TRANSCRIPT OF PROCEEDINGS BEFORE

             THE CANADIAN RADIO‑TELEVISION AND

               TELECOMMUNICATIONS COMMISSION

             TRANSCRIPTION DES AUDIENCES DEVANT

              LE CONSEIL DE LA RADIODIFFUSION

           ET DES TÉLÉCOMMUNICATIONS CANADIENNES

                       SUBJECT/SUJET:

Various broadcasting applications further to calls for

applications for broadcasting licences to carry on radio programming undertakings to serve Owen Sound, Windsor and Peterborough, Ontario /

Plusieurs demandes en radiodiffusion suite aux appels de demandes de licence de radiodiffusion visant l'exploitation d'entreprises de programmation de radio pour desservir Owen Sound, Windsor et Peterborough (Ontario)

HELD AT:                          TENUE À:

Rooms B, C & D                    Salons B, C et D

Delta Hotel London Armouries      Hôtel Delta London Armouries

325 Dundas Street                 325, rue Dundas

London, Ontario                   London (Ontario)

December 11, 2007                 Le 11 décembre 2007

Transcripts

In order to meet the requirements of the Official Languages

Act, transcripts of proceedings before the Commission will be

bilingual as to their covers, the listing of the CRTC members

and staff attending the public hearings, and the Table of

Contents.

However, the aforementioned publication is the recorded

verbatim transcript and, as such, is taped and transcribed in

either of the official languages, depending on the language

spoken by the participant at the public hearing.

Transcription

Afin de rencontrer les exigences de la Loi sur les langues

officielles, les procès‑verbaux pour le Conseil seront

bilingues en ce qui a trait à la page couverture, la liste des

membres et du personnel du CRTC participant à l'audience

publique ainsi que la table des matières.

Toutefois, la publication susmentionnée est un compte rendu

textuel des délibérations et, en tant que tel, est enregistrée

et transcrite dans l'une ou l'autre des deux langues

officielles, compte tenu de la langue utilisée par le

participant à l'audience publique.

               Canadian Radio‑television and

               Telecommunications Commission

            Conseil de la radiodiffusion et des

               télécommunications canadiennes

                 Transcript / Transcription

Various broadcasting applications further to calls for

applications for broadcasting licences to carry on radio programming undertakings to serve Owen Sound, Windsor and Peterborough, Ontario /

Plusieurs demandes en radiodiffusion suite aux appels de demandes de licence de radiodiffusion visant l'exploitation d'entreprises de programmation de radio pour desservir Owen Sound, Windsor et Peterborough (Ontario)

BEFORE / DEVANT:

Rita Cugini                       Chairperson / Présidente

Peter Menzies                     Commissioner / Conseiller

Helen del Val                     Commissioner / Conseillère

ALSO PRESENT / AUSSI PRÉSENTS:

Cindy Ventura                     Secretary / Secrétaire

Joe Aguiar                        Hearing Manager /

                                  Gérant de l'audience

Kelly-Anne Smith                  Legal Counsel /

                                  Conseillère juridique

HELD AT:                          TENUE À:

Rooms B C D                       Salons B C D

Delta Hotel London Armouries      Hôtel Delta London Armouries

325 Dundas Street                 325, rue Dundas

London, Ontario                   London (Ontario)

December 11, 2007                 Le 11 décembre 2007

- iv -

           TABLE DES MATIÈRES / TABLE OF CONTENTS

                                                 PAGE / PARA

PHASE I

PRÉSENTATION PAR / PRESENTATION BY:

Neeti P. Ray (OBCI)                               288 / 1743

Blackburn Radio Inc.                              364 / 2173

PHASE II

INTERVENTION PAR / INTERVENTION BY:

Neeti P. Ray (OBCI)                               430 / 2562

PHASE III

INTERVENTION PAR / INTERVENTION BY:

CTV                                               435 / 2595

PHASE IV

REPLY BY / RÉPLIQUE PAR:

Blackburn Radio Inc.                              455 / 2692

Neeti P. Ray (OBCI)                               480 / 2842

- v -

           TABLE DES MATIÈRES / TABLE OF CONTENTS

                                                 PAGE / PARA

PHASE I

PRÉSENTATION PAR / PRESENTATION BY:

Acadia Broadcasting Limited                       485 / 2870

591989 B.C. Ltd.                                  527 / 3143

                   London, Ontario / London (Ontario)

‑‑‑ Upon commencing on Tuesday, December 11, 2007

    at 0900 / L'audience débute le mardi

    11 décembre 2007 à 0900

LISTNUM 1 \l 1 \s 17301730             THE CHAIRPERSON:  Ladies and gentlemen, good morning.

LISTNUM 1 \l 11731             I just have an announcement before we begin the proceeding today.

LISTNUM 1 \l 11732             According to the agenda of the Public Hearing, the presentations of the Peterborough and Kawartha Lakes applications will follow after the completion of the Windsor phase of this proceeding.

LISTNUM 1 \l 11733             Late yesterday afternoon we were advised by Acadia Broadcasting Limited, item 13 on the hearing agenda, of a tragic fatality back home involving a member of the Acadia Radio family.  As a consequence, Acadia Broadcasting has requested and has been given permission to present its application first as part of the Phase I presentations involving the Peterborough and Kawartha Lakes applications.  For Phase II and Phase IV we will revert back to the original agenda.

LISTNUM 1 \l 11734             On behalf of the CRTC, and I'm sure all of you join me in extending our condolences to Acadia Broadcasting.

LISTNUM 1 \l 11735             I would also like to thank the remaining Peterborough and Kawartha Lakes applicants for their understanding and cooperation.

LISTNUM 1 \l 11736             Thank you all very much.

LISTNUM 1 \l 11737             Madam Secretary.

LISTNUM 1 \l 11738             THE SECRETARY:  Thank you, Madam Chair.

LISTNUM 1 \l 11739             We will now proceed with item 5 which is an application by Neeti P. Ray, on behalf of a corporation to be incorporated, for a licence to operate an FM commercial ethnic radio programming undertaking in Windsor, Ontario.

LISTNUM 1 \l 11740             The new station would operate on frequency 95.9 MHz (channel 240B1) with an average effective radiated power of 2,900 watts (maximum effective radiated power of 11,800 watts/antenna height of 145 metres).

LISTNUM 1 \l 11741             Appearing for the applicant is Mr. Neeti Ray.

LISTNUM 1 \l 11742             Please introduce your colleagues and you will have 20 minutes for your presentation.

PRESENTATION / PRÉSENTATION

LISTNUM 1 \l 11743             MR. NEETI RAY:  Thank you very much.

LISTNUM 1 \l 11744             Madam Chair and Commissioners, my name is Neeti Ray.  I am president of the company to be incorporated.  I am also president of 1650 AM Mississauga CINA Radio.

LISTNUM 1 \l 11745             On my left is Radhika Ray.  She is a consultant with MacKenzie and Company, and also London is a very familiar place for her because she spent four years doing her HBA at the Ivy School of Business before joining MacKenzie.

LISTNUM 1 \l 11746             On my right is Anthony Gossman.  He is a broadcast and wireless engineer.  He is also partner in the proposed Windsor radio station.  He has also done broadcasting when he was very young.  He told me that he is very old now.

‑‑‑ Laughter / Rires

LISTNUM 1 \l 11747             MR. NEETI RAY:  Next to Anthony is Rochelle Porter who is with the Multicultural Council of Windsor Essex County.  She has also worked for the CBC as a communications manager for 22 years until recently.

LISTNUM 1 \l 11748             Behind me on my left is Mr. John Corrent.  He is a lawyer and he is also partner in our proposed radio station in Windsor.

LISTNUM 1 \l 11749             Next to John is Dr. Walter Temelini.  He is Professor Emeritus, University of Windsor.  He is also chairman of the board of directors of the proposed radio station in Windsor.

LISTNUM 1 \l 11750             And next to Dr. Temelini is Dr. Conrad Winn.  He is the president of COMPAS Research and Public Opinion Inc. and he is the one who has done the survey on our behalf of the Windsor audience.

LISTNUM 1 \l 11751             And next to Dr. Winn is Jim Moltner.  He is our engineering consultant.

LISTNUM 1 \l 11752             Madam Chair, if I have your permission I would like to put on record that on September 28 we provided the Commission with a revised ownership structure and the main asset of that was that we joined hands with three new partners.

LISTNUM 1 \l 11753             And in addition to that, the members of the family of Neeti Ray, myself, would hold 94 percent shares in the new station which we have called "Newco" through a holding company which will be called Rayco in which, as we wrote to the Commission on the 28th of September, we would be the sole shareholders holding shares; as follows, Neeti Ray 67 percent, Rayno Ray 23 percent and Radhika Ray 10 percent.

LISTNUM 1 \l 11754             I would like to advise the Commission that because of the sudden and unexpected demise of Mrs. Rayno Ray on November 18th, 2007 it has become necessary to revise the ownership structure of Rayco as follows:  Neeti Ray 67 percent and Radhika Ray 33 percent.

LISTNUM 1 \l 11755             I would also point out that the above revision has no impact on the ultimate control of the licensee, as outlined in our application, which will continue to be exercised by Neeti Ray.  I have also given a copy of this letter to the Commission.

LISTNUM 1 \l 11756             And I would start the formal part of the presentation now.

LISTNUM 1 \l 11757             Madam Chair and members of the Commission, our appearance before you today seeking approval to establish Windsor's first ever ethnic radio station on 95.9 FM represents the culmination of a broadcasting mission we embarked upon a few years ago.

LISTNUM 1 \l 11758             Our goal is to create a radio station that meaningful reflects the reality of Windsor's ethnicity, addresses the needs of its diverse, multicultural communities and builds important bridges.  A readily identifiable gap exists in the Windsor market.

LISTNUM 1 \l 11759             According to the 2001 Census more than 50 percent of Windsor's total population have indicated an ethnic origin other than English, French or aboriginal.  In fact, Windsor has Canada's fourth largest proportion of foreign‑born population after Toronto, Vancouver, Hamilton, according to the same census results and, yet, there is no dedicated full service ethnic radio station in Windsor to serve the unique needs of its vast multicultural population.

LISTNUM 1 \l 11760             The current local market clearly does not reflect the dominant reality of Windsor's cultural and linguistic diversity.  What it does graphically illustrate, however, is the need for a fulltime ethnic radio station dedicated to third language programming, third language broadcasting services for the multicultural communities of the Windsor region.

LISTNUM 1 \l 11761             If licensed, the proposed ethnic radio station will optimize the utilization of the 95.9 FM frequency and reaching out to serve 21 un‑served multicultural communities in 12 different languages within the Windsor region.  These languages are Cantonese, Italian, German, Polish, Ukrainian, Hindustani, Tagalog, Spanish, Arabic, Hungarian, Romanian and Serbian.

LISTNUM 1 \l 11762             It is our intention to provide high‑quality locally relevant programming services in the above languages to the following 21 multicultural communities who currently have no service available to them in their mother tongues, Chinese, Italian, German, Polish, Ukrainian, Indian, Pakistani, Filipino, Spaniard, Mexican, Salvadorian, Guatemalan, Nicaraguan, Lebanese, Iraqi, Egyptian, Palestinian, Syrian, Hungarian, Romanian and Serbian.

LISTNUM 1 \l 11763             We have also extended an opportunity to First Nations peoples to participate fully with the proposed ethnic radio station's 21‑member broadcast family through six hours of programming each week.

LISTNUM 1 \l 11764             The inclusion of high‑quality locally relevant programming into these 21 targeted multicultural communities will add significant new elements of diversity and listener choice to the radio spectrum of the Windsor Essex County.

LISTNUM 1 \l 11765             Ethnic groups will now have access to local programs to promote events and activities in their communities.  Multilingual programming is important to listening audiences who unlike their mainstream English‑language counterparts do not have access to any Canadian radio broadcasting in their preferred languages.

LISTNUM 1 \l 11766             MS RAY:  An imbalance currently exists in the Windsor market between mainstream English language programming and the non‑existent local programming to third language audiences.

LISTNUM 1 \l 11767             The total number of weekly programming hours broadcast by local English radio stations within the Windsor region is approximately 1,200 hours, not counting CHYR FM Leamington which has a good reach within the Windsor Essex County.  By comparison the programming hours available to the multicultural communities from a local Canadian station is zero.

LISTNUM 1 \l 11768             The implementation of the proposed radio station's ethnic broadcast plan represents an important step forward in addressing this gap. The only source of over‑the‑air multilingual programming for Windsor's ethnic communities is WNZK 680 AM Radio in Detroit.  It is an American station with no Canadian orientation or commitment to fulfil the needs of local Windsor communities or to provide local Windsor news, traffic or community information.

LISTNUM 1 \l 11769             The U.S. station cannot serve the needs in Canada or build bridges the way a Canadian station could.

LISTNUM 1 \l 11770             The proposed ethnic radio station's broadcast plan for 95.9 FM fully meets the spirit and intent of the Broadcasting Act and the Commission's ethnic broadcasting policy and represents the most comprehensive and productive utilization of the 95.9 FM frequency.

LISTNUM 1 \l 11771             Turning specifically to the third language segment of the market, Windsor's population by immigrant status in 2006 was 75,000 or 23.2 percent of Windsor's total population.  Now, this itself represents a population comparable to the total population of either Sault Ste. Marie or Kawartha Lakes, Ontario or Red Deer or Grand Prairie, Alberta and larger than that of Owen Sound, Woodstock, Leamington, North Bay and Cornwall, Ontario to name a few.

LISTNUM 1 \l 11772             According to the recently released 2006 Census results, Windsor's immigrant population has grown by 14,000 between 2001 and 2006 representing the largest ever increase in Windsor's immigrant population.

LISTNUM 1 \l 11773             Foreign‑born population accounted for 22 percent of Windsor's total population in 2001, up from 20 percent in 1996.  These numbers will only increase as new immigrants continue to make Windsor their home.

LISTNUM 1 \l 11774             The 2001 Census also shows that almost 70,000 respondents or 22 percent of Windsor's population indicated a mother tongue other than English, French or one of the aboriginal languages.  There are further tens of thousands of Canadians born to third language parents who would relate to and want to listen to the proposed ethnic radio station.

LISTNUM 1 \l 11775             These demographic facts compellingly indicate that it is time for an ethnic radio station to be established in Windsor.

LISTNUM 1 \l 11776             The 2001 Census found that there are a sizeable number of immigrants living in the Windsor region who could speak neither English nor French.  These persons are at risk of social isolation and they face great barriers to accessing information and services.

LISTNUM 1 \l 11777             Multilingual radio programming in their respective heritage languages can reduce these risks by helping immigrants connect within their ethnic communities and access information about services, programs, local Canadian laws and current happenings.  This in turn will also help make them active participants in the larger community.

LISTNUM 1 \l 11778             MR. NEETI RAY:  As a further means of ensuring that our broadcast plan will address the specific needs and interests of the large and diverse ethnic communities we commissioned the non‑partisan and respected public opinion and research firm, COMPAS Inc., to conduct a comprehensive study of the Windsor Radio audience.

LISTNUM 1 \l 11779             The Windsor radio survey of 350 respondents from the general population conducted by COMPAS confirms our contention that, given the multicultural composition of the Windsor CMA and the absence of a fulltime Canadian multilingual radio station to fulfil their needs, a readily but yet untapped market undoubtedly exists.  It needs to be served.

LISTNUM 1 \l 11780             Surveys of this size, according to COMPAS are deemed accurate to within 5.5 percentage points, 19 times out of 20.  A key finding in the COMPAS survey, which did not target a particular segment but the general population, is that the proportion of respondents who indicated that they listen to multicultural radio from Detroit corresponds closely with the proportion of foreign‑born residents in Windsor and those who have a mother tongue other than one of the official languages.

LISTNUM 1 \l 11781             In the COMPAS study 20 per cent of all respondents said they listen to multicultural programming coming from a Detroit ethnic radio station.  As discussed earlier, 22 per cent of respondents in the 2001 census were foreign‑born and a similar proportion also indicated a mother tongue other than English or French.

LISTNUM 1 \l 11782             It would therefore be reasonable to say that the vast majority of all foreign‑born and all third‑language speaking population of the Windsor region have a substantial appetite for radio programming in their respective heritage languages.

LISTNUM 1 \l 11783             The COMPAS study shows that the vast majority of Windsor's third‑language population are indeed resorting to a Detroit ethnic radio station to fulfil their needs.  This existing Windsor radio station is immediately available to switch from an American station to a Canadian ethnic radio station offering locally relevant programming to Windsor residents.

LISTNUM 1 \l 11784             MS RADHIKA RAY: Windsor residents are enthusiastic about another issue that makes the approval of this radio application even more desirable.  This was revealed by answers to the following questions.  Question, and I quote, "Canadians who want to listen to a multicultural station should have a Canadian option and shouldn't have to listen to American content."

LISTNUM 1 \l 11785             Fifty‑nine per cent of all respondents from the general public indicated that they strongly or moderately agree with the above statement.  But what is particularly remarkable is that among those respondents who listen to ethnic radio from Detroit 57 per cent say they strongly agree and a further 19 per cent say they agree, for a total of 76 per cent who believe there should be a Canadian ethnic radio option as opposed to an American one.

LISTNUM 1 \l 11786             These results clearly demonstrate that, first, a need exists for ethnic programming. Second, that there is a ready audience demand in Windsor for ethnic radio programming.  And third, that there is demand for a Canadian station to serve needs and build bridges.

LISTNUM 1 \l 11787             Respondents also estimated the impact of a new Canadian‑owned multicultural station on Windsor and the reactions were overwhelmingly positive irrespective of their background.  A strong majority also believe that the proposed new ethnic radio station would enhance Canada's image as a democratic country respectful of its multicultural communities.

LISTNUM 1 \l 11788             The full version and details of the audience demand survey by COMPAS can be found on record as part of our application.

LISTNUM 1 \l 11789             MS PORTER:  Madam Chair and commissioners, turning now to our Canadian content development initiatives, CCD.  In keeping with the Commission's policy regarding CCD, as set out in public notice 2006‑158, the new ethnic radio station will, if licensed, implement a number of creative initiatives that will directly and beneficially impact the development, promotion and ongoing exposure of ethnic‑Canadian talent within the Windsor CMA.

LISTNUM 1 \l 11790             All CCD contributions will go toward the Annual Ethnic Journalism Scholarship Fund to be administered independently by the Multicultural Council of Windsor and Essex County.

LISTNUM 1 \l 11791             The direct expenditures proposed under the CCD plan, which we would take as a condition of licence, are as follows.  A basic financial contribution will be based on the revenue generated each year during the first licensing period of the new FM radio station in keeping with the new radio policy, which we estimate to be approximately $6,000 over seven years.

LISTNUM 1 \l 11792             Additionally, an over and above contribution each year will go toward the Ethnic Journalism Scholarship Fund.  These contributions would remain stagnant during the first seven years of licensing for a total of $24,000, over and above contributions over the seven years.  The combined total of both the basic and over and above CCD contributions will go toward the Ethnic Journalism Scholarship Fund to be paid to and administered by the Multicultural Council of Windsor and Essex County.

LISTNUM 1 \l 11793             MR. NEETI RAY:  We propose to award four mutually exclusive scholarships each year in years one through four.  Each scholarship will be of an amount equal to the total combined basic and over and above CCD amount in a given year divided by four.

LISTNUM 1 \l 11794             Further, in years five, six and seven we propose to award eight mutually exclusive scholarships.  And again, each scholarship will be of an amount equal to the total combined CCD amount for a given year divided by eight.  Thus, a total of 40 such scholarships will be awarded over seven consecutive years, administered by the Multicultural Council.

LISTNUM 1 \l 11795             To further clarify, while the proposed Windsor ethnic radio station will provide these funds and assist in everyway possible with the proposed scholarship awards, the management and ownership of the station will remain autonomous of the selection and decision making process of the jury appointed by the Multicultural Council of Windsor and Essex County.

LISTNUM 1 \l 11796             In addition to the direct expenditures over a seven‑year period, we are committing to at least $36,000 annually or $252,000 over seven years in indirect costs for the on‑air promotion of ethnic concerts, performs and artistic programs in the various ethnic communities.

LISTNUM 1 \l 11797             We believe that indirect on‑air initiatives can have a profoundly beneficial impact on a radio station's efforts to further enhance, stimulate, promote and develop Canadian talent.

LISTNUM 1 \l 11798             MS RADHIKA RAY:  Turning to our business plan, the projections we have made in our application are conservative and attainable without difficulty.

LISTNUM 1 \l 11799             We project revenues of $550,000 in year one with a sell‑out factor of about 25 per cent, going up to about 40 per cent in year seven with revenues of $845,000.  We have no doubt that Windsor's strong ethnic business sector would be able to support the new ethnic radio station.

LISTNUM 1 \l 11800             The vast majority of the over 750 ethnic businesses in Windsor remain untapped by existing radio stations.  Only 5 per cent of our revenue or $27,500 in year one is projected to come from existing Windsor radio stations.

LISTNUM 1 \l 11801             It would be worthwhile to keep in mind that with the 95.5 FM frequency we would gain, as a naturally‑flowing bonus, advertising dollars and listening audiences from the Detroit market.  Though we have projected only 20 per cent or $110,000 in year one to come from the Detroit market, this projection is conservative.

LISTNUM 1 \l 11802             We know that the proportion revenues the existing radio stations garner from Detroit is significantly lower.

LISTNUM 1 \l 11803             MR. GOSSMANN:  The only ethnic radio service available to Windsor listeners and advertisers is Detroit's WNZK‑AM 680 radio.

LISTNUM 1 \l 11804             In order to effectively compete with this Detroit ethnic radio station, it is vitally important that we have a signal coverage that local Windsor businesses need in order to reach their target markets on both sides of the border.  95.9 FM is the only frequency capable of doing that.

LISTNUM 1 \l 11805             In order to gain further insight into the needs of Windsor's ethnic radio advertisers I would quote from two of the number of intervention letters that the Commission has received from such local businesses.  Mr. J. Andrew Porter of Windsor's well‑known immigration law firm wrote:

"If a proposed radio station is licensed on frequency 95.9 FM, which I understand has good coverage of both Windsor and Detroit, it could be the foremost outlet for us to get our messages across to our perspective clients.  Without doubt, we would prefer this local Canadian outlet over the Detroit ethnic radio station if it delivers the audiences we are looking for near the Detroit River." (As Read)

LISTNUM 1 \l 11806             Mike Vonella, President of the famous Erie Street Business Improvement Association, also known as Via Italia, writes that:

"There is need to attract U.S. ethnic customers as well as local ethnic clients through a radio program that can be heard equally well in the entire region on a regular basis.  In this way, we shall not have to depend on U.S. radio stations like WNZK." (As Read)

LISTNUM 1 \l 11807             These letters echo the feelings within Windsor's ethnic business communities, as seen in interventions similar to these.

LISTNUM 1 \l 11808             MR. NEETI RAY:  Turning to the Windsor economy and whether it can sustain a new radio station.  First, we would like to underline the fact that in a market where no ethnic radio station exists and where there is a large ethnic population and a sizeable business community, an ethnic format is in the best position to be viable and would have the least impact on existing mainstream English radio stations.

LISTNUM 1 \l 11809             The Windsor economy is in a state of adjustment, which is a part of a natural business cycle.  Windsor's economy is based on foreign ground.  Windsor has seen downturns in the past and has a strong history of economic growth. Such downturns have been short lived and the economy has always rebounded with great strength as the mayor of the City of Windsor, Eddy Francis, is on record as having said two weeks ago, "By the time a new station will be established the Windsor economy is expected to be well on its way to recovery."

LISTNUM 1 \l 11810             With Windsor's recent winning of the North American Cities of the Future award from Foreign Direct Investment magazine and the city's designation as North America's best small city for investment is a testament to the confidence that reputable economic organizations and publications have in Windsor's firm footing.

LISTNUM 1 \l 11811             Without a doubt, an ethnic radio station will be sustainable by Windsor's ethnic market.  The benefits of such a station would greatly outweigh any risks.

LISTNUM 1 \l 11812             To conclude, we would emphasize that Commission approval of our proposed ethnic radio station will bring true diversity to Windsor's broadcasting market.  Its unique format will reflect the city's multicultural needs, attract new listeners, increase tuning hours and generate new advertising dollars, overall a positive impact on Windsor's radio market and Canada's broadcasting system.

LISTNUM 1 \l 11813             Thank you very much, that concludes the formal part of our presentation.  And we would be very pleased to answer any questions and I am sure you have some.

LISTNUM 1 \l 11814             THE CHAIRPERSON:  Thank you, Mr. Ray.  You have attended CRTC hearings before, I see, to be sure that we have questions.

LISTNUM 1 \l 11815             First of all, I would like to thank you for reading into the record your letter of December 10th and to you as well, on behalf of the Commission, we would like to express our condolences for the loss of Mrs. Ray.

LISTNUM 1 \l 11816             MR. NEETI RAY:  Thank you.

LISTNUM 1 \l 11817             THE CHAIRPERSON:  Attached to your oral presentation this morning you have filed some information that relates to the immigrant population of Windsor.

LISTNUM 1 \l 11818             So I just wanted to know whether or not this is new information or if this is information that was already included in your application.

LISTNUM 1 \l 11819             MR. NEETI RAY:  This is new information because we didn't have on record at the time that we initially submitted the application the survey that was done by COMPAS, and also it reflects the new 2006 census results, which have been released recently, some of them as recently as the 4th of December this year.

LISTNUM 1 \l 11820             THE CHAIRPERSON:  Right.  So the charts here or the graphs, this is information that was compiled from the release of the Stats Canada data?

LISTNUM 1 \l 11821             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 11822             THE CHAIRPERSON:  Okay.  Thank you very much.

LISTNUM 1 \l 11823             I will ask Commissioner del Val to begin the questioning.

LISTNUM 1 \l 11824             MR. NEETI RAY:  Thank you.

LISTNUM 1 \l 11825             COMMISSIONER DEL VAL:  Thank you, Mr. Ray and panel.

LISTNUM 1 \l 11826             I just want to begin with looking at some of your programming first.  I think a key element of your application is the prospect of repatriation of the listeners who currently have no alternative but to tune to the Detroit stations, and namely the strongest one seems to be CNZK, and that you plan to do so by providing a distinctly Canadian option.

LISTNUM 1 \l 11827             I would like to ask you exactly what your repatriation strategy is, how you plan to draw the listeners to your station and with what.  So this is what these questions will be about.

LISTNUM 1 \l 11828             Now I am looking at your supplementary brief and you do talk about the Detroit market and the Windsor market.  But aside from the size of those two markets, what distinction do you see between the Canadian Windsor audience and the U.S. Detroit audience?

LISTNUM 1 \l 11829             MR. NEETI RAY:  As far as the demographics are concerned, there is hardly any difference.  Every ethnic community in Windsor has a sister community in Detroit and as a result there is also a lot of interaction between the two sister communities.

LISTNUM 1 \l 11830             As an example, the Italian community in Windsor, I think, totals, if I remember correctly, between 30,000 and 35,000, and their Detroit counterparts over 350,000 of them.  So the difference is not in demographics but there is a huge difference in the number of each ethnic community, the population within each ethnic community.

LISTNUM 1 \l 11831             Otherwise, the habits, the cultural activities, the food and the customs are the same as far as the audience is concerned and I think that is what your question was, about the audiences.

LISTNUM 1 \l 11832             COMMISSIONER DEL VAL:  Okay.  So then I am looking at the Windsor radio study by COMPAS and particularly the analysis that was provided as a response to deficiency, I believe.  Then you also alluded in your opening paragraph about the question that you posed for the potential audience.

LISTNUM 1 \l 11833             Maybe I should go to the question as you have summarized in ‑‑ yes, I believe it is page 7.

LISTNUM 1 \l 11834             MR. NEETI RAY:  Of the supplementary brief?

LISTNUM 1 \l 11835             COMMISSIONER DEL VAL:  I am sorry, of your opening statement.

LISTNUM 1 \l 11836             MR. NEETI RAY:  Today.

LISTNUM 1 \l 11837             COMMISSIONER DEL VAL:  And you said ‑‑ are you there?

LISTNUM 1 \l 11838             MR. NEETI RAY:  Of the presentation today, right?

LISTNUM 1 \l 11839             COMMISSIONER DEL VAL:  Yes.

LISTNUM 1 \l 11840             MR. NEETI RAY:  Okay.

LISTNUM 1 \l 11841             COMMISSIONER DEL VAL:  Yes, the second to the last paragraph where you say, and I quote:

"Canadians who want to listen to a multicultural station could have a Canadian option and shouldn't have to listen to American content." (As read)

LISTNUM 1 \l 11842             What did you distinguish as American content?  What was it that the audience didn't like about American content?

LISTNUM 1 \l 11843             MR. NEETI RAY:  Before I ask Conrad Winn to shed further light on that, I guess the fundamental question that the respondents would ask themselves is the aspect of programming that relates to local content.

LISTNUM 1 \l 11844             WNZK is the only radio station heard by these respondents.  WNZK does not have a Canadian orientation.  It doesn't have Windsor news, local news, local traffic, information about local events, and that is what they are missing and therefore they would prefer to have a Canadian option.

LISTNUM 1 \l 11845             I am sure that Dr. Winn would have a few words to say on that.

LISTNUM 1 \l 11846             Dr. Winn.

LISTNUM 1 \l 11847             COMMISSIONER DEL VAL:  Perhaps I could just follow up on your answer because it might be sufficient.

LISTNUM 1 \l 11848             So what you are talking about in terms of Canadian perspective is what you just said about local news, local traffic of Windsor, so what is happening about town in Windsor, and aside from that, is there anything that would make your proposed station's programming different from Detroit's?

LISTNUM 1 \l 11849             MR. NEETI RAY:  Well, it would be different also in that the Detroit station is not committed to fulfilling any of the regulatory requirements of CRTC, which are good towards serving the Canadian audience as well, and to fulfil their needs.

LISTNUM 1 \l 11850             One of them is the exposure of Canadian talent and Canadian musical talents and exposure of Canadian events in the musical world and also the quality of programming, I guess.  What we have proposed is very high‑quality programming from the perspective not only of the local content but the overall quality of the programming, which would include the kind of music they want to listen to.

LISTNUM 1 \l 11851             Local announcers, local content, response to the demands of the local listeners is something that would not be possible except through a local Canadian radio station.

LISTNUM 1 \l 11852             COMMISSIONER DEL VAL:  Those are good examples.  I am just trying to flesh out the application.  I would like very much to hear about specifically what are the programs that you consider Canadian and that are customized for the Canadian audience.

LISTNUM 1 \l 11853             Do you have any other examples of those?

LISTNUM 1 \l 11854             MR. NEETI RAY:  Well, each program would consist of news, and I know as a matter of fact that WNZK is not providing news except the international news coming from back home.  Our news content will be equally divided between local news, national/regional news and international news.  WNZK is not providing anything of that kind.

LISTNUM 1 \l 11855             I hope I am able to address exactly what you are trying to get at.

LISTNUM 1 \l 11856             COMMISSIONER DEL VAL:  Yes, I think you are on the way there.  Those are good examples.

LISTNUM 1 \l 11857             MR. NEETI RAY:  Yes and, for example, the open line shows which WNZK has, but then of course that is mainly American context.

LISTNUM 1 \l 11858             There are no open line shows to give opportunities, for example, to the ethnic communities who are not very well versed in the official languages to be able to discuss issues, whether it is issues relating to social problems, issues in relation to, say, family problems, and be able to discuss issues relating to laws, local laws, politics and so on and so forth, which can only be done ‑‑ and that will distinguish our station from WNZK.

LISTNUM 1 \l 11859             COMMISSIONER DEL VAL:  Would you have any, say, programs to feature Canadian artists?

LISTNUM 1 \l 11860             I know that this is sort of ‑‑

LISTNUM 1 \l 11861             MR. NEETI RAY:  Yes, in fact, as we have specified in our CCD commitments, that we would encourage local artists, Canadian talents to come forward and provide us with their musical recordings so that we can expose them on the radio and this is an opportunity to them which for them would give them the chance to be heard by thousands of people, which they otherwise would not have had.

LISTNUM 1 \l 11862             COMMISSIONER DEL VAL:  Okay.  Then going to the spoken‑word programming, and you did mention the equal proportions of regional, local and international news, and I had noticed in your application you had set 33 percent local.

LISTNUM 1 \l 11863             So then the remainder would be 33 percent regional and then 33 percent national/international?

LISTNUM 1 \l 11864             MR. NEETI RAY:  Well, 33 percent local, 33 percent, say, international and 33 percent will be national and regional, like Ontario and the rest of Canada.

‑‑‑ Pause

LISTNUM 1 \l 11865             COMMISSIONER DEL VAL:  So then on your spoken‑word programming, would you be willing to commit to a condition of licence that would stipulate 36 hours per broadcast week of spoken word?

LISTNUM 1 \l 11866             MR. NEETI RAY:  Yes, we would commit to that as we have said in the supplementary brief.

LISTNUM 1 \l 11867             COMMISSIONER del VAL:  And would you be prepared to commit to 11.5 hours of content subcategory 11, which is news?

LISTNUM 1 \l 11868             MR. NEETI RAY:  Yes, we would.

LISTNUM 1 \l 11869             COMMISSIONER del VAL:  Now, you have also noted in your application what you ‑‑ you had a section called the bonus market, the Detroit bonus market.  Now, there is nothing wrong with availing yourself of any available resources and sources of revenue, but we note that the Canadian ‑‑ the Windsor population is a fraction, is a small fraction of the Detroit audience, and I know that you also plan to attract the Detroit audience.

LISTNUM 1 \l 11870             Now, what would be your incentive to not abandon or to neglect the much, much smaller market in favour of the larger, more lucrative Detroit market?

LISTNUM 1 \l 11871             MR. NEETI RAY:  I would like to clarify that there is neither the intention or remotely any plan of abandoning to any extent the local Windsor market.  That is our primary market and we are committed to serving the needs of that market.  We are not here to fulfil any of the FCC requirements.  We are strictly gearing our proposal to fulfilling the needs of the Canadian audiences.

LISTNUM 1 \l 11872             And having said that, I'm not sure if your question was also what we planned to do with the Windsor or with the Detroit audiences and businesses ‑‑

LISTNUM 1 \l 11873             COMMISSIONER del VAL:  I'm ‑‑

LISTNUM 1 \l 11874             MR. NEETI RAY:  ‑‑ and why it is important to us or is it important to us.

LISTNUM 1 \l 11875             My answer to that would be that I must once again reiterate that our business plan and our programming plans are predicated on the Windsor market.  However, when we called the Windsor market a bonus market, it is something that would flow into the proposed radio station as a natural whether we target them or not, whether we specifically do things that the Detroit residents' listeners want us to or not.  These are the benefits that would naturally flow into the proposed radio station.

LISTNUM 1 \l 11876             Why it is important for us?  There is only one reason why it is very important for us to ensure that we reach the Detroit audiences.  And by being forthcoming about it I don't want to give the impression that the Detroit audience has an importance for us except because the Windsor businesses who advertise on WNZK do so because they are not only able to attract the local ethnic population audiences of Windsor but also the Detroit audiences.

LISTNUM 1 \l 11877             It is vitally important for the ethnic businesses within Windsor to be able to attract them and they depend on the American businesses to make their businesses viable and profitable.  An Indian clothing, fashion clothing store would advertise, and they do advertise on WNZK.  Or an Indian jewellery shop or a Korean restaurant or a Vietnamese restaurant would advertise on WNZK not only because they want to attract the Windsor audiences but also the Detroit audiences and they depend on that business in order to make their businesses profitable.

LISTNUM 1 \l 11878             If we fail to provide the Windsor businesses the exposure that WNZK does they would not have the incentive to advertise with us, as they would to continue advertising with WNZK.

LISTNUM 1 \l 11879             So the big challenge that we face in making this radio station successful is that we must be able to give the Windsor advertisers what they are looking for.  As we have seen in the two examples that we read, two of the many letters that we have received from Windsor businesses who have said clearly ‑‑ and we have spoken to a number of them, to many of them in fact, especially in the Fort Erie street business improvement area ‑‑ they said, "We would love to advertise with you as long as you deliver us the clients that we are looking for."

LISTNUM 1 \l 11880             COMMISSIONER del VAL:  Thank you.

LISTNUM 1 \l 11881             And don't get me wrong.  I'm not saying that there is something wrong about attracting the resources from Detroit.  It's not that.  But I think it is also clear from the application that you would and actually tried to attract the American Detroit audience as well.

LISTNUM 1 \l 11882             So I mean in the balance our concern is that the fact that this is a Canadian station and that you would not abandon the Canadian market ‑‑ would not ‑‑ that that would not happen.  So then, now, would you have some programming that is catered specifically to the Detroit market?

LISTNUM 1 \l 11883             And I'm just trying to understand what the station is going to sound like, what the programming is.  I'm not trying to trap you into saying is there something for the Americans.  Of course you have to have something for the Americans if you want their dollars.

LISTNUM 1 \l 11884             MR. NEETI RAY:  No.  We do not have to have that.  That is; you know, things in the programming that specifically caters to the Detroit audiences, we do not have to have that in order to attract those audiences.  They would be attracted naturally by simply the quality of the programming that we intend to broadcast.

LISTNUM 1 \l 11885             It may be worthwhile to mention that the WNZK programs are all 100 percent what they call leased‑out programs or brokered programs and there is no mechanism in place that we know of that would ensure that they are meeting the needs of their own people.  And it's none of our business but I am mentioning that because in our radio station, our proposed radio station, even the brokered programming would operate in more or less the same way as the station‑produced programming.  We will be monitoring them.  We will be helping our programmers.  We train them.  We ensure that they are capable of producing high quality programming.  So that is one difference.

LISTNUM 1 \l 11886             Therefore, we as a result have that natural flow of audiences from Detroit.  And once again, we do not have to do anything else in order to attract them.

LISTNUM 1 \l 11887             So the orientation will remain completely ‑‑ almost completely Canadian.  It doesn't mean that we may not talk about events going on in Windsor because they are also of interest to ethnic communities within Windsor as well.  I give the example of the Italian or the Indian or the Hungarian communities or the other communities, the Arab communities.  They have their sister communities and they go ‑‑ they commute not only to work in the U.S. and shop in the U.S., but also to attend these functions and, you know, go to relatives or friends.

LISTNUM 1 \l 11888             COMMISSIONER del VAL:  I will ask you some questions about brokered programming and well, that's a good opening.

LISTNUM 1 \l 11889             So one of the questions that I was going to ask, that you brought up is your projection that 20 percent of your revenues will come mainly from the Detroit station.  So how did you come up with the 20 percent?  Is it what you have just said, that it will just naturally flow or do you have some plan to target the advertisers there and maybe some of the advertisers there are Canadian and you are trying to repatriate?

LISTNUM 1 \l 11890             So could you talk ‑‑ tell me about your plans to get that 20 percent?

LISTNUM 1 \l 11891             MR. NEETI RAY:  The 20 percent in our projection consists in fact more of Canadian advertisers advertising on WNZK than American advertisers.  Therefore, when we say that our projection of 20 percent is conservative it is because we have not, except to a minimal degree, taken into account the prospect of advertisers from Windsor ‑‑ sorry, from the U.S. side, from Detroit.

LISTNUM 1 \l 11892             Would we target them?  Well, I guess it would be wise to do so because there is nothing that ‑‑ they don't stop us from doing that and we would be making the radio station benefit from that bonus market that exists and there would also ‑‑ we expect some natural flow of businesses as well because once everybody finds out that there is a great radio station going on and a lot of people are listening to it, well, obviously you like to advertise on that.

LISTNUM 1 \l 11893             So yes, we do expect businesses to come from there.  Exactly what percentage I couldn't tell you at this time.  We didn't go into details of how much, but we are confident looking at the existing radio stations in Windsor and what they garner from the U.S. market is that our projection of that part of the revenue is conservative.

LISTNUM 1 \l 11894             COMMISSIONER del VAL:  So can I gather ‑‑ conclude from your response that at this point there is ‑‑ there hadn't yet been any advertiser survey done that would form the basis of the 20 percent?

LISTNUM 1 \l 11895             For example, did you do any survey to see how many of the Windsor merchants are actually advertising on the Detroit station and then how many have you approached to say, "Would you move your advertising to us, so add us to your advertising budget?"  Have you done anything like that?

LISTNUM 1 \l 11896             MR. NEETI RAY:  Yes, absolutely.  We have made personal contacts with a number of businesses within the Windsor market, ethnic businesses, many of whom are currently advertising on WNZK.  And our three partners from Windsor are well aware ‑‑ are very familiar with that market.

LISTNUM 1 \l 11897             And having spoken to a number of the businesses like the ones we have quoted and like the ones who have written to the Commission, like the ones we have contacted, dozens of them have expressed abundantly their interest to advertise on our radio station, simply because most of them sometime or the other have advertised on WNZK.  And having a local radio station with local context, and having learned from us that this would you know cater to the local needs of the ethnic population of Windsor, there was a lot of interest in advertising on our radio station.

LISTNUM 1 \l 11898             As far as Detroit is concerned I'm not sure if you are asking that question ‑‑ probably you did ‑‑ that if any business in Detroit may have spoken to you, yes, we have spoken to some businesses in Detroit and they said, "Absolutely.  Whoever gives us the product we will certainly advertise on them.  Deliver us the product and you will have our business."

LISTNUM 1 \l 11899             COMMISSIONER del VAL:  So at this point would it be fair to say you have good promising leads and no commitments yet, but you don't have a station yet either?

LISTNUM 1 \l 11900             MR. NEETI RAY:  Right, it would be premature to have commitments.  But yes, absolutely, we have clear indications from businesses, ethnic businesses, to advertise on the proposed radio station.

LISTNUM 1 \l 11901             COMMISSIONER del VAL:  And what about the ‑‑ any synergies you see from your recently licensed Mississauga station?

LISTNUM 1 \l 11902             MR. NEETI RAY:  Yes, we do.  And because that radio station has not been implemented yet and it would be premature for us to project some of the synergies that we know will take place ‑‑ therefore we have been very cautious when we wrote to the Commission subsequent to being licensed in Mississauga that the synergy that we can see for sure at this time are some of the aspects in the administration of the radio station.

LISTNUM 1 \l 11903             But we know that there will be many more synergies that could take place including in programming that we ‑‑ Toronto is a much larger centre of ethnic programming and we plan to produce programming not only for Windsor but some programming specifically made for Windsor.  So that would reduce some of the programming costs in Windsor.  That we have not put on record earlier because I thought and I still think that it would be premature to give any specific numbers in there.

LISTNUM 1 \l 11904             But we ‑‑ to answer your question, yes, there will be synergies that would help us in our undertaking, our proposed undertaking in Windsor.

LISTNUM 1 \l 11905             COMMISSIONER del VAL:  So I will go back to the program costs later but just going back to the financial, your business case and the projections.  Now, I think you are projecting in year one the 12‑plus tuning would be about 1 percent and then going up by year seven to about 1.6 percent.

LISTNUM 1 \l 11906             Now, according to our stats, I think the BBM Spring 2007 ‑‑ but tuning to the Detroit station is only 0.1 percent.  So compared to your projections it makes me think that your projections for tuning are a bit optimistic.  Could you please comment on that?

LISTNUM 1 \l 11907             MR. NEETI RAY:  I haven't ‑‑ did you say that the BBM has indicated that WNZK has ‑‑

LISTNUM 1 \l 11908             COMMISSIONER del VAL:  WZNK.

LISTNUM 1 \l 11909             MR. NEETI RAY:  Has a tuning of 0.1 percent.

LISTNUM 1 \l 11910             COMMISSIONER del VAL:  0.1 percent.  And if my numbers are wrong please correct me.

LISTNUM 1 \l 11911             MR. NEETI RAY:  I am not sure.  I have not seen ‑‑ I have not seen that survey or the results of the BBM.

LISTNUM 1 \l 11912             COMMISSIONER del VAL:  Well, perhaps then we can just focus on the basis of your 1 percent projection, why you feel that that is realistic.

LISTNUM 1 \l 11913             MR. NEETI RAY:  It is ‑‑ our estimation was based on our experience in other markets.

LISTNUM 1 \l 11914             DR. WINN:  Neeti, it's Conrad.  Could I just say something technical?

LISTNUM 1 \l 11915             MR. NEETI RAY:  Yes, sure, please.  Yes, go ahead.

LISTNUM 1 \l 11916             DR. WINN:  Unless you are using multilingual interviewers you are going to ‑‑ on your sample the people who don't speak English.

LISTNUM 1 \l 11917             MR. NEETI RAY:  Thank you.

LISTNUM 1 \l 11918             What I was in fact ‑‑ what I was going to say is also that BBM ‑‑ in conversation with BBM at one point I was told that it is not possible for us; that is, for BBM, to gauge ethnic audiences accurately as they would be able to the mainstream.

LISTNUM 1 \l 11919             COMMISSIONER del VAL:  I'm aware of that problem.

LISTNUM 1 \l 11920             MR. NEETI RAY:  Yes, for ‑‑

LISTNUM 1 \l 11921             COMMISSIONER del VAL:  Yes, and so ‑‑

LISTNUM 1 \l 11922             MR. NEETI RAY:  So the 1 percent is based on our experience of ‑‑ I worked for CKER Edmonton for nine years for the radio station and of course our ‑‑ my programming in the past in Toronto and the other radio stations in Toronto that are ethnic.  It would be reasonable to say that a 1 percent compared to the percentage points in Edmonton and Toronto is reasonable if not conservative.

LISTNUM 1 \l 11923             The other point that I would like to make in response to the results of the BBM that you just quoted is that in the COMPAS survey which was not specifically targeting any segments of the population but the general population, 20 percent indicated that they listen to the Detroit ethnic radio station.  That, I guess, is more in my view ‑‑ in our view that is more authentic than the BBM.

LISTNUM 1 \l 11924             COMMISSIONER del VAL:  Thank you.

LISTNUM 1 \l 11925             Then I'm looking at your revenue and PBIT projections and in year three you had projected ‑‑ so rounding off it's 27 percent for your PBIT margin.

LISTNUM 1 \l 11926             Now, I'm not ‑‑ I don't know whether you are aware that when I look at the overall figures for Canada and for the rest of Ontario, for the rest of Ontario it's about 13.7 percent and for Canada it's about 8.4 percent.

LISTNUM 1 \l 11927             MR. NEETI RAY:  I'm sorry.  If you don't mind could you repeat that to me?  I guess I lost you on the ‑‑

LISTNUM 1 \l 11928             COMMISSIONER del VAL:  Sorry, your ad revenue and PBIT projections for year three.

LISTNUM 1 \l 11929             MR. NEETI RAY:  Which is $715,000.

LISTNUM 1 \l 11930             COMMISSIONER del VAL:  Yes.

LISTNUM 1 \l 11931             MR. NEETI RAY:  Okay.

LISTNUM 1 \l 11932             COMMISSIONER del VAL:  And the PBIT margin is 27 percent.  Is that ‑‑ or do I have that wrong?

LISTNUM 1 \l 11933             MR. NEETI RAY:  That's 11.7 percent increase from the previous year.

LISTNUM 1 \l 11934             COMMISSIONER del VAL:  Yes, and if ‑‑ but the PBIT margin itself is 27 percent, isn't it?

LISTNUM 1 \l 11935             MR. NEETI RAY:  From year one.

LISTNUM 1 \l 11936             COMMISSIONER del VAL:  Yes.

LISTNUM 1 \l 11937             MR. NEETI RAY:  What we have projected is ‑‑

LISTNUM 1 \l 11938             COMMISSIONER del VAL:  Yes.

LISTNUM 1 \l 11939             MR. NEETI RAY:  ‑‑ the second year the increase will be the greatest which is 16.4 percent.

LISTNUM 1 \l 11940             COMMISSIONER del VAL:  M'hm.

LISTNUM 1 \l 11941             MR. NEETI RAY:  And third year it will go to 11.9 percent increase in revenue and then of course it will taper down to 7 percent in the next year, and then will go further down.

‑‑‑ Pause

LISTNUM 1 \l 11942             COMMISSIONER del VAL:  But is the PBIT margin in year three in absolute numbers, not as a comparison, is it not 27 percent?  Do I have the calculation wrong then?

LISTNUM 1 \l 11943             MR. NEETI RAY:  Are you saying 20 percent ‑‑ 27 percent over the first year revenue?

LISTNUM 1 \l 11944             COMMISSIONER del VAL:  No, not as ‑‑

‑‑‑ Pause

LISTNUM 1 \l 11945             MR. NEETI RAY:  I think you are summing the year two increase and year three increase together to bring it to 27 percent.

LISTNUM 1 \l 11946             COMMISSIONER del VAL:  I have your PBIT margin for year one is 11 percent.  Do you ‑‑ do I have my numbers wrong?

LISTNUM 1 \l 11947             MR. NEETI RAY:  Oh, 11 percent of what?

LISTNUM 1 \l 11948             COMMISSIONER del VAL:  That would be your ‑‑ that would be your margin.

‑‑‑ Pause

LISTNUM 1 \l 11949             MR. NEETI RAY:  I apologize.  I am not sure I am ‑‑

LISTNUM 1 \l 11950             COMMISSIONER del VAL:  That's okay.

LISTNUM 1 \l 11951             MR. NEETI RAY:  ‑‑ understanding the question well what the 27 percent relates to.  Radhika has something to say.

LISTNUM 1 \l 11952             MS RAY:  Sorry, could you just say what numbers you are using to get to the PBIT?

LISTNUM 1 \l 11953             COMMISSIONER del VAL:  Say for year one what do you have for your PBIT margin?

LISTNUM 1 \l 11954             MR. NEETI RAY:  And what are you looking at, which part of our application?

LISTNUM 1 \l 11955             COMMISSIONER del VAL:  Maybe without looking at the numbers, I would say that say by your year three ‑‑ if I said by year three your revenue projections are high, particularly compared to what ethnic stations are doing in the rest of the country and in Ontario, would you agree with that?

LISTNUM 1 \l 11956             MR. NEETI RAY:  I am not sure if I would agree with that.  One thing to keep in mind when looking at these numbers is, unlike Toronto or Vancouver or Montreal where you have a number of stations to take small pieces of the pie, Windsor does not have any station to cater to the market and, therefore, we would be the only one there.  Therefore this is, if I can put it this way, is that the entire pie would, we would be the only one to garner that.  And I am not sure if that makes sense.

LISTNUM 1 \l 11957             COMMISSIONER del VAL:  Yes, m'hmm.

LISTNUM 1 \l 11958             MR. NEETI RAY:  But what I am saying is that these projections are based on our estimation of the total number of businesses in Windsor, the businesses who are advertising on ‑‑ it is based on the size of the ethnic businesses in Windsor and whatever we will get conservatively estimated from the U.S.

LISTNUM 1 \l 11959             But are you asking me that the profit level, as well, is high?  Is that what you are getting at?

LISTNUM 1 \l 11960             COMMISSIONER del VAL:  Yes, yes.

LISTNUM 1 \l 11961             MR. NEETI RAY:  In the assumption, if we go to the details of the cost of the programs, which only increased 3 to 5 per cent each year.

LISTNUM 1 \l 11962             Okay, let us start with year two. It is the largest increase, because we are hoping that by the time the first full year of operation completes that we would have promoted ourselves enough to garner more audiences.  And by the end of the second year we would have reached a much larger number of audiences because of better awareness created during the first 24 months.  And therefore, the second year has the largest increase.

LISTNUM 1 \l 11963             One thing that does not change to the extent that the revenues change are the expenses.  So because the expenses remain more or less at the same level, increasing 3 to 5 per cent, is that the profit is higher as the revenues increase.  So there is more leverage that we are taking advantage of.

LISTNUM 1 \l 11964             I hope that makes sense.

LISTNUM 1 \l 11965             COMMISSIONER del VAL:  Yes.  And I apologize for not switching fast enough to say PBIT, you know, profit, but that was exactly what I was looking for.

LISTNUM 1 \l 11966             But now, what would you say if I told you that your programming costs, compared to other ethnic stations across Canada and in Ontario, are very low?

LISTNUM 1 \l 11967             MR. NEETI RAY:  I am going to point out something which is important to keep in mind, it is we only have 70 hours per week of programming that our station produced.  Fifty‑six hours of programming are brokered out and no programming costs incur as a result of that.  So there is a substantial saving in the programming as a result of the 56 hours of brokered programming that, as I said, will cost us nothing.

LISTNUM 1 \l 11968             COMMISSIONER del VAL:  Okay, great.  Thank you, that is a perfect segway into my question on brokered programming.

LISTNUM 1 \l 11969             So on the 56 hours of brokered programming, what are the sources that you know of now, where are you going to get the brokered programming from?

LISTNUM 1 \l 11970             MR. NEETI RAY:  Oh, we have had contacts already in order to gauge the demand for brokered programming.  We have seven signed letters of intent to broker programs out.  We have them in writing and, if necessary, we can provide copies of that to the Commission, from seven programmers, various languages like Serbian and Hungarian, Polish and so on who have already committed to..

LISTNUM 1 \l 11971             And we wanted to gauge if there is interest or not, so we called a number of, you know, those who would be interested through their organizations.  And to answer your question, yes, there is great interest and we see, as a result, that there will be no problem finding brokers who would work within our guidelines.

LISTNUM 1 \l 11972             COMMISSIONER del VAL:  Okay.  Then you have in your deficiency response given quite a comprehensive answer about your guidelines.  But I would just like to find out a bit more about how you will select your independent producers for your programs.

LISTNUM 1 \l 11973             MR. NEETI RAY:  It would be done with the help of the various organizations that we are ‑‑ if I can use the word, partnering up with, who would be on our advisory council.  And we have provided a list of those organizations in the addendum to the supplementary brief.  And we have been working closely with them.  In fact, that is what resulted in these seven brokers how provided us their letters of intent.

LISTNUM 1 \l 11974             We would do this in conjunction with the organizations within each ethnic community whose programming would be brokered out to them.

LISTNUM 1 \l 11975             COMMISSIONER del VAL:  Can I just ask, on the seven, are they all local or..?

LISTNUM 1 \l 11976             MR. NEETI RAY: I am sorry?

LISTNUM 1 \l 11977             COMMISSIONER del VAL:  Oh sorry, of the seven that have signed letters of intent, are they local?

LISTNUM 1 \l 11978             MR. NEETI RAY:  Yes, absolutely.  All Windsor, local Canadian individuals and organizations.

LISTNUM 1 \l 11979             COMMISSIONER del VAL:  And what kind of professional backgrounds are you looking for in your independent producers?

LISTNUM 1 \l 11980             MR. NEETI RAY:  We do not expect that there would be many who have ‑‑ well, some would have and some do have very good background. In fact, one of the, the President of the Hungarian Concert Club, he's been doing a program on WNZK for many years.  And he's one of the persons, of course, who has signed the letter of intent.  We don't expect many of them who would be really experienced.

LISTNUM 1 \l 11981             COMMISSIONER del VAL:  Yeah, perhaps ‑‑

LISTNUM 1 \l 11982             MR. NEETI RAY:  But we are also aware that there are talents whose talents have not been exploited.  And I am a broadcast trainer myself, and that was one of my jobs at Radio CKER, is to train various language groups, even though I did not speak say Chinese or Korean. But the principles of broadcasting are the same.  You know, effective broadcasting is the same in all languages, whether it is voice modulation or writing the right scripts.

LISTNUM 1 \l 11983             So we would find, with the help of the organizations who are participating with us, the talents who are capable of broadcasting and we will chisel them and, you know, shape them into good broadcasters.

LISTNUM 1 \l 11984             COMMISSIONER del VAL:  Thank you.

LISTNUM 1 \l 11985             Then we can move onto CCD.  I believe you were here yesterday when we were talking about the commercial radio policy in 2006. And the guidelines there, in paragraph 116 ‑‑

LISTNUM 1 \l 11986             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 11987             COMMISSIONER del VAL:  ‑‑ for a basic annual contribution.

LISTNUM 1 \l 11988             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 11989             COMMISSIONER del VAL:  Can you confirm that you understand those and that would commit to..?

LISTNUM 1 \l 11990             MR. NEETI RAY:  Yes, absolutely.  I do understand that if it is less than $625,000 then we pay $500; and between $625,000 and $1.25 million is $1,000.  Anything over that is 0.5 per cent plus the $1,000.

LISTNUM 1 \l 11991             COMMISSIONER del VAL:  Great, thank you.

LISTNUM 1 \l 11992             Those are my questions.  Thank you very much for your time.

LISTNUM 1 \l 11993             MR. NEETI RAY:  Thank you.

LISTNUM 1 \l 11994             COMMISSIONER del VAL:  Thank you, Madam Chairman.

LISTNUM 1 \l 11995             THE CHAIRPERSON:  Commissioner Menzies.

LISTNUM 1 \l 11996             COMMISSIONER MENZIES:  Good morning, Mr. Ray.

LISTNUM 1 \l 11997             MR. NEETI RAY:  Good morning, sir.

LISTNUM 1 \l 11998             COMMISSIONER MENZIES:  I will try to be fairly quick.  First of all, I would like to add my condolences to those already expressed by the Commission.

LISTNUM 1 \l 11999             I have a couple of questions, quickly, on your business plan.  And I am assuming you have a background in this.  I am struck by the salary levels and I wanted to know that you are confident that you can recruit and retain the quality that you need at those levels for the number of people that you are covering, particularly in programming, salaries, wages and fringe benefits $105,000.

LISTNUM 1 \l 12000             MR. NEETI RAY:  Yes, we have worked in the $35,000 per annum for all the employees, that is the average including the benefits.  And if we look at the detailed profit and loss statement, we would have no problem meeting our obligations, given the $35,000 per year, which, in my opinion, is no different from some of the other centres that I am aware of, except Toronto where it is certainly higher, slightly higher than that, not significantly higher.

LISTNUM 1 \l 12001             But the average, $35,000, I guess would be reasonable for programmers who are skilled programmers or say the other employees of the radio station.  I couldn't think of anything drastically less than that.  If I remember correctly, Edmonton and Calgary have the same, they are paying their employees and average of about $35,000 as well.

LISTNUM 1 \l 12002             So to answer your question in short, we have considered that and it should be no problem for us.

LISTNUM 1 \l 12003             COMMISSIONER MENZIES:  Thank you. Also, your bad debt expenses at $8,000 first year and progressing roughly on a percentage basis from there.  Given the nature of a lot of your advertising being relatively independent small shops, restaurants, retail, that sort of stuff, that strikes me as low.  Can you help me understand that a bit more?

LISTNUM 1 \l 12004             MR. NEETI RAY:  Yes.  It may look low because of what the average maybe is in the market or markets.  From our personal experience, I have had brokered programming that we have had in Toronto and the advertisers were all the small businesses.  But the way that we conducted our business, we had I will say between 90 and 95 per cent recovery simply because our programming were of very high quality, they had to advertise with us, but we always took the payments in advance.  We would not advertise them in Toronto without getting all the payments in advance.  So that is one of the strategies that we have used.

LISTNUM 1 \l 12005             Now, in Windsor we may not, at the beginning, be able to do that, but I have used our previous experience to come up with the bad debt. Now, even if the bad debt is more than that, if we go to the profit levels in the subsequent years, we should be able to absorb a higher level of bad debt in the Windsor proposed station.

LISTNUM 1 \l 12006             COMMISSIONER MENZIES:  Okay. It is very wise of you, good for you.

LISTNUM 1 \l 12007             I was struck by Ms Ray's comment about the ability of a project such as this to help alleviate social isolation among people living without the ability to speak either official language.  I suppose some could argue that this sort of a project could also confirm that social isolation, unless there was a strong dedication to fostering shared Canadian identity.

LISTNUM 1 \l 12008             And I would like you to expand on that a little bit for me, the extent to which the station, apart from news, because you can get news elsewhere, what your station would do to help foster shared Canadian identity.

LISTNUM 1 \l 12009             DR. TEMELINI:  Can I say something about that?

LISTNUM 1 \l 12010             MR. NEETI RAY:  Yes, Dr. Temelini.

LISTNUM 1 \l 12011             COMMISSIONER MENZIES:  Sure.

LISTNUM 1 \l 12012             DR. TEMELINI:  My experience and my research have shown that the freedom to express oneself or to use one's language will foster confidence in one's individual identity.  And a security identity will impact positively on responsible citizenship, harmonious society, at least social interaction that will lead to the ideal of Canadian multiculturalism, which is national unity.

LISTNUM 1 \l 12013             This is just a brief summary of an article that I have written some years ago.  Thank you.

LISTNUM 1 \l 12014             COMMISSIONER MENZIES:  I guess what I am trying to get at a little bit is your station versus your counterpart across the river, that if one is Canadian and one is American, I am just trying to get a broader understanding of what makes one Canadian and what makes one American other than the passport of the owner.

LISTNUM 1 \l 12015             MR. NEETI RAY:  As far as news is concerned, let me start with that, with your permission, one thing that was similar between the two stations would be international news.  But one thing that will not be similar would be local news, local information, events within the local community.

LISTNUM 1 \l 12016             Another very important aspect is for them to be able to interact through the radio, share not only their values but also their concerns, issues.  And also services available, for example, English as a second language, we would promote that.  One of the intentions of this proposed radio station, as was our brokered programming in Toronto, was to help the various communities to integrate into the mainstream.  It would help those who are isolated come out and participate in the activities of the mainstream.

LISTNUM 1 \l 12017             There was research by Raymond Breten whose research has been very helpful to various social agencies in helping immigrants integrate.  He commented at one point that for immigrant populations, the immigrant people who are of third language, who are not fluent in English or French, for them a radio program in their own language provides the comfort and solace similar to religious institutions that they go to, that cater to their own faith, whether they are Sikhs or Jews or Muslims, whoever.

LISTNUM 1 \l 12018             So our radio station, first, will provide that comfort to them.  And having become comfortable, the information we impart to them that will help them to integrate, they will be more sensitive to that and we do intend doing that as effectively as possible.  Through information about local laws, what is going on in the local community, what our obligations are and so on and so forth.

LISTNUM 1 \l 12019             COMMISSIONER MENZIES:  Thank you for clarifying.

LISTNUM 1 \l 12020             Are there other ethnic media, not broadcast, but other print I guess or online currently in Windsor or circulating in Windsor?

LISTNUM 1 \l 12021             MR. NEETI RAY:  Big time.  In fact, one of the major Italian magazines is called La Gazetta, Dr. Temelini is the editor of that magazine.  But that is not the only magazine.  In every community the print media is about the only way for the ethnic population to read news, to find out about what is on sale in the ethnic stores and businesses.

LISTNUM 1 \l 12022             So to answer your question in short, yes, the print media is there big time.

LISTNUM 1 \l 12023             COMMISSIONER MENZIES:  Okay.  So there is an existing pool from which you can draw your 15 per cent from other media?

LISTNUM 1 \l 12024             MR. NEETI RAY:  Absolutely.

LISTNUM 1 \l 12025             COMMISSIONER MENZIES:  That would be what that represents?

LISTNUM 1 \l 12026             MR. NEETI RAY:  Yes, yes.

LISTNUM 1 \l 12027             COMMISSIONER MENZIES:  One last question was just in regarding ‑‑ and you may have touched on this earlier, but I would just like a final clarification.

LISTNUM 1 \l 12028             If you are looking at 20 per cent of your advertisers from the U.S. side of the border, you and I have both been around long enough to know that the needs of advertisers and the needs of listeners don't always coincide.  And I want just to hear from you if you see that as being a possible conflict in terms of the Canadian identity of your programming?

LISTNUM 1 \l 12029             MR. NEETI RAY:  It would ‑‑ the Canadian identity will not hamper, in our view, the development of audiences on the U.S. side of the border.  In fact, it just came to me that my daughter, listens to 98.5 in Toronto, you know, fairly often, which is a station from Buffalo.  And it has an American orientation, but because the programming is of high quality and the music is what they are looking for, then a lot of youngsters listen to that radio station.

LISTNUM 1 \l 12030             Similarly, our Canadian orientation is in context of the spoken word programming and in the Canadian content musically, which I would say the ethnic population in American would not only not mind listening to, would probably enjoy listening to.

LISTNUM 1 \l 12031             So whether it overlaps the needs of the business community and the audiences, what is fundamentally important for us is the audience. If we have the audience on this side of the border then, of course, we know it is very important to have on the other side of the border, simply because of the business side of it and to be able to fulfil the needs of the ethnic businesses in Windsor, our high quality programming itself would garner the businesses that we need.

LISTNUM 1 \l 12032             So the quality of the programming and the Canadian orientation will compliment the business possibilities.

LISTNUM 1 \l 12033             COMMISSIONER MENZIES:  Thank you.

LISTNUM 1 \l 12034             THE CHAIRPERSON:  Mr. Ray, I too have some follow‑up questions.

LISTNUM 1 \l 12035             Earlier, you said that there was little or no difference in the ethnic makeup of Detroit and Windsor, correct?

LISTNUM 1 \l 12036             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12037             THE CHAIRPERSON:  I am looking at your supplementary brief and you did provide examples of Detroit's ethnic population figures.

LISTNUM 1 \l 12038             My first question is:  Are these population figures based on ethnic origin or mother tongue?

LISTNUM 1 \l 12039             MR. NEETI RAY:  They are based on ethnic origin.

LISTNUM 1 \l 12040             THE CHAIRPERSON:  Okay.

LISTNUM 1 \l 12041             MR. NEETI RAY:  Yeah.  Otherwise ‑‑

LISTNUM 1 \l 12042             THE CHAIRPERSON:  The reason I ask is with every ethnic service your core audience is mother tongue.

LISTNUM 1 \l 12043             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12044             THE CHAIRPERSON:  It may or may not extend to ethnic origin but the reality is your core audience is going to be mother tongue.

LISTNUM 1 \l 12045             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12046             With your permission if I can just add to that.

LISTNUM 1 \l 12047             THE CHAIRPERSON:  Please.

LISTNUM 1 \l 12048             MR. NEETI RAY:  In fact, you asked me if it is my mother tongue or not.  Well, it is not.  For example, the German population in Detroit is over 900,000.  This includes the second and third generation who have indicated an ethnic origin that is German but not all of them would be speaking German.  A good proportion of them would speak German but also a good proportion of them who do not fluently speak German would relate to the music that would be played on the German programming.  So I am giving you one example.

LISTNUM 1 \l 12049             But there are other communities, for example, the Indian community in Detroit, which is 45,000 to 50,000, if I remember correctly.  A larger proportion in such communities would understand ‑‑ would speak their language more fluently.  These are the groups that are not ‑‑ that came later into the United States and Canada, not the first wave, which was the Europeans but the second or the third wave of immigrants in which the population would have a much larger proportion of those who use their heritage language at home.

LISTNUM 1 \l 12050             THE CHAIRPERSON:  And what is your definition of a good proportion?  Is it more that 50 percent, is it more than 75 percent?

LISTNUM 1 \l 12051             MR. NEETI RAY:  Well, every community would have its own proportion.  The Indian community would have perhaps more than 75 percent.  The Arab community would have more than 75 percent.  The German community may not have more than maybe 15 percent.  The Italian community might not have more than 30 percent.

LISTNUM 1 \l 12052             THE CHAIRPERSON:  And are those the factors that you took into consideration in determining the ethnic languages in which you would broadcast?

LISTNUM 1 \l 12053             One of the reasons I ask the question is if we go back to your earlier statement that there is little or no difference in the ethnic makeup, the second largest group ‑‑ well no, it is equal to the five Arabic groups ‑‑ is Chinese, for example.  So you are going to do 15 hours a week of Cantonese programming.

LISTNUM 1 \l 12054             We don't have a breakdown of the ethnic makeup of the Windsor market but if I look at the ethnic makeup of the Detroit market and refer it back to your statement, there is no Chinese.

LISTNUM 1 \l 12055             MR. NEETI RAY:  That further confirms our ‑‑

LISTNUM 1 \l 12056             THE CHAIRPERSON:  So why did you ‑‑ what made you decide to use Cantonese language programming on this radio station, as an example?

LISTNUM 1 \l 12057             MS PORTER:  Excuse me, can I just state the 2006 Census that says the top countries of place of birth, the immigrant population as a percentage of total immigrants who came to Canada from 2001 to 2006 was U.S. first, followed by India, then China, then Pakistan, then Romania.

LISTNUM 1 \l 12058             THE CHAIRPERSON:  I appreciate that but I want to know how many of those people came to Windsor.

LISTNUM 1 \l 12059             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12060             THE CHAIRPERSON:  Do you know what I mean?  That is the relationship I need to know.  I need to know what population this proposed radio station is serving.

LISTNUM 1 \l 12061             MS PORTER:  That was Windsor.

LISTNUM 1 \l 12062             THE CHAIRPERSON:  Okay, thank you.

LISTNUM 1 \l 12063             MS PORTER:  Yes.

LISTNUM 1 \l 12064             MR. NEETI RAY:  To answer your specific question, that we have a very good chunk of program for Chinese in Windsor even though there are not so many of them in the same proportion on the U.S. side as the other languages, is it further confirms our contention that this radio station is a Canadian radio station.  Our orientation is Canadian.

LISTNUM 1 \l 12065             When we focused on the need we looked not at the U.S. side of the border, we looked at the Canadian side of the border and we believe that the Chinese community is very prosperous in Windsor.

LISTNUM 1 \l 12066             The Chinese business community is one of the strongest among ethnic communities of that size in Windsor.  Therefore, we thought it would be good to have programming and also because the Chinese community is one of the communities who have ‑‑ we find that they have one of the largest proportions of the use of their mother tongue at their homes and at their work.

LISTNUM 1 \l 12067             THE CHAIRPERSON:  So it is not necessarily true therefore that there is little to no difference in the ethnic makeup of Detroit and Windsor?

LISTNUM 1 \l 12068             MR. NEETI RAY:  It is not like a mirror image of one to the other.  But if you take overall, then every community, almost every community, if not all, have their sister communities on the other side of the border.  So Chinese is quite exceptional.

LISTNUM 1 \l 12069             THE CHAIRPERSON:  Okay.  You also said that brokered programming will cost you nothing.  But there is essentially a cost to your business of having brokered programming.  That is in the way of not having those advertising minutes available to you to sell.

LISTNUM 1 \l 12070             Am I correct in that is how you will broker programming, that is, you will give it to a producer, that producer will sell the minutes of advertising in that program, therefore not available to you?

LISTNUM 1 \l 12071             MR. NEETI RAY:  With the exception of every hour of the brokered programming, similar to every other ethnic radio station in Canada that brokers time out, every hour would have two minutes available to the radio station to satisfy the needs of our clients, mainly national advertisers.

LISTNUM 1 \l 12072             So that is not entirely true that we don't have anything in there.  We do have two minutes in every hour of the brokered programming to advertise on.

LISTNUM 1 \l 12073             THE CHAIRPERSON:  And you anticipate that those two minutes will be national advertisers?

LISTNUM 1 \l 12074             MR. NEETI RAY:  Most of them would be national advertisers.

LISTNUM 1 \l 12075             THE CHAIRPERSON:  Okay.  And I want to go back a little bit to what both commissioners del Val and Menzies talked to you about, and that is advertising, because it is obviously the basis of your business plan and we are certainly not here to satisfy advertisers, we are here to satisfy Canadian listeners.

LISTNUM 1 \l 12076             So I get it completely why you would want to propose an ethnic radio station for Windsor and that we need to serve the needs and desires of the Canadian audience.  I get that completely, of course, but the reality is that it does depend on advertising.

LISTNUM 1 \l 12077             So right now the situation is we have an American service that is available in the Windsor market.  We have Canadian advertisers who are advertising on that U.S. service.  We have Canadian listeners listening to that U.S. service.  Your advertisers have told you:  Yes, terrific, we will support you but you have to give me the audience that my current advertising on the American station gives me.  That is basically the general picture.

LISTNUM 1 \l 12078             The result is, however, that if licensed you will be splitting the audience because the American station will still be available in Canada.  So you are now giving Canadian listeners a choice between your service and the U.S. service because it is not going to go away.  It is not like its signal is not going to be available in Windsor anymore.

LISTNUM 1 \l 12079             And of course, it is your hope that your programming will be compelling enough and relevant enough that the Canadian listeners will listen.  But that won't necessarily be true of the American listeners.

LISTNUM 1 \l 12080             They are not going to necessarily listen to the Canadian service, correct, not necessarily, because their needs will be met by their American service?

LISTNUM 1 \l 12081             MS PORTER:  I would like to say wearing my previous hat as communications ‑‑

LISTNUM 1 \l 12082             THE CHAIRPERSON:  We wear all kinds of hats.

‑‑‑ Laughter / Rires

LISTNUM 1 \l 12083             MS PORTER:  When I was at CBC in Windsor radio, we did numerous focus group studies and the reality of living in Windsor is, of course, the American border and the choice of a multitude of radio stations.  It is the busiest place on the dial anywhere in Canada.

LISTNUM 1 \l 12084             Overwhelmingly, each focus group sessions, year after year, clearly identified a strong need by people who live in Windsor and Essex County to have Canadian programming, to have Canadian news and information, and I think that that holds true even from our immigrant population as they adjust to their new life and including the people who have been there for a long time.

LISTNUM 1 \l 12085             THE CHAIRPERSON:  Oh! Yes.  I get that completely.

LISTNUM 1 \l 12086             MS PORTER:  Okay.

LISTNUM 1 \l 12087             THE CHAIRPERSON:  I get that completely.  The road I am going down is this quite simply.

LISTNUM 1 \l 12088             If your Canadian advertisers have said to you:  Absolutely, we will support you but you have got to give us the audience or at least a comparable level of audience that the U.S. service gives us, you are now coming on with a Canadian service, the Canadians are going to be listening to that Canadian service; correct?

LISTNUM 1 \l 12089             You are cutting off from the American service, hopefully, the Canadian listeners who have gone to that American service.  The Americans may not listen to your Canadian service because they have got their own.

LISTNUM 1 \l 12090             So are you not, therefore, decreasing the expectation from the viewpoint of the advertisers?  In other words, what guarantees or assurances ‑‑ because guarantees may be too strong a word ‑‑ what assurances can you give the Canadian advertisers that your programming is going to be compelling enough to be able to give them the same rate of return on their advertising that they are getting on the American station?

LISTNUM 1 \l 12091             Because you are splitting the audience.  And that is a good thing because, like I said, Canadians should have a Canadian service.  So that is a good thing.  I am not disputing that at all.

LISTNUM 1 \l 12092             But if your business plan is not realized because you cannot deliver the audience to your advertisers, we end up with no service to Canadians.

LISTNUM 1 \l 12093             So I want the hook, is really what I am after, as to what is going to make your service so terrific that Canadian advertisers will say:  You know what, I am with you a hundred percent, may even decrease their budget on the American service, if not eliminate it altogether so that you can realize your business plan and therefore provide the best programming possible to Canadians?

LISTNUM 1 \l 12094             That is the bottom line.  I went a roundabout way of doing that but that is what I want to know.

LISTNUM 1 \l 12095             MR. NEETI RAY:  All the very more reason that the 95.9 FM frequency is widely important for us.

LISTNUM 1 \l 12096             First of all, we would have a competitive advantage over WNZK simply because they are on the AM band and we propose to be on the FM band, and I guess traditionally and even currently if you had a choice between AM and FM, then unless the AM programming is so compelling, of such exceptionally high quality that people would prefer that over the FM.  That is one point.

LISTNUM 1 \l 12097             The other is the quality of programming.  Like I said, most of these WNZK programs, in fact, all of them are brokered programs.  So the owner of the station is more like a landlord and he has many tenants in there who can do what they want.

LISTNUM 1 \l 12098             We would focus on garnering audiences and in order to do that we would focus on the quality of programming.  The overall quality of the programming is not only what we would do in the spoken word which is of Canadian context but also the entertainment programming.

LISTNUM 1 \l 12099             In the spoken word, the news programming, we would ensure that it is so interesting and attractive that audiences on both sides of the border would tune in to us.

LISTNUM 1 \l 12100             I am not sure if this will make sense or not.  To cite an example, in 1995, if I remember correctly, in Toronto, 680News changed its format a year earlier than that to news from their music format.  We had an ethnic programming catering to the South‑Asian community, and that was on the St. Catharines radio station.

LISTNUM 1 \l 12101             The BBM, which I agree cannot gauge the ethnic audiences as good as they can mainstream, it did ‑‑ because they send diaries to many South‑Asians as well, it recorded a listening audience for our programming which was 10 percent higher during our program time, which was 7:00 p.m. to midnight ‑‑ actually it was 7:00 p.m. to 6:00 a.m. ‑‑ but regulated time 7:00 p.m. to midnight, which was measured by BBM, was 10 percent higher than 680News, which was an average of only 8,500 per quarter.

LISTNUM 1 \l 12102             They do agree that they are not able to measure the ethnic audiences as accurately but having said that, that was a very conservative figure.

LISTNUM 1 \l 12103             So what I am trying to get at is simply that the audiences that we have had in the past ‑‑ we have the experience of gathering a large audience ‑‑ is based on the kind of programming that we believe we are capable of putting together and training our announcers, our producers to produce that kind of program, to make it compelling for the audiences to listen to those programs.

LISTNUM 1 \l 12104             A radio program has to simply sound good.  That is the basis of holding onto our audiences and we believe that that is what our expertise is and we are going to implement that in the proposed Windsor radio station.

LISTNUM 1 \l 12105             My personal interest would be to meet up with every prospective producer and guide them and share with them the 27 years of my experience as a broadcaster, as a broadcast trainer, as a broadcast sales executive.

LISTNUM 1 \l 12106             I am going to be directly involved in doing that and I will use every other resource necessary in order to ensure that the quality of the programming is compelling for audiences on both sides of the border.

LISTNUM 1 \l 12107             There would then be no reason to have concerns, serious concerns about being able to retain, hopefully, a much larger share of the audiences in that big international market, the Windsor‑Detroit international centre.

LISTNUM 1 \l 12108             THE CHAIRPERSON:  And if you were to write everything down that you just said in a proposal to advertisers in the Windsor market, you are confident that they will sign?

LISTNUM 1 \l 12109             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12110             THE CHAIRPERSON:  Okay.  Your application says that you will broadcast 105 hours per week of ethnic programming and that is equal to 83.3 percent of the broadcast week.

LISTNUM 1 \l 12111             MR. NEETI RAY:  Yes.

LISTNUM 1 \l 12112             THE CHAIRPERSON:  Based on 126 hours.

LISTNUM 1 \l 12113             MR. NEETI RAY:  I know that we have committed to 105 local ‑‑

LISTNUM 1 \l 12114             THE CHAIRPERSON:  Ethnic programs, of ethnic programming?

LISTNUM 1 \l 12115             MR. NEETI RAY:  Yes, you are right.  I am sorry, yes, absolutely.

LISTNUM 1 \l 12116             THE CHAIRPERSON:  Will you accept that as a condition of licence?

LISTNUM 1 \l 12117             MR. NEETI RAY:  I would accept that as a condition of licence.

LISTNUM 1 \l 12118             THE CHAIRPERSON:  Final line of questioning.

LISTNUM 1 \l 12119             You aren't the only new applicant in Windsor.  Would the licensing of another FM station in Windsor have any impact on your business plan if we were to go that route?

LISTNUM 1 \l 12120             MR. NEETI RAY:  None whatsoever except if the 95.9 FM was not allotted to us.

LISTNUM 1 \l 12121             THE CHAIRPERSON:  Have you identified an alternative frequency that is acceptable?

LISTNUM 1 \l 12122             MR. NEETI RAY:  There are two points I would like to make here vis‑α‑vis the alternate frequency.

LISTNUM 1 \l 12123             We have been flexible.  Let's underline that.  We have been flexible in that when we were specifically asked by the Commission that in the event that we are not given our first choice, would there be something else, and we said that yes, 102.3 would be sufficient for us to meet our business plan.

LISTNUM 1 \l 12124             But having said that, there are two points in there.

LISTNUM 1 \l 12125             Number one, CBC has also applied for that frequency and even though we have intervened, requesting that CBC should consider an alternate frequency, the fact of the matter is also that the 102.3, while it will give a reasonable coverage of the Windsor market, it will not give us what the Windsor advertisers have asked for.

LISTNUM 1 \l 12126             It will not give the coverage in the entire area in order to deliver to the businesses that we have spoken to, the clients that they are looking for.  I will not guarantee an Italian restaurant that we will deliver a good number of clients to your restaurant from outside the Windsor market, which is what they are getting right now and who are very important to them.

LISTNUM 1 \l 12127             THE CHAIRPERSON:  Your bottom line, Mr. Ray, is if you don't get coverage of the Detroit market you cannot make this business plan a go and you therefore cannot serve Canadian listeners?

LISTNUM 1 \l 12128             MR. NEETI RAY:  I would ‑‑ okay, let me put the question to myself in a yes or no.

LISTNUM 1 \l 12129             Will we be viable, will we survive if we didn't get the 95.9, will we survive with the 102.3?

LISTNUM 1 \l 12130             The answer in yes or no, I would say yes categorically that we will survive but there would be difficulties, more difficulties or I would say there would be a lot less ‑‑ a lot less easy than to use the 95.9.

LISTNUM 1 \l 12131             We are a standalone radio station.  We do not have the synergies from a local radio station, the managerial or, as one termed it, the backroom and the front room of an existing radio station to reduce our costs of the operation.

LISTNUM 1 \l 12132             So we would survive, Madam Chair, and the answer in yes or no, I would have to be forthcoming in that it is yes but we need the 95.9 badly to be able to serve the business communities well and to ensure that in the short term that we would be profitable.

LISTNUM 1 \l 12133             THE CHAIRPERSON:  Thank you very much.

LISTNUM 1 \l 12134             Legal Counsel, do you have some questions?

LISTNUM 1 \l 12135             MS SMITH:  Yes, I have one question for you.

LISTNUM 1 \l 12136             MR. NEETI RAY:  Can Mr. Winn put a word in?

LISTNUM 1 \l 12137             THE CHAIRPERSON:  Perhaps what we can do is have legal counsel ask her question and then you can do the wrap‑up.  Thank you.

LISTNUM 1 \l 12138             MS SMITH:  Mr. Ray, you have indicated that you will broadcast 105 hours or 83.3 percent ethnic programming per week.  The Regulations require that at least 50 percent of all programming broadcast by ethnic stations be third‑language programming, that is, other than French, English or Aboriginal Canadian.

LISTNUM 1 \l 12139             What level of third‑language programming will you adhere to by condition of licence?  So this is other than French, English or Aboriginal Canadian.

‑‑‑ Pause

LISTNUM 1 \l 12140             MR. NEETI RAY:  It is the percentage that you just quoted, which is a total of 105 hours third‑language programming.

LISTNUM 1 \l 12141             MS SMITH:  So that will be other than French, English or Aboriginal Canadian, the 83.3 percent?

LISTNUM 1 \l 12142             MR. NEETI RAY:  Correct.

LISTNUM 1 \l 12143             MS SMITH:  Okay.  Thank you very much.

LISTNUM 1 \l 12144             THE CHAIRPERSON:  Okay, please go ahead.  I will give you a couple of minutes just to wrap up and conclude.  Thank you.

LISTNUM 1 \l 12145             DR. WINN:  Just a brief word.

LISTNUM 1 \l 12146             The financial value to advertisers of advertising depends obviously on the size of the audience but it also depends on the character of the audience's relationship to the broadcaster and that is what gives this radio station proposal so much value.  The intimate relationship would be so much more intense than in the case of the U.S. counterpart.

LISTNUM 1 \l 12147             THE CHAIRPERSON:  Thank you.  I appreciate those comments.

LISTNUM 1 \l 12148             Mr. Ray, you have the final word.

LISTNUM 1 \l 12149             MR. NEETI RAY:  So I have two minutes?

LISTNUM 1 \l 12150             THE CHAIRPERSON:  Go for it.

LISTNUM 1 \l 12151             MR. NEETI RAY:  Well, this proposal, Madam Chair, is for the establishment of the first ever full service ethnic radio station in Windsor and the benefits of licensing this radio station are numerous.

LISTNUM 1 \l 12152             The proposed service will provide nearly 150 ethnic Canadians who have indicated origins other than English, French and aboriginal to benefit from it, but most particularly those who have indicated that their third language ‑‑ their mother tongue is other than English or French or aboriginal, which is about 75,000.

LISTNUM 1 \l 12153             This radio station if licensed would have the least impact on existing radio stations.

LISTNUM 1 \l 12154             This radio station would fill a gap that exists in the Windsor market.

LISTNUM 1 \l 12155             This radio station will provide vital service to communities who do not currently have any service.

LISTNUM 1 \l 12156             This radio station will repatriate the Canadian dollars and the Canadian audiences currently going to the U.S. radio station.

LISTNUM 1 \l 12157             Our business plan is attainable without problem and we have plans in place for programming that would directly benefit the local audiences with local news, local programming not currently available to them.

LISTNUM 1 \l 12158             It will have a positive impact on the development of Canadian talent through the direct contributions that we have committed to and the indirect and the participation of the Multicultural Council of Windsor Essex County, which is very active and has been there for 25 years.

LISTNUM 1 \l 12159             And our proposal would provide for the first time an ethnic radio station in the market of its size in Canada, and the proportion of immigrants in such cities do not have third language services because of their size and the business and the population.

LISTNUM 1 \l 12160             We are in a unique position to provide this service to the ethnic communities with the advantage of its geographical location in Canada.  So I hope that the Commission would find our proposal approvable.

LISTNUM 1 \l 12161             MS RAY:  And I would just like to quote one of the CRTC Public Notices released out to me.  It is the 1985‑139, "A broadcasting policy reflecting Canada's linguistic and cultural diversity" which states that:

"The development of broadcasting services that reflect this cultural and linguistic plurality is an essential part of the Canadian social structure."

LISTNUM 1 \l 12162             MS RAY:  The philosophy of our station will be to reflect Windsor's growing local multicultural community and I really believe that this would have a positive impact on Windsor's society and on Canada's society.

LISTNUM 1 \l 12163             MR. NEETI RAY:  Thank you very much.

LISTNUM 1 \l 12164             THE CHAIRPERSON:  Mr. Ray, and to your associates, thank you very much for also your patience in answering our questions this morning.

LISTNUM 1 \l 12165             We will take a 15‑minute break now.

LISTNUM 1 \l 12166             Thank you.

‑‑‑ Upon recessing at 1055 / Suspension à 1055

‑‑‑ Upon resuming at 1110 / Reprise à 1110

LISTNUM 1 \l 12167             THE SECRETARY:  Before beginning we would like to remind you that when you are in the hearing room please turn off your cell phones, beepers and Blackberries as they are an unwelcome distraction and they cause interference on the internal communication systems used by our translators.

LISTNUM 1 \l 12168             We would appreciate your cooperation in this regard throughout the hearing.

LISTNUM 1 \l 12169             We will now proceed with item 6 which is an application by Blackburn Radio Inc. for a licence to operate an English‑language FM commercial radio programming undertaking in Windsor, Ontario.

LISTNUM 1 \l 12170             The new station would operate on frequency 95.9 (channel 240B1) with an average effective radiated power of 3,300 watts (maximum effective radiated power of 14,000 watts/antenna height of 145 metres).

LISTNUM 1 \l 12171             Appearing for the applicant is Mr. Richard Costley‑White.

LISTNUM 1 \l 12172             Please introduce your colleagues and you will have 20 minutes for your presentation.

PRESENTATION / PRÉSENTATION

LISTNUM 1 \l 12173             MR. COSTLEY‑WHITE:  Thank you.

LISTNUM 1 \l 12174             Good morning, Madam Chair, members of the Commission and Commission staff.

LISTNUM 1 \l 12175             My name is Richard Costley‑White.  It is my honour and privilege to be before you here today, sitting over to your left this time, to present an application for a new FM radio station in Windsor, Ontario.

LISTNUM 1 \l 12176             Now, I would like to introduce our panel.

LISTNUM 1 \l 12177             With me today to my immediate left is our General Manager for Blackburn Radio stations in Leamington, Chatham and Windsor, Terry Regier.  Terry has been with Blackburn for over 26 years, 10 years as a radio broadcaster and 16 in print.  Terry's experience is in the area of sales and marketing.  He has lived in Windsor for over 35 years.

LISTNUM 1 \l 12178             Next to Terry is Walter Ploegman.  Walter is our Operations Manager for Blackburn Radio.  He has been a radio broadcaster for more than 26 years and has experience as an on‑air host, music director and as a program director.  Walter also oversees and manages the distribution of Canadian content development funds for Blackburn Radio in Essex‑Kent.

LISTNUM 1 \l 12179             To Walter's left is Sue Storr.  Sue is currently Program Director for Blackburn's Country CHOK in Sarnia.  Sue has spent the last 18 years in the broadcast industry as a reporter, news announcer and talk show host.  Sue also taught broadcast journalism for 10 years at Lambton College.

LISTNUM 1 \l 12180             To Sue's left is Rod Martens who has been a radio broadcaster for more than 18 years and has been an on‑air host, music director, marketing director and program director.  Rod is currently the Program Director for CKUE FM, a position he has held since 2005.  Rod is currently overseeing the launch in March of our new Leamington Country FM station.

LISTNUM 1 \l 12181             Finally, in the front row is Lori Baldassi, Director of Community Relations in Windsor.  We hired her because of her vast experience in the social services field in Windsor for more than 15 years.

LISTNUM 1 \l 12182             Now, in the second row, starting from your right is Jason Ploegman who we introduced during our Owen Sound presentation.

LISTNUM 1 \l 12183             Next to Jason is Carl Veroba.  Carl was President and General Manager of CFCO AM, CKSY FM and CKUE FM for 20 years before selling his interest to Blackburn in 2004.  Carl now consults for Blackburn Radio, covering a wide variety of technical matters.

LISTNUM 1 \l 12184             Next to Carl is Debra McLaughlin, an economic consultant with Strategic Inc.  Debra has prepared many economic and market reports on new radio, television and other applications before this Commission.

LISTNUM 1 \l 12185             Beside Debra we would like to welcome back Mark Kassof, President of Mark Kassof & Co.  Mark has researched radio markets and formats for broadcasters in Canada and in the United States for 25 years.

LISTNUM 1 \l 12186             As with the Owen Sound presentation, we have provided you with a binder with these remarks, our seating plan, copies of the PowerPoint slides and other materials to which we will be referring in our presentation or during the question period.

LISTNUM 1 \l 12187             We are here today to present our proposal to add a new Canadian radio programming choice for Windsor.  Windsorites deserve an additional programming choice on their radio dial that provides local and regional Canadian news and reflection.

LISTNUM 1 \l 12188             Canadian country artists deserve exposure in one of Canada's larger cities.

LISTNUM 1 \l 12189             In our Owen Sound presentation I told you about the history and values of our company with particular emphasis on our passion for news and community service.  We bring the same commitment to Windsor.  Our stations in Chatham, Kent, Leamington and Sarnia have operated in challenging circumstances for many years with multiple American stations available.  Our success is built on our local connection.

LISTNUM 1 \l 12190             With large newsrooms, synergies between our stations and strong and autonomous local management we have been successful.  And when we entered Windsor with a rebroadcaster of our Chatham‑Kent rock station this attention to local reflection proved to be successful as well.

LISTNUM 1 \l 12191             I would now like to ask Terry Regier to speak a bit more about the market in which he has lived for the past 35 years.

LISTNUM 1 \l 12192             Terry.