The Canadian Press morphed from one of Canada’s largest media co-ops on Friday into a for-profit news organization with financial backing from three of the largest media corporations in Canada.

The new entity, Canadian Press Enterprises Inc., is the result of a joint investment by Torstar Corporation, publisher of the Toronto Star; Square Victoria Communications Group, which publishes seven French-language newspapers, including La Presse; and the Globe and Mail, which is owned by CTVglobemedia Inc.

Canadian Press (CP) announced the planned change to a for-profit model last year, but Phillip Crawley, CEO and publisher of the Globe, told The Tyee CP knew it was in trouble before that and was looking for investors as early as December 2008. Crawley says the co-op was facing a $35 million pension deficit, but denies the move has anything to do with Canwest (now Postmedia Network Inc.)’s decision to pull out of the co-operative in 2006 to create their own news wire service.

“It needed to create new business opportunities, and therefore needed to make more money than it was making as a not for profit cooperative,” he told The Tyee.

A press release issued by CP asserts the editorial independence of the news wire will be maintained, but news organizations that previously accessed CP content as co-op members will now be commercial clients, paying fees for the content they want.

However Steve Anderson, media critic and founder of Openmedia.ca, is not convinced journalists will have the same editorial freedoms under media corporations as they did under CP.

“I’m sure that they’re not going to call up all the journalists and say ‘you need to start towing this line or you need to start covering things this way,” he told The Tyee.

“But at the same time, the companies that are buying Canadian Press, especially CTV, have a matrix of commercial interests, and any journalist that is covering the story that is smart will know that they probably shouldn’t go against the interests of the owner of the outlet that they’re writing for.”

Anderson claims direct experience with this: journalists have told him they are personally interested in Openmedia.ca’s vocal opposition to Bell Canada’s internet restrictions, but say they can’t cover the story because their outlet is associated with the telecommunications giant. Incidentally, Bell is currently in talks to takeover CTV, though it is unknown if the Globe or CP will be part of the final deal.

Crawley says the change solves the pension issue, with the pensions of retired and current employees staying the same, and he says any downsizing of the over 300 current employees is not in the immediate future.

“We don’t have any plans to do any changes at this stage, we’re just assessing the nature of the business,” he says.

But Anderson is dubious of this statement as well, saying businesses by their very nature are out to increase their bottom line.

“Certainly the new owners are going to find a way to make Canadian Press work, they’re not going to pay into something that doesn’t bring back revenue for them,” he says.

“From my perspective, this is just sort of part of a larger trend of the traditional media becoming more and more concentrated and controlled by a few entities, and it sort of renews the importance of the new independent media projects and experimentation in online independent media. I think that’s becoming more and more clear that that’s gonna be the solution and where we create some diversity in the media.”