved without a public process.

To Newcap Radio:

These acquisitions, total price of $112 million, were announced on Aug. 26. The CRTC has not yet set a hearing date for this acquisition.

To DHX Media:

These acquisitions were announced on Nov. 28. The CRTC has not yet set a hearing date for this acquisition.

To V Media:

  • MusiquePlus Inc. (MusiquePlus and MusiMax). Price unknown (La Presse reports $15 million).

The CRTC has not yet set a hearing date for this acquisition.

V, turnaround artist

It’s been a bit over five years since a company effectively owned 50% each by Maxime and Julien Rémillard got CRTC approval to take over the bankrupt TQS network. Thanks in part to a successful reboot that banked on a counter-programming strategy, and in part to getting the CRTC to agree to virtual elimination of its news department, the Rémillards got the network that has never made money to finally make some money.

The road hasn’t been easy, though. As competitors like Bell Media, Quebecor Media, Radio-Canada and others can make liberal use of other sources of funding, V had only advertising revenue to go on. It had no money-making specialty channels or lucrative cable distribution networks.

Remstar does have licences for three unlaunched specialty channels:

Each of these has four years (so until 2015) to launch before their licences are taken away.

It also had a licence for a user-generated-content channel, which has since expired because it never launched.

Launching new specialty channels is difficult for various reasons, but a big one is that you need to get carriage. And unless you own a cable provider, that can be an uphill battle.

Getting control of MusiquePlus and MusiMax means V doesn’t have to go through that process. MusiquePlus already has 2.4 million subscribers. MusiMax has 1.9 million. They’ll already have the audience. It’ll just be a question of turning that into profits.

Unlike most popular specialty channels, MusiquePlus and MusiMax are not highly profitable. MusiMax has been hovering around the break-even mark, and MusiquePlus has lost more than $5 million since 2009. (This is probably why Bell decided to let them go.)

Media critics blame this unprofitability on the channels having lost their way. There’s no music on MusiquePlus, they complain, but rather a series of reality shows about pregnant teenagers, models, cars, washed-up celebrities, people who are famous for being famous and whatever Criss Angel is.

Sure, there’s Rajotte, but MusiquePlus has a long way to go to make itself a music channel again. On the bright side, V has already shown that it can revitalize a television channel and keep it young at heart. If it can do the same with these channels, while also keeping them tied to their raison d’être — music — then they should be able to win a lot of fans, and hopefully make a good amount of money too.