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ARCHIVED -  Broadcasting Decision CRTC 2005-169

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Broadcasting Decision CRTC 2005-169

  Ottawa, 20 April 2005
  Bel-Roc Communications Inc.
Haldimand County, Ontario
  Application 2004-0132-3
Public Hearing in the National Capital Region
29 November 2004
 

English-language FM radio station in Haldimand County

  The Commission approves in part the application by Bel-Roc Communications Inc. (Bel-Roc) to operate an English-language FM radio station in the municipality of Haldimand County, Ontario. Specifically, the Commission approves that portion of Bel-Roc's application pertaining to the establishment of a new FM station in Haldimand County. That portion of the application proposing the use of 106.7 MHz is denied. The Commission expects Bel-Roc to submit, within three months of today's date, an amendment to its application proposing the use of an alternative FM frequency that is acceptable to both the Commission and the Department of Industry.
  In other decisions published today, the Commission has disposed of three applications which also proposed the use of frequency 106.7 MHz, and were thus technically mutually exclusive with the Bel-Roc application.
 

The application

1.

The Commission received an application by Bel-Roc Communications Inc. (Bel-Roc) for a broadcasting licence to operate an English-language FM radio programming undertaking in the municipality of Haldimand County, Ontario. The applicant indicated that the proposed station would provide the first local radio service to Haldimand County and would operate at 106.7 MHz (channel 294B) with an effective radiated power of 13,300 watts. As part of this process, the applicant also identified an alternative frequency that could be used to implement the proposed service.

2.

The applicant stated that the proposed station would operate in a multi-genre music format that is being used successfully by an Internet-based radio station, and 60% of all music to be broadcast would be Canadian selections.

3.

An intervention to this application submitted by James Brown requested that the Commission postpone the consideration of the Bel-Roc application and instead issue a call for competing applications to serve Brantford.

4.

In its reply to Mr. Brown's intervention, Bel-Roc objected strongly to the intervener's request that the Commission issue a call for competing applications.

5.

The Commission carefully considered the intervention by Mr. Brown as well as the applicant's reply, and determined that it was appropriate to proceed with consideration of this and other applications, without issuing a call for further applications.

6.

At the 29 November public hearing, the Commission also considered three other applications proposing the use of the frequency 106.7 MHz, the same frequency as that proposed by Bel-Roc. The four applications, as filed, were thus technically mutually exclusive.

7.

In addition to the Commission's determination on the Bel-Roc application contained herein, in CIKZ-FM Kitchener-Waterloo - Technical Change, Broadcasting Decision CRTC 2005-168 (Decision 2005-168), FM radio station in Brantford, Broadcasting Decision CRTC 2005-171 and CJTW-FM Kitchener - Technical change, Broadcasting Decision CRTC 2005-170, all published today, the Commission sets out its determinations on the three other applications proposing the use of frequency 106.7 MHz.
 

Interventions

8.

The Commission received numerous interventions in support of this application, and interventions opposing Bel-Roc's proposal from:
 
  • Larche Communications (Kitchener) Inc. (Larche), licensee of CIKZ-FM Kitchener,
 
  • Telephone City Broadcast Limited (TCB), licensee of CKPC and CKPC-FM Brantford, and
 
  • CHCD Inc., licensee of CHCD-FM Simcoe.

9.

Larche and TCB were also applicants at the 29 November public hearing, both proposing the use of frequency 106.7 MHz.

10.

Larche's objection to the Bel-Roc application was based on the fact that its station CIKZ-FM, operating on frequency 99.5 MHz in Kitchener, has a serious signal problem that could only be resolved by a change of frequency and specifically by the use of 106.7 MHz.

11.

TCB also objected to Bel-Roc's use of 106.7 MHz because TCB has proposed the use of that frequency to serve Brantford. The intervener was of the view that Bel-Roc's business plan and financial projections are unrealistic. TCB expressed the concern that Bel-Roc would be forced to solicit advertising in neighbouring markets, which could have a negative financial impact upon TCB's radio stations in Brantford. Finally, the intervener stated that the Bel-Roc application does not represent the best possible use of the frequency in question.

12.

CHCD Inc. objected to the Bel-Roc proposal based on its concern that approval would have a negative financial impact on its station in Simcoe. CHCD Inc. noted that the population of Haldimand County is widespread and that the area is without either a town centre or a strong retail base. Based on the proposed transmitter location and signal contours, CHCD Inc. expressed concern that Simcoe would receive a very good signal from the proposed new station. Further, the intervener indicated that the applicant's advertising projections are unrealistic, and that financial pressures would lead Bel-Roc to solicit advertising in Simcoe, which would have a serious impact on CHCD-FM.
 

The applicant's replies

13.

In reply to the Larche intervention, Bel-Roc suggested that there are other potential technical solutions for the problem Larche is experiencing in Kitchener, and that, according to Larche's own Internet web-site, few listeners to CIKZ-FM have commented negatively about the signal.

14.

In response to the concerns expressed by TCB, Bel-Roc indicated that, while it is true that no market survey was done with regard to the proposed station format, the format has been extremely successful on the Internet, and would have wide appeal. With respect to TCB's concerns for financial impact in Brantford, the applicant indicated that its sales revenues in Haldimand County would be augmented by revenues from Hamilton, and that it would be prepared to accept a condition of licence prohibiting it from soliciting advertising in Brantford or Brant County. Further, and contrary to TCB's position, Bel-Roc reiterated that the frequency it has requested is the best choice for use in Haldimand County.

15.

In reply to CHCD Inc.'s concern, the applicant indicated that it had not projected any revenue from Simcoe, and that advertising from the Haldimand/Hamilton area would be adequate to fulfil its revenue projections. Bel-Roc added that it would accept a condition of licence ensuring that its proposed radio station not solicit advertising in Simcoe or Brantford.
 

The Commission's analysis and determination

16.

In the Introductory Statement to Decisions CRTC 99-480, 99-481 and 99-482, 28 October 1999, the Commission indicated that, pursuant to its Commercial Radio Policy 1998, Public Notice CRTC 1998-41, 30 April 1998 (the Commercial Radio Policy), the factors set out below are generally among those relevant to the evaluation of competitive commercial radio applications:
 
  • the quality of the application;
 
  • the diversity of news voices in the market;
 
  • the market impact of any proposed station on existing stations; and
 
  • the competitive state of the market.

17.

The Commission notes that the fourth factor listed above has no bearing on the current application, as the Haldimand region that would be served by the proposed new station is not currently served by any local radio station. As for the other factors, the Commission considers that, as described below, Bel-Roc has presented a high quality application with a sound business plan based on repatriation of some of the 100% out-of-market tuning in the region. The Commission also notes the applicant's very strong commitments to Canadian content, local programming and Canadian talent development (CTD), and that the proposal would bring a first local service to Haldimand County.

18.

In regard to the potential market impact of the proposed new station on existing stations, the Commission notes the applicant's indication that it would accept a condition of licence prohibiting the solicitation of advertising in Brantford and Simcoe, Ontario. Consistent with the applicant's indication, a condition of licence to this effect is set out in the appendix to this decision.
 

Bel-Roc's programming plans

 

Local programming

19.

In its plans for the proposed new radio station, Bel-Roc indicated that it would offer detailed surveillance programming, including news, weather, traffic, border crossing information, and sports on a daily basis. In addition, the new station would provide entertainment news, a community events calendar, and town hall reports.

20.

Bel-Roc also indicated that it would involve local high school students in the production of a program about youth activities, and that it has identified a local historian interested in producing a series of historical vignettes about the Haldimand area. In addition, the applicant plans to broadcast church services, and remote broadcasts from community events.
 

Canadian content and contributions to Canadian talent development

 
Canadian content

21.

Section 2.2 of the Radio Regulations, 1986 (the Radio Regulations) requires that, on a weekly basis, a minimum of 35% of all category 2 musical selections, and a minimum of 10% of all category 3 musical selections broadcast be Canadian selections.

22.

As part of its application, Bel-Roc made a commitment to ensure, by condition of licence, that at least 60% of all category 2 musical selections broadcast would be Canadian, both over the broadcast week and during the period 6:00 a.m. to 6:00 p.m. on weekdays.

23.

The Commission notes that the applicant's commitment exceeds the minimum regulatory requirement, and would therefore provide increased exposure for Canadian music. A condition of licence requiring the applicant's adherence to its commitment is set out in the appendix to this decision.
 
Canadian talent development

24.

The applicant will not participate in the CTD Plan created by the Canadian Association of Broadcasters. Instead, Bel-Roc proposed to expend a total of $290,000 on direct expenditures for CTD initiatives over a seven-year licence term. That total would be based on annual expenditures of $30,000 in each of the first three years of operation, $40,000 in the fourth, $50,000 in each of the fifth and sixth, and $60,000 in the seventh year. Of those totals, $5,000 in each of the first three years, and $10,000 in each of the remaining years of the licence term, would be directed to the Foundation to Assist Canadian Talent on Record (FACTOR). The remaining expenditures in each year would be directed to non-profit events that would involve the showcasing of Canadian talent at concerts and festivals.

25.

A condition of licence requiring adherence to these commitments is set out in the appendix to this decision. The Commission considers that the minimum annual expenditure should be made over seven consecutive broadcast years, upon commencement of operations.

26.

The Commission reminds the applicant that all of the CTD funding directed to the showcasing of live Canadian talent must be spent on the direct, out-of-pocket costs of underwriting performances by Canadian artists.
 

Conclusion

27.

Accordingly, the Commission approves in part the application by Bel-Roc Communications Inc. Specifically, it approves the application requesting a broadcasting licence to operate an English-language commercial FM radio programming undertaking in Haldimand County. In approving this application, the Commission notes in particular the contribution to the local community to be made by the new station.

28.

The frequency 106.7 MHz, proposed for use by Bel-Roc, is the same as that proposed by Larche for use in Kitchener. In its application and in its reply to the intervention filed by TCB, Bel-Roc stated that it would, if necessary, be willing to find another frequency if its application for a new FM station were approved. In Decision 2005-168, also issued today, the Commission has approved Larche's application to use 106.7 MHz. Accordingly, the use of 106.7 MHz by Bel-Roc is denied.

29.

The licence will expire 31 August 2011, and will be subject to the conditions of licence set out in the appendix to this decision.
 

Issuance of the licence

30.

The Commission will only issue the licence, and it will only be effective at such time as:
 
  • The applicant submits, within three months of the date of this decision, an amendment to its application proposing the use of an FM frequency and technical parameters that are acceptable to both the Commission and the Department. This amended application will form part of a public process; and
 
  • The applicant has informed the Commission in writing that it is prepared to commence operations. The undertaking must be operational at the earliest possible date and in any event no later than 24 months from the date of this decision, unless a request for an extension of time is approved by the Commission before 20 April 2007. In order to ensure that such a request is processed in a timely manner, it should be submitted at least 60 days before that date.
 

Cultural diversity

31.

In its Commercial Radio Policy 1998, Public Notice CRTC 1998-41, 30 April 1998, the Commission encouraged broadcasters to reflect the cultural diversity of Canada in their programming and employment practices, especially with respect to news, music and promotion of Canadian artists.

32.

The Commission expects Bel-Roc to reflect the cultural diversity of Canada in its programming and employment practices.
 

Employment equity

33.

In accordance with Implementation of an employment equity policy, Public Notice CRTC 1992-59, 1 September 1992, the Commission encourages the applicant to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources.
  Secretary General
   This decision is to be appended to the licence. It is available in alternative format upon request, and may also be examined in PDF format or in HTML at the following Internet site: www.crtc.gc.ca 
 

Appendix to Broadcasting Decision CRTC 2005-169

 

Conditions of licence

 

1. The licence is subject to the conditions set out in New licence form for commercial radio stations, Public Notice CRTC 1999-137, 24 August 1999, with the exception of condition number 5.

 

2. The licensee shall, as an exception to the percentage of Canadian musical selections set out in sections 2.2(8) and 2.2(9) of the Radio Regulations, 1986, in any broadcast week:

 

(a) devote, in that broadcast week, 60% or more of its musical selections from content category 2 to Canadian selections broadcast in their entirety; and

 

(b) devote, between 6:00 a.m. and 6:00 p.m., in the period from Monday to Friday of the same broadcast week, 60% or more of its musical selections from content category 2 to Canadian selections broadcast in their entirety.

 

For the purposes of this condition, the terms "broadcast week", "Canadian selection", "content category" and "musical selection" shall have the same meaning as that set out in the Radio Regulations, 1986.

 

3. The licensee shall devote a total of $290,000 over the seven-year licence term in direct expenditures, to support the development of Canadian talent, as detailed in this decision and based upon the following annual budgets:

 

Years 1, 2 and 3

$30,000 annually
 

Year 4

$40,000
 

Years 5 and 6

$50,000 annually
 

Year 7

$60,000
 

4. The licensee shall refrain from soliciting local advertising in Brantford and the Town of Simcoe, Ontario.

Date Modified: 2005-04-20