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ARCHIVED -  Decision CRTC 86-241

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Decision

Ottawa, 20 March 1986
Decision CRTC 86-241
Licensing of a New Private FM Radio Station to serve Vancouver
Jim Pattison Industries Limited - 851038000
Robert Keith Whyte, representing a company to be incorporated - 851583500
Robert E. Redmond, on behalf of Redmond Communications (Vancouver) Ltd., a company to be incorporated - 851531400
CHUM Limited - 851575100
Zephyr Broadcasting Company Inc. - 851625400
Robert McCord, representing a compa- ny to be incorporated - 851529800
At a Public Hearing in Vancouver on 2 December 1985, the Commission heard proposals from the six applicants noted above, each seeking a licence to provide a new English-language FM radio service in Vancouver. The applications were submitted in response to a call issued by the Commission on 8 November 1984.
The call followed the Commission's announcement, in May 1984, of the lifting of a long-standing freeze on private FM applications for the Vancouver/Victoria area. This freeze had been imposed by the Commission in April 1979 to allow the CBC time to develop its long range plans for the extension of its network radio services. A public hearing was held in April 1982 to assess the implications of the CBC's plans on the utilization of available FM channels, particularly in areas such as Vancouver, where shortages had been identified. The Commission issued its conclusions in February 1983, and following further studies, announced on 31 May 1984 that the FM freeze was no longer in effect.
Two of the six applicants, CHUM Limited and Zephyr Broadcasting Comany Ltd., proposed to operate Group I stations featuring Pop and Soft Rock music. Robert E. Redmond proposed to operate a Group II station featuring Pop and Hard Rock music, and Robert Keith Whyte proposed a Group IV (Dance music) station. Jim Pattison Industries Limited and Robert McCord proposed Country music stations operating in Group III.
For the reasons outlined herein, the Commission approves the application by, and will issue a licence to, Jim Pattison Industries Limited (Pattison) to carry on an Englishlanguage FM radio broadcasting transmitting undertaking at Vancouver, operating on the frequency 93.7 MHz with an effective radiated power of 36,000 watts. The licence will expire 30 September 1990, and will be subject to the conditions specified in this decision and in the licence to be issued.
The five competing applications noted above are denied.
In its deliberations following the hearing, the Commission first examined the question of whether there is room in the Vancouver market for a new private FM station. The Commission's study necessarily took into account the AM licence which it granted in 1983 to Ocean Pacific Broadcasting Inc. (Ocean Pacific) but which, for technical reasons, will not be implemented until later this year.
Although the financial performance of Vancouver's radio stations reflected little real growth between 1984 and 1985, indications are that the local broadcasting market has effectively recovered from the recent recession; all projections point to a healthy development in broadcasting sales this year due to activity surrounding Expo 86. On this evidence, therefore, the Commission is satisfied that the market should be able to support the introduction of one new FM service at this time, without having any undue impact on the financial well-being of existing radio stations, including the new AM station to be operated by Ocean Pacific. At the same time, the Commission considers it necessary that the prospective licensee have a realistic and prudent business plan, a real knowledge and understanding of the Vancouver market, a sound financial base and a demonstrated capacity to withstand unexpected shortfalls in revenues.
In the Commission's view, it is even more essential that the prospective licensee have chosen a music format and developed programming plans which will provide an attractive alternative to services provided by existing Vancouver stations. As reaffirmed by the Commission in its call for applications, the fundamental objective of its FM policy is to ensure that the overall FM radio services provided in a given market are as varied and comprehensive as possible.
The Commission has carefully assessed the applications before it, and is convinced that the programming plans and music format proposed by Pattison will contribute diversity within the FM services available in Vancouver. The Commission also considers that, of all the applicants, Pattison most successfully combines this essential ingredient of increased diversity with such other prerequisites as a strong commitment to the goals of the FM policy, firm proposals for new initiatives in support of Canadian talent, lengthy broadcasting experience, a familiarity with the Vancouver market and established financial resources. Overall, the Commission is confident that Pattison will offer a viable, attractive and responsible new FM service to Vancouver listeners.
The applicant is also the licensee of CJOR Vancouver which is the only broadcasting undertaking owned by Vancouver businessman James A. Pattison. During the more than 20 years that Mr. Pattison has been involved as owner of CJOR, he has established a record of responsible performance as a broadcaster. Although CJOR has operated a loss loss for some time, Mr. Pattison has maintained the station's talk format and has consistently met his commitments to the Commission. In the past year, the financial outlook of CJOR has improved significantly. The Commission considers that the economies associated with the holding of a joint FM licence will be of long-term benefit to the licensee's AM and FM stations.
At present, there are five private FM stations operating in the Vancouver Central Market Area. Of these, three are in Group I, one is in Group II and one is an all-news station. Pattison will operate the proposed FM station in Group III and will offer Vancouver listeners, for the first time, an FM stereo service featuring music that is totally Country and Country-oriented, complete with regular newscasts and a full complement of surveillance material.
Although there are AM stations in the area which currently operate in a Country format, Pattison emphasized that the proposed FM station will provide a true and attractive alternative to these services by broadcasting a much wider variety of Country music, with a greater use of album selections and much less emphasis on hits.
In the Commission's view, Pattison's application was carefully and thoroughly researched. The applicant provided the results of a market survey indicating a very strong degree of support and acceptance for the concept of a Country music FM station among listeners in the Vancouver area. Pattison proposed a service targeted to those between the ages of 35 and 59. Although this demographic group represented 31% of Vancouver's population in 1985, it is estimated to expand to 40% of the total in fifteen years. In contrast, the demographic group between the ages of 12 and 34 is expected to shrink in size from 40% to 32% of the total during the same period. The applicant, by its choice of music format and target audience, has thus identified a large unfilled niche in the range of broadcasting services available in Vancouver, as well as a strong and growing market for the proposed service.
In reviewing the commitments made by Pattison for the development of Canadian talent, the Commission notes that it will allocate the sum of $25,000 per year for the establishment and ongoing support of a "Canadian Country Talent Development Fund" to be administered by the Academy of Country Music Entertainment. The applicant stated that it would enlist financial support for the fund from other country music stations across Canada, with a view to promoting national concert tours and the production of new country music albums by Canadian artists. The applicant stated that 20% ($5,000) of its annual contribution to this fund would be allocated to FACTOR/CTL, for the development of Canadian musical recording, including country music records.
The Commission notes Pattison's proposal for the broadcast of 60 minutes of live Country music, six evenings per week, from the entertainment lounge of a Vancouver hotel. The applicant indicated that these programs will feature different groups and artists who would be primarily Canadian, and who would perform generally for periods of a week or less. The applicant indicated that it had budgeted a minimum of $20,000 for the capital costs of installing appropriate broadcasting facilities at the hotel, and $18,000 per year to maintain these facilities. The applicant also stated that it would allocate a further $12,000 to cover the costs of talent to do the sound mixing for these live broadcasts.
The Commission has taken note of this initiative, and would be concerned if projects such as the one proposed were discontinued and not replaced with other, equally-funded initiatives in support of Canadian talent.
Accordingly, consistent with this applicant's total financial commitment in respect of support for Canadian talent, and commensurate with the expenditures in this area by other licensees with comparable resources and operating in comparable markets, it is a condition of licence that Pattison allocate a minimum of $50,000 each year for the development of Canadian talent. This amount includes the applicant's commitment to the Canadian Country Talent Development Fund.
In accordance with paragraph 22(1)(b) of the Broadcasting Act, the Commission will only issue the licence, and the authority granted herein may only be implemented, at such time as written notification is received from the Department of Communications that it will issue a Technical Construction and Operating Certificate.
Further, it is a condition of this licence that construction of the station be completed and that it be in operation within six months of the date of receipt of written notification from the Department of Communications that it will issue a Technical Construction and Operating Certificate or such further period as the Commission may, upon receipt of a request for extension before the expiry of the said six months, deem appropriate under the circumstances. In this context, the Commission notes the applicant's statement at the hearing that it would be able to commence broadcasting within 90 days of the date of a favourable decision.
Fernand Bélisle
Secretary General