Bell Media (TSX: BCE)(NYSE: BCE) announced the purchase of Groupe V Média assets on Wednesday. The agreement includes the sale of the conventional network V and other digital assets, including the video-on-demand service, Noovo.ca.
As a result of the acquisition, Bell Media can expand content for French-language viewers and expand its presence in Québec. At this time, Bell Media and Groupe V Média have not disclosed the financial details of this transaction, and regulatory authorities have not yet approved it.
The V television network produces original programs such as Occupation double, L’amour est dans le pré, and Un souper presque parfait.
Groupe V Média
Groupe V Média is a French entertainment and content delivery company. As the largest independent media group in Canada, Groupe V Média’s television assets have a reputation for delivering innovative content.
After the sale of network V and Noova.ca to Bell Media, Group V Média will retain ownership of the specialty channels, ELLE Fictions and MAX.
In 1986, the V Media Group launched the French television station, V. The channel airs the Ultimate Fighting Championship (UFC) and other sporting events. The media group boasts a market share of over 20% in the French-language.
Bell Media
Bell Media is the media segment of its parent company, BCE Inc, formerly known as Bell Canada Enterprises. The prominent telecommunications and media company currently owns French-language media assets in Québec such as Canal D, Canal Vie, Z, VRAK, Investigation, Super Écran, and Cinépop.
On these platforms, Bell Media airs some of the most popular shows and original productions.
BCE issues a competitive dividend yield of 5.11% along with relatively stable prices with a 50-day average stock price of over $60. BCE’s stock price performance has lagged behind peers this year.
Nonetheless, the stock offers investors above-average earnings within its current 52-week price range. The company’s price-to-book (P/B) ratio is 96% of the industry average P/B of 3.46.
Foolish takeaway
Researchers estimate that technological change contributes to 90% of data demand. With the advent of 5G on the horizon, the very culture of media is changing. Faster mobile download and streaming speeds will increase demand for nontraditional broadcasting services.
Mobile data usage has soared 82% since 2018 and is expected to triple over the next few years if the network has the data streaming capacity to accommodate the additional traffic.
Additional data bandwidth is a crucial feature of the 5G upgrades, which requires substantial capital expansions of cell towers.
BCE stockholders should carefully watch the strategic product innovations Bell Media adds to network V and Noova.ca.
The acquisition holds significant profit-generating potential for Bell Media moving into the new era of smart cars and the Internet of Things (IoT).
The new 5G network is expected to power autonomous vehicles such as those tested in Ontario for the past two years.
In the United States, Google’s Waymo has tested autonomous cars in Arizona. In just a few years, Canadians could be binge-watching television while commuting to work in self-driving vehicles.
