21 February 2009

Looking forward to CanWest bankruptcy

I hate to wish anyone bad luck, but I'll make an exception for media giant CanWest as it plunges into a debt crisis. CEO Leonard Asper is desperately seeking financial help as the family-run media empire inches toward bankruptcy. The good news is that even if he gets it, the financial benefactors may demand he step down as CEO and the family eliminate the dual-class share structure that allows them to control the company. That one family can control over a quarter of the daily newspaper circulation in the country, along with a host of other media outlets, is an insult to democracy. Indeed it isn't democracy, it is plutocracy, or oligarchy if you prefer. To a democrat, the Asper empire's financial problems are promising news. The icing on the cake would be to see the empire broken up into a number of smaller media companies with a variety of editorial positions.

The power of such a vast media network has corrupted political debate in this country. Middle Eastern coverage serves as an example. CanWest's unequivocal support of Israel combined with the extensive reach of its propaganda makes criticism of Israel a dangerous business for politicians aspiring to high office. The result is a highly one-sided debate.

I would not of course wish ill to any employees of the empire as it suffers through the crisis. I wish them all gainful employment in the reincarnation whatever that may be, although columnists with a broader range of philosophies would be welcomed.

CanWest may very well fall into the hands of yet another right-wing media baron, of course -- certainly no one on the left has the necessary cash to buy a daily newspaper, much less a chain -- but it's hard to imagine a more stifling media presence than the Aspers.


  1. About the only place you won't find a CanWest collapse story today is in the National Post. Lenny just rubbed everyone the wrong way, manipulating CanWest's journalism standards to promote his own narrow world view.

    I don't share your generosity to all CanWest employees. I'd love to see Kelly McParland, Jonathan Kay, Lorne Grunter and those of their ilk get their severance pay in CanWest common stock.

  2. I live in BC where CanWest saturates the corporate market. You're right about democracy. It isn't at all served here.

    The company's demise couldn't happen to a more deserving dinosaur.

  3. I agree. Media convergence is bad for public interest and democracy.

  4. As a former employee of the Edmonton Journal (a CanWest paper), I questioned my boss to the wisdom of the financing arrangment with Goldman Sachs to purchase the Alliance Atlantis assests. The current money problems can mostly be pointed to that purchase, which at the time meant CanWest was adding new debt at 7 TIMES their EBITDA.

    The other issue I had with the purchase was CanWest only kept the TV assets, leaving the more profitable movie distribution assets to Goldman Sachs. As our current recession has proven, people go to movies in droves in bad times, and movie theatres are doing well in econonic uncertainty.

    And while I couldn't had predicted the hit traditional media advertising revenue is taking back in '07, ad revenues were down throughout the newspaper chains. It just seem stupid to me that the execs at CanWest could not see the value of Alliance Atlantis film distribution unit. I don't see any sugar daddy in CanWest's future and feel bankruputcy is a certainty.

  5. if anybody thinks the aspers are going to suffer, forget it, they have been siphoning millions in annual bonus for years. the small shareholders who were sucked in by the equally corupt banking stock brokers are the real victims of this greedy manipulative group.