Tag Archives: Sun Media

Competition Bureau approves Postmedia’s acquisition of Sun Media

I’m about to acquire a lot of colleagues.

The Competition Bureau has approved (in the sense that it will not oppose) the $316-million acquisition of Sun Media’s 174 newspapers and publications in English Canada, the Canoe portal and other assets by my employer, Postmedia Network.

Press releases from Postmedia and Quebecor say the deal will close in the coming weeks. Once that happens, Postmedia will own the lion’s share of print media in English Canada, including three of six dailies in Toronto, and two paid dailies in Vancouver, Edmonton, Calgary and Ottawa.

The bureau appears to have agreed with Postmedia’s argument that competition from other forms of media, particularly online, will prevent this transaction from becoming anti-competitive. The bureau also points to “the lack of close rivalry between Postmedia’s broadsheet and Sun Media’s English-language tabloid newspapers” and “existing competition from free local daily newspapers” in its decision.

I’ll update my media ownership chart once news comes down that the transaction has closed.

Postmedia to buy Sun Media’s English papers/websites for $316 million (if the Competition Bureau agrees)

I just woke up, and I’m still not sure I’m entirely conscious because I’m seeing that Postmedia (my employer) is buying Sun Media’s English newspapers — a total of 175 of them — and digital assets like Canoe.ca for $316 million. (Postmedia press release, Quebecor press release)

The transaction would have to go through the Competition Bureau, which quickly issued a statement saying it will examine the transaction (as it would for any transaction of this type).

The transaction includes the big Sun papers in Toronto, Ottawa, Winnipeg, Calgary and Edmonton, plus the 24 Hours papers in Toronto and Vancouver, the London Free Press, and a lot of community newspapers.

The transaction does not include the Journal de Montréal or any other French-language papers. It also does not appear to include the Sun News Network, which will make for an interesting situation there because of how that network and the Sun are tied together.

This deal follows another in which Quebecor sold its Quebec community newspapers to Transcontinental for $75 million. Both appear to be a way to shed legacy assets and build up cash to strengthen Quebecor’s position as a telecom company and potential national wireless player.

The Competition Bureau also reviewed the Transcontinental transaction and concluded that, where competing papers were acquired, an offer to sell one had to be made. That eventually led to the sale of 14 of them.

If I had to guess, I’d say this situation would be similar. The Bureau probably won’t allow the two major paid dailies in cities like Ottawa, Calgary and Edmonton to be owned by the same company, and would force Postmedia to sell them (or their existing broadsheets). Similarly for areas where both have community papers. And in Vancouver, where it would own three of four papers, and Toronto, where it would own three of six, it might be forced to make sales there too.

And breaking up the Sun chain sounds like it would be a disaster. Those newspapers share a lot of resources, not to mention branding. So it’s hard to see the Ottawa/Toronto/Winnipeg/Calgary/Edmonton Sun not ending up with the same owner.

We’ll see how it works out. The Transcontinental/Quebecor deal took almost a year to work through the system, and I suspect it will probably be next summer before we know who owns what as a result of this.

The $316-million value is about 1/5 of what Quebecor paid for Sun Media ($989 million in 1999) and Osprey Media ($576 million in 2007) to acquire those newspapers, though subsequent moves means there are some adjustments to that comparison.

Competition Bureau: Transcontinental can buy 74 Quebecor papers, but must (try to) sell 34

The Competition Bureau has ruled that Transcontinental can acquire Quebecor Media’s 74 regional newspapers in Quebec, but in order to preserve competition, it must then sell 22 of those papers and 12 of its own.

In its decision, the bureau said it looked closely at the financial situation of the Transcontinental and Quebecor papers, noting that rivalry between the two intensified in 2009:

Since 2009, Transcontinental and Quebecor Media have engaged in aggressive competition for advertisers, entering markets where the other Party was the historical incumbent and cutting advertising prices. While a few independents remain in certain markets, Transcontinental and Quebecor Media own the only community newspapers in many of Quebec’s local communities and, as such, the Proposed Transaction may allow Transcontinental to have the only community newspaper(s) in numerous local markets.

The Bureau determined that at least one of the Parties’ newspapers was in financial distress in the vast majority of markets where the Parties compete. These were typically the newspapers that had been launched in recent years.

The competition rules by which the bureau operates allows for mergers that would reduce competition if the alternative is that one of the parties goes bankrupt and nobody picks up its assets, which would reduce competition anyway. The bureau’s assessment shows the community newspaper sector isn’t doing that well, but that Transcontinental should nevertheless put the newspapers on the block, and for no minimum price, for a period of 60 days, and managed by a third party.

“Following the completion of the sale period defined in the Consent Agreement, if no potential purchaser is identified for a particular paper, Transcontinental will be entitled to retain ownership of the newspaper,” the bureau writes. So Transcontinental could end up keeping many of these papers (or being allowed to shut them down and merge them with their competitors in each market) if no one else is interested in buying them for even $1 (with printing and distribution provided by Transcontinental for a limited time).

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Quebecor ends community newspaper war with Transcontinental by selling them all their papers

It was 2010 when it really started to heat up. Quebecor Media started up new community weekly newspapers in Laval and the north shore, encroaching onto territory served by Transcontinental Media. A few months later, new papers in Joliette and Repentigny. It was clear at this point that Quebecor was starting a war.

Transcontinental responded with papers on Montreal’s south shore, in Sainte-Agathe, Mont-Tremblant and Abitibi.

Before then, both companies had dozens of community newspapers across Quebec. There was sort of a gentlemen’s agreement, or maybe just a fear of competition, so they didn’t encroach on each other’s territory. Until Quebecor decided it would expand into fast-growing areas and take on Transcon directly.

But on Thursday, that ended, with this matter-of-fact announcement from Quebecor that it is selling all 74 of its community weeklies to Transcontinental for $75 million. The announcement comes a day after it said it would cut 200 more jobs at Sun Media, including 50 in editorial positions.

Quebecor has 600 employees at these papers.

“The digital revolution has brought profound changes in local print media markets,” Quebecor CEO Robert Dépatie said in the press release. “Advertisers now have a multitude of platforms available to them that did not even exist little more than 10 years ago. We believe in the future of print media but we cannot ignore the new market realities”.

Quebecor talks about how the papers are in good hands, but the reality is that with many papers in overlapping markets (and many of those in fierce, unfriendly competition with each other), some mergers and shutdowns are inevitable.

The fact that this leaves Quebec with only one major community weekly publisher will mean it should get attention from the Competition Bureau. Sun Media will keep running the papers until it gets approval.

UPDATE (Dec. 19): Quebecor has also killed Le Sac Plus, its Publisac competitor. The shutdown will result in the loss of about 30 jobs, not including all the people who actually deliver it. Selling the regional weeklies prompted it to re-evaluate Le Sac Plus’s viability as a business, Quebecor said.

The list of papers TC Media is acquiring is below.

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We’re very proud of you. You’re fired.

Elizabeth Thompson: "Free agent"

Did you hear the shocking news today?

No, not Halak getting traded to St. Louis. We expected something like that.

What I didn’t expect was for Elizabeth Thompson, who was The Gazette’s Ottawa bureau chief* worked for The Gazette for 23 years – including eight as its Ottawa bureau chief – and then took a buyout in January 2009 (because the paper was closing its Ottawa bureau) in order to jump to Sun Media as one of its parliamentary reporters, to suddenly announce on Thursday that she has been dismissed from that job, a victim of an apparent housecleaning by new management there that has also booted Peter Zimonjic and Christina Spencer.

The move was enough to garner the attention of La Presse (and this blogger), particularly since Sun Media just announced it was launching a new all-news television network, which one would think requires hiring journalists instead of firing them.

As Vincent Brousseau-Pouliot noted in his article, this comes mere weeks after Sun Media was gushing over Thompson’s nomination for a Canadian Association of Journalists award, for her discovery that the government auctioned off high-priced silverware and china for insanely low prices, only to later discover that some of the objects didn’t even belong to them, forcing the government to buy some items back for up to 25 times the price they sold them for.

Sun Media’s piece on Thompson’s nomination included this ironic quote:

“Elizabeth is one of the most inquisitive people you will ever meet,” said National News Editor Mike Therien. “It surprises nobody who knows her that she is being hailed for news scoops. We are very proud of her sleuthing.”

Not proud enough, I guess, to keep employing her.

(Needless to say, this is one of the reasons a unionized job is better than a non-unionized one – you can’t be fired for literally no good reason.)

Thompson says she plans to stay in Ottawa and remain part of the press gallery there. But she’s running out of mainstream news organizations to work for, and there isn’t much independent media covering the federal government with the kind of cash to pay a professional journalist.

Thompson’s blog posts for Sun Media (and, for that matter, The Gazette) are still online … for now. And her Twitter account is still active (moreso with everyone retweeting about this news).

*CORRECTION: For some stupid reason this post originally had Thompson working in the Ottawa bureau for 23 years. I blame invisible gremlin editors for messing with my copy.

Sun Media’s new insert-paper-name-here redesign


Redesigned calgarysun.com

The Calgary Sun today redesigned its website.

Actually, I should say Sun Media redesigned the Calgary Sun’s website. The new site is nearly identical to those of the Toronto Sun and Winnipeg Sun which have already been converted from the old Sun website layout (you know, the one that overused the Impact font and just looked so 90s in general?). Even 24 Hours and the Journal de Québec have most of the same layout styles.


ottawasun.com uses the old design

Two papers remain with the old, quaint web format: the Ottawa Sun and Edmonton Sun. Expect them to be switched over some time over the next few weeks.

It’s another example of the Sun chain going where Canwest has already gone. National news desks, centralized layout desks that create copy-paste pages, dumping Canadian Press in favour of its own in-house news service, electronic editions of its newspapers, laying off hundreds of people, and now white-label websites whose contents can be copied from site to site with the click of a button. (Not that the old Sun sites were that much different from each other of course, but this just furthers the process.)

In addition to the wider design that looks like all the other newspaper websites out there (in good ways and bad), a mobile version, and what is sure to be an improved backend, the new system allows reader comments on articles (or at least it says it does – I can’t find any articles with that feature enabled).

(via TSF)

Synergy at Sun Media

In an effort to cut costs, Sun Media is combining resources at its small Ontario dailies (which formed the Osprey Media chain that is now part of Quebecor). It’s being described as “synergy”, but it basically means replacing local jobs with fewer, lesser-paid jobs at larger production centres.

Among the changes:

In each case, jobs that were considered technical rather than editorial in nature are being replaced by a centralized operation that can be more efficient and work with fewer people. But the worry is that the people doing these jobs now have no connection to the papers and don’t care about the quality of what they put out. The fact that union jobs are replaced by non-union jobs with less pay and no benefits only makes that problem worse.

It’s also touching aspects of editorial too. As the Observer article points out, the papers are taking advantage of “synergy” by running national columns rather than local ones wherever possible. The Sun and Osprey chains are even copying whole pages (taking advantage of their similar layouts) from each other, and outsourcing layout work to a centralized location (which is how the Journal de Montréal is still functioning despite a lockout of 253 workers).

If this sounds familiar, a similar strategy is at the centre of stalled contract talks between my union and Canwest, which has centralized its customer service call centre, is centralizing some layout and copy editing work, and started printing standardized business pages in its major dailies.

I think some centralization (even of editorial work) makes sense, and I understand the need of these companies to reduce costs, but there’s a fine line between outsourcing a technical job to a company that specializes in that work and removing parts of what give local papers their identity, which go beyond just what names appear in the bylines and what you get in the police blotter.

In the end, it will be the subscribers who decide whether or not any cut goes too far.

Rearranging the deck chairs on the media’s Titanic

Some news today from Canadian media as they struggle to keep afloat:

Canwest still ticking

Canwest, which faced a huge debt-related deadline today, got another extension – this time to April 7. It also said it would not make a $30.4 million debt payment scheduled for Friday, taking advantage of a 30-day grace period before lenders start demanding all of their money back. The rest of the release includes a lot of news which sounds kind of good but I don’t understand.

Everyone is understandably nervous about Canwest’s future, including some independent television producers for Canwest’s cable channels who have halted production and are holding their breath.

UPDATE (March 12): DBRS has responded to the delay by lowering Canwest’s credit rating from CCC to C. Canwest Limited Partnership, which is the branch The Gazette falls under, is rated slightly higher because it has more manageable debt.

Quebecor pulls out of CP

The bigger news is that Quebecor, the huge media company that owns Sun Media and the Journal de Montréal/Québec, gave notice to Canadian Press that it plans to pull out of the news-sharing cooperative effective in June 2010 (CP requires a year’s notice before membership is suspended – Sun Media could always change its mind, though that’s probably unlikely). Sun Media is CP’s largest member since Canwest pulled out of CP in 2007. Despite that and the “millions” of dollars that won’t be paid each year, CP is downplaying the significance of the pullout, saying it is restructuring itself to become a for-profit operation, which will allow it to sell its services with more flexibility.

Since pulling out of CP, Canwest and its newspapers (including the Gazette) have relied on competing wire services including Reuters, Agence France-Presse, New York Times News Service and PA SportsTicker, in addition to beefing up its internal Canwest News Service by adding national and international bureaus. Sun Media has already started beefing up its parliamentary bureau in Ottawa and launched its Agence QMI wire service, which notably has been used to provide content for the locked-out Journal de Montréal.

Apparently the notice happened in December, but the news was leaked to the public through a memo to employees by Quebecor head Pierre-Karl Péladeau.

UPDATE: Steve Proulx notes that CP said as recently as a year ago that it was confident Quebecor wouldn’t pull out.


Journal Daily Digest: SCANDALE!!!

Rue Frontenac had the news EN PRIMEUR this morning, a result of an ENQUÊTE EXCLUSIF: The Journal de Montréal is subcontracting its subscription marketing to a company that’s not registered and is perhaps not being entirely honest with people. (THE HORROR!) This investigation involved the usual Journal technique of going undercover and exposing all of the inner dealings, then talking to experts about how this might be illegal if anyone cared to prosecute. It caught Lagacé’s attention, at least.


Journal de Montréal lockout “imminent”, union says

Despite yesterday’s decision that said many of the people who stepped in at the Journal de Québec were scabs, the union representing workers at the Journal de Montréal held a news conference and issued a press release this morning saying that they expect to be locked out within days of their contract expiring on Dec. 31. They’re calling for a conciliator to step in and get negotiations started again.

UPDATE: The government has appointed Pierre-Marc Bédard as conciliator.

Patrick Lagacé has some comments, and Steve Proulx also has some thoughts, including the fact that the Quebecor-owned free daily 24 Heures has practically doubled its staff recently.

This comes as negotiations at The Gazette are set to resume in January, and an arbitration hearing about outsourcing of editorial work is set to be heard in February. The prospect of two of Montreal’s four major daily newspapers being crippled by labour disruption is very real.

Oh, and Sun Media (which owns the Journal) just announced they’re cutting 600 jobs.

Sun Media begins using electronic newspapers

Sun Media, which owns the Sun papers, Journal de Montréal/Québec, London Free Press, 24 heures and the Osprey chain (Kingston Whig-Standard, Sudbury Star et al), has signed a deal with NewspaperDirect to make electronic versions of the papers available to subscribers. No word on when this is going to start.

The NewspaperDirect service, which is used by the entire Canwest chain including The Gazette, produces exact copies of the paper, almost like PDFs, except with DRM so you can’t save them (at least on a Mac) and only two levels of zoon (my personal pet peeve). On the other hand, it provides some bells and whistles like having an automated reader read articles aloud.

With Transcontinental also working with NewspaperDirect (and over 700 publications in their repertoire), it’s clear that the Vancouver-based company provides a service that is either too hard or too expensive to try to duplicate.

I used it for about a year in order to save on recycling hassle, save the environment and save on subscription price. Though the saving on paper was fun (especially as I look around my living room now), reading the newspaper on my computer screen (and having to manipulate it with my laptop trackpad) and then watching TV and doing other stuff on my computer screen all day can put stress on the eyes, not to mention my posture.

Sure, I could go outside and have a life or something, but let’s be realistic…

Canoe.tv: Clueless

For the first time ever, a Canadian company is going to be broadcasting videos on the Internet.

At least that’s what Quebecor would have us believe. They’re calling their new service Canoe.tv Canada’s first Internet broadcaster. In its newspapers, it clarifies that it’s the first Canadian web broadcaster “to feature specially commissioned programs in English and French“, whatever that’s supposed to mean.

The service, available in French and English, is basically a YouTube clone, only without any of that user-generated content junk that nobody wants. It also includes live content from networks like LCN, though the live feeds use Windows Media instead of Flash like the rest of the site.

On the French side, its content includes Prenez garde aux chiens, as well as interviews from Larocque-Lapierre, Denis Lévesque and others. Curiously, no Vlog despite the fact that Quebecor Media owns the show and the show is about online video.

The English side is even stranger. There’s more content from CBC (Just for Laughs, Rick Mercer, Peter Mansbridge, etc.) than there is from Sun Media’s crappy SUN TV. There are, however, plenty of Sunshine Girl videos.

But aside from their arrogance proclaiming to be the first to do something everyone else is already doing (in fact, the entire site was designed by a company called Feed Room), here’s why I don’t like the site:

  1. There’s no way to embed individual videos in blogs
  2. There’s no way to comment on videos
  3. Videos are referred to as “stories” in the “bookmark” page (that’s how you find out how to link to individual videos), and have 81-character URLs (just long enough to get cut in emails — YouTube’s URLs are half that length, and they have a lot more videos)
  4. Navigation uses some sort of proprietary Flash/JavaScript system which breaks just about every tool my browser has (opening links in new windows, the back button, scrolling)
  5. Videos are undated (probably deliberately, since most of them are old)

If I wanted to design a web video portal that was doomed to failure, it would look something like this. It might get some traffic, thanks to exclusive video (though anything worth watching is available straight from the source), but it’s not going to take off.

In short: FAIL.

UPDATE (Nov. 29/30): Some more reaction from the blogosphere:

InfoPresse points out that the site has virtually no fiction content, because of licensing issues. Le Devoir also has an article with detail about the problem.

UPDATE (Nov. 30): Pierre-Karl Péladeau does a very awkward-sounding presentation of Canoe.tv. In it, he says it’s a “totally Canadian” site, which is laughable because it was designed by an American company.

He also says that Sun Media can do a better job than the Canadian Television Fund at producing Canadian programming. The CTF funds things like Degrassi: TNG, The Rick Mercer Report, Slings and Arrows, ReGenesis, Intelligence and Little Mosque on the Prairie, all of which won Gemini awards this year. Sun Media funds sucker-generated-content show CANOE Live and … uhh … that’s about it.

Also, the Sun Family blog points out that 24 Hours Toronto didn’t even bother to rewrite the press release announcing the network so it conforms to its style.

UPDATE (Dec. 6): CBC tech guy Bruno Guglielminetti (whose name I can spell without looking it up first) interviews Peladeau for an article in Le Devoir.

UPDATE (Dec. 11): Intruders.tv has an interview with Dominique-Sébastien Forest, who has some long title at Canoe.tv. In the overly long interview that sounds more like a press release until the last few minutes, he notes:

  • They’re working on getting a real-time Flash encoder for live feeds, which are currently displayed through Windows Media.
  • Quebecor doesn’t consider CBC as competition online. They’re just another content provider who will share in the revenues.
  • The site is focused on professional content only (you know, like the Sunshine Girls I mentioned above).
  • It doesn’t offer embedding because their content license agreements don’t permit them to.
  • Nobody apparently noticed that there are no dates on the videos.
  • They’re working on adding comments to videos, like Espace Canoë has
  • He’s confirmed that Vlog will be coming back as a web-only show on Canoe.tv.