ARCHIVED -  Transcript

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 /

Diverses demandes de radiodiffusion

HELD AT: TENUE À:

Hermitage Ballroom Hermitage Ballroom

Best Western Mariposa Inn Best Western Mariposa Inn

400     Memorial Avenue 400, avenue Memorial

Orillia, Ontario Orillia (Ontario)

January 28, 2009 Le 28 janvier 2009

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 /

Diverses demandes de radiodiffusion

BEFORE / DEVANT:

Rita Cugini Chairperson / Présidente

Suzanne Lamarre Commissioner / Conseillère

Peter Menzies Commissioner / Conseiller

Candice Molnar Commissioner / Conseillère

Marc Patrone Commissioner / Conseiller

ALSO PRESENT / AUSSI PRÉSENTS:

Lynda Roy Secretary / Secretaire

Francine Laurier-Guy Hearing Manager /

Gérante de l'audience

Eric Bowles Legal Counsel /

Conseiller juridique

HELD AT: TENUE À:

Hermitage Ballroom Hermitage Ballroom

Best Western Mariposa Inn Best Western Mariposa Inn

400     Memorial Avenue 400, avenue Memorial

Orillia, Ontario Orillia (Ontario)

January 28, 2009 Le 28 janvier 2009

- iv -

TABLE DES MATIÈRES / TABLE OF CONTENTS

PAGE / PARA

PHASE IV

REPLY BY / RÉPLIQUE PAR:

Rock 95 Broadcasting Ltd. 639 / 4063

Frank Torres (OBCI) 644 / 4089

Debra McLaughlin (OBCI) 648 / 4119

Newcap Inc. 658 / 4171

Bayshore Broadcasting Corporation 664 / 4205

Larche Communications Inc. 665 / 4215

Nick Montague (OBCI) 668 / 4231

PHASE I

PRESENTATION BY / PRÉSENTATION PAR:

JOCO Communications Inc. 674 / 4266

Instant Information Services Inc. 742 / 4800

Muskoka-Parry Sound Broadcasting Ltd. 756 / 4899

William Wrightsell (OBCI) 781 / 5103

Bayshore Broadcasting Corporation 829 / 5406

Gatineau, Quebec / Gatineau (Québec)

‑‑‑ Upon resuming on Wednesday, January 28, 2009

at 0830 / L'audience reprend le mercredi

28     janvier 2009 à 0830

4055     THE CHAIRPERSON: Good morning, everyone. Glad to see that everybody made it here safely.

4056     Madam Secretary.

4057     THE SECRETARY: Thank you, Madam Chair.

4058     Before we start, for the record, we have received the following undertakings from Bayshore Broadcasting Corporation ‑‑ they submitted their updated proof of financing. We also received from Newcap Inc. an updated proof of financing as well as a response to a question regarding the use of the CBC antenna and the relative radiating power.

4059     These documents have been added to the public file and copies are available in the examination room.

4060     And we will now proceed with Phase IV in which applicants can reply to all interventions submitted of their application.

4061     Applicants appear in reverse order and, for your information, Instant Information Services Incorporated already indicated they will not appear. So I will now call Rock 95 Broadcasting Limited.

‑‑‑ Pause

4062     THE SECRETARY: Go ahead, please. Reintroduce yourself for the record and you have 10 minutes.

REPLY / RÉPLIQUE

4063     MR. BINGLEY: Thank you, Madam Secretary.

4064     My name is Doug Bingley. I'm President and General Manager of Rock 95 Broadcasting and with me is Mr. Larry Campbell who is the President of Campbell Media Research.

4065     Commissioners, I would like to respond to the intervention by Larche Communications and, first, I would like to place on the record that our presentation in no way was intended to reflect on the professionalism of Mr. Larche or his staff. He has put together a group of talented broadcast professionals. I respect the quality of their work as well as their wonderful team spirit, and that team spirit has come about due to the leadership of Mr. Larche. This station's staff are often out and about at charity and other events in Orillia and across Simcoe County and the number of CCMA awards won by the station attest to the quality of their programming and the skills of their staff.

4066     But we were not questioning the quality of the programming. The obvious question in this hearing is the need for a station that provides local content, and that is the question that we addressed in our presentation.

4067     Mr. Larche contends that we have overstated our case and quotes our own research as evidence of that. And I have asked Larry Campbell to clear up any misconceptions in this area.

4068     MR. CAMPBELL: Good morning, Commissioners.

4069     Yesterday, Mr. Larche felt the need to stand up for the staff at KICX because of criticisms voiced by the applicants concerning KICX's failure to perform ‑‑ excuse me ‑‑ failure to program the station as a local Orillia radio station.

4070     As Doug mentioned, we want to be clear that any criticisms we have made regarding KICX's performance as a local Orillia radio station were not personal criticisms. They were based on the perceptions of 200 Orillia CMA radio listeners aged 18 to 64 that were voiced in our market study and, as has been said many, many times before, the perception is the reality.

4071     Mr. Larche quoted from our market research study yesterday. However, he really didn't provide the whole story from those tables. Mr. Larche or the person who provided him with this portion of our study was clearly not familiar with the question that we asked or how to properly interpret the data tables.

4072     I will read question 5 from our final questionnaire and then go over the results of this critically important section to the study with you providing the whole story. Question 5 reads:

"Please rate each programming feature that I mentioned using a 1 to 9 scale where 1 means it's not very important and 9 means it's very important. Then tell me what one radio station first comes to mind when you think about that programming feature. If no station fits say none. How important is it that a radio station gives the top news and local information focusing on Orillia?" (As read)

4073     MR. CAMPBELL: CICX was the first mentioned radio station with a 13 percent score, which means that 87 percent of the people in the study didn't mention KICX. In fact, 52 percent of the respondent says there is none. No station fits.

"How important is it that a radio station gives up to date weather reports and forecasts for the Orillia area?" (As read)

4074     MR. CAMPBELL: 17 percent mentioned KICX, 83 percent didn't; 37 said there is none.

"How important is it that the station has frequent reports on traffic and road conditions for the Orillia area?" (As read)

4075     MR. CAMPBELL: 13 percent mentioned KICX, 87 percent didn't; 57 percent said there are none.

"How important is it that the station lets you interact with the station on the telephone or online or by text messages to pick your music, voice your opinions and so on?" (As read)

4076     MR. CAMPBELL: 14 percent mention KICX, 86 percent didn't, 48 percent said there is none.

"How important is it that the station is active in Orillia community events supporting sports, charities, organizations and so on?" (As read)

4077     MR. CAMPBELL: 14 percent mentioned KICX, 86 percent didn't; 57 percent said there is none.

4078     So we wouldn't have brought this up had Mr. Larche not brought this information up but his presentation of KICX being listed first, which it was in each of these critically important programming areas, didn't really mention the fact that by far the winning response was there is none.

4079     MR. BINGLEY: Thanks, Larry.

4080     And, finally, I would like to point out that I am not unsympathetic with Mr. Larche's position. I'm sure it must be difficult in these economic times to contemplate a new radio station coming into your market. I can emphasize with that because that's precisely the situation I am in today.

4081     Finally, Commissioners, I would like to take the time to conclude by thanking our many intervenors, by thanking our staff who worked very hard on this, and I would also like to thank Commission staff. As always, they have been very courteous and helpful ‑‑ and also to the panel for your courteous and direct line of questioning.

4082     I hope that while you are here in Orillia you have the time to get out and perhaps see some of the sights of this beautiful city. And on behalf of the main street merchants I hope you get down there as well and maybe checkout some of their stores.

4083     Thank you very much.

4084     THE CHAIRPERSON: Thank you very much, Mr. Bingley.

4085     MR. BINGLEY: Thank you.

4086     THE CHAIRPERSON: Madam Secretary.

4087     THE SECRETARY: We will now proceed with Frank Torres, on behalf of a corporation to be incorporated.

‑‑‑ Pause

4088     THE SECRETARY: For the record please reintroduce yourself, and you have 10 minutes.

REPLY / RÉPLIQUE

4089     MR. TORRES: Thank you, Madam Secretary.

4090     Good morning, Madam Chair, Commissioners, Commission staff. My name is Frank Torres. I'm the President of Torres Media Ottawa and the Vice‑President of Skywords Media.

4091     For the record we would like to thank the many supporters that sent in letters of support for our FM application to serve Orillia. In particular we would like to thank appearing intervenors; Jeff Mallory, Peter Hintze from Mariners Cove Marina, Mike Lucas from Christian Island Elementary School.

4092     I would like to express our appreciation of the Commission's flexibility with regards to scheduling Phase III yesterday, ensuring that all our appearing intervenors were accommodated as part of this public process. Considering the weather we had to deal with today it was very much appreciated.

4093     The research presented at this hearing asserts that the Orillia economy is performing at or above the provincial economy and that the economic crisis of confidence has inspired governments globally to stimulate economies worldwide.

4094     A new radio service in Orillia will create jobs, stimulate the local economy and make the incumbent radio station work hard and smart to grow and repatriate listenership and revenue to where it belongs in Orillia.

4095     We have appeared before the Commission on numerous occasions and spoken at length about our long term broadcast strategy. We view every application that we have made as a long term business venture.

4096     Our applications are properly capitalized and planned as full service radio stations with all the proper tools and equipment for providing the community a good radio service and returning investments on a four to seven year basis.

4097     We feel that any assessment of the viability of a new service in light of the state of the economy must be made with respect to the long term viability of the service over the entire licence term.

4098     I would like to thank the Commission for a well run hearing and Commission staff for their assistance and patience in this public process.

4099     THE CHAIRPERSON: Thank you, Mr. Torres.

4100     I know that there is always a bead of sweat that forms whenever we have questions in this phase but, trust me, they are routine questions and they are questions that we have asked other applicants and we simply forgot to ask you.

4101     So my question for you is in what timeframe, if licensed, will you be prepared to launch the station?

4102     MR. TORRES: We can comfortably launch the station within the 24 months that generally is advised and recommended by the Commission.

4103     The experience that we had with the commencement of our Ottawa operation was that we were well within a 12 month timeframe to start operations. We would have had testing initiated at the seven month mark in Ottawa and as far a weather conditions and timing of when it would be most likely that the decision would be rendered and we would commence operations would be on par with our Ottawa plan.

4104     THE CHAIRPERSON: Okay, thank you.

4105     And Commissioner Lamarre also has a question that she asked other applicants.

4106     COMMISSIONER LAMARRE: Yes, sorry, I skipped one as we were discussing yesterday.

4107     And I'm going to refer you back to a map. You may not have it in front of you but I'm sure you can remember it vividly. It's your proposed contour map and the fact that it has an interfering zone within it.

4108     I want to make sure that you understand that this interference not only can be present at the time that you will go on air but also can materialize only after you have been on air for a certain period of the time. So your consultant has gone over with you on that matter.

4109     MR. TORRES: Yes, we have and that is taken into account in our financial forecast as well, and we are prepared to accept that.

4110     COMMISSIONER LAMARRE: Thank you.

4111     MR. TORRES: You are welcome.

4112     THE CHAIRPERSON: Thank you for your presence. Safe drive.

4113     MR. TORRES: Thank you, same to you.

4114     THE CHAIRPERSON: Thank you.

4115     Madam Secretary.

4116     THE SECRETARY: Thank you.

4117     I would now call Debra McLaughlin, on behalf of a corporation to be incorporated.

‑‑‑ Pause

4118     THE SECRETARY: When you are ready please reintroduce yourself for the record. You have 10 minutes.

REPLY / RÉPLIQUE

4119     MS McLAUGHLIN: Good morning, Madam Chair, Commissioners, Commission staff.

4120     For the record I'm Debra McLaughlin, President of Strategic Inc. and the controlling shareholder in Orillia's Own.

4121     With me are Carmela Laurignano, also a partner in Orillia's Own; Heather Thompson, Lynn Forgeron and Rob Malcolmson of Goodman's LLP, our legal counsel.

4122     We are here to respond to the interventions we heard yesterday and, in particular, provide responses to the comments made about the local economy, our revenue projections and our research.

4123     During the hearing we heard a lot of rhetoric about the unique challenges of the Orillia radio market. We heard that despite per capita retail sales that are well above the national average, radio revenues are stagnant. We heard that our revenue projections cannot be achieved and we heard that our format is too narrow a niche for a market this size.

4124     Rob.

4125     MR. MALCOLMSON: All of these objections came from the incumbent broadcasters, Mr. Bingley and Mr. Larche. We certainly understand why they are fighting so hard.

4126     If either one are licensed they will have pulled off a major regulatory coup as with your approval the successful applicant will be the operator of three stations, each with a 3 mV/m contour covering the market of Orillia, something that runs directly contrary to the Commission's common ownership policy and the Commission's stated desire to increase the diversity of voices within the Canadian Broadcasting System.

4127     MS McLAUGHLIN: In our reply we will deal with the facts. They are facts we know well as we have studied this market carefully.

4128     First, let's deal with the economic facts.

4129     The economy in Orillia is clearly not stagnant. It is growing. Unlike southern Ontario which because of its proximity to major arteries to the U.S. is favoured by manufacturers, central Ontario has always been more diverse in terms of the industries that support the communities. Orillia is a case in point. Over 80 percent of its economy is services based. Much of the impact of the slowdown has already been felt here.

4130     Importantly, FP Markets forecast to 2011 project a 6 percent growth in retail sales and by 2014 a further 8.4 percent for a total net improvement of 14.94 percent. These are impressive forecasts.

4131     But what is even more impressive is what is actually happening in Orillia today. Today, Orillia's per capita retail spend is 29 percent above the national average. Sure, a portion of this is generated by seasonal visitors to the market but does that really matter? The truth is it doesn't. If the cash registers are ringing retailers are making money and they are using advertising to attract more retail sales. This is a proven fact and there is nothing credible on the record to disprove it.

4132     Everywhere you look in Orillia there are signs of steady growth and all in the midst of this recession. These are not projections. They are things that are actually happening in the market today.

4133     The introduction of the Lakehead Campus will bring 7,000 more temporary residents into this market. Retailers have chosen to relocate or expand here. Leading retailers like Walmart and Shoppers Drug Mart would simply not have made long term investments of millions of dollars in this community if the market is as uniquely challenged or as stagnant as Mr. Larche would have you believe.

4134     The economy is also fuelled by population. Population growth in Orillia has exceeded the Ontario average and this is expected to continue. Provincial greenbelt legislation that precludes urban development immediately north of Toronto is in a large part driving this growth as people looking to escape urban sprawl are now leapfrogging to communities in central Ontario.

4135     It is clear from all of this evidence that Orillia is weathering the current economic storm.

4136     Carmela.

4137     MS LAURIGNANO: Thank you, Debra.

4138     Now, let's discuss our revenues. Much has been made about the fact that our revenue projections are the highest of all the applicants before you. They are. They were derived from our knowledge of retail sales, our review of the rates that the incumbent broadcasters are selling at and our discussions with local advertisers who today have to buy Barrie to reach Orillia.

4139     The numbers from Orillia show that there is no disconnect between the economy, retail sales and radio advertising revenues.

4140     Data from RBM, CRTC financial summaries and StatsCan show a clear, consistent and irrefutable relationship between retail sales and sales across both large and small markets. In light of the data, the only credible conclusion that can and should be reached is that Orillia's radio sales market is severely underdeveloped. As Commissioner Patrone put it, "It's a lack of choice that is the anchor in this market."

4141     Revenues that should be staying in Orillia are flowing to Barrie. This suggests nothing about the quality of Mr. Larche's stations but, rather, the need for more choice to capture all of the revenues.

4142     One of the challenges of being a monopoly is that it is impossible to be all things to all people. To recapture the loss of revenue for this market you need competition.

4143     Our Year 2 local ad revenues are $1.146 million. This means we have to generate $22,045 per week in local sales to hit our number. And in order to do this we would only have to sell two minutes per hour, about two remote broadcasts per week and 18 sponsor features eight Mondays to Friday and 10 on the weekends per week to achieve our goal.

4144     Madam Chair, Commissioners, I operate eight radio stations in large and small markets across the country and I can tell you that these sales levels are realistic and easily achievable given the level of retail sales activity in this underdeveloped market.

4145     Lynn.

4146     MS FORGERON: We would like to respond to the statement made by Mr. Bingley of Rock 95 that we could potentially lose approximately $6.5 million over the seven year licence term.

4147     He took an average of others' revenues and layered them onto our expenses to arrive at his conclusion. This approach is entirely without merit. We could just as easily apply an average of the other applicants' expenses layered on our revenues and show that we would be $7.3 million ahead of plan, but this exercise would be just as meaningless as that put forward by Mr. Bingley.

4148     Any sensitivity exercised becomes misleading if nonsensical assumptions are made. A sound business plan cannot be derived without considering expenses in relation to projected revenues. So to mix revenues from a group of business plans with expenses from another, simply put makes no sense. Both the mix of some very divergent financial projections and the lack of relationship between one applicant's revenue and another's expenses underscore this.

4149     We conducted a legitimate sensitivity analysis looking at the impact of a 10 percent, 20 percent and 30 percent shortfall in projected revenues. We held our expenses constant for this exercise with the intention of maintaining our promise of performance.

4150     We looked at the impact on cash requirements of these three sensitivity points. At 10 percent of revenue no additional funding is required. At 20 percent below revenue an additional one million is required. Finally, at 30 percent below plan an additional 1.9 million is required. The shareholders have the collective ability to fund any of these shortfalls through equity contributions and they are prepared to do so.

4151     In addition, we can advise that we have received confirmation from the Business Development Bank of Canada that it is prepared to provide our venture with a credit facility of one million dollars. I must reiterate we do not need it. This was simply an extension of our due diligence.

4152     Debra.

4153     MS McLAUGHLIN: Now, I would like to turn to the issue of research and in particular the remarks made by Mr. Campbell.

4154     Mr. Bingley is correct that we did not conduct a format find based on his sample size. Neither did he. His plan is simply to extend the research of his Barrie AC format further north on an Orillia station that will replicate his Barrie AC.

4155     If you subscribe to Mediabase or BDS you can see what is in the market and quickly see what is missing. This automatically narrows your focus and reduces the need for a format find. Once you narrow your focus you can look to the demos most in need of service and this further reduces your choices.

4156     Depending on your level of experience you can either test well a single option that makes sense or substantially increase your sample size and test many.

4157     We thoroughly tested a single format and it was proven correct by the most reliable data presented at these hearings. We sampled 400 persons and did a follow‑up secondary survey on 75 to confirm our interpretation.

4158     Further, the research scale that Mr. Campbell found so objectionable is in fact used by multiple research firms in Canada and the U.S. and has received approval in the most rigid of audits. Does it work? Of course it does.

4159     My consulting firm has been in business for over 15 years and I have longstanding clients. My clients have described by share and reach projections actually as "eerily accurate".

4160     But just before we leave, Madam Chair, Commissioners, I would just like to thank our intervenors, especially because there was over 1,200 that wrote letters and three who appeared. The letters came from organizations such as SIRPA, music industry people such as Bernie Finkelstein, local, municipal, provincial and national governments ‑‑ the Chamber of Commerce supported us ‑‑ and most especially from the people and businesses of Orillia.

4161     During this process we have had the pleasure of working with some truly exceptional people and we would like to acknowledge just a couple of them: Heather Thompson who everybody in Orillia knows, and this is a testament to her years of broadcasting excellence and her continuing contribution to the community.

4162     Also, we want to acknowledge our local partner, Suzanne Legue who was a font of information on Simcoe County and through her relationship with the businesses in the area she was able to provide us invaluable insight into the economics and potential.

4163     Finally, we would like to thank you, the Commission and the Commission staff for all your help and assistance. As you know, we have had some particular issues with our application.

4164     The view from the front row really is very different and I hope we have played a part in encouraging new entrants to come forward, women and men to expand, secure and advance the diversity in the system.

4165     Thank you.

4166     THE CHAIRPERSON: Thank you very much, Ms McLaughlin and your colleagues. I don't have any indication from my colleagues that they have any questions.

4167     Safe travels. Thank you.

4168     Madam Secretary.

4169     THE SECRETARY: We will now proceed with Newcap Inc.

‑‑‑ Pause

4170     THE SECRETARY: Please reintroduce yourself for the record and you have 10 minutes.

REPLY / RÉPLIQUE

4171     MR. MURRAY: Good morning. I am David Murray, Chief Operating Officer of Newcap Radio, and with me is Mike Keller, our Vice‑President of Industry Affairs.

4172     Thank you for this opportunity to reply to interventions to our application.

4173     MR. KELLER: First, we note that other engineers have come up with technical plans different than ours. If we were granted the licence we would certainly explore means to maximize the signal.

4174     We would also like to reply to comments made by the applicant from Rock 95 where they stated that CHR is a small tent format and also referred to a format ranking chart showing CHR with the lowest preference of eight formats.

4175     To characterize CHR as a small tent format when compared to Hot AC is outlandish. In fact, what is clearly the key to beating a Hot AC is to launch a CHR station. Let's look at several real market examples comparing ratings for the demographics adults 12‑plus.

4176     First, in Ottawa the dominant CHR HOT 89.9 ranks number three while Rogers' Hot AC station KISS‑FM ranks a distant 11. This has been consistent over the past three years.

4177     Second, in Sydney, our CHR station, The Giant, ranked number one with a 26 share of hours tuned while the Hot AC station, The Cape, ranked number five in a five station market with a 9 share.

4178     Number three, in St. John's; HITS‑FM, the CHR station, ranks number two with a 19 share while the Hot AC station ranks number five with a 10 share. This is not just a phenomenon limited to Newcap's CHR markets so let's look at a few others.

4179     In Calgary, The Vibe, Astral's CHR station, ranks number three while CHUM's Hot AC ranks 14.

4180     In Winnipeg, Astral's CHR station also ranks number two while the Hot AC was forced to change format because it could only reach a ranking of number eight.

4181     In Vancouver CTV's CHR station, The Beat, is number three while Astral's Hot AC station is ranked eighth.

4182     In fact, Madam Chair, CHR is the big 10 format and Hot AC is a splinter format of CHR that is a much smaller tent.

4183     We stand behind the research provided by Mr. Kassof that did look for the format most in demand and least available rather than using a contrived format ranking.

4184     MR. MURRAY: Sometimes, the universe speaks to us in mysterious ways. In our opening remarks we referenced an email we received yesterday from Robert Lamb, the Manager of Economic Development for the City of Orillia. In addition to the exciting news of the ongoing development plan for the city in 2009 we took particular interest in the motivational quote that Mr. Lamb had inserted at the bottom of his email. It read:

"Don't let the fear of striking out keep you from playing the game." (As read)

4185     MR. MURRAY: We are pretty sure Mr. Lamb did not knowingly submit this quote uniquely for our benefit or for presentation to the CRTC. We presume that this is the quote he places predominantly at the bottom of each and every email he sends out on behalf of the citizens of Orillia.

4186     We would like to enter this quote into the official record of these proceedings:

"Don't let the fear of striking out keep you from playing the game". (As read)

4187     Despite one of the most robust local economies in the country another applicant has expressed their fear of the impact of new competition in the market and has suggested that the best option is not to increase diversity in the market at all.

4188     We at Newcap, however, are not afraid. We are not afraid in any of our existing markets, many of which do not enjoy the healthy economic status that Orillia enjoys, and we are not afraid of the economic challenges of the present day.

4189     Are we cautious? Of course we are. But we won't allow fear to govern our business plans.

4190     The reality is no licences were awarded in the most recent Guelph hearings. That fact while unspoken at these hearings, has been hanging in the air in an almost omnipresent way, but we insist Orillia is not Guelph. Orillia has retail sales well above the national average and 42 percent above what Guelph has to offer.

4191     Orillia is not Guelph. Orillia has a vibrant and healthy local economy and an expanding retail economy which the local radio station has yet to fully explore.

4192     We believe that the Commission has an opportunity to improve the quality and variety of local radio service available to both the listeners and advertisers of Orillia without any undue risk to the incumbent broadcaster.

4193     There is an opportunity to licence a proven mainstream CHR format, a winning format in even the most competitive markets in the country and the hottest format in North America today.

4194     There is an opportunity to increase the diversity of editorial voice and ownership in the region.

4195     There is the opportunity to licence an established top quality broadcaster with a proven track record of ratings and sales success and one with solid financial backing.

4196     There is an opportunity to reward new and emerging artists with not only national and local airplay but with $350,000 in additional CCD commitments.

4197     All of these things are possible but there is only one application before you today that will allow you to accomplish all these things, and that application is from Newcap Radio.

4198     We ask you humbly on behalf of the radio listeners and business owners in the city of Orillia, please put us in the game. We are not afraid and we will not disappoint.

4199     Madam Chair, Commissioners and Commission staff, thank you for a fair, efficient and thorough hearing. We understand that this is the first hearing for Commissioner Lamarre and for a number of your staff. Congratulations to all.

4200     Thank you, and we wish you a safe trip home.

4201     THE CHAIRPERSON: Thank you very much, Mr. Murray and Mr. Keller, and the same to you, safe trip home. Thank you.

4202     Madam Secretary.

4203     THE SECRETARY: Thank you, Madam Chair.

4204     I will now ask Bayshore Broadcasting Corporation to come forward to the presentation table.

‑‑‑ Pause

REPLY / RÉPLIQUE

4205     MR. KENTNER: Thank you, Madam Secretary, Madam Chair, Members of the Commission.

4206     I would just like to take a moment to thank our intervenors, Dr. Bruce Meyer and Robin Parkes of NewPlace literature and also Fred Addis, Curator of the Leacock Museum National Historic site who audited a large part of this hearing with us. Of course, we are very excited about the Orillia reading series and we appreciate the help they have lent us in making this possible if we are licensed.

4207     I also want to thank all of our intervenors and particularly Pete McGarvey and George McLean who are two icons of Canadian broadcast journalism who supported our application.

4208     I also just want to thank the Bayshore staff, many of whom are quite new to our company in the last three years.

4209     And I thank the Commissioners and staff for a very thorough and, I believe, fair airing of all the issues at this hearing. Thank you very much.

4210     THE CHAIRPERSON: And safe travels to you as well.

4211     MR. KENTNER: Thank you.

4212     THE CHAIRPERSON: Madam Secretary.

4213     THE SECRETARY: Thank you. I will now call Larche Communications Inc.

‑‑‑ Pause

4214     THE SECRETARY: Please reintroduce yourself for the record. You have 10 minutes.

REPLY / RÉPLIQUE

4215     MR. LARCHE: Good morning. My name is Paul Larche, President of Larche Communications. It's always amazing how three days can feel like three weeks.

4216     I had some written comments but, you know, I think I'm just going to wing it a bit.

4217     Like all the other applicants that came up this morning I want to thank the entire staff here and all of you for doing what I consider to be a very fair, balanced and transparent hearing and very thorough. You know, this is a great process we have and it's envied around the world and, you know, we should all take pride in that.

4218     I actually want to thank Mr. Bingley for his comments this morning. Again, we get a little emotional in these things and we all look out for our own people and I do appreciate what he said. I do have a great staff. They work very, very hard. And his staff does as well. You know, he does operate a very good radio station.

4219     Some had mentioned, again during intervention, that I might be doing this from fear. I just heard it again.

4220     There is a little fear in there. You know I would be lying if I didn't tell you otherwise. I'm one of the most optimistic people you will know in the business and if you talk to anybody who knows me you know they will tell you that I'm not usually one to look at the glass half empty.

4221     But I am concerned about the economy. I am concerned about the timing of this thing you know and I ‑‑ unlike a lot of people who have come up in front of you don't have their house on the line, and their bank breathing down their neck with the financial obligations we have.

4222     So there is a little bit of fear there. Absolutely, I'm up here to try to look after you know my turf at this point in time. The point I have tried to make is I just don't think now is the time for a new station.

4223     I have got to thank all of the intervenors who sent us letters. We received them from Orillia city council. We actually had a letter from Mayor Ron Stevens and city council that was included in our application with an endorsement.

4224     We also received letters of support from the OPP and Orillia Big Brothers and the Orillia Rotary Club, Soldiers Memorial Hospital, Salvation Army, the Orillia Jazz Festival and many more, and we really appreciate their support.

4225     I also want to thank my staff who worked very hard to put this presentation together and although we won't see you for the rest of the week, do have a safe travel home and do get a chance to check out Orillia. It is a beautiful city. It is growing and, you know, that's why I bought the radio station here a year ago. I feel very, very confident that this is ‑‑ the city is going to continue to grow and going to continue to be a great place to do business.

4226     Thank you.

4227     THE CHAIRPERSON: Thank you very much, Mr. Larche. We don't have any questions and please drive safely.

4228     Madam Secretary.

4229     THE SECRETARY: Thank you, Madam Chair. I will now call Mr. Nick Montague, on behalf of a corporation to be incorporated.

‑‑‑ Pause

4230     THE SECRETARY: And please reintroduce yourself for the record, and you have 10 minutes.

REPLY / RÉPLIQUE

4231     MR. MONTAGUE: Thank you very much. I am Nick Montague from Twin Lakes Broadcastings.

4232     I would like to thank the Commission, say good morning to you, Madam Chair, Members of the Commission and staff, and thank you once again for ‑‑ as has been reiterated a number of times ‑‑ a very fair and well run and most interesting experience for myself as well, being the first time before you.

4233     I would also like to thank all of the intervenors that appeared on behalf of the applicants.

4234     I do agree with a lot of what was said yesterday. I have known Mr. Bunker for quite some time, worked with him for a number times with EZ Rock when I was with that. I think it would behove the Chamber to work with another locally‑owned radio station that would be a member of the Chamber.

4235     I don't think anything can be said against Mr. Larche of what he has done with the Chamber in a lot of events, but I think giving the Chamber an opportunity to work with another entity would be far, far better for the city as a whole.

4236     I also would like to thank the people from NewPlace Reading who came down on behalf of Bayshore.

4237     I don't discredit the advantage of spoken word. As a matter of fact I used audio books. My brother has used audio books and things of that nature in most courses that we have done in a lot of different areas. But if you take a look at true numbers across the nation the viability of ratings building by spoken word and reading, especially in an area where post‑secondary education is slightly limited but for the majority of the residents, it just does not really seem to be a viable ratings building projection for spoken word programming, and that is one of the things that I was concerned about.

4238     With respect to the Women's Habitat that showed up with Ms McLaughlin, it was wonderful to see them. Unfortunately, I have never heard anything about Green Haven, the women's shelter, right in Orillia. Twin Lakes Broadcastings is committed to supporting the Green Haven women's shelter. It is one of our major, major charities that we have put above and beyond anything else. Women's issues are of great concern to Twin Lakes Broadcastings.

4239     Is a totally female‑owned radio station ‑‑ truly mean anything to the average listener? Unfortunately, I don't think they know and I don't think they care. What the average listener cares about is that it's a locally owned and operated radio station.

4240     And hearing comments from Ms Laurignano and Ms McLaughlin of them not willing to give up their day jobs for their radio station, that does not sound like a true commitment to the radio station to me. 15 to 35 percent increase in listener by females to a slightly more male‑dominated radio format ‑‑ if Ms Janik who appeared before Ms McLaughlin is as diligent as I know she is in her research, she will tell you that across North America 15 to 35 percent increase. If there is a licence ‑‑

4241     THE CHAIRPERSON: Mr. Montague, you are venturing into the waters of an intervention.

4242     MR. MONTAGUE: M'hm.

4243     THE CHAIRPERSON: At this phase you are given the opportunity to reply to those who have intervened ‑‑

4244     MR. MONTAGUE: Yes, ma'am.

4245     THE CHAIRPERSON: ‑‑ to those who have intervened and commented on your application.

4246     MR. MONTAGUE: Yes.

4247     THE CHAIRPERSON: So if you could please restrict your comments just to that?

4248     MR. MONTAGUE: Again, I don't think there was many comments to my personal application. I don't think many people take us as a threat. We are the small dog in a big pond.

4249     We have definitely seen that the city has looked at it from one point of view. We were here. We ran a small test station and we were very well received and people would like to continue that commitment.

4250     Twin Lakes Broadcastings would ask that the Commission look at everything as they always do, on a fair upscale open market. Local should be recognized. If any of these companies were really concerned why weren't they the first to apply as we were? And we would ask that you would award the licence to those that gave that commitment first.

4251     Thank you very much.

4252     THE CHAIRPERSON: Thank you very much, Mr. Montague.

4253     I don't have an indication that anyone has any questions. Safe journeys. Thank you.

4254     MR. MONTAGUE: If you are from here this is nothing.

‑‑‑ Laughter / Rires

4255     THE CHAIRPERSON: Thank you.

4256     THE SECRETARY: This completes the consideration of Items 1 to 8 on the agenda. Thank you, Madam Chairman.

4257     THE CHAIRPERSON: And that therefore concludes the Orillia portion of this hearing. To all the applicants for Orillia, thank you very much for the process. I'm sure Commissioner Lamarre will agree that her baptism by fire was quite pleasant.

4258     We will take a 10‑minute break. Thank you.

‑‑‑ Upon recessing at 0914 / Suspension à 0914

‑‑‑ Upon resuming at 0934 / Reprise à 0934

4259     THE SECRETARY: Thank you, Madam Chair.

4260     Before we start I would like to inform you that Nick Montague, on behalf of a corporation to be incorporated has requested an extension with respect to the date by which he must provide the panel with a complete section 9 to their application, and the panel has determined that the undertaking must be compiled with us by Friday, January 30th.

4261     Thank you. And we will now proceed with the Phase I of the Gravenhurst and Bracebridge market.

4262     I will now proceed with Items 9 and 10 on the agenda which are applications by JOCO Communications Inc. for a licence to operate an English‑language FM commercial radio programming undertaking in Gravenhurst.

4263     The new station would operate on frequency 101.7 MHz (channel 269A) with an average effective radiated power of 1,780 watts (maximum effective radiated power of 3,160 watts with an effective height of antenna above average terrain of 26 metres).

4264     And appearing for the applicant is Mr. Joe Cormier.

4265     Mr. Cormier, you have 30 minutes to make your presentation today.

PRESENTATION / PRÉSENTATION

4266     MR. CORMIER: Hello, everybody. How are you doing? Bonjour.

4267     My name is Joe Cormier from JOCO Communications Incorporated. JOCO Communications is a small broadcast company currently operating two small radio stations, one in Sturgeon Falls and one in Espinola, and we are looking into expanding our business in the beautiful town of Gravenhurst.

4268     We have the knowledge to run radio stations and in ‑‑ Gravenhurst would be a great place to start maybe a little bit of a bigger station than what we have got now, maybe expand our business a little bit more.

4269     We also have a second application in that we choose to go 100 percent Canadian content. By the study we did it was a pretty popular format. So I will be doing a presentation basically for those two applications and hopefully we can get one of them approved and start up a radio station.

4270     We are confident that CRTC will give us serious consideration to award us this broadcast licence. So before we start I would like to thank Ms Chair and Commission to give us a chance to make this presentation.

4271     JOCO Communications is pleased to provide a local voice, stand out and provide important information at a community level.

4272     Sometimes without local radio station news of our friends neighbours are passed over and we miss hearing about their achievements, difficulties and success. So we are just saying, you know, when a town has a small radio station it's fun. You can, you know, talk about the good stuff that's going on. Sometimes it's bad news but they still need to hear about it, try to keep it as positive as possible. So we believe that Gravenhurst is probably a town that would benefit with a local radio station.

4273     Yeah, we believe that ‑‑ you know years ago if you listened to radio stations at seven in the morning they have a Canadian national anthem. I think it's pretty important. We do that. I don't know if it's any importance here but at seven in the morning we always ‑‑ you know, as soon as people get up they usually hear the national anthem, so we decided seven in the morning would be a good time.

4274     We are also more about the Canadian content. We are committing to play 100 percent Canadian content on one of our applications if it gets approved. That station there will play 100 percent Canadian music.

4275     There is enough music in Canadian content to start a radio station. We did our study on it and there is a lot of good artists. A lot of them are not being heard because with the 35 percent Canadian content on most stations sometimes some of the really good artists are not being heard on our radio, so maybe with 100 percent Canadian content we could play, you know, a lot of ‑‑ a lot of different style of music made in Canada.

4276     And also we are going to put 10 percent of emerging independent Canadian artists on our regular format.

4277     So on 10 percent of our format there would be a lot of new local artists from around, you know, northern Ontario and that and Toronto, or wherever they are from. We usually get a lot of emails from people that want us to play their music and we usually do. So we want to commit 10 percent of our format. So every 10 songs there is going to be an emerging artist coming out.

4278     Of course, we are going to have to make sure that the music is, you know, really good and it's able to put on the radio. A lot of the artists sometimes they send us stuff and it's not really ‑‑ you got to tell them, you know, listen, you got to maybe ‑‑ maybe get the music a little bit better or whatever and we will throw it on the air.

4279     But there is a lot of people that we do play, a lot of local artists. So that's what we want to achieve here too. And with 100 percent Canadian content I think we could really concentrate on that. When people listen to radio they will, you know, kind of say, "Hey, there is another Canadian because it's all going to be Canadian content". So that's what I am trying to get at with the 100 percent Canadian content.

4280     Our goal is serving the local community, of course. Being a locally‑driven radio station we have the power to develop local community news information and interests. So by hiring people in the local community we could train them.

4281     Usually communities like around Gravenhurst and that, I'm sure there is a lot of people that did take their radio station broadcasting and that so it's not going to be hard to find people local, try to like keep it local. This way here the stories are easier to find.

4282     And we will try to create a place where people will share the news and information. And we want to be in cooperation with other stations in the area because we are not going to be playing the same format as they are. So we will try to maybe work together with them and the newspapers and try to get this going really good.

4283     And we will talk about issues that cut across regions reporting the best of local community meetings. We will feature citizen's critics giving reviews of local arts and entertainment.

4284     Again, in the Muskoka area there is a lot of art and entertainment there. Well, there is a lot of artists that live in that area or go on vacation in that area. So we want to really, really put something good together for not only for the local people but for also the seasonal people that live there in the summertime.

4285     One vital role is reaching people during disasters. When a community is in crisis JOCO Radio's priority is to broadcast up to the minute updates. We will act as an emergency community headquarters for the local police, fire department and city officials as we do on our other stations.

4286     When the power went out, you know, we had our generators going and we had the mayor come in there and talk to the people and the CAO of the town. The fire department, police, it's always open for them.

4287     And we are also heavily invested in operating and marketing, helping advertisers build their business. We maintain a strong focus on connecting with the community we serve through local groups and national organizations, community leaders, charities and special causes.

4288     The strength in our business is our people. We are committed to recruiting and retaining diverse talent by creating an environment that integrates diversity and includes in all aspects of our operation. And we are also an equal opportunity employer where all are encouraged to apply.

4289     We are committed to reflect the cultural diversity of Canada in our programming and employment practices especially with respect to news and music and promotion of Canadian artists.

4290     Another thing ‑‑ Canadian artists, we really like to promote that. I think it's important that local people that write their own songs and make their own music, you know, at least give them a chance to go on the airwaves. We have had a few local people in Sturgeon Falls where they have actually had a SOCAN cheque. We are pretty happy about that. Some of them made it to MuchMusic like High Holy Days. You know they are a band that started there and we have been promoting them lots and they have got a couple of music videos on MuchMusic. Now, we are not saying that we have created that but we have helped them out of bed.

4291     A local telethon too in Sturgeon Falls ‑‑ this year they have raised $46,000 ‑‑ we broadcasted that live. We did a lot of announcements for it. Two years ago they had $25,000 so it went up quite a bit. And we might have helped them out there too with the fire department.

4292     We work a lot with the local community promoting a lot of stuff that's going on.

4293     Our strength at JOCO Radio is the diversity of our people, our thoughts and our ideas all working together to meet and exceed the expectations of our listeners and our clients.

4294     We also have proved successful in the past with our two small stations and can easily start the station within six months of getting approved financially, no problem. We have got the know how, and I think it's time we grew our business a little bit and go in a bigger community.

4295     We are committing more than is required for cash donations to FACTOR that is possible and realistic given the size of the market and our company. We are going to donate $5,000 a year. I know it's probably not as much as other companies, and I don't want to say nothing bad about anybody or whatever, but we figure that amount is pretty fair unless of course we don't hire as many people and we could give $40,000 a year. I mean if that's the way we have got to go for the licence then that's the way we would have to do. But I think a $5,000 donation is pretty good, like I said, considering the size of our company and the market.

4296     We are committed to promoting musicians and composers from the local community. We have got a show on our two stations ‑‑ that's going to be on the Espinola station. Yet, I haven't found enough talent yet to get it fired up there but it should be there in another three months.

4297     But in Sturgeon Falls we have got a show called Homegrown, and it's all local artists. And there is lots of it in that area, a lot of young people. It doesn't matter who you are, you know. Bring us your song, you know. We are going to show them how to get it registered through SOCAN, help them out with that ‑‑ promote their album free of charge.

4298     We do a show every Sunday night and we are going to actually make a second show now probably on a Monday or Tuesday. And it's all local musicians from the West Nipissing, North Bay and Sudbury area. Very popular, works really good and I think that's a good way to promote artists.

4299     A cash donation is good too so we do a lot of fundraisers that we don't put on our applications here, but we have raised a lot of money for people for ‑‑ contests like Battle of the Bands and stuff like that. We do that in Sturgeon Falls. We have had four of them going.

4300     We work with a youth group, buy them electric guitars; base guitars as donations. And we would be ready to do that here probably a little bit bigger here because it's a bigger market.

4301     We are offering a unique listening format for Gravenhurst. We are going to be going with music that would range from people from like 35 years old to, you know, 65‑70 years old; baby boomers. With our study that's what was coming back to us that people wanted to hear the most. I'm not saying listening to the most because there is already a good radio station there that's playing pretty well new music. You know, they go back to the eighties and nineties and that. We are just going to go below that.

4302     We provide live coverage of community events with up to the minute information and times of local, regional and national emergencies. Again, like I was saying, with the blackouts and emergencies we are going to be there.

4303     We are focused on the local community and we are committed to airing 100 percent Canadian content if that's the licence that gets approved, which would be a pretty interesting licence I think. I don't know if there is another in Canada that exists with 100 percent Canadian content and I think maybe it's about time we have one. If Nashville ‑‑ or if Memphis could have Elvis Presley 100 percent of the time on the radio, I'm sure Canada could have their Canadian artists on the radio 100 percent and be very successful.

4304     And we are committed to airing emerging artists during peak hours of listenership. So you know at one in the afternoon you might hear a local artist go on and will have a nice little call sign in front of their song and people are going to know who they are and we will have ads on running where they could buy their CDs.

4305     Also, in Gravenhurst for our study we have noticed there is a lot of stuff going on there with local clubs, events; interests. You know, there is a lot of car shows. We do car shows in Sturgeon Falls and we are going to start in Espinola this year. They are very excited about that and it's always fun. We will play music and, you know, we will shine some cars, give out some trophies on behalf of the radio station.

4306     And that's just stuff we do without putting it on the paper here. And there is a big boat show up in Gravenhurst. They are really heavy on these wooden boats that the people are really excited about.

4307     Museums, well, the Muskoka area is ‑‑ well, you know, it's all about Canadian history with the museum and the forest and stuff like that.

4308     Tourism, well, I can't say enough about tourism. I go there myself, spend a lot of time. It's beautiful. So we will promote tourism there and the environment. The environment, like I said, it's beautiful and they want to keep it that way and they want to promote that. You know, promote a good environment and let's keep it green. We will help them with that.

4309     Artisans or artists ‑‑ I'm sorry. I'm French. Sometimes ‑‑ des artistes, painting and stuff like that ‑‑ there is a lot of artists in the Muskokas.

4310     And also we will create some local jobs in Gravenhurst with our station starting up. As it grows we will get some more staff and, you know, get this thing going really good.

4311     And the radio business it's our passion. It's fun. We have fun with it. Maybe ‑‑ you know, they might say we are not as serious as everybody else but you know what? We want to get serious. We want to get bigger. You know, instead of being a small town we would like to go in a bigger community and see what we could do. And I think if you give me a chance we will pull it off really good and make you proud.

4312     I just ran out of paper.

‑‑‑ Laughter / Rires

4313     THE CHAIRPERSON: Thank you, Mr. Cormier. (Off microphone)

4314     MR. CORMIER: Oh, great. No, it's great. You know, it's fun and I want to keep it fun.

4315     THE CHAIRPERSON: Also, Mr. Cormier, if at any point you feel more comfortable speaking in French, please feel free.

4316     MR. CORMIER: Okay, merci.

4317     THE CHAIRPERSON: Although not every single one of us is fully bilingual, we do have translators.

4318     MR. CORMIER: Okay, great, yeah.

4319     THE CHAIRPERSON: So please feel more than comfortable to speak in French at any point.

4320     MR. CORMIER: Great, thank you.

4321     THE CHAIRPERSON: I will ask Commissioner Molnar to lead the questioning.

4322     COMMISSIONER MOLNAR: Good morning, Mr. Cormier.

4323     MR. CORMIER: Good morning.

4324     COMMISSIONER MOLNAR: I have a number of questions for you today. As you know, we are covering both of your applications ‑‑

4325     MR. CORMIER: Okay, great.

4326     COMMISSIONER MOLNAR: ‑‑ your application for an oldies format as well as the 100 percent Canadian. And it is a little bit different to be addressing two applications at the same time.

4327     MR. CORMIER: Oh, it's okay; it's okay.

4328     COMMISSIONER MOLNAR: I noted that there is a lot of similarity between the two applications so I am going to try and cover off some of the issues that are common to the two first and deal with those matters of clarification and then we will get into some of the specifics of your two separate applications; the one related to the oldies and the one related to Canadian content.

4329     To begin, I noticed you don't have with you your applications.

4330     MR. CORMIER: No, I don't, no.

4331     COMMISSIONER MOLNAR: Okay.

4332     MR. CORMIER: I have sent them in to you guys a long time ago.

4333     So was I supposed to bring them? I thought I just had to present myself today. I didn't think I had to go through my application.

4334     COMMISSIONER MOLNAR: Well, we do have some questions on it.

4335     MR. CORMIER: No problem.

4336     COMMISSIONER MOLNAR: So we will go through. You probably know it very well, I expect.

4337     MR. CORMIER: Well, maybe my assistant here will answer ‑‑

‑‑‑ Laughter / Rires

4338     MR. CORMIER: ‑‑ but they couldn't come today. You know there are slippery roads and they are busy working and I have got the whip out.

4339     I'm just kidding around.

‑‑‑ Laughter / Rires

4340     COMMISSIONER MOLNAR: Okay, yeah. We will see how this goes.

4341     I'm going to begin with the issue of format. In your application you indicated a commitment to a minimum of 49 percent sub‑Category 2 music and a commitment to 50 percent musical programming. And we just want to make sure we understand what you mean by that. And I say that from the perspective that there are speciality formats and there is commercial, you know the traditional commercial radio format.

4342     So you could just tell me your intent as it regards the amount of when you say sub‑Category 2 music what is it you mean by that?

4343     MR. CORMIER: Well, Category 2 that's, you know, your rock; you got country.

4344     COMMISSIONER MOLNAR: So it's the traditional conventional Category 2?

4345     MR. CORMIER: Yeah, absolutely, yeah, yeah, it's Category 2.

4346     COMMISSIONER MOLNAR: And when you say a minimum of 49 percent Category 2, normally a specialty licence is provided if you have less than 70 percent Category 2 music. So would you be looking for a specialty format or are you looking at a normal Category 2 licence and airing more than 70 percent?

4347     MR. CORMIER: Yeah. Well, that would probably go under commercial with a minimum of 70 percent.

4348     COMMISSIONER MOLNAR: Okay, and that's the case for both of your applications?

4349     MR. CORMIER: Yeah, for both applications.

4350     COMMISSIONER MOLNAR: Right.

4351     MR. CORMIER: Like the same type of music. It's just one format is just going to be Canadian artists instead of having a variety of artists from around the world.

4352     COMMISSIONER MOLNAR: Okay, okay.

4353     Another area of clarification relates to your proposal related to live to air programming.

4354     MR. CORMIER: Okay.

4355     COMMISSIONER MOLNAR: You said in your application that 40 percent of your broadcast time would be live to air programming in a given broadcast week, which would indicate 60 percent would be what, voice tracks?

4356     MR. CORMIER: Oh, voice track, yeah.

4357     COMMISSIONER MOLNAR: 60 percent voice track to 40 percent live to air?

4358     MR. CORMIER: Yeah.

4359     COMMISSIONER MOLNAR: Okay. Can you tell me during what periods of time you would be live to air?

4360     MR. CORMIER: Well, we go from 6:00 a.m. to 6:00 p.m. live to air. Now, unless we have a request show or something at night it's the only time I have a live person in there for specialty, like from seven to eight at night we usually have shows. That's usually when we have the All Canadian show or request shows or oldies show or whatever show we want to do, blues and whatever. We usually have a person in there live at that time which maybe would fall under the live to air again.

4361     COMMISSIONER MOLNAR: M'hm.

4362     So can you tell me, in those periods when you would not be live to air what would be your plan for being responsive in case there is an emergency or, you know, breaking news that should be broadcast to your community?

4363     MR. CORMIER: Oh, no, we would have people working, you know. There is always somebody, you know. There is always somebody on standby for that, you know. And usually the phones are forwarded to my place right now because the stations are pretty small. Sometimes we can't always have a staff there but there is always somebody on standby. If it's not one of my staff it's myself, or my wife or whoever is going to be no standby, you know, and they are going to relate the message back pretty fast.

4364     So we are always ‑‑ we are always ready for emergency; could always be reached.

4365     COMMISSIONER MOLNAR: Okay.

4366     MR. CORMIER: Okay.

4367     COMMISSIONER MOLNAR: Okay.

4368     MR. CORMIER: Is that clear enough?

4369     COMMISSIONER MOLNAR: You would have 7/24 standby?

4370     MR. CORMIER: Oh, yeah, we always have that. We have had it for the last six years, so it's working good. And with three stations, let's say if you can't reach somebody, you would be able to reach somebody at the other station. We always work as a team, you know.

4371     COMMISSIONER MOLNAR: M'hm. And when you say "reach", just for my curiosity, if somebody phones into the radio station it's automatically forwarded ‑‑

4372     MR. CORMIER: Oh, yeah, it's forwarded. It's forwarded somewhere where somebody is going to be. Let's say there is a staff that's supposed to be working on a Saturday morning and they are going to take the calls for that day. We will forward it to his place or her place.

4373     COMMISSIONER MOLNAR: M'hm.

4374     MR. CORMIER: Or have somebody at the station.

4375     COMMISSIONER MOLNAR: Okay.

4376     MR. CORMIER: It's working pretty good where we are now with that. In Gravenhurst, being a bigger station, we would definitely have people there all the time to make sure to answer the phones. And, again, you know you don't have people there at 12 o'clock at night but they are forwarded.

4377     Like for bus cancellations and that I always get a phone call at six o'clock in the morning. So I get up and I do my thing. We get it on air you know 10 minutes later.

4378     COMMISSIONER MOLNAR: M'hm, okay.

4379     A question regarding the oldies format that you have proposed; in your application you committed to eight hours of news and information programming which includes sports and weather. For purposes of our record and our assessment could you tell me how much of that eight hours would be devoted to pure news?

4380     MR. CORMIER: Good question. Well, the pure news is like ‑‑ the pure news, you mean like news without being the weather or the sports?

4381     COMMISSIONER MOLNAR: Yes.

4382     MR. CORMIER: Like is sports and weather considered news? Like a snowstorm for people that are out driving it's pure news. They want to know if they are going to make it to work or not.

4383     So do you want a percentage or the hours?

4384     COMMISSIONER MOLNAR: I would say you can give it to me in either a percentage or hours but what amount would be devoted to local, national, international news.

4385     MR. CORMIER: Oh, okay.

4386     COMMISSIONER MOLNAR: Versus weather, versus sports, versus you know other talk.

4387     MR. CORMIER: Yeah, we got about 40 percent local news, whenever it's available to us. Sometimes the smaller communities they don't have as much news as, let's say, Toronto or something.

4388     COMMISSIONER MOLNAR: M'hm.

4389     MR. CORMIER: So we got to go more of the regional and the national news.

4390     COMMISSIONER MOLNAR: M'hm.

4391     MR. CORMIER: And then we will put sports and weather. Weather is ‑‑ I would have to say like 25 percent of it would be sports and weather, the rest would be news.

4392     COMMISSIONER MOLNAR: Okay, fair enough.

4393     And I do understand what you are saying, that sometimes weather is the news.

4394     MR. CORMIER: Oh, yeah, absolutely, especially if there is a bus cancellation or something, you know, or if there is 25 centimetres of snow. It's not always the best news but ‑‑

4395     COMMISSIONER MOLNAR: Yes, that's right.

4396     MR. CORMIER: ‑‑ unless you snowmobile and then it's fun, and I do lots of that.

4397     COMMISSIONER MOLNAR: I would like to move to the Canadian content application for a minute.

4398     MR. CORMIER: Okay.

4399     COMMISSIONER MOLNAR: And just speaking about your format you provided a sample block schedule. You provided a schedule of what you would propose to be playing and it shows that you would offer up to 14‑and‑a‑half hours of Category 3, which is special interest music in each broadcast week. Things such as blues, jazz, folk music are considered Category 3 music.

4400     MR. CORMIER: Folk music, like there is two ways of looking at that. Like Neil Young has got folk songs and he has got rock songs. So I would put Neil Young in the morning and let's say in the morning you would put the song Old Man, you know by Neil Young, and then at night you would put Rocking in the Free World. Well, it's the same artist but it's two different categories.

4401     So I would put down some ‑‑ you know, Gordon Lightfoot is more of a folk artist, right, so does he fall under the category of folk or does he fall under the category of rock?

4402     We would put some folk music in the morning and then when you go towards the day you would be more of the mainstream stuff, like the older stuff. But how can I explain that? A little bit of Canadian rock and popular music.

4403     COMMISSIONER MOLNAR: M'hm.

4404     MR. CORMIER: So I might have ‑‑

4405     COMMISSIONER MOLNAR: Let me just maybe explain the reason for my question.

4406     MR. CORMIER: Okay.

4407     COMMISSIONER MOLNAR: The Commission does have a special interest in ensuring that there is diversity of music.

4408     MR. CORMIER: Yes.

4409     COMMISSIONER MOLNAR: And that some of the genres such as blues and jazz and so on also have a place on the airwaves, and to ensure that there is you know a broader base. And so where people ‑‑ applicants come forward and propose to play that music it is of interest to us.

4410     MR. CORMIER: Okay.

4411     COMMISSIONER MOLNAR: But we also request that then become a commitment ‑‑

4412     MR. CORMIER: Right.

4413     COMMISSIONER MOLNAR: ‑‑ from you that you would play ‑‑ if you are proposing to do it, that you stick by that commitment to play a certain amount of what we call Category 3 music.

4414     MR. CORMIER: Yeah, absolutely.

4415     COMMISSIONER MOLNAR: So you have ‑‑ when we looked at your playlist we identified that you did have music from those genres in there.

4416     MR. CORMIER: Yes.

4417     COMMISSIONER MOLNAR: And my question is would you commit to that? If you were awarded the licence would you commit to ensuring that you did maintain that level, the 14‑and‑a‑half hours per week of these genres of music?

4418     MR. CORMIER: Oh, absolutely,

4419     COMMISSIONER MOLNAR: What we call Category 3.

4420     MR. CORMIER: Absolutely, because the people want that. You know, with our series we did people want that music. They want Diana Krall. They want stuff like that. They don't hear it right now.

4421     COMMISSIONER MOLNAR: M'hm.

4422     MR. CORMIER: So yeah, definitely.

4423     COMMISSIONER MOLNAR: Okay, a bit of a housekeeping item here.

4424     MR. CORMIER: Okay.

4425     COMMISSIONER MOLNAR: When you did provide your playlist to the Commission as part of your application, the blocks of programming that are required that would show the morning and the afternoon, what's played through the morning and afternoon peak periods, it doesn't meet the Commission's requirements.

4426     What is being asked in the application is that you provide a playlist that shows what you are going to play in the morning and afternoon peak periods.

4427     So could I ask you to provide us with a playlist that ‑‑ and I say compliant with the requirements of section 8.6 of the application. Should you have any question with what is meant by compliant with section 8.6 I am certain that some of our staff could help direct you to where that is, and you can find that.

4428     MR. CORMIER: Great.

4429     COMMISSIONER MOLNAR: So just to resubmit ‑‑

4430     MR. CORMIER: Okay.

4431     COMMISSIONER MOLNAR: ‑‑ the playlist so that it's compliant with the application so it can be compared to the other applications that are in front of us.

4432     MR. CORMIER: Okay, great, yeah, no problem.

4433     COMMISSIONER MOLNAR: Okay.

4434     MR. CORMIER: Okay.

4435     COMMISSIONER MOLNAR: And I'm going to ask if you could do that what would you need a couple of days to get that information?

4436     MR. CORMIER: Oh, I could do ‑‑ yeah, probably tomorrow I will be able to do it because I have got to go do ‑‑ I'm a little bit busy this afternoon with an ice show. I know it's funny. Kids want to ‑‑ doing ice skating and they want me there so I'm going to go.

‑‑‑ Laughter / Rires

4437     MR. CORMIER: I have got to commit to the ‑‑ I go to these events too.

4438     COMMISSIONER MOLNAR: Okay.

4439     MR. CORMIER: So tomorrow I will ‑‑

4440     COMMISSIONER MOLNAR: So tomorrow.

4441     MR. CORMIER: ‑‑ I will work on that and I will have that in here, no problem.

4442     COMMISSIONER MOLNAR: Okay, thank you.

4443     A couple more questions related to your application for Canadian content. You said that you would commit by condition of licence to broadcasting 40 percent Canadian content.

4444     MR. CORMIER: Oh, it's probably a typo. I mean 100 percent on that application and it's 40 percent on the other one.

4445     COMMISSIONER MOLNAR: Oh, I'm very sorry. That's my ‑‑ that's my error.

4446     MR. CORMIER: Oh, okay.

4447     COMMISSIONER MOLNAR: As I'm looking at my notes you are right. I am talking about your oldies one. I'm very sorry here.

4448     MR. CORMIER: Okay.

4449     COMMISSIONER MOLNAR: Related to your oldies format ‑‑

4450     MR. CORMIER: Yes.

4451     COMMISSIONER MOLNAR: ‑‑ you said you would commit 40 percent ‑‑

4452     MR. CORMIER: Yes.

4453     COMMISSIONER MOLNAR: ‑‑ to Canadian content.

4454     Would that be across the entire broadcast week?

4455     MR. CORMIER: Yes.

4456     COMMISSIONER MOLNAR: Yes?

4457     MR. CORMIER: M'hm.

4458     COMMISSIONER MOLNAR: Okay.

4459     And can you tell me if you would have the same commitment of 40 percent to the Category 3 music; the jazz, the blues and so on, that as well would be?

4460     MR. CORMIER: Oh, yeah, because there is enough talent in Canada to do that easily.

4461     COMMISSIONER MOLNAR: Okay.

4462     One of the things that was identified is that in an oldies format there have been many, many licensees who have come forward to the Commission and actually requested a reduction in the amount of Canadian content they needed to broadcast because in that period in the oldies format, in the fifties, sixties, seventies arguably there isn't as much Canadian content. And so many licensees have actually, rather than increasing their requirement to 40 percent, have requested that it be reduced to 30 percent.

4463     Do you remain confident that you can find the musical inventory to meet the 40 percent that you have committed to?

4464     MR. CORMIER: Oh, yeah. I think I could find it, especially in the seventies. Seventies there is a lot of Canadian. The older music, well, yeah, we will have to work at it maybe but I can't see, you know, asking for a reduction.

4465     COMMISSIONER MOLNAR: Okay.

4466     MR. CORMIER: So yeah. Yeah, we will commit to that.

4467     COMMISSIONER MOLNAR: Okay.

4468     One more housekeeping item on your oldies format, and that's related to the CAB's equitable portrayal code.

4469     I note in your statements that you commented on diversity and your commitment to diversity. The CAB's equitable portrayal code lays out the standards for the industry related to the portrayal of different groups both on the radio and within the stations themselves. Have you ever seen that code? Are you aware of the code?

4470     MR. CORMIER: Yeah, well, I am aware of it.

4471     COMMISSIONER MOLNAR: Are you willing to commit to meeting the conditions of the code?

4472     MR. CORMIER: Oh, absolutely.

4473     COMMISSIONER MOLNAR: Okay, very good. Thank you.

4474     I'm going to move on ‑‑

4475     MR. CORMIER: Thank you.

4476     COMMISSIONER MOLNAR: ‑‑ on now to questions related to your 100 percent Canadian content format.

4477     In this application, as in the first one, there was a little bit of a question on our part because it spoke to the commitment to a minimum of 49 percent sub‑Category 2 music and a commitment of 50 percent musical programming. We just spoke about that.

4478     MR. CORMIER: Okay.

4479     COMMISSIONER MOLNAR: Again, you are looking at just a traditional commercial licence?

4480     MR. CORMIER: Yes.

4481     COMMISSIONER MOLNAR: Right, okay.

4482     Okay. I think now we get into the nuts and bolts of your application. You have proposed 100 percent Canadian format and you mentioned in your opening statements that your research indicates that it's achievable and it would be welcomed.

4483     MR. CORMIER: But there is a lot of interest, like people really ‑‑ like you would mention that and the artists especially they say it's about time. So I thought, well, we will give it a shot and put an application in and see if we could get this.

4484     And, you know, I had to do ‑‑ you know we did our study and that and we crunched the numbers and it looks like it would work really good. And actually, a lot of the businesses would like to hop on that because of the commitment of 100 percent Canadian content ‑‑ musical content.

4485     COMMISSIONER MOLNAR: Okay. So from a research perspective can you tell me what particularly ‑‑ what specifically what work you did to; one, ensure that this is in fact achievable in that you know the inventory of music is there, that it would meet the needs of that market?

4486     MR. CORMIER: Well, the music is abundant, you know. There is so much of it it's mind boggling. As far as for music I'm not worried about that. You know it doesn't seem like the people were worried either. I mean there is a lot of content. There is a lot of undiscovered Canadian music that we could play on that.

4487     I guess I had better get back to the real answer here.

‑‑‑ Laughter / Rires

4488     MR. CORMIER: As far as for achievable I think myself it could be done. You know, an oldies format would work great and I think 100 percent Canadian content format would work really great too and putting 10 percent of the new coming artists on there, like you know that would work really good.

4489     I think it would be welcomed really good. I can't see that failing, really. Well, myself I can't see it failing. You know, we weren't supposed to be able to achieve nothing in Sturgeon Falls and, I mean, that station is going on its second term now and it's really doing good, and Espinola the same.

4490     Gravenhurst, the market is three times the size. I can't see it failing. It's probably something that I ‑‑

4491     COMMISSIONER MOLNAR: So you have based this on your own ‑‑

4492     MR. CORMIER: Not on my own. We did talk to a lot of people but you are asking me why 100 percent Canadian. It's just a question I had out there. I had some really good response.

4493     So like I said, we put two applications in. The Canadian one would be really exciting to start for, you know, a lot of personal reasons and a lot of ‑‑ you know, we know a lot of artists that would like to see that happen.

4494     So yeah, we did do a study. We phoned 100 people and the response was great. It was different. That's all. We never had that question asked us. 100 percent, of course, will listen to that. It's great. It's about time.

4495     COMMISSIONER MOLNAR: So Mr. Cormier, could you tell me who is the target audience for your 100 percent Canadian station?

4496     MR. CORMIER: Well, the 100 percent Canadian station, what happens with that one is I would probably have to go in a little bit of ‑‑ you know, I would go from the 35 to 65 year old audience.

4497     Myself, being 45, I listen to a lot of new stuff too, so we would have to include a little bit of new stuff in there too.

4498     I wouldn't put all new music. I would like to bring a lot of the old stuff back, Neil Sedaka, you know, Burton Cummings, BTO, stuff like that. So maybe back to the sixties, seventies and back to the fifties too. I'm going to have to do some research on Canadian artists back there.

4499     But, yeah, we would probably put 10 percent of new stuff too, you know, and mix it in the mix somewhere maybe a little bit later on in the daytime after supper or something.

4500     COMMISSIONER MOLNAR: Okay. So in talking about the broad range of music that you would be looking at from the fifties to new and emerging, are you targeting anybody particularly within this market?

4501     MR. CORMIER: Well, we are targeting from 35 to like 65 and over. We are targeting the baby boomers, a little bit of the older generation I guess we could say. Like the older generation, people a little bit younger than me.

4502     COMMISSIONER MOLNAR: M'hm.

4503     MR. CORMIER: Okay.

4504     COMMISSIONER MOLNAR: And your basis for ‑‑

4505     MR. CORMIER: Us ‑‑ thank you.

‑‑‑ Laughter / Rires

4506     COMMISSIONER MOLNAR: Your basis for assuming that this target audience would be receptive to this and would choose it as their station to listen to, and the advertisers would choose therefore to advertise on your station, is the survey you did of 100 people?

4507     MR. CORMIER: Yes, absolutely, and there is a lot of older people than younger people that reside there, fulltime and part‑time residents.

4508     COMMISSIONER MOLNAR: M'hm, okay.

4509     I want to just move on. You have stated that you would accept a 100 percent Canadian content as a condition of licence. So you would commit to 100 percent?

4510     MR. CORMIER: I would be happy to commit to that as I love it.

4511     COMMISSIONER MOLNAR: Okay.

4512     MR. CORMIER: Yeah.

4513     COMMISSIONER MOLNAR: Personally, as I was going through your application and looking at your programming and so on, what you had proposed, I noticed for example you had a request ‑‑ you were proposing that as part of your operations you would broadcast a request Tuesday nights, I think it was, or one evening would be a request line.

4514     So how do you see that working when you have a relatively ‑‑ I mean I understand there is a plethora of quality Canadian music.

4515     MR. CORMIER: Oh, there is lots.

4516     COMMISSIONER MOLNAR: But it is not always the case that people phoning in are going to identify or know whether it's Canadian or otherwise. So how do you see that working? You will be targeted 100 percent. If they call in and ask for something else it's simply not available?

4517     MR. CORMIER: No, choose a Canadian artist. It's a Canadian radio station.

4518     And the thing is it's funny. We do a lot of request shows and most of the songs requested are from Canadian artists. You know they want to hear Bryan Adams. They want to hear Nickelback, Theory of a Dead Man.

4519     Like the stuff is really good. I have even got some good dance music now that comes out of Canada too. Like you know there is so much it's crazy.

4520     COMMISSIONER MOLNAR: M'hm.

4521     MR. CORMIER: So yeah, we would definitely do that. I don't think people would get offended by it. I think they would really support it.

4522     COMMISSIONER MOLNAR: Okay.

4523     I just also want to bring to your attention that when we are saying Canadian content there are particular rules, if you will, as to what ‑‑

4524     MR. CORMIER: Oh, yeah, okay, okay.

4525     COMMISSIONER MOLNAR: ‑‑ what qualifies as Canadian content. And so we would be looking at Canadian content that qualifies within the CRTC to find rules of Canadian.

4526     So you would be comfortable in knowing those rules and ensuring you are broadcasting within those parameters?

4527     MR. CORMIER: Oh, absolutely. As soon as we get the licence we would make sure that everything is in compliance and I would make sure to tell my staff that and we would just have that music there available for that station.

4528     COMMISSIONER MOLNAR: And if it does not meet the requirements of 100 percent Canadian you simply would not have it available?

4529     MR. CORMIER: Oh, I would tell the artists to call you guys. No, no, kidding. Yeah, no, it wouldn't be available there.

4530     COMMISSIONER MOLNAR: So there is no risk you could end up being in non‑compliance ‑‑

4531     MR. CORMIER: No, no, because we are going to make sure we only have that music there.

4532     COMMISSIONER MOLNAR: Okay.

4533     MR. CORMIER: No, we don't want to do that.

4534     COMMISSIONER MOLNAR: Okay. Mr. Cormier, I have a number of questions related to the business plan that you provided.

4535     First of all, in looking at your applications I note that they project to generate the same revenue and virtually the same costs regardless of what format is chosen. Can you tell me the basis for that assumption?

4536     MR. CORMIER: Well, basically it's the same application. One of them is 100 percent Canadian, the other one is a variety ‑‑ if the CRTC feels, you know, 100 percent Canadian is not going to work for Joe but we will give him an oldies station.

4537     So we have based it on the same type of music but it's just one of them would be committed to 100 percent Canadian. So basically the numbers are the same. They are not going to be different.

4538     COMMISSIONER MOLNAR: Because under either format you will generate the same audience interest and therefore be able to generate the same advertising; is that ‑‑

4539     MR. CORMIER: Yeah, absolutely. It's an oldies format for both. Canada you would have a little bit of difference for ‑‑ let's say you would have to put some new music every ‑‑ you know maybe 10 percent. But basically the revenues should be the same unless you give me two licences, then we could split that in two.

4540     I'm just being honest here. I'm not trying to make people laugh for nothing but that's the way I'm looking at it.

4541     It's just like in Sturgeon. If I'm going to play 100 percent Canadian content the advertisers are still going to be listening in. I'm sure of it, because it's the same type of music. It's just the artists are from Canada instead of being from the States and from all over.

4542     I don't think you lose too many listeners like that. I think you would gain listeners with 100 percent Canadian, to tell you the truth, unless there is not enough music and it gets to be repeated a lot. But I mean there is so much music out there it's crazy. You know, you could run a format with two or three thousand songs and have a lot of music for a long time without repeating.

4543     Canadian music, I mean you could ‑‑ you know if you look at the website of Jimmy Valance's, you know, he is a Canadian writer. He writes songs for Bryan Adams and that. On his website alone he has produced so much Canadian music it's unreal that people don't even know about, you know.

4544     COMMISSIONER MOLNAR: So perhaps you could tell me, and you just noted, you know if the CRTC gave you both.

4545     MR. CORMIER: Yes.

4546     COMMISSIONER MOLNAR: You would be happy with that outcome?

4547     MR. CORMIER: Oh, yes, and I would make sure those two stations rolled real good.

4548     COMMISSIONER MOLNAR: And you believe there is capacity in the market for both of those?

4549     MR. CORMIER: I'm not sure about that. I'm not sure if ‑‑ you know what would ‑‑ with two stations though you could run them out of one station and have the two, you know. You could save a lot of costs there. It's a different ballgame all together.

4550     But yeah, it would be ‑‑ you know because there is a lot of stuff you use twice. You know, you don't have to rent two studios. You have just got the one. And the tower site, the same thing you know. So there is a lot of cost difference there if you get two stations.

4551     COMMISSIONER MOLNAR: M'hm.

4552     MR. CORMIER: And a lot of the staff could do, you know, the news and stuff like that.

4553     COMMISSIONER MOLNAR: Right.

4554     MR. CORMIER: It's a different ballgame with two stations.

4555     COMMISSIONER MOLNAR: Let's assume that the Commission was to provide you one. Which one would be your preference?

4556     MR. CORMIER: Either one I would be really happy.

4557     COMMISSIONER MOLNAR: Or you want us to choose?

4558     MR. CORMIER: Canadian would be great. I would love the challenge and I think we would be the first one in Canada to have an all‑Canadian station. And in the Muskoka area it would be a perfect place for it. You have got so much tourists that goes there and so many people from down south and that that go visit there. It's totally Canadian there, you know.

4559     COMMISSIONER MOLNAR: M'hm.

4560     Okay. I want to turn back. You know when I asked if the market can support two you weren't quite sure.

4561     MR. CORMIER: Well, if I say yes, you know, it's double of what we asked but we wouldn't be bringing in double that money. You would probably be bringing in a little bit less on one of the stations, right?

4562     COMMISSIONER MOLNAR: Yes.

4563     MR. CORMIER: Or you would have to bring the costs down if you would want to go on both stations or vice versa.

4564     COMMISSIONER MOLNAR: Fair enough. I think truthfully, Mr. Cormier, one of our challenges is to understand if the market can support one.

4565     MR. CORMIER: Oh, it can definitely ‑‑

4566     COMMISSIONER MOLNAR: You know particularly with the economic situation out there. We have seen one of the applicants who had their application in for this market actually withdraw it because of the economic situation.

4567     MR. CORMIER: Yeah, but they want to make some big, big bucks out there. I'm not saying nothing against no one. I mean everybody is a good broadcaster here. Everybody is going to put a good application in. But I mean you have got to be reasonable on your prices too at this time, you know. And yeah, you got the cutbacks and that, but it's business. That's what it is, you know.

4568     We want to run a business here and I know we could be successful there. We proved successful in towns of 5,000 people. So if you have got ‑‑ you know, you have got about 11,000 there and another town close by with 20,000. That leaves, you know, 30,000 in population. It shouldn't be too, too hard to get one going but two, I would be questioning that.

4569     COMMISSIONER MOLNAR: Right. So besides the population have you done any more or can you provide us with any additional information that would provide us some assurance that this market can actually support the station you propose?

4570     MR. CORMIER: Like I said before, you know, before you actually put the station on, you know, you turn on the switch and you actually get the people to advertise, I mean if you go back by what we did in our other stations I can't see a problem with it and not making it. You have got some pretty big stores there and I'm sure they would love to be on their local stations. Just in Espinola we got a lot of the big guys that hopped on this year.

4571     Now, to prove which people ‑‑ I mean I don't think anybody could prove that for real. It's just ‑‑ you know, it's just assuming, you know. You go there and you assume the market could do that good and then you turnaround and you start up your station and it wasn't as good or, wow, it's a lot better than I thought it was going to be.

4572     COMMISSIONER MOLNAR: Right.

4573     MR. CORMIER: So to be right on the money ‑‑

4574     COMMISSIONER MOLNAR: I guess what I would say to you, Mr. Cormier, if you were going to your bank to say "I want to open this station" then they would say to you, "Prove to me that, you know, you can be profitable. Show me your financials, the financials you provided to us. Show me your financials and prove to me or give me some assurance that in fact this can be achieved", you know what would be the response because we are in the same situation. Give me some assurance ‑‑

4575     MR. CORMIER: No, they have already ‑‑

4576     COMMISSIONER MOLNAR: ‑‑ that the revenues you projected can be achieved.

4577     MR. CORMIER: They have already approved that. I mean I brought in an application. I brought in a study of like the amount of businesses there is here and in comparison to Sturgeon or Espinola and the amount of people, like the population, plus the whole thing put together.

4578     COMMISSIONER MOLNAR: So based solely on the population ‑‑

4579     MR. CORMIER: There is enough.

4580     COMMISSIONER MOLNAR: ‑‑ and it's ‑‑

4581     MR. CORMIER: The population and the business and the way the economy is going there. It's still booming there. I mean they have got a marina going up there that's world class. You know it's beautiful. They have got the opera house there. It's phenomenal. You know, car shows at a track of 500 or 600 cars, maybe more. It's unbelievable.

4582     People flock there, people with ‑‑ you know there is a lot of ‑‑ I don't want to say it like that but there is a lot of actors and actresses and singers that go there. You know they go there to spend money, let's face it.

4583     It's a beautiful place and it's very welcoming. So I can't see that place ‑‑ a radio station not make it there. It's going to make it for sure.

4584     COMMISSIONER MOLNAR: Okay. Have you given any thought as to what impact a new station that you proposed would have on the incumbent? There is a station in Bracebridge today.

4585     MR. CORMIER: Yeah, yeah, absolutely.

4586     COMMISSIONER MOLNAR: And so what would you see to be the impact on them?

4587     MR. CORMIER: I think the impact shouldn't be too, too harsh on them but we will impact for sure. I can't say we are not because I would be lying.

4588     To tell you the amount of money, I don't know how much he makes so I don't know what we would be taking away from them, because if he has got a lot of advertisers in Gravenhurst he would probably lose a few of them or they wouldn't be ‑‑ you know, they would say, "No, we are going to cut the budget and we will go half on the other station". So in Gravenhurst itself I'm not sure if I would really affect them that much. I don't think we are going to be going into Huntsville or nothing.

4589     But in Bracebridge, yeah, he is in Bracebridge too.

4590     COMMISSIONER MOLNAR: So there would be an impact. It's not certain how much?

4591     MR. CORMIER: We might be a little dent but I don't think it would be as much as ‑‑ you know, I don't think he would hurt too much over it.

4592     It's just like when that same guy started a radio station in North Bay. It affected us in Sturgeon Falls but now we are actually making more than we ever did there since we have been there. So it kind of complements the radio market and people want to get more into it.

4593     So if they advertise with me in Gravenhurst and they say it works good, "Let's go on The Moose. He is even bigger. It's going to work out even better, you know. We will go on both." So it might actually help the market by having a station there.

4594     COMMISSIONER MOLNAR: Okay. I'm going to turn to the issue of the costs that you have projected for your new station.

4595     MR. CORMIER: Okay.

4596     COMMISSIONER MOLNAR: I have a couple of questions of clarification so I will reference in mine what schedules that you provided that we are going to be looking at.

4597     First of all, you have said in your application that you project revenues low and costs high. Yet, if we look at your financials you are breaking even during the first year of operations which isn't ‑‑

4598     MR. CORMIER: We hope, we hope. You know what I mean? It probably won't be ‑‑ we are not sure, like we are ‑‑ the numbers we are doing is numbers we crunched and you know if everything goes to plan we should be ‑‑ we should be not above water but not too much underwater type thing.

4599     COMMISSIONER MOLNAR: M'hm. It isn't traditionally the financial projections we see that would see a new operation breakeven in Year 1.

4600     MR. CORMIER: But there is a lot of stations out there that lose $30,000 but they give $30,000 to Canadian artists. So we gave $5,000. If we are going to give an extra 30, yeah, we will be in the hole $30,000 too.

4601     So we are just trying to ‑‑ you know we are trying to ‑‑ we don't have a whole bunch of stations to back us up. We have got two of them which, you know, they are doing good but we don't want to sink them and get this going so we will take the money out of there and, you know, we don't want to lose too much money.

4602     So I see a lot of the loss. On the other ones it's because they want to give, you know, $100,000 a year to Canadian artists. I believe in the cause but I mean you can't sink your own ship to do that, to achieve that in order to get a licence. I don't believe in that.

4603     COMMISSIONER MOLNAR: Okay.

4604     MR. CORMIER: So that's why we are at par. We hope that that's the way it goes.

4605     COMMISSIONER MOLNAR: Mr. Cormier, for your information I'm an accountant.

4606     MR. CORMIER: Okay.

4607     COMMISSIONER MOLNAR: And so when I received this application I looked at the different financial schedules and so on you provided, you know looked at the financials, looked at the fact you were breaking even, and I found some matters of, I will say, discrepancy between the different schedules you provided.

4608     MR. CORMIER: Okay.

4609     COMMISSIONER MOLNAR: Which I need to understand. Again, you don't have the schedules in front of you. I am going to move ‑‑ I have on my computer here the schedules and so I am going to move to a schedule you provided in Appendix 3A that shows us the projected expenses of your station. That will just take me a minute.

‑‑‑ Pause

4610     COMMISSIONER MOLNAR: Sorry about this but I want to be able to read it to you since you don't have it in front of you.

4611     MR. CORMIER: Okay.

‑‑‑ Pause

4612     COMMISSIONER MOLNAR: Okay. So here is one of the first areas that I have some questions on, and it relates to the programming costs you provided to us in your financials.

4613     In your financials that you provided as part of your application you show your programming costs to be $75,000 in the first year, rising to $90,000 over the seven‑year period but you are talking about $75,000 in programming. In the appendix that you provided, Appendix 3A in your supplementary brief, you show your first year of programming costs to be $132,000.

4614     I also note in your application that you said that you would have 10 employees including four in programming. So when I looked at $75,000 I assumed that was quite low.

4615     MR. CORMIER: Yeah.

4616     COMMISSIONER MOLNAR: Can you tell me which of these numbers that are provided here reflect your expense projections?

4617     MR. CORMIER: It would probably be 132,000.

4618     COMMISSIONER MOLNAR: Okay. And I can go through the rest of it and get the same thing, you know, each year. Each year this has occurred. In Year 2 it's $137,000 versus $78,000.

4619     MR. CORMIER: Yeah, the other one might have been something that I didn't add to it because it sounds to me like $75,000, maybe that's for programming. I should have brought my application. I guess that would have been a lot better but I didn't think we would go into all these details today, so we have to ‑‑

4620     COMMISSIONER MOLNAR: And we don't always go into these details, Mr. Cormier.

4621     MR. CORMIER: Unless there is a mistake; that's right.

4622     COMMISSIONER MOLNAR: But there are some issues. There are issues ‑‑

4623     MR. CORMIER: Okay.

4624     COMMISSIONER MOLNAR: ‑‑ in that I wasn't able to correlate the information you provided in your appendix to the information you provided in your ‑‑ you know, in your overall financials.

4625     MR. CORMIER: Okay.

4626     COMMISSIONER MOLNAR: And it did appear that your expenses were, you know, low given that you were ‑‑

4627     MR. CORMIER: A little bit low.

4628     COMMISSIONER MOLNAR: ‑‑ going to be generating positive net income by Year 1 and these expenses ‑‑

4629     MR. CORMIER: Okay.

4630     COMMISSIONER MOLNAR: ‑‑ when you look at an organization of 10 employees looked relatively low. As we noted, four of them in programming, $75,000 was not likely to be ‑‑

4631     MR. CORMIER: No, no, they wouldn't want to work for me.

4632     COMMISSIONER MOLNAR: That's right.

4633     So you have indicated that you would ‑‑ you are planning on 10 employees plus a couple of part‑times; is that correct?

4634     MR. CORMIER: Yeah, that's what we are hoping to do.

4635     COMMISSIONER MOLNAR: Right, four in programming, four in sales, one station manager and one technical; is that right?

4636     MR. CORMIER: Yeah.

4637     COMMISSIONER MOLNAR: Okay. Again, when I look at it, your sales, advertising and promotion there is some discrepancy in your financial report. You show $200,000; in the appendix you show $150,000 in sales and advertising.

4638     So in either of those ‑‑ let's keep it in either of those ‑‑ it's a $50,000 difference. It's not going to pay for the rest of the employees.

4639     MR. CORMIER: I'm going to have to look into the application and the appendix and see where I went wrong because it's just a matter of the numbers. I probably didn't crunch them right in the one spot or I put some numbers somewhere else but I know the numbers come out okay. You know I'm going to have to look into that.

4640     COMMISSIONER MOLNAR: Okay. Well, Mr. Cormier, I can also tell you that when you look at it again mathematically it does not add.

4641     MR. CORMIER: Okay.

4642     COMMISSIONER MOLNAR: So yeah. You know, take a look at what is in the application for the financials and add up your columns of total expenses. They don't ‑‑ they don't add to what is shown as the total and therefore the net income projected over the period is different than what is shown here.

4643     I'm going to leave this with legal staff. I would like to see ‑‑

4644     MR. CORMIER: Revised?

4645     COMMISSIONER MOLNAR: ‑‑ a revised financial schedule.

4646     And based on the information that is in your application, you know, as I said you have made an application or attached in your application in section 4.1 a financial ‑‑ a financial projection and then in your supplementary brief you provided further details of the different categories of programming, sales and so on.

4647     MR. CORMIER: Okay.

4648     COMMISSIONER MOLNAR: Using the information you provided, if you want to take a look at it.

4649     MR. CORMIER: Oh, I will.

4650     COMMISSIONER MOLNAR: And just ensure that, you know, you have carried forward ‑‑ for example, if the programming is in fact $132,000 instead of the $75,000 contained in your application, carry forward that item into the financials and if you could provide us a revised financial?

4651     MR. CORMIER: Oh, I will, for sure.

4652     COMMISSIONER MOLNAR: Tomorrow?

4653     MR. CORMIER: Yeah, tomorrow.

4654     COMMISSIONER MOLNAR: Okay, thank you.

4655     Those are my questions. Thank you.

4656     MR. CORMIER: Thank you.

4657     THE CHAIRPERSON: Thank you, Commissioner Molnar.

4658     We are going to have to take a five‑minute break. I have never had to do this before but there is a first time for everything. See you in five.

‑‑‑ Upon recessing at 1040 / Suspension à 1040

‑‑‑ Upon resuming at 1048 / Reprise à 1048

4659     THE CHAIRPERSON: Well, thank you very much for that unplanned break.

4660     Commissioner Lamarre.

4661     CONSEILLÈRE LAMARRE : Merci.

4662     Bonjour, Monsieur Cormier. Vous avez eu droit aux questions comptables un peu plus tôt, vous allez avoir droit aux questions d'ingénierie.

4663     M. CORMIER : O.K.

4664     CONSEILLÈRE LAMARRE : On vous a remis une copie de votre carte de rayonnement parce qu'une image vaut mille mots, et c'est beaucoup plus facile de suivre ce dont je veux discuter avec la carte.

4665     Je veux m'assurer que vous comprenez bien l'impact et l'ampleur des limitations qui sont associées avec la fréquence qui a été choisie...

4666     M. CORMIER : O.K.

4667     CONSEILLÈRE LAMARRE : ...par votre consultant.

4668     Sur cette carte‑là, à l'intérieur du contour protégé, il y a une zone ombragée. Ça, c'est une zone à l'intérieur de laquelle vous allez recevoir du brouillage, si vous obtenez la licence, de la part de stations existantes.

4669     M. CORMIER : Oui.

4670     CONSEILLÈRE LAMARRE : Vous comprenez et vous acceptez la situation telle qu'elle est?

4671     M. CORMIER : Oui, j'accepte ça.

4672     CONSEILLÈRE LAMARRE : Bon! Mais ça ne se termine pas là, malheureusement.

4673     M. CORMIER : Ah!

4674     CONSEILLÈRE LAMARRE : Si vous remarquez, il y a aussi deux lignes pointillées pour lesquelles la légende précise que c'est un brouillage, une interférence future possible de la part de deux stations existantes, celle de North Bay et celle de Wingham, si jamais ces stations‑là décident d'augmenter leur puissance, tel qu'elles ont droit de le faire...

4675     M. CORMIER : Oui.

4676     CONSEILLÈRE LAMARRE : ...en vertu des dispositions d'Industrie Canada.

4677     Alors, est‑ce que vous acceptez aussi la situation que le rayonnement protégé sur cette fréquence‑là pourrait être réduit d'autant si ces stations‑là choisissaient d'aller de l'avant avec les augmentations de puissance?

4678     M. CORMIER : Oui, j'accepte ça.

4679     CONSEILLÈRE LAMARRE : Maintenant, vous avez expliqué tout à l'heure, parce que vous avez deux demandes...

4680     M. CORMIER : M'hmm.

4681     CONSEILLÈRE LAMARRE : ...ici devant le Conseil présentement, que si les deux demandes étaient approuvées, tel que vous le souhaitez, que, évidemment, il y a des dédoublements que vous n'auriez pas besoin de faire au niveau du personnel, au niveau du studio, au niveau... au fond, de l'exploitation.

4682     Maintenant, il y a une chose que vous allez devoir dédoubler, vous allez avoir besoin de deux fréquences...

4683     M. CORMIER : Une autre fréquence, oui.

4684     CONSEILLÈRE LAMARRE : ...ça, c'est certain. Et vous avez identifié des fréquences alternatives.

4685     Est‑ce que vous avez été en mesure, avec votre consultant, de vérifier l'étendue du rayonnement que vous obtiendriez avec fréquences alternatives là, soit le 97.5 et le 102.9?

4686     M. CORMIER : Mon ingénieur m'a dit qu'il n'y aurait pas de problème avec ces fréquences‑là, qu'on serait probablement capable de faire la même puissance, puis que ça serait approuvé avec... bien, il faudrait se faire approuver par Industrie puis NAV CANADA.

4687     CONSEILLÈRE LAMARRE : Oui.

4688     M. CORMIER : Mais il ne voit pas de problème pantoute, lui.

4689     CONSEILLÈRE LAMARRE : Donc, vous vous attendez à ce que le rayonnement soit quand même similaire, l'étendue du rayonnement soit quand même similaire à ce que vous proposez présentement avec votre demande?

4690     M. CORMIER : Oui, ce serait quelque chose de très proche à qu'est‑ce qu'on fait ici.

4691     CONSEILLÈRE LAMARRE : Je veux seulement faire une toute petite mise en garde parce que, par expérience...

4692     M. CORMIER : O.K.

4693     CONSEILLÈRE LAMARRE : ...je sais pertinemment que lorsqu'on propose une fréquence, on propose généralement la meilleure disponible et que les fréquences alternatives sont parfois un peu moins intéressantes. Donc, il pourrait y avoir quelques limitations supplémentaires...

4694     M. CORMIER : M'hmm.

4695     CONSEILLÈRE LAMARRE : ...sans nécessairement que ça soit fatal là, mais je veux simplement que vous en soyez conscient.

4696     M. CORMIER : Oui. O.K. Merci.

4697     CONSEILLÈRE LAMARRE : Ce sont toutes mes questions. Merci.

4698     M. CORMIER : Merci.

4699     CONSEILLÈRE LAMARRE : Merci, Monsieur Cormier.

4700     M. CORMIER : Bienvenue.

4701     THE CHAIRPERSON: Commissioner Patrone.

4702     COMMISSIONER PATRONE: Madam Chair.

4703     Good morning.

4704     MR. CORMIER: Good morning.

4705     COMMISSIONER PATRONE: Just a couple of quick questions, Mr. Cormier.

4706     I was wondering if you sought support for your 100‑percent Canadian content in the stations from various music organizations like SOCAN, the music organizations, the provincial groups, as well as the national groups, because that would be something that they would certainly be interested in hearing about. Have you spoken to any of them?

4707     MR. CORMIER: I haven't spoken to them about it. I have spoken to a lot of local musicians in the Sturgeon Falls, Espanola and Gravenhurst area. They were really excited. But, you know, I didn't even think of calling them up for support.

4708     COMMISSIONER PATRONE: I was also wondering ‑‑ and I have asked others this question ‑‑ about monetizing the numbers, the ratings numbers, which obviously aren't taken over the summer months. I would assume that in Sturgeon Falls there is quite a dramatic increase in the number of people coming into that community over the summer months.

4709     Have you been able to monetize that retail swelling that takes place during the warmer months?

4710     MR. CORMIER: Well, in Sturgeon Falls, I will take it as an example because it's a really good example, a lot of people go there for the lake and they go camping there and they got a ‑‑ mostly what I see in the summertime, it's mostly, how can I say it, like events and ‑‑ like Fiddle Fest and all these summer events and we will get really busy on the radio. It gets slower a bit in the fall, then Christmas time gets really busy and that.

4711     So I have to say probably the same thing. In Muskoka it's even more though. In the summertime, like the population is so big there it's crazy, like ‑‑ so I think in the summertime, yes, we would be a lot busier than in the wintertime.

4712     Was that the answer you were looking for or...?

4713     COMMISSIONER PATRONE: You are skirting around it a little bit ‑‑

4714     MR. CORMIER: Yes.

4715     COMMISSIONER PATRONE: ‑‑ but you are sort of getting to it.

4716     MR. CORMIER: I just want to...okay.

4717     COMMISSIONER PATRONE: Others have spoken to us during the course of our week here about the difficulties and challenges associated with trying to monetize those dramatic retail numbers and the fact that they have struggled in trying to monetize the ratings increase ‑‑ the number of people listening because of the times that the ratings are normally taken.

4718     So I have posed that question to a number of other broadcasters and that's why I posed it to you, as well.

4719     MR. CORMIER: Yes. A little bit hard to answer because I'm not sure what the question is, like, the real question is.

4720     Are you saying there's going to be more listeners in the summertime than the winter and how I'm going to deal with that?

4721     COMMISSIONER PATRONE: Well, yes, I'm wondering if there's a way in which you have managed with your other operation to try and monetize that?

4722     MR. CORMIER: I'm not really sure what you mean by that.

4723     COMMISSIONER PATRONE: Okay, that's fair.

4724     MR. CORMIER: It's just...you know, like in Sturgeon ‑‑ I will go back to Sturgeon and Espanola, which are really busy in the summertime ‑‑ we know we have got more listenership and that, it just seems we do more stuff in the summer, contests and concerts and that. So as far for monitoring how many listeners ‑‑

4725     THE CHAIRPERSON: Mr. Cormier, just an example.

4726     MR. CORMIER: Okay.

4727     THE CHAIRPERSON: Do you, for example, have a summer rate card and an off‑season rate card ‑‑

4728     MR. CORMIER: Okay.

4729     THE CHAIRPERSON: ‑‑ where your rates charged ‑‑

4730     MR. CORMIER: Yes.

4731     THE CHAIRPERSON: ‑‑ to advertisers would be higher in the summer?

4732     MR. CORMIER: Yes, we ‑‑

4733     THE CHAIRPERSON: For example.

4734     MR. CORMIER: In the fall time ‑‑ I will give you an example ‑‑ we give, you know, maybe a 15‑percent discount. If you hop on the radio for ‑‑ let's say for the next three months, we will give you a good deal, you know, to try to keep the people on there. So it will encourage them to stay on the radio, instead of saying, "Oh, you know, the prices are the same" and they are going to say, "Well, there's not as many people in the area".

4735     Yes, we do that in Sturgeon Falls. We put out a little sale in the fall and in the wintertime, and then in the summer we go back to our card rate, and it's been working pretty good for us like that.

4736     It took me a couple of years to figure that out, but, yes, it's going probably be the same thing in Gravenhurst, I would imagine, because the businesses are not as busy, so, you know, they want to cut the budget. So we will kind of cut them, and we will say, you know, "What's a fair deal?", and try to negotiate with that.

4737     COMMISSIONER PATRONE: Thank you very much, appreciate that.

4738     MR. CORMIER: Thank you, and thanks for clarifying.

4739     COMMISSIONER PATRONE: That's it. Thank you.

4740     THE CHAIRPERSON: Mr. Cormier, just a few questions for you.

4741     In your discussions with Commissioner Molnar regarding the Category 3 ‑‑

4742     MR. CORMIER: Okay.

4743     THE CHAIRPERSON: ‑‑ music, the Commission, as a result of its commercial radio policy, increased the levels of Canadian content that radio broadcasters must air if they choose to do Category 3 music.

4744     So will you accept a condition of license that, if you broadcast any music from Subcategory 31, that is concert music, that 25 percent will be Canadian?

4745     MR. CORMIER: Yes.

4746     THE CHAIRPERSON: And will you accept a condition of license that at least 20 percent of Subcategory 34, that is jazz and blues, will be Canadian?

4747     MR. CORMIER: Yes, I accept that.

4748     THE CHAIRPERSON: Okay. Thank you.

4749     Again, in your conversation with Commissioner Molnar, we talked about your application for a 100 percent Canadian content music, and I just want to make sure that you do realize that even if you play one song that is not considered Canadian, you won't be in compliance ‑‑

4750     MR. CORMIER: Yes.

4751     THE CHAIRPERSON: ‑‑ with the condition of license?

4752     MR. CORMIER: Yes, I totally understand that.

4753     THE CHAIRPERSON: So I would just like to know what measures you have in place to ensure that every song meets the requirements of MAPL, for example, which is, you know, the ‑‑

4754     MR. CORMIER: Yes.

4755     THE CHAIRPERSON: ‑‑ definition used.

4756     MR. CORMIER: Absolutely. I'm going to make sure myself that the music that's in that station is only Canadian, if we get that licence. I will monitor that myself.

4757     THE CHAIRPERSON: Don't you go on vacation, Mr. Cormier?

4758     MR. CORMIER: Oh, vacation, you have got to mix it with business all the time.

4759     THE CHAIRPERSON: No, no, but what happens if you are just not available? I mean ‑‑

4760     MR. CORMIER: Well, the whole ‑‑ like, we all use computers here, so in that computer there's not going to be any other music but Canadian music. So that's how I'm going...you know, if somebody puts it on air, I can't see how they could do that. Because I take ‑‑ you know, I'm going to make sure it's Canadian that goes in there and I will have my station manager, you know, train for it and give him a list of what we are allowed to put on, you know. It's got to meet the criteria and that's the only music going on that station.

4761     THE CHAIRPERSON: Okay.

4762     And I did ask every applicant for the Orillia portion of this hearing, and I am going to ask every applicant in this portion of the hearing: are you able to provide us with updated proof of financing within 10 days?

4763     MR. CORMIER: Oh, yes, I can.

4764     THE CHAIRPERSON: Okay.

4765     Thank you very much, those are my questions.

4766     MR. CORMIER: Thank you.

4767     THE CHAIRPERSON: And I'm going to hand you over to legal counsel.

4768     MR. CORMIER: Okay.

4769     MR. BOWLES: Just a few quick questions.

4770     For the benefit of clarifying an answer you provided to a question posed by Commissioner Molnar ‑‑

4771     MR. CORMIER: Okay.

4772     MR. BOWLES: ‑‑ with respect to the revised sample playlist that you are to provide by tomorrow, which you committed to provide by tomorrow, can I clarify whether you are willing to do this for both of your applications?

4773     MR. CORMIER: Oh, yes. Yes, definitely.

4774     What time tomorrow can I ‑‑ I got to probably work on that in the morning, so in the afternoon or...?

4775     MR. BOWLES: Usually, it's by day's end.

4776     MR. CORMIER: Okay, no problem.

4777     MR. BOWLES: With specific respect to your application for an Oldies station, the questions was posed whether you would be willing to accept as a condition of license a requirement to broadcast a minimum of 14.5 hours of Category 3 music per broadcast week.

4778     Can you just confirm whether you are willing to accept this as a condition of license?

4779     MR. CORMIER: Yes, I'm willing.

4780     MR. BOWLES: Okay.

4781     And once again, my last question has to do with the undertaking you granted with respect to providing ‑‑ the undertaking to provide by tomorrow, sorry, the revised financial operations information in the form of a resubmitted section 4.1 of the application form.

4782     Just to clarify, can you commit to doing that with respect to both of the applications?

4783     MR. CORMIER: Yes.

4784     MR. BOWLES: And those are my questions.

4785     Thank you.

4786     MR. CORMIER: Thank you.

4787     THE CHAIRPERSON: Thank you very much, Mr. Cormier, those are all the questions we have for you ‑‑

4788     MR. CORMIER: Well, thank you.

4789     THE CHAIRPERSON: ‑‑ and we will see you in the next phase.

4790     MR. CORMIER: Great. Take care.

4791     THE CHAIRPERSON: We will be taking a 15‑minute break now, but just for the information of everyone the Applicant Instant Information Services Incorporated was not able to make the drive up from Toronto, so we will be hearing their application via teleconference.

4792     See you in 15.

‑‑‑ Upon recessing at 1101 / Suspension à 1101

‑‑‑ Upon resuming at 1123 / Reprise à 1123

4793     THE CHAIRPERSON: Order please.

4794     Madam Secretary?

4795     THE SECRETARY: We will now proceed with item 11, which is an application by Instant Information Services Incorporated for a licence to operate a low‑power English‑language tourist‑information FM radio station on Gravenhurst.

4796     The new station would operate on frequency 101.9 MHz, Channel 270 LP, with an effective radiated power of 25‑watt non‑directional antenna, with an effective height of antenna above average terrain of 64.9 metres.

4797     Appearing for the applicants are James MacLeod and Tim Hern via teleconference today.

4798     Mr. MacLeod and Mr. Hern, you have 20 minutes to make your presentation.

4799     Please go ahead.

PRESENTATION / PRÉSENTATION

4800     MR. MacLEOD: Thank you, Madam Chair and Madam Secretary.

4801     Good morning.

4802     I will begin by once again introducing myself. My name is James MacLeod and I'm the General Manager of Instant Information Services Incorporated.

4803     I would first like to sincerely apologize to the Commission for not being personally present at today's hearings.

4804     Because the Commission heard a full description of our operations in the application for a station in Orillia yesterday, and since the services are intended to be virtually identical, we will spare the Commission a complete repetition of our earlier presentation CRTC 2008‑0800‑1; however, we wish to address one of the issues raised by questions from the Commission since our application was submitted, followed by a brief overview of our service.

4805     The Commission has expressed concern that our signal strength will not be sufficient to reach Bracebridge or the northeast areas of Gravenhurst. We admit that 50 watts will not be sufficient to reach Bracebridge, however, the site we selected is strategically supportive our objective.

4806     We believe the primary and secondary signals will be sufficient to reach most parts of Gravenhurst and the highways leading to Bracebridge, number 11, on the east, and Parry Sound, number 169, on the west. So we will serve both Gravenhurst and Bracebridge by reaching travellers and acting as an audio billboard to promote events, attractions and commercial facilities. If necessary, we will consider installing a transmitter/repeater in the Bracebridge area with the support of the municipality.

4807     We now operate eight low‑power FM stations throughout Atlantic Canada and Ontario. They are commonly called information radio. In Ottawa, two services, one in English and one in French, Halifax and Amherst, Nova Scotia, Fredericton, Moncton and St. Stephen, New Brunswick, and on the Confederation Bridge. We will be launching our Brockville service this week.

4808     In addition to our two applications here, we have received encouragement from several municipalities in Ontario to establish similar services to serve their communities.

4809     We are unconventional broadcasters, addressing both the mobile and static audience of visitors and residents. We broadcast safety and community information in a program loop, repeating every 10 to 15 minutes prerecorded voice reports or MP3 audio files from a number of different sources.

4810     Environment Canada will make two‑day and five‑day local weather forecast audio files available to us and our software checks every few minutes for updates and bulletins. We also carry local road reports, a major report of the current local events and attractions in the area, the Bank of Canada exchange rate, and other features of local interest updated regularly.

4811     But perhaps our most important role is as a standby emergency broadcast facility. We are building a model which we believe will be the most effective and reliable delivery system for emergency information in Canada. That claim is based on three operating principles.

4812     First, our business is repetitive messaging in a 10‑minute loop. An ice storm, flood or hurricane alert would be broadcast at least every 10 minutes during an emergency.

4813     Second, we intend to create a 24‑hour production and monitoring centre for immediate response, 24‑7, 365 for just such events.

4814     And third, we are prepared to strip down our regular program loop to broadcast emergency messages exclusively every few minutes. We know from discussions with Emergency Measures Organization officials that no other radio station is prepared to make that commitment. That's why we are the designated broadcast system in Halifax and Ottawa by formal agreement and in other centres by verbal agreement.

4815     We would seek to have the same designation for Gravenhurst. We think the addition of Gravenhurst would be a valuable addition to our growing network of information services in Canada.

4816     I'm now prepared to answer any questions the Commission may have and thank you for your consideration.

4817     THE CHAIRPERSON: Thank you very much.

4818     I'm glad we were able to accommodate the request to hear your application via teleconference, and I will now ask Commissioner Lemarre to lead the questioning.

4819     COMMISSIONER LAMARRE: Good morning, Mr. MacLeod, this is Commissioner Lemarre speaking.

4820     Since it's not easy since we don't see each other's reaction here, I want to apologize immediately if I ever interrupt you as you are speaking. And if you, on the other hand, interrupt me, be assured that no offense will be taken at all.

4821     MR. MacLEOD: I appreciate that. I will forewarn you and say that I am having some difficulty hearing. I can make out most of the things, but it is fairly quiet.

4822     COMMISSIONER LAMARRE: Okay, so I will speak closer to the mike to help you hear this out.

4823     Like you, I will not have you repeat all the answers you gave to our questions regarding the way your enterprise deals with synergies between the different cities and different transmitters. So I will focus on what is different in the Gravenhurst/Bracebridge application than what is in the Orillia application.

4824     MR. MacLEOD: Okay.

4825     COMMISSIONER LAMARRE: So first off, let's make this clear, what you are proposing for Gravenhurst and Bracebridge is not a rebroadcaster of what will be aired in Orillia?

4826     MR. MacLEOD: Absolutely not. It will be it's own stand‑alone independent station serving that specific municipality.

4827     COMMISSIONER LAMARRE: So, for example, the weather information and the road information will be totally focused on the area served by your transmitter over there?

4828     MR. MacLEOD: Absolutely, however, there may be some overlap, which would be beneficial, and we would take a look at what highway reports would be better served on both stations, if the case may be, but also liaise directly with the municipalities to decide what exact reporting they need on there.

4829     With respect to weather, I don't know exactly offhand what AVIPAD files will be made available directly from Environment Canada, but we would have the most specific file at our disposal on the air for each specific station.

4830     COMMISSIONER LAMARRE: Thank you.

4831     Now, on the question of coverage that you touch upon in your presentation, I had actually made a note that, indeed, the municipalities are not all enclosed in the 3‑millivolt‑per‑metre contour, which is a primary‑coverage contour. I do take your point that it is nonetheless included within the .5 millivolt per metre contour.

4832     But did I hear you correctly that, if once you put that transmitter on air you realize or find out or receive comments that there are some areas further north that are not sufficiently well covered, that you will, at that point in time, entertain and propose to establish a retransmitter?

4833     MR. MacLEOD: That is something that we would have to discuss with the municipality itself, depending on want of coverage. The simple fact here is that we are doing the absolute best with what we can under the LP FM designations and the available tower space that we deemed available to us.

4834     So we would certainly be open to exploring other options, I would have to consult directly with our engineering contacts on that note. But we would be open to exploring the other options, such as repeaters and the like, if it was deemed of benefit to the municipality itself.

4835     COMMISSIONER LAMARRE: So the option of a repeater will be entertained if a clear and explicit need is expressed.

4836     And I also hear you say that the current coverage that you have is a result of your decision to establish your antenna on an existing tower site?

4837     MR. MacLEOD: That is correct.

4838     On the matter of the frequency you have chosen ‑‑ and in your application you have noted that as a low‑power unprotected transmitter you do have to change frequency if an applicant comes in for a protected frequency ‑‑ as far as the applications for Gravenhurst and Bracebridge are currently concerned, you are already with the proposed frequency in conflict with all those applications.

4839     So if we approve any of these other applications and yours at the same time, in what period of time will you be able to refile a technical brief in order to ask for a different frequency?

4840     MR. MacLEOD: We have experienced ‑‑ as we mentioned yesterday, with regards to Orillia, and in the past in Ottawa, we have successfully researched other frequencies to go on quite quickly. I apologize before the Commission that without the consult of our engineer, I won't be able to give a definitive timeline on that; however, I could get a definitive timeline to the Commission before the end of today's hearings.

4841     COMMISSIONER LAMARRE: Thank you.

4842     We also discussed, as part of the Orillia proceeding, the question of Canadian content development. And with your Gravenhurst application we are facing the same situation that we had with the Orillia one, and that is that, as part of the current policy, you would need to provide funding of up to $500 per year, starting in year two for Canadian content development.

4843     Do you agree to that?

4844     MR. MacLEOD: We absolutely agree to that. We apologize for the confusion yesterday. And our president, Jack McGaw delivered a fax to the CRTC yesterday hopefully clarifying the entire point, and we would be more than pleased to pay the fixed amount identified in that fax.

4845     COMMISSIONER LAMARRE: Thank you, Mr. MacLeod.

4846     Merci, Madame la Présidente, those are all my questions.

4847     MR. MacLEOD: Thank you.

4848     THE CHAIRPERSON: Mr. MacLeod, Commissioner Molnar has a question for you.

4849     COMMISSIONER MOLNAR: Mr. MacLeod, this is Commissioner Molnar.

4850     MR. MacLEOD: Hello.

4851     COMMISSIONER MOLNAR: Hi.

4852     I just have one question. Just to be clear, you mentioned that you would have separate programming between these two applications that you have in front of us, the Gravenhurst versus the Orillia.

4853     Can you just confirm for me that these applications are, in fact, mutually exclusive and you would be content and would be able to implement your business plan if you received either one of these applications and not those?

4854     MR. MacLEOD: Yes, I can.

4855     I can confirm 100 percent that each application is entirely stand‑alone. One is not contingent on the other. However, if we did get both and had both on the air, there would be obvious synergies.

4856     COMMISSIONER MOLNAR: Right. And as you did in Orillia, you would have a local person in the Gravenhurst market?

4857     MR. MacLEOD: We would. That would be out utmost desire. I can't confirm anything because that is not as yet identified. However, I can say with each station we have significant local support and our ideal business model and policy asks for a municipal contact, various municipal contacts, to be delivering MP3 files directly to our server for that site specifically.

4858     So it is a mutually beneficial situation for us and for the municipality, whether it be a public employee or a private person we identify on our own for arts and events, et cetera, or, in the case of municipality, municipal events, garbage collection, traffic, et cetera, and then notwithstanding the entire aspect of the emergency broadcast facility.

4859     COMMISSIONER MOLNAR: Okay. Thank you.

4860     That was my question.

4861     MR. MacLEOD: Thank you.

4862     THE CHAIRPERSON: Mr. MacLeod, it's Commissioner Cugini speaking.

4863     Just for the sake of efficiency, do you plan on participating in either Phase II or Phase IV of this hearing?

4864     MR. MacLEOD: We do not, for the sake of efficiency.

4865     THE CHAIRPERSON: Thank you very much and thank you for your presentation this morning, and hope the weather gets better in Toronto.

4866     MR. MacLEOD: Yes.

4867     Thank you very much, and I once again apologize and thank you very much for your accommodation.

4868     THE CHAIRPERSON: No problem.

4869     MR. BOWLES: Madam Chair?

4870     THE CHAIRPERSON: We will be taking...oh, sorry.

4871     I'm sorry, I forgot to throw it over to legal counsel.

4872     MR. MacLEOD: I'm still here.

4873     MR. BOWLES: Yes, hello. This is Eric Bowles, legal counsel.

4874     MR. MacLEOD: Hello.

4875     MR. BOWLES: I just have two quick questions.

4876     Can you confirm your willingness to abide by the Equitable Portray Code by condition of license?

4877     MR. MacLEOD: I can.

4878     MR. BOWLES: And with respect to...sorry, I just need a little bit of clarification on this. With respect to the undertaking you provided with respect to the CCD contributions ‑‑

4879     MR. MacLEOD: Yes.

4880     MR. BOWLES: ‑‑ by what date would you be willing to go through with this undertaking?

4881     MR. MacLEOD: I will have to consult with my president to see if he put a date on that fax. I will have that answer to the Commission no later than the end of today's hearings.

4882     MR. BOWLES: Just to clarify, the fax you were referring to had to do with the application you tendered as part of the Orillia market phase, is that correct?

4883     MR. MacLEOD: Okay, my apologies, my confusion. We will resubmit. I was under the understanding that it covered both applications, both yesterday's and today's. However, I will personally promise that we will identify that issue and have that in your hands before the end of today confirming a date.

4884     MR. BOWLES: Also, I'm not sure whether you are in a position to answer this question, and I apologize, I'm slipping back into the previous phase of this proceeding, the fax that was sent to the Commission, are you aware of whether that is an exact copy of the document that was tendered to the hearing secretary or whether it was in any way different?

4885     MR. MacLEOD: That is the original fax. That was created yesterday and sent directly to the Secretary.

4886     MR. BOWLES: Okay.

4887     Thank you. That's all.

4888     MR. MacLEOD: Thank you very much.

4889     THE CHAIRPERSON: You can now go.

4890     MR. MacLEOD: Thank you very much. Good luck.

4891     THE CHAIRPERSON: Thank you, those are all our questions.

4892     We will be taking an early lunch today and resuming at 1 o'clock.

4893     Thank you.

‑‑‑ Upon recessing at 1139 / Suspension à 1139

‑‑‑ Upon resuming at 1302 / Reprise à 1302

4894     THE SECRETARY: Good afternoon.

4895     We will now proceed with item 12, which is an application by Muskoka‑Parry Sound Broadcasting Limited relating to the license of the English‑language commercial radio station CFBK‑FM, in Huntsville.

4896     In order to improve the coverage of its station, the licensee proposes to change the authorized contours by increasing the effective radiated power from 5,000 watts to 43,400 watts by decreasing the effective height of antenna above average terrain of 147 metres. The station will continue using the 105.5 MHz frequency, Channel 288 B.

4897     Appearing for the Applicant is Christopher Grossman.

4898     Mr. Grossman, you have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

4899     MR. GROSSMAN: Thank you.

4900     Madam Chair and Commissioners, my name is Christopher Grossman and I am the President of Muskoka‑Parry Sound Broadcasting Limited and Haliburton Broadcasting Group Incorporated.

4901     The company owns and operates 13 radio stations and two repeaters in two clusters. One cluster surrounds Toronto's Cottage Country and the other along the Highway 11 corridor from North Bay to Hearst, Ontario. All operate under the Moose FM radio brand.

4902     CFBK Huntsville has been on the air for 50 years, servicing the communities of Huntsville, Lake of Bays, Almaguin Highlands and into a large section of Algonquin Park. Haliburton Broadcasting Group Incorporated purchased the station in 2007 from Ian Byers, a local independent operator.

4903     The stations is a key part of the fabric of the communities that it has served for over 50 years. The reason that this application was made was we were asked by the mayor of Huntsville if we could improve our signal to the west into the Almaguin Highlands Region to improve service to a cluster of 27 very small communities.

4904     The towns would also like to further integrate CFBK into Huntsville's Emergency Service Plan. The Town of Huntsville's goal is to have a similar emergency broadcast plan to what we have established in the District of Muskoka with our station CFBG in Bracebridge. This allows the District of Muskoka's emergency personnel direct access to our on‑air operation through a telephone interface in case of emergency. This is used primarily when time is of the essence in communicating emergency instructions to our listeners.

4905     This application has a very small sliver of the proposed signal that will reach the Bracebridge trading area, and the overlap in the 3‑millivolt look to the map to where the solid black line meets the solid blue line. To put this sliver into context, the 3‑millivolt overlaps into a total of 573 households out of a potential of 32,689 and the proposed 3‑millivolt signal does not reach the Gravenhurst trading area.

4906     Our spoken‑word content and news content for CFBK Huntsville focuses only on Huntsville, Algonquin Park and the Almaguin Highlands Region. This proposed power increase will also greatly improve the reception and signal in areas that have limited or impeded signal coverage due to the very challenging terrain in our area.

4907     The tower is 35 kilometres east of Huntsville and 73 kilometres east of the 27 communities that have limited or no signal from CFBK, including parts of the Town of Huntsville, as well as the 27 communities that comprise Almaguin Highland's coverage issues that continue to be a challenge for CFBK in the mayor's Emergency Service Plan, and, with Huntsville hosting the upcoming 2010 G8 Summit of world leaders next June, this has become an increased priority for the town.

4908     We have looked at a variety of technical solutions, including moving the tower site. We felt this proposal maximized the use of Channel 288 B and dealt with the issue of terrain and coverage properly.

4909     CFBK Huntsville is a key element in communicating with the people in the local areas for emergency services and priority public and community information. CFBK's signal power is very low in comparison to other small‑market stations that need to cover a very large area of very small communities.

4910     This improvement will have no impact on existing broadcasters in the 3‑millivolt signal coverage area as it reaches only stations that are owned and operated by the Haliburton Broadcasting Group Incorporated.

4911     In both of the public processes this application has been through, there have been no interventions.

4912     Let's review the benefits of this application: improved coverage for 27 small communities in the Almaguin Highlands District and the Town of Huntsville; integration into the Huntsville Emergency Services Plan; maximize the utilization of Channel 288 B; and no impact on existing broadcasters.

4913     I would be happy to answer any questions you may have about this application or any other questions that you may have surrounding this hearing about issues in and around Bracebridge.

4914     THE CHAIRPERSON: Thank you very much, Mr. Grossman.

4915     I will ask Commissioner Patrone to lead the questioning.

4916     COMMISSIONER PATRONE: Thank you, Madam Chair.

4917     Welcome, Mr. Grossman.

4918     I don't recall seeing the letter that you spoke about regarding the mayor. Did you in fact submit that?

4919     MR. GROSSMAN: Yes. It is in the application ‑‑

4920     COMMISSIONER PATRONE: Okay.

4921     MR. GROSSMAN: ‑‑ and I have a copy of it here.

4922     COMMISSIONER PATRONE: I would like to have a look at it when...

4923     MR. GROSSMAN: Yes.

4924     COMMISSIONER PATRONE: A little later.

4925     Now, you did speak a little bit around the issues that I'm going to be asking you questions about, and I'm not asking you not in acknowledging what you have already said but I would like perhaps to get just a few more details about the various aspects of your application.

4926     The Commission expects that when a licensee files an application to change it's operating class to that of a higher powered class, it should present compelling evidence that its authorized technical parameters are no long adequately providing a reliable signal, and, granted, you provide some evidence here, and listed them here.

4927     What assurances, if any, can you offer the panel that the proposed technical amendments will not result in the station shifting the entire focus of the surveillance material ‑‑ weather, news and sports coverage ‑‑ as well as the promotion of local events and activities to try and accommodate the newly covered communities?

4928     MR. GROSSMAN: And communities, specifically which ones are you concerned about?

4929     COMMISSIONER PATRONE: Well, obviously, you are increasing your contours to encompass 27 small communities and other areas, so the CRTC needs some assurances that, in fact, the areas that you were licensed originally to cover will not suffer in any way regarding their own local voice and that sort of thing.

4930     MR. GROSSMAN: The assurance that I can give you is that Huntsville is ‑‑ you know, represents the overwhelming majority of the revenue that we create for that station. I can't think of the logic behind why we would want to service 27 small communities of towns that are sizes of 10 and 15 and 20. There just wouldn't be the advertising support.

4931     We have the station in Bracebridge and in Parry Sound, so my assurance would be that doesn't make economic sense to us, obviously.

4932     COMMISSIONER PATRONE: So it's not part of your business case, basically.

4933     MR. GROSSMAN: No, no, no, definitely no.

4934     COMMISSIONER PATRONE: Can you provide the panel with details regarding your music format currently?

4935     MR. GROSSMAN: Yes. I can definitely supply you with that. It's currently best described as a middle‑of‑the‑road AC station. And, again, the current signal has no real coverage in any other markets other than Huntsville and to the northern lake areas.

4936     COMMISSIONER PATRONE: What details can you tell us concerning the content of the 126 hours of programming per broadcast week? For instance, what exactly is the amount of spoken‑word programming?

4937     MR. GROSSMAN: I would have to get that information for you. It's an existing station that's been on the air for...

4938     COMMISSIONER PATRONE: Understood. Can you, in fact, supply us with that information?

4939     MR. GROSSMAN: I sure can.

4940     COMMISSIONER PATRONE: Can you tell us the current level of Canadian content?

4941     MR. GROSSMAN: I think we are currently running about 40 percent.

4942     COMMISSIONER PATRONE: You don't sound 100 percent sure about that.

4943     MR. GROSSMAN: I think it could be 39.5 percent or 41.5. That's the goal of all of our stations that we operate with Selector at.

4944     COMMISSIONER PATRONE: Could you tell us a little bit about what successes you have had concerning your station's ability to provide local reflection to the communities that you currently serve?

4945     MR. GROSSMAN: Maybe a brief history about our company.

4946     Over the last 10 years, we have basically focused on buying distressed radio properties, stations that have not been profitable, that have had a difficult time continuing, prided ourselves in our staff being able to marry both content, spoken word, technology, you know, to create a radio station that's relevant for the communities that it's in.

4947     I think if you look at the CAB nominations that we have had, I can't think of a small‑market operator that's had more nominations for Canadian development with Moose Tracks.

4948     Through public service, our community and public service, in small towns raise anywhere from fifty to a hundred and fifty thousand dollars a year in charities, both hospitals and for the Moose Kids Salvation Army Fund, as well as something that I'm very proud about, our aboriginal programming. Again, last year, we were nominated the only small‑market station, other than an aboriginal station, by the CAB, for aboriginal programming out of Parry Sound.

4949     You know, because we are in distressed markets, markets that are difficult, Kapuskasing, Hearst, Timmins, Iroquois Falls, Cochrane, Elliot Lake, these are markets that are a little bit more challenging to operate than, let's say, Toronto or Ottawa.

4950     COMMISSIONER PATRONE: And does your staffing currently reflect the community that you serve?

4951     MR. GROSSMAN: Yes.

4952     COMMISSIONER PATRONE: How so?

4953     MR. GROSSMAN: Obviously, our aboriginal reporter was recognized by the CAD, of only two in Canada, in terms of excellence. She also teaches at a school in Toronto.

4954     If you are talking about ‑‑ could you be more specific about what reflection you are looking for. Aboriginal men? Women?

4955     COMMISSIONER PATRONE: Exactly.

4956     MR. GROSSMAN: Yes.

4957     COMMISSIONER PATRONE: The ethnic ‑‑

4958     MR. GROSSMAN: There's more women that work in our company than there are men.

4959     COMMISSIONER PATRONE: ‑‑ makeup of your staff ‑‑

4960     MR. GROSSMAN: Right.

4961     COMMISSIONER PATRONE: ‑‑ does that reflect the community that you serve?

4962     MR. GROSSMAN: Yes, I think it does. Yes.

4963     COMMISSIONER PATRONE: Fair enough.

4964     Could you tell us how the Muskoka station distinguishes itself from other adult‑oriented applicants?

4965     MR. GROSSMAN: If you could clarify "Muskoka". We are in Bracebridge.

4966     COMMISSIONER PATRONE: Sorry, Bracebridge.

4967     MR. GROSSMAN: How does the Bracebridge station ‑‑

4968     COMMISSIONER PATRONE: Yes.

4969     MR. GROSSMAN: ‑‑ distinguish itself? Is that in relation to this application?

4970     COMMISSIONER PATRONE: Yes. We are looking for...sorry, the Huntsville station. Can you talk about how you provide a diverse voice to the community that you serve?

4971     MR. GROSSMAN: I think it's things like we run the flea market on a daily basis, we run Garth, who is our news and sports man. It's been on the air for 50 years.

4972     None of the texture that Ian had for the years that he operated the station have changed, other than the branding of it. We do local initiatives on a weekly basis, large fund raising for the animal hospital, for the hospital in Huntsville, as well as for the Salvation Army on an annual basis.

4973     COMMISSIONER PATRONE: Can you talk about your current news operation, staffing and that sort of thing?

4974     MR. GROSSMAN: In Huntsville, we operate with a full‑time morning news person, and then a second full‑time news person that works weekends, as well as is a reporter during the week.

4975     It's our goal in that market, and every market that we have, to have live news seven days a week in the morning.

4976     COMMISSIONER PATRONE: Would you be adding any new staff? Any plans to increase your news coverage at all?

4977     MR. GROSSMAN: I don't think that this power increase would have any effect on the business model that we would have, so no, we wouldn't.

4978     COMMISSIONER PATRONE: You have already spoken around this, but do you feel in any way that your current audience will lose a local voice if your contours change?

4979     MR. GROSSMAN: No, I don't feel that way. I think largely the genesis of this idea came from Claude Doughty, who's the mayor of Huntsville. The District of Muskoka and Bracebridge came to us looking for support in their Emergency Services Plan, which we supplied them with, and he's looking for sort of a comparable thing.

4980     This is, you know, prior to us selling to Newcap, and then the sale not going through, with the financing falling through. It was basically at the beginning. As you say, we put ‑‑ this has been through the system twice, I think it's been on file, is it a year a bit?

4981     COMMISSIONER PATRONE: Yes.

4982     MR. GROSSMAN: Yes, it's been a long time, so this is prior to all the other stuff.

4983     COMMISSIONER PATRONE: Do you anticipate any changes at all in your programming?

4984     MR. GROSSMAN: No.

4985     COMMISSIONER PATRONE: Madam Chair, I have no other questions.

4986     THE CHAIRPERSON: Thank you.

4987     Commissioner Menzies.

4988     COMMISSIONER MENZIES: I just wanted to get you just to embellish a little bit on your staff.

4989     All your staff, they live in the area, they are part of the area, they come from the area?

4990     MR. GROSSMAN: Yes, they do. The station's been on the air for 50 years.

4991     COMMISSIONER MENZIES: Right.

4992     MR. GROSSMAN: There's been really no changes, other than we have taken some operational synergies out of Bracebridge and put them together. We haven't had any mass layoffs or anything like that, in fact we have added bodies to the station.

4993     COMMISSIONER MENZIES: And I know you stated really isn't a ‑‑ this doesn't alter your business plan in any way, in terms of additional costs of taking anything on, it doesn't ‑‑

4994     MR. GROSSMAN: No.

4995     COMMISSIONER MENZIES: ‑‑ given you any opportunities for additional ‑‑

4996     MR. GROSSMAN: No.

4997     COMMISSIONER MENZIES: ‑‑ revenue ‑‑

4998     MR. GROSSMAN: No.

4999     COMMISSIONER MENZIES: ‑‑ and it's bottom line is the emergency system?

5000     MR. GROSSMAN: Yes. I think probably the biggest threat to us is the proposal before you for Gravenhurst, and the effect that would have on Bracebridge operation, and how that would impact the rest of our operations in markets that are less profitable than what we have in the Cottage Country markets.

5001     COMMISSIONER MENZIES: Okay.

5002     Thank you.

5003     THE CHAIRPERSON: Commissioner Molnar.

5004     COMMISSIONER MOLNAR: Thank you.

5005     And just following up on the question of Commissioner Menzies, I understand, from what you have provided in your opening remarks, that you are going to, through this technical amendment you propose, add 27 communities that encompass 573 households.

5006     MR. GROSSMAN: No. No, that's not correct.

5007     COMMISSIONER MOLNAR: No?

5008     MR. GROSSMAN: No. The reason that I think we are here is because we had a series of questions to talk about. If you look at the map where the black line ‑‑

5009     COMMISSIONER MOLNAR: Okay.

5010     MR. GROSSMAN: ‑‑ and the blue line meet that's ‑‑

5011     COMMISSIONER MOLNAR: Oh, that's the overlap.

5012     MR. GROSSMAN: That's the overlap. And because there's 580 households out of 32,000, it's been put on this hearing because it has ‑‑ the logic could prevail that this could be a competing application against a station ‑‑ I guess when Paul Larche's application was in in Bracebridge. I can't imagine it having any impact on his station in Gravenhurst, Ontario. That's what the 500 is referring to.

5013     COMMISSIONER MOLNAR: The 500. Okay, thank you.

5014     MR. GROSSMAN: The other map is the 27 small communities that I supplied you with, just for better reference. Those are the communities. Their population bases go from 10 to 150, and that's in this map.

5015     COMMISSIONER MOLNAR: Okay, thank you. I just needed ‑‑

5016     MR. GROSSMAN: Not a problem.

5017     COMMISSIONER MOLNAR: I was a bit confused by this 573 households, and I understand.

5018     MR. GROSSMAN: Duplication.

5019     COMMISSIONER MOLNAR: Thank you.

5020     MR. GROSSMAN: Yes.

5021     COMMISSIONER MOLNAR: That's the duplication.

5022     Thanks you, that's my question.

5023     MR. GROSSMAN: I'm confused, too.

5024     THE CHAIRPERSON: Commissioner Lamarre.

5025     COMMISSIONER LAMARRE: Merci, madame la présidente.

5026     Good afternoon, Mr. Grossman.

5027     I'm glad I can finally put a face on the name, because I have seen your name floating around ‑‑

5028     MR. GROSSMAN: Oh.

5029     COMMISSIONER LAMARRE: ‑‑ a number of times in my past life, so...

5030     MR. GROSSMAN: Good.

5031     COMMISSIONER LAMARRE: I'm looking at the map that you indeed provided, and I have a small concern, and it's with the overlap between CFBG‑FM and your station in Muskoka, CFBK‑FM.

5032     Is one the rebroadcaster of the other one?

5033     MR. GROSSMAN: No.

5034     COMMISSIONER LAMARRE: No. It's two different programming?

5035     MR. GROSSMAN: Originating local. It was our business model at the beginning to dominate the cottage markets in northern Ontario, around Toronto, and these are key elements of it. They are both different audiences, different advertising bases, and how we sell them through in Toronto is very different, as well.

5036     COMMISSIONER LAMARRE: Okay.

5037     The other point I would like to get a clarification on: in your presentation you made the point that there was actually a demand from Huntsville Municipality to have better reliability and also cover some areas that were not covered as well as they wished in case of emergency services needed, with your help. I look at the power increase, and it's actually quite ambitious. At the same time you raise, though, a key point, and that is that you have to deal with a specific topography in the area.

5038     I don't know if you are seeing me coming here. In order to reflect that topography, and how realistically you have issues currently, and how this would actually solve these issues, would it be possible to get realistic coverage contours?

5039     MR. GROSSMAN: Other than what we supplied. I think it has the population estimates, has the ‑‑ it's included in the package that we have sent you. Above and beyond that?

5040     COMMISSIONER LAMARRE: Yes.

5041     MR. GROSSMAN: I think the reference that I make is that, if you look at our station in Elliot Lake, which is 90,000 watts, you look at the station we have in Bancroft, which is 50,000 watts, you know, these are smaller communities ‑‑

5042     COMMISSIONER LAMARRE: Yes.

5043     MR. GROSSMAN: ‑‑ lower billing regions that, you know, they service a tremendous amount of very, very small communities that have no access or limited access to the CBC, and in most cases don't have any other radio station servicing them in any way.

5044     So it's less than those markets and it's a station that bills more than that. So I guess that's sort of what the logic was. Elliot Lake, Bancroft, Parry Sound, you know, they have larger signals than what I'm proposing here.

5045     COMMISSIONER LAMARRE: Okay. So you are comfortable that the map you have provided with representation today actually represents ‑‑ with its limitations, as we know them, from those types of calculations, they represent the area that will be able to receive an adequate signal?

5046     MR. GROSSMAN: Yes, I'm more than confident that it will in comparison to other markets that we do the same thing in very successfully.

5047     COMMISSIONER LAMARRE: Thank you.

5048     Those are all my questions.

5049     THE CHAIRPERSON: Thank you.

5050     Mr. Grossman, I do appreciate that it's only 573 households that represent the overlap with Bracebridge, but do you anticipate any increased advertising revenues as a result? Because you have a station in Bracebridge ‑‑

5051     MR. GROSSMAN: Yes.

5052     THE CHAIRPERSON: ‑‑ it's twice the presence.

5053     MR. GROSSMAN: Yes. Again, no, I don't, but I want to reiterate our concern about it. And because we had to pull our application, which trigger this gall, in both Orillia and in Gravenhurst, you know, I can't impress upon you enough how important it is that I express to you the concerns that we have in our operation about the effect of what will happen in Gravenhurst if it's licensed.

5054     I don't see any negative effect on our business in servicing communities, and largely at the mayor's request to get more coverage in communities that aren't served. I definitely have some concerns about the effect of licensing a station in Gravenhurst, and its effect on my company that I have reinherited in the last week.

5055     THE CHAIRPERSON: Yes, I know you have been through a very tough time lately ‑‑

5056     MR. GROSSMAN: And I just want to apologize ‑‑

5057     THE CHAIRPERSON: ‑‑ and that would certainly be an understatement.

5058     MR. GROSSMAN: I want to apologize. I'm not completely prepared. I just ‑‑ you know, I realized last ‑‑ when this thing was coming apart that I would have to come here. It's not normally I would come by myself, but the staff's so mad at me I couldn't get anybody to come, so...

5059     THE CHAIRPERSON: No, I have seen you on action before and I can very well appreciate the position in which you find yourself.

5060     MR. GROSSMAN: Trying my best.

5061     THE CHAIRPERSON: I understand that. And I certainly do appreciate your patience ‑‑

5062     MR. GROSSMAN: Yes.

5063     THE CHAIRPERSON: ‑‑ with the process.

5064     MR. GROSSMAN: Right.

5065     THE CHAIRPERSON: And I will ask legal counsel if they have any questions.

5066     MR. BOWLES: Just one simple question.

5067     With respect to the undertaking given with respect the local programming, can we get from you a date by which you will be willing to commit to provide this information?

5068     MR. GROSSMAN: I'm hoping that the gal that does this for me is listening right now, and she could probably have it for you before the end of toady.

5069     MR. BOWLES: So you will commit to ‑‑

5070     MR. GROSSMAN: Yes, I'm pretty sure. If I can email it to the same person I emailed the other file to, I can probably get it today. End of today, yes.

5071     MR. BOWLES: Thank you.

5072     THE CHAIRPERSON: Thank you very much, Mr. Grossman. Those are all our questions.

5073     MR. GROSSMAN: Ouch.

5074     THE CHAIRPERSON: Not so ouch, come on.

5075     MR. GROSSMAN: No opportunity to talk about the effect of Gravenhurst on my operation.

5076     THE CHAIRPERSON: Unless you intervened.

5077     MR. GROSSMAN: I couldn't intervene.

5078     See, you know, my concern here is, you know, and these are extraordinary circumstances that have never happened before, you know, because of the agreement that I had, I had to withdraw my application in Gravenhurst, I had to ‑‑ which was an application that had the support of the mayor of both Gravenhurst, Lake of Muskokas, all the key business people, and because of these extraordinary times: you know, the CAB just announced today it laid off 14 people, the chief operating officer. You know, Newcap's goal was not to not be able to put the financing together. My hands are tied here.

5079     THE CHAIRPERSON: Okay. Hang on for just a second.

5080     MR. GROSSMAN: Yes.

‑‑‑ Pause

5081     THE CHAIRPERSON: Now I really do feel like a judge because that was a sidebar.

5082     Here is our dilemma. We understand and fully appreciate the extraordinary circumstance in which you find yourself because of the issue with Newcap; however, we can't allow you, technically, to intervene before hearing the other applications.

5083     So we will make an exception and, if your time permits, allow you to appear in Phase II tomorrow, which is scheduled to start, at this point, around 9:50.

5084     MR. GROSSMAN: And the content I can cover in Phase II is what?

5085     THE CHAIRPERSON: Is why you think we shouldn't license anybody in Gravenhurst or why you think we shouldn't license one of the applicants in Gravenhurst. It's your intervention with regard to the licensing process in Gravenhurst.

5086     MR. GROSSMAN: Thank you.

5087     THE CHAIRPERSON: Is that acceptable to you?

5088     MR. GROSSMAN: Yes, definitely.

5089     THE CHAIRPERSON: So we will put you on the list for Phase II tomorrow.

5090     MR. GROSSMAN: Right, which I'm not on the list for now.

5091     THE CHAIRPERSON: That's right.

5092     MR. GROSSMAN: Right. Okay.

5093     THE CHAIRPERSON: Okay?

5094     MR. GROSSMAN: Thank you. I appreciate that.

5095     THE CHAIRPERSON: All right, thank you very much.

5096     We will take five minutes.

5097     Thank you.

‑‑‑ Upon recessing at 1325 / Suspension à 1325

‑‑‑ Upon resuming at 1338 / Reprise à 1338

5098     THE SECRETARY: Thank you.

5099     We will now proceed with item 13 on the agenda, which is an application by Bill (William) Wrightsell, on behalf of a corporation to be incorporated for a licence to operate an English‑language FM commercial radio programming undertaking in Gravenhurst.

5100     The new station would operate on frequency 102.3 MHz, Channel 272 B, with an average effective radiated power of 15,000 watts, maximum effective radiated power of 50,000 watts, with an effective height of antenna above average terrain of 116 metres.

5101     Appearing for the Applicant is Bill Wrightsell.

5102     Please introduce your colleagues, and you will have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

5103     MR. WRIGHTSELL: Thank you.

5104     Madam Chair, members of the Commission and Commission staff, my name is Bill Wrightsell. Thank you for the opportunity to present this application on behalf of a company to be incorporated for the establishment of a new FM radio undertaking in Gravenhurst/Bracebridge, Ontario.

5105     I believe a key element in an undertaking of this nature is bringing together a team of business professionals that will provide support and guidance in building a successful enterprise.

5106     I would like to introduce our team. First, Dorothy Christie.

5107     MS CHRISTIE: Good afternoon, Madam Chair and Commissioners.

5108     I'm Dorothy Christie, an experienced account executive, who worked for over 12 years as a senior corporate and government accounts manager and trainer with Xerox Canada.

5109     For the past seven years I have been the business partner for Bill Wrightsell, account executive, and the publisher of Bayview Magazine, a quarter lifestyle publication in the City of Thunder Bay.

5110     MR. CHRISTIE: Madam Chair, Commissioners, my name is Glenn Christie. I am an HR consultant and an executive career coach. I have held a number of senior HR positions with global technology and professional services organizations.

5111     I have worked most of my career with Towers Perrin, as an HR director, and with IBM, and I have worked developing management development programs. I was the chief architect of several innovative leadership development programs related to talent management. I recently returned to Toronto, after three years in China.

5112     I'm pleased to offer my expertise in helping Bill and his team recruit and develop people for the new organization.

5113     MR. WRIGHTSELL: Next on our team is Brian Christie. His is the President of Lowerys BASICS, a three‑generation owned and operated office supply and office equipment business that operates in locations in Thunder Bay, Kenora and Dryden, Ontario.

5114     Mr. Christie is committed to and oversees over 80 employees. Brian planned to attend today, but due to the scheduling of his company year end on January 31st, he regrets that he is unable to join us.

5115     And I'm Bill Wrightsell, the owner of Wrightsell Advertising, a full‑service advertising and marketing company. I began my career as a radio announcer at age 17, and later worked in radio sales at CFPA, CJLB radio, in Thunder Bay.

5116     The Commission has seen me before. I was part of a team headed by Spence Bell, of CFNO Marathon, in the late‑eighties for a radio licence in Thunder Bay. Nearly two years ago, I presented an application for a licence in Sudbury, Ontario, and now this application for Gravenhurst/Bracebridge.

5117     I work with radio stations in both media buying and constructing successful radio campaigns. I'm a strong proponent of using radio to generate sales for the companies I represent.

5118     I have a deep‑rooted passion for radio and understand the positive impact that a well run radio station that's local can have on the life of a community.

5119     Should we be fortunate to receive a licence from the Commission, I would move to Gravenhurst and act as the station general manager and sales manager.

5120     After the excellent experience of constructing an application for Sudbury, I didn't want to give up on my career ambition. I searched for a suitable market that appeared underserved, with potential for long‑term growth. Gravenhurst appeared to be such a place. Having visited Gravenhurst on several occasions, I was surprised that this market did not have its own radio station.

5121     There have been several calls for radio applications in other markets recently, but this market was particularly appealing to me. Besides the absence of a local radio station, Gravenhurst has an active business community and a number of large‑scale developments under way. Gravenhurst seemed to be the perfect fit for a new broadcast company to establish itself without being directly challenged by well established broadcasters. As I began to build the business case, I became even more convinced that a station in Gravenhurst will be a success.

5122     Gravenhurst/Bracebridge are well established communities, with long histories as recreational destinations. Due to the close proximity to Toronto and the densely populated areas of Ontario, these communities have two distinctive groups of inhabitants: permanent residents who work and live in the communities year‑round and have chosen to enjoy their golden years in a safe and active community and season residents who enjoy cottage life in the region.

5123     Gravenhurst/Bracebridge are well positioned to continue rapid growth and prosperity in the future. According to the Financial Post survey of markets, Bracebridge retail sales figures are well above the national average. In 2006, retail sales figures were 164 percent higher than the national average, and in 2008 42 percent higher. We believe this reflects the healthy injection of economic activity generated by seasonal residents and tourists as the extensive retail choices exist in Bracebridge.

5124     In Gravenhurst, the retail community is smaller, but is rapidly growing. There are currently a number of developments under way, including a 106‑unit Marriott Residence Hotel next to the new Grace & Speed Museum, three new condominiums located at the waterfront wharf, and a new 385,000 square foot Trinity Real Power Centre, which is a shopping centre currently under construction.

5125     In a discussion with Barb Buckley, of Evanco. Homes, a company instrumental in Gravenhurst's waterfront wharf development, she told me that important critical mass is coming to Gravenhurst. According to the Financial Post survey of markets, retail sales figures are expected to grow to over $172 million by 2013. That's a 41.5 increase versus 2005 figures.

5126     A healthy advertising environment is also evident. The market is served by two weekly newspapers, the Gravenhurst Banner and the Bracebridge Examiner, each owned by Metroland, a division of the Toronto Star.

5127     To uncover the estimated advertising dollars each paper generates, we measured the advertising linage purchased during one week in June. We determined that approximately $1.8 million in advertising sales are earned annually by each of these two weekly newspapers.

5128     Add the numerous tourism guides, the directories and publications, then it's reasonable to assume that the total advertising market is well in excess of $5 million annually. These numbers also gave us confidence in knowing that, even if our station was able to attract 12 to 15 percent of that, we would be successful in achieving our financial objectives.

5129     We also commissioned Red Head Media Solutions, a marketing and advertising company based in Bracebridge, to identify the pricing and approximate split between Bracebridge's and Gravenhurst's advertising on Moose FM, Bracebridge.

5130     In a monitoring period taken in late‑spring, Read Head determined that only 8 percent of the Moose FM advertising was derived from Gravenhurst advertisers, with the other 22 percent from Huntsville, Lake Muskoka and the Lake of Bays area. The other 70 percent came from Bracebridge businesses.

5131     We believe a station located in Gravenhurst, with a well positioned local presence, will be successful in attracting new dollars to radio primarily through Gravenhurst businesses. Our choice of locating the station in Gravenhurst will help have a minimal effect on Moose FM's revenues.

5132     MS CHRISTIE: After evaluating the various formats available to listeners in Gravenhurst/Bracebridge, and keeping in mind the older demographic makeup of the community, and in our discussions with local residents during numerous site visits, it was determined that a Gold‑based Adult Contemporary radio format will address a clear format opportunity that exists.

5133     To help support our assumptions and assess the needs of town residents, we commissioned Telelink Inc., of St. John's, Newfoundland, to conduct a telephone survey to determine musical preferences, community need and determine the viability of a new station.

5134     Telelink concluded that an Oldies‑based radio format would appeal to listeners, and thus help repatriate listening to local radio from out‑of‑market stations from Barrie, Orillia and Midland. In the 54‑to‑64 demographic group, demand for Gold‑based core artists from the sixties ranked the highest, with the seventies soft rock and seventies pop artists ranking very high in the 45‑to‑54 age group.

5135     Telelink's results reinforce that a Gold‑based Adult Contemporary format, designed with the majority of songs from the mid‑sixties, seventies and eighties, would achieve high acceptance in our desired demographic group.

5136     The research also uncovered a strong appetite by those in the 45‑to‑54 age group, our core listener, to hear new emerging Canadian artists and 87.1 percent indicated it was important or somewhat important to them.

5137     Our survey also determined a strong demand for local news coverage, seven days a week, along with access to news on our website, along with strong demand for local wether information, cultural events and entertainment updates, local free‑time access for non‑profits groups and organizations, and our survey results showed an overwhelming preference to having all their programming originate from Gravenhurst/Bracebridge.

5138     Our station will be based in Gravenhurst, with all front‑ and back‑end operations originating with this community. This will be a 100‑percent Gravenhurst station, not a satellite operation.

5139     We proposed 11 full‑time and 3 part‑time positions with our unique stand‑alone operation. We plan to become an important valuable and professional employer in the community.

5140     When asked if they were likely to listen to a station with a Gold‑based Adult Contemporary format, including emerging Canadian and local artists, along with news, weather, sports and community events pertaining to Gravenhurst/Bracebridge and area, 91.2 percent said they would definitely or probably listen.

5141     The area has a number of a outside signals extending from Midland, Barrie and Orillia, but what will ultimately make our station successful will be our locally produced content. We will not succeed by playing 10 songs in a row. We will only succeed by demonstrating our connection to the community with live and local news and information programming that people who live and vacation here can depend on.

5142     We believe there are three pillars for developing a great radio station.

5143     MR. WRIGHTSELL: Thanks, Dorothy.

5144     The first pillar is extensive live and local news and information programming. To address the fact that Bracebridge's Moose FM is the one daily news‑gathering organization serving the region and the Gravenhurst/Bracebridge markets are only served by a weekly newspaper, we believe this presents a huge opportunity to offer important news diversity, along with much‑needed daily local news coverage.

5145     We will also implement an innovative news and information web strategy, posting our local news stories daily on our station website, something that is currently unavailable from any area station. We believe area residents who live here during part of the year will appreciate the chance to keep informed on local news happenings in their second‑favourite place to live.

5146     We will offer live and local news each hour between 6 a.m. and 5 p.m., along with updates each evening. We will also offer live local news and information on Saturdays and Sundays. In total, we will present five hours and 27 minutes of local news coverage per broadcast week. We will also offer weather, surveillance and sports coverage important to the community, such as information on the community preparations for next summer's G8 Summit.

5147     It is important to note that strong, local news coverage is a natural fit with the Gold‑based Adult Contemporary format we proposed.

5148     MS CHRISTIE: Pillar two, community involvement and programming. We believe that being the stewards of a radio licence includes a responsibility to provide leadership and support a growing community. We are prepared to offer non‑profit groups and organizations 10 minutes of free‑time announcements, 20 times 30‑second commercials per day for their use. These spots will help raise awareness, encourage volunteerism, communicating their goals, and assist these groups in the fund‑raising function. A pool of spots will be available on a rotation basis for each organization.

5149     We will also produce a number of local program features of interest to the residents of south Muskoka. Our Go Green Muskoka feature will air each day with information on how we all can support, promote and expand environmental initiatives in the area, along with practical advice on how local residents and cottage owners can practise a more green existence.

5150     Our Muskoka Gem feature is a five‑minute vignette, aired daily, that will salute and extraordinary citizen of the week who has made a special contribution to the arts, culture and volunteer scene.

5151     Muskoka Outdoors is a daily feature that will offer information on outdoor events and seasonal activities in the region.

5152     Muskoka Life is a daily feature that will provide a schedule of upcoming arts, entertainment and cultural events taking place in the broadcast area.

5153     Our bi‑monthly Chamber Chat Program will give representatives of the three area Chamber of Commerce organizations a chance to discuss their initiatives of interest to local residents and business owners in the area.

5154     We will also feature a school newsmaker of the week, spotlighting a local student who is making a unique difference in the life of their school and community.

5155     Our 100‑percent locally based station will be connected and responsive to the needs of local residents.

5156     MR. WRIGHTSELL: Thank you, Dorothy.

5157     Pillar three, strong support for community talent development and new and emerging artists. Each hour we will feature a future gold recording by an emerging Canadian artist. To ensure our listeners develop a connection with each of those artists, this flag‑waving favourite will feature background information and a short artist's profile prior to air play. We will also list information on each of our featured artists on our website, along with links to the artist's site.

5158     We will also offer a number of initiatives that will hold up the local music community. Our Music on the Barge talent search will uncover a local amateur musician, artist or group and present them with a $6,500 cash award for the production of a professional recording.

5159     Our high school music bursary will offer annual cash awards to the most promising high school students in each school system to pursue a post‑secondary career in music.

5160     In all, we are committed to offer $112,500 for Canadian content development to assist both local and Canadian artists. As a stand‑alone operator, we believe this represents a realistic commitment.

5161     It's important to note that in years six and seven, we are prepared to increase our commitments by $2,500 ‑‑ that is reflected in our figures, by the way ‑‑ and that reflects our stronger financial position in year six and seven.

5162     We believe these initiatives will make a discernable difference in the career development of local emerging talent. To demonstrate the needs of the community and showcase the unique flavour of our proposed station, we would like to present the following video.

5163     Hopefully, they are ready. Oh, here we go.

‑‑‑ Video Presentation / Présentation vidéo

5164     MR. WRIGHTSELL: All the people shown in our video are local residents. Their enthusiasm for a new station in the town is very genuine. Our application has been widely endorsed by a number of citizens, non‑profit groups and foundations: Muskoka Tourism, the Bracebridge/Gravenhurst Chambers of Commerce, Gravenhurst Council, cottage owners, musicians and from broadcast professors from Seneca and Humber Colleges.

5165     A standalone operator in a town of this size will have an excellent chance at succeeding while providing extensive benefits to the listeners in the area and satisfying the mandates of the Broadcasting Act by offering important diversity of programming, editorial voice and ownership.

5166     Our pillars are firmly focused; strong local community news and information coverage, strong support for community groups and organizations, strong Canadian talent development and emerging artist development.

5167     Thank you for your attention. We would be pleased to answer any questions that you might have.

5168     THE CHAIRPERSON: Thank you very much, Mr. Wrightsell, and to your colleagues. I just want to know if it is by coincidence that both your last names are Christie?

5169     MS CHRISTIE: Yes, no ‑‑

5170     MR. CHRISTIE: (off microphone) relationships.

‑‑‑ Laughter / Rires

5171     MS CHRISTIE: No, no, my husband is Brian Christie, who couldn't make it today.

5172     THE CHAIRPERSON: Go ahead.

5173     MR. CHRISTIE: And Dorothy is my sister‑in‑law.

5174     THE CHAIRPERSON: Okay. I thought wow, what a common name.

5175     MR. CHRISTIE: And we don't own the Christie biscuit ‑‑

‑‑‑ Laughter / Rires

5176     MR. CHRISTIE: I wish.

5177     THE CHAIRPERSON: Gravenhurst and Bracebridge, 20 kilometres separates them, right? Am I not mistaken? Okay.

5178     And in the application ‑‑ I mean, the second paragraph of the executive summary,

"will be the first radio service for the community of Gravenhurst and a secondary radio service for Bracebridge."

5179     What exactly do you mean by that? Do you mean secondary just because there is an incumbent in Bracebridge?

5180     MR. WRIGHTSELL: Right, Bracebridge already has a station that serves Bracebridge very well. Both communities are very different, they have their own town councils, you know, they can complete for government funding for projects, they are very different.

5181     I think if you talk to a business person in Bracebridge he would look at the Bracebridge station as his station, as his town's radio station. Whereas somebody in Gravenhurst, if you ask them if they thought the Moose was their radio station, they wouldn't feel the same way, that it really isn't in their town and perhaps doesn't reflect what the needs of the town are or, you know, in terms of news coverage or, you know, surveillance, et cetera.

5182     THE CHAIRPERSON: And yet, in your video the very first thing that ‑‑ you know, it's ‑321C in Bracebridge and minus ‑‑

5183     MR. WRIGHTSELL: It was too.

5184     THE CHAIRPERSON: ‑‑ 311C in Gravenhurst or you said it the other way around obviously. So it is absolutely your intention to cover the local news from Bracebridge as well?

5185     MR. WRIGHTSELL: It is, yes.

5186     THE CHAIRPERSON: Will your local news have more or less of a focus on Gravenhurst? What would be the breakout between local coverage of Gravenhurst events and local coverage of Bracebridge?

5187     MR. WRIGHTSELL: I would think we would have a 50/50 split, that both communities are roughly the same size, Bracebridge a little bigger. So in terms of news events for both places I think both places have an equal number of news events to cover and, you know, issues to deal with from a news department.

5188     THE CHAIRPERSON: I'm going to cover just a series of general questions first ‑‑

5189     MR. WRIGHTSELL: Yes.

5190     THE CHAIRPERSON: ‑‑ just so I have a clearer idea. Because, to me, this like Mississauga and Toronto.

5191     MR. WRIGHTSELL: Right.

5192     THE CHAIRPERSON: You know, not the same size, but certainly the proximity. And so I am trying to get an understanding of whether or not your application is indeed for a standalone service in Gravenhurst. And whether or not you consider your ‑‑ you would consider yourself to be a competitor to the service that already exists in Bracebridge?

5193     MR. WRIGHTSELL: I think that is correct. I think we are a competitor to the service that already exists in Bracebridge, that we would be selling into the Bracebridge market our signal lands in the Bracebridge market, the three millivolt I believe. So, you know, it is a second radio station to serve the people of Bracebridge as well.

5194     But Gravenhurst has never had a radio station, they have lived in the shadows of all the other markets surrounding them. So to have their own media outlet, I think we are going to be really embraced by the people of Gravenhurst and I think we are going to get more loyalty from the advertisers of Gravenhurst as well.

5195     So I think, if you look at balance in advertising, I would imagine that Gravenhurst advertising would probably fall in the 70 per cent and then the other 30 per cent would fall from outside of the Gravenhurst market, which would include Bracebridge of course.

5196     THE CHAIRPERSON: Because I am, correct me if I am wrong, but I am absolutely positive that Gravenhurst businesses advertise on the Bracebridge radio station, do they not?

5197     MR. WRIGHTSELL: We had some research done no that that was in the package and over a monitoring period, you know, out of 100 per cent of the advertising 70 per cent of it on the Moose FM were Bracebridge businesses, the other 30 were made up of Lake of Bays, Huntsville ‑‑ there is one I am missing.

5198     MR. CHRISTIE: Baysville.

5199     MR. WRIGHTSELL: Basil?

5200     MR. CHRISTIE: Baysville.

5201     MR. WRIGHTSELL: Baysville? I don't think that was the one.

5202     It is in the brief, I am sorry, there is one market I am leaving out. But only 8 per cent of the businesses from Gravenhurst were on the Moose FM.

5203     THE CHAIRPERSON: So where are the businesses from Gravenhurst advertising?

5204     MR. WRIGHTSELL: Well, interesting you ask that. I measured the lineage, you now, old fashioned ‑‑ and Commissioner Menzies knows this very well, the lineage ruler went through the Gravenhurst Banner and the Bracebridge Examiner, the two newspapers that serve the market. And they are loaded with advertising.

5205     I mean, there is a healthy advertising market that exists. And I believe those Gravenhurst businesses, a good number of them, support the Gravenhurst newspaper. And again, it is their paper, it is their community's paper.

5206     Some of them do advertise in the Bracebridge paper as well but, you know, if you were just looking to target a Gravenhurst buyer, then, you know, you would buy the Gravenhurst newspaper, you know, first and foremost. And you might buy Moose as well if you are hoping to bring some people in from Bracebridge.

5207     THE CHAIRPERSON: And so this would explain why, as a percentage of your year 2 revenues, you estimated that 35 per cent would come from other media, including ‑‑

5208     MR. WRIGHTSELL: Yes, I think there's a huge ‑‑

5209     THE CHAIRPERSON: ‑‑ because it is their primary source.

5210     MR. WRIGHTSELL: Right, and there is a huge opportunity to take dollars away from the weekly newspaper.

5211     THE CHAIRPERSON: You make a point in your application and you repeated it here this afternoon, that your station will be based in Bracebridge ‑‑ in Gravenhurst, I am sorry.

5212     MR. WRIGHTSELL: Gravenhurst.

5213     THE CHAIRPERSON: See, I am still getting confused.

‑‑‑ Laughter / Rires

5214     THE CHAIRPERSON: That is why I wanted these points of clarity ‑‑ that you are going to be based in Gravenhurst.

5215     MR. WRIGHTSELL: Yes, absolutely.

5216     THE CHAIRPERSON: And I am assuming this is a strategic decision on your part as opposed to ‑‑

5217     MR. WRIGHTSELL: Well, strategic in that I really think Gravenhurst deserves its own radio station and I think the community will really embrace a new locally‑owned station.

5218     THE CHAIRPERSON: And you will be moving to Gravenhurst from where?

5219     MR. WRIGHTSELL: From Toronto.

5220     THE CHAIRPERSON: Big move, big move.

5221     MR. WRIGHTSELL: Well, big move, fairly close though, you know. Still get to enjoy some of the spoils of Toronto.

5222     THE CHAIRPERSON: I do it all the time.

5223     And your choice of format. I fully appreciate that you have done quite a bit of research and I am not going to get into the details of the research, because it was extremely comprehensive.

5224     MR. WRIGHTSELL: Thanks.

5225     THE CHAIRPERSON: But we do have the incumbent in Bracebridge with a Hot AC format, there is a considerable amount of out‑of‑market tuning in this market, it is at 83 per cent. And a lot of it is going to the AC format coming out of Huntsville

5226     And your share projections are relatively high. They go from 19 per cent in year 1 to 30.5 percent in year seven. And the fact is they are the highest of among all the applicants in this part of the proceedings.

5227     What is going to differentiate your station from what already exists on the market to allow these listeners to change their listening habits and give you a shot?

5228     MR. WRIGHTSELL: Well, the Hot AC format of course targets a younger audience. And I would make some arguments that perhaps Moose FM, the tuning to that station, would be higher if they were targeting an older demographic. But they have chosen to target a younger demographic and that is fine.

5229     But they have left a hole, I believe, in the market for the 35 plus listener who, you know, wants to listen to a little more of the music from the mid‑1960s, British Invasion up to the 1980s, 1990s and then ‑‑ in our research it did show that Canadian emerging artists were something that the older demographic did want to hear.

5230     So, you know, we are addressing that with that one song every hour from an emerging artist, along with some information on that artist that is being featured to get the audience familiar with that artist.

5231     I am not sure I have answered the question fully though.

5232     THE CHAIRPERSON: Well, I guess what I am looking for is how is your sound going to be different from what people are already accustomed to in the market, like I say such that they are going to change what they have formed as a listening habit?

5233     I get it, I mean, it is an adult contemporary versus a hot adult contemporary format, but the fact remains you are all basically going after a pretty broad target group as far as demographics are concerned. In fact, well in your application you said 40 to 59, but ‑‑

5234     MR. WRIGHTSELL: As the core, right.

5235     THE CHAIRPERSON: ‑‑ but then in your oral presentation you said 45 to 54.

5236     MR. WRIGHTSELL: Just now?

5237     THE CHAIRPERSON: Yes.

5238     MR. WRIGHTSELL: Okay.

5239     THE CHAIRPERSON: So which is it?

5240     MR. WRIGHTSELL: Oh, sorry.

5241     THE CHAIRPERSON: Or was it the 45 to 54 is the core, your core audience?

5242     MR. WRIGHTSELL: Yeah, I believe that was in the deficiency as well, that I did put core of 40 to 59, I am sorry.

5243     THE CHAIRPERSON: Okay.

5244     MR. WRIGHTSELL: In the deficiency questions that were answered.

5245     THE CHAIRPERSON: Yes.

5246     MR. WRIGHTSELL: Yes.

5247     THE CHAIRPERSON: But let me ask you this ‑‑

5248     MR. WRIGHTSELL: That would be core. I mean, that is the soul of the ‑‑ of who we are serving, the core demographic.

5249     THE CHAIRPERSON: One question we have asked in the past to applicants to hone it down even further, what is the median age of your listener? Paint for me a typical ‑‑

5250     MR. WRIGHTSELL: I believe ‑‑

5251     THE CHAIRPERSON: ‑‑ picture of who your average listener is. Is it male, is it female, is..?

5252     MR. WRIGHTSELL: It is a 47‑year‑old female. These formats that are a little more oldies‑based or recurrent‑based from years past do tend to skew or resonate a little better with a female listener. Whereas a classic rock format for a 47‑year‑old male ‑‑ I mean, they are attracted a little more to that format than a female is.

5253     THE CHAIRPERSON: Is your 47 female currently listening to CFBG or CFBK in Gravenhurst? Those are two signals that are in Gravenhurst. Is she listening to those radio stations right now?

5254     MR. WRIGHTSELL: I think she could be. There is some who would and then I think there is some that would not, that aren't being served by it. And some are listening because they might tune in in the morning just for the news, just to find out what is going on in their community and the music, you know, doesn't do it for them, so they move on and listen to a more music‑intensive format that might be coming in from Barrie let's say.

5255     THE CHAIRPERSON: And so what is she going to find on your radio station when she is going through the dial and looking for something interesting to listen to? What is she going to find on your radio station so that her presets aren't CFBG anymore or CFBK?

5256     MR. WRIGHTSELL: Well, she is going to know that it is a Gravenhurst radio station, that, you know, we have a shingle out in the town, they know we exist, they know that we are providing the listeners in the area with all the local news coverage, the sports, the things that are going on in their community that are important to people who live there.

5257     When you are listening to a station in Barrie you are not getting that. When you listen to a station in Midland or Orillia you are not getting that. And in some cases, because the Bracebridge station is based in Bracebridge, you are not perhaps hearing the news about Gravenhurst or things that are happening because the troops on the ground are not in Gravenhurst, they are in Bracebridge for that station.

5258     So I think the news coverage really differentiates us. And as far as the music goes, the music is very different. It is a broad format, I grant you that, but I think in a market this small it would have to be a broad format in order to survive. I really think for survival we would have to look at, you know, a fairly wide demographic target.

5259     THE CHAIRPERSON: Okay. That is a little bit more of the kind of answer I was looking for, thanks.

5260     I will take you back to your share projection, like I said, just for a reference point, is 19 per cent in year 1. And, as we know, share of hours tuned comes from three different sources; existing radio, repatriation of out‑of‑market or simply from people who don't currently listen to the radio.

5261     But you add a fourth element. And this is really the question that I want to get at. To make up the 19 per cent, did you say, well, 10 per cent of my listeners will come from Gravenhurst and 9 per cent will come from Bracebridge? Did you define your share of hours tuned in that way at all or did you look at the entire Bracebridge/Gravenhurst market to come up with the 19 per cent share?

5262     MR. WRIGHTSELL: Yeah, I don't think I looked at it that way. I mean, I looked at both markets and, you know, on the Commission's call, it is for Gravenhurst/Bracebridge ‑‑

5263     THE CHAIRPERSON: Yeah.

5264     MR. WRIGHTSELL: ‑‑ so as much as I think the station needs to be in Gravenhurst to attract the loyalty of the Gravenhurst advertiser, I looked at the market as, you know Gravenhurst/Bracebridge when coming up with that 19 per cent.

5265     NewCap earlier today, they had a station they said in Sydney that had just signed on and they had a 26 share of audience. There are cases where there are very good, you know, locally‑based ‑‑ the broadcasters that do great jobs ‑‑ I am just looking for a couple of examples that I had. In, you know, the Kent region of New Brunswick there is a station, CJSC, with 42 per cent.

5266     In Vernon there is a station at 26 per cent. In Yorkton, Saskatchewan there is a station doing 42 per cent share.

5267     If you put a great station on the air that has, you know, the soul of a community in mind and really understands the people in that area and is really serving it well with, you know, good local news coverage, you know, good people on the air that they make a connection with, there is no reason why we can't come up with a 19 share in the Gravenhurst/Bracebridge market.

5268     THE CHAIRPERSON: And because the call was for Gravenhurst/Bracebridge, how much of an impact do you think you will have on the Bracebridge station in terms of share of hours tuned? In other words, how much are you going to take away from them?

5269     MR. WRIGHTSELL: That is a good question. I would think it is going to be somewhere in the 15 to 20 per cent range. And I believe in the brief also I alluded to where the advertising would come from and ‑‑

5270     THE CHAIRPERSON: Just from 10 per cent ‑‑

5271     MR. WRIGHTSELL: ‑‑ 10 per cent for that.

5272     But I would imagine we are going to be in that 15 to 20 per cent range for taking the top end of their audience, you know, the older part of their audience.

5273     THE CHAIRPERSON: And because you just spoke about revenue and it was a great segway into my next question, and in that chart where you list your sources of revenues, you say, expanded budgets by existing advertisers is 30 per cent and new advertisers is 25 per cent of your revenues, for a total of 55 per cent of your revenues, which I could therefore define as being new dollars in the market because, like I said, 30 per cent from expanded budgets and 25 per cent from new advertisers, being advertisers who don't currently use the radio.

5274     And I know you said you did your study and you found that only 7 per cent of Gravenhurst businesses currently use print media, for example. But it just seems like, you know, it is a huge dependence on brand new dollars in the market. Do you have commitments from the advertisers in Gravenhurst that, if licensed, you are going to get their dollars?

5275     MR. WRIGHTSELL: You know, I have talked to businesses in both Gravenhurst and Bracebridge and, you know, they all talked that they are happy if we went on the air. And, you know, one fellow, I stopped into his restaurant and on the way out of town after doing the video and it was ‑331C that morning, it was a cold day.

5276     And as I was leaving he said, well, you be sure to be ‑‑ you know, when you get your licence, be sure to call me first because I want to support you, and that is a Gravenhurst restaurant.

5277     So I think there is a certain amount of that that is going to go on. I think there will be a lot of customer loyalty in Gravenhurst because, like I said, Gravenhurst has kind of lived in the shadows of the other markets in the area. And to have their own identity with a radio station is certainly a big thing.

5278     THE CHAIRPERSON: Now, in terms of your business plan, obviously you are going to have losses the first couple of years, which is fairly common with radio applications. But given the economic situation in which the country currently finds itself, are you still confident that you are going to be able to achieve the kinds of results that you have projected in your financial projections for this application?

5279     MR. WRIGHTSELL: Yesterday there was some talk about the formula of coming up with available dollars in a market. And, you know, when you do the formula from the Financial Post Survey of Markets for retail sales in Gravenhurst and Bracebridge, you know, the total is somewhere depending on if you take 12 per cent of that number, you know, you multiply it by 3 and then you divide by 12 ‑‑

5280     THE CHAIRPERSON: Right.

5281     MR. WRIGHTSELL: ‑‑ or one of the applicants yesterday did 15. And, you know, you are in that $1.6 to $2 million range for the Gravenhurst/Bracebridge markets. So I think, based on those things, I think our revenue projections were fairly conservative actually.

5282     THE CHAIRPERSON: And I don't know if you were listening to the entire Orillia hearing, the Orillia portion of this hearing, I have asked every applicant if they will file within 10 days updated proof of financing.

5283     MR. WRIGHTSELL: Will do.

5284     THE CHAIRPERSON: Are you able to do that?

5285     MR. WRIGHTSELL: Oh yes, absolutely.

5286     THE CHAIRPERSON: The other question I asked all applicants is although we do grant an authorization for two years with an opportunity to launch within those two years and also an opportunity to come and ask us for a year's extension, if necessary.

5287     I did ask all applicants, in what timeframe would you be prepared to launch this service of licence?

5288     MR. WRIGHTSELL: Well, the desired timeframe would be to, you know, obviously be on the air by summer. And so I am thinking somewhere May/June of 2010.

5289     And, you know, failing that, you know, if we are stalled for some reason or economically there seems to be a continued problem on the Canadian and American economies, the world economies I guess we could say ‑‑ although, you know, the Bank of Canada included in our written deputation that the article from the Globe and Mail on Friday that talked about the Bank of Canada, you know, they stay awake day after day trying to crystal ball what the Canadian economy's going to do.

5290     And they are thinking that we are going to be in pretty good shape next year, that the ugliness will be behind us by the first and second quarter of this year.

5291     So we would like to be on the air ‑‑ I am sorry, I am rambling.

5292     THE CHAIRPERSON: No.

5293     MR. WRIGHTSELL: The best answer would be that we would like to be on the air before summer of next year. And if, failing that, then we will definitely be on the air by spring of 2011.

5294     THE CHAIRPERSON: If you don't ramble at this point, then you have not done your job.

‑‑‑ Laughter / Rires

5295     THE CHAIRPERSON: This is your platform.

5296     MR. WRIGHTSELL: Thank you.

5297     THE CHAIRPERSON; Commissioner Menzies has some additional questions.

5298     UNIDENTIFIED SPEAKER: I am supposed to kick you.

5299     MR. WRIGHTSELL: Yes, she is supposed to kick me.

‑‑‑ Laughter / Rires

5300     COMMISSIONER MENZIES: Rambling is okay, to a point.

5301     But I just have really one question and it came up earlier this week in conversations regarding the potential to overestimate or miscalculate advertising revenue coming out of markets that have very high retail spending. Typically, markets that were recreational, retirement, that sort of stuff, lots of money gets spent, but the normal calculators for assuming advertising expense don't necessarily apply. Now, there were a variety of viewpoints on that.

5302     But I wanted to know if you had thought that through and considered whether the advertising buy might not be typical of the usual calculators in terms of the high retail spend?

5303     MR. WRIGHTSELL: The Bracebridge retail spend is quite low versus Bracebridge. Bracebridge gets the lion's share of retail spending. They are up 149 per cent I believe of what the ‑‑

5304     COMMISSIONER MENZIES: Sorry, was that the Gravenhurst spend is..?

5305     MR. WRIGHTSELL: Lower.

5306     COMMISSIONER MENZIES: Lower than Bracebridge?

5307     MR. WRIGHTSELL: Yeah, lower. Bracebridge does benefit greatly from quite a high retail spend. And that would be the large influence of the GTA, you know, people come up here, buy groceries, you know, they buy things, they buy boats, they buy all sorts of things, right.

5308     And so the Bracebridge businesses have sort of cashed in on that, the Gravenhurst businesses a little less so. But that is changing. There is a number of strong retail developments underway in Gravenhurst right now. And when you look at the new Canadian Tire store opening up, the Mark's Work Wearhouse, the Trinity Development is huge. So, you know, there is a number of great things happening, the Marriott Hotel another, you know, activity in the area.

5309     Hopefully, that answers the question, I'm sorry.

5310     COMMISSIONER MENZIES: Yes, that is fine.

5311     THE CHAIRPERSON: Commissioner Patrone?

5312     COMMISSIONER PATRONE: Thank you, Madam Chair.

5313     Just a couple of quick questions. I appreciate your promotional video, by the way. And the fact that you already have a mic flagged, that is pretty quick on the draw.

‑‑‑ Laughter / Rires

5314     MR. WRIGHTSELL: That is right, we used to have those.

5315     COMMISSIONER PATRONE: You spoke a little bit about your web presence and plans to have regular news updates. What are your plans as far as monetizing your site are concerned? Do you have any thoughts on how, if at all, you intend to proceed with that?

5316     MR. WRIGHTSELL: Well, I think we will have to bundle it in with an ad buy that, you know, if you buy a certain package with us or committed to a certain amount of dollars, then we would look to work the web, you know, as part of that package.

5317     Very few advertisers, I think, would just go with a pure web presence. They would want also some spots on the station. It is a hard one to monetize, and we heard that yesterday even from one of the applicants here that, you know, the web is a harder thing to sell than radio air time. People want to buy audience and that they, you know, they hear it in their stores, they know it is there.

5318     Whereas, they are not ever sure really how many people go to a website. There might be a web counter that can tell them that, but they don't know if they have actually seen their ad on the website, you know, because it is buried in different places or even if it is high profile you can't really tell.

5319     So, you know, we are going to actively sell that. I think it is a real value add and I think it is a very positive thing for the market that only gets a weekly newspaper really for their news.

5320     To have that daily news source available to them and for people who also don't live in the area that, you know, this is their second favourite place to be in and they want to find out what is happening in the community. So I think it is a very valuable component of our application.

5321     COMMISSIONER PATRONE: You spoke a little bit about the local features that you will be producing. Will you have a designated staffer for that or will that just be up to the regular news staff to provide those features?

5322     MR. WRIGHTSELL: I think in the deficiency answer I did sort of layout which person would be ‑‑

5323     COMMISSIONER PATRONE: Okay.

5324     MR. WRIGHTSELL: ‑‑ in charge of each feature.

5325     COMMISSIONER PATRONE: Okay, fine.

5326     MR. WRIGHTSELL: So, you know, there is some multitasking going on but, you know, it is a small newsroom and it is a small market station so ‑‑

5327     COMMISSIONER PATRONE: Yes, everybody knows everybody.

5328     MR. WRIGHTSELL: ‑‑ you know, we are trying to do the best we can with what we have, you know, with the troops that we have.

5329     COMMISSIONER PATRONE: How do you counter any suggestions that being a Torontonian, which you are, that you might be considered an outsider to this particular market and, therefore, might not understand the locals and the local market as well as perhaps someone from closer to that area?

5330     MR. WRIGHTSELL: Well, you know, I have been to the area many times and, you know, it certainly is a place that is a wonderful place to come in the summertime. And I am not a big, you know, winter outdoors snowmobiler type, not that I take anything away from people like that but, you know, summer is usually when I come up and it is a great place and the people are wonderful.

5331     And I think, you know, the fact that I am moving there, you know, I want to locate there, I want to do the best job I can, put my heart and soul into this station, I think they are going to feel that and they are going to feel the passion when I come in and sell.

5332     Selling advertising is a very emotional thing for businesses. If they have a connection with the person, you know, especially somebody who owns the station or just good salespeople ‑‑ I mean, Dorothy can even speak to this because you know the sales game probably better than me. You know, they will be loyal to you and the walls come down and their friends.

5333     And I mean, a lot of my clients that I have now are ‑‑ I mean, they have really become friends of mine. And I think in that community, same thing will happen. People will, you know, they will pin me down at local meetings or on the street and talk to me about the issues that are going on in the community and they will see me out there making it happen and putting my heart and soul into the station.

5334     COMMISSIONER PATRONE: Those are my questions, thank you very much. Madam Chair.

5335     MR. WRIGHTSELL: Commissioner Lamarre.

5336     COMMISSIONAIRE LAMARRE: Merci, Madame la Présidente.

5337     Good afternoon, Mr. Wrightsell.

5338     MR. WRIGHTSELL: Hi.

5339     COMMISSIONER LAMARRE: Just a few minor points of clarification with technical issues. In your video, at the beginning of the video, there was a weather forecast and it was ‑311C.

‑‑‑ Laughter / Rires

5340     COMMISSIONER LAMARRE: Does Bracebridge get +311C in the summer to average it out?

‑‑‑ Laughter / Rires

5341     MR. WRIGHTSELL: Yes, it does.

5342     COMMISSIONER LAMARRE: It does, okay.

5343     MR. WRIGHTSELL: It was the coldest day ‑‑ I think it was the coldest day of the year. I think they may have broke a record the day we did the video. I don't know if you saw my hand, but it was going like this. It was something else.

5344     COMMISSIONER LAMARRE: It was something, okay.

5345     MR. WRIGHTSELL: Yes.

5346     COMMISSIONER LAMARRE: Now, more seriously, I want to draw your attention and refer you to Figure 8 of your engineering brief, which is the actual coverage maps that was provided to you by your consultant. So I will let you find it.

5347     MR. WRIGHTSELL: This is the contour drawing, right?

5348     COMMISSIONER LAMARRE: Yes, the contour drawing, yes, Figure 8.

5349     MR. WRIGHTSELL: Okay. Page 25?

5350     COMMISSIONER LAMARRE: I don't ‑‑

5351     MR. WRIGHTSELL: Oh, Figure 8, I have it, yes.

5352     COMMISSIONER LAMARRE: Figure 8, I don't have the page number, sorry.

5353     MR. WRIGHTSELL: Yes.

5354     COMMISSIONER LAMARRE: I only have extracts.

5355     Now, I have a comment and I also have a question. You do notice that on this map there is a shaded area that represents interference that will come from two incumbents that are actually quite far away from your area, but still will cause interference within your protected contour, CKJJ‑FM and CFNY‑FM.

5356     So you are aware that within this area you will have reception issues that you will be able to do nothing about, in the sense that you won't be able to complain about it?

5357     MR. WRIGHTSELL: Absolutely.

5358     COMMISSIONER LAMARRE: Okay. Now, it is not clear to me whether or not this area represents the current interference zone created by those incumbent stations or if it also includes the interference zone that may be created in the future if those incumbents increase their power, as they may be permitted by Industry Canada.

5359     So would it be possible to get confirmation of that? I flipped through the entire engineering brief and I cannot find that information. So if we could get confirmation that it also represents the future interference that may be produced by incumbent stations CKJJ and CFNY‑FM. And in the case that it doesn't, if we could get an update on the map so that you definitely have the final if you want. It is probably just, you know, that your consultant forgot. Just to make sure that we have it on file and you also have it.

5360     MR. WRIGHTSELL: Okay. It is something you would normally get from an engineering consultant then?

5361     COMMISSIONER LAMARRE: Yes, yes.

5362     MR. WRIGHTSELL: Okay, well fair enough, I will call Mr. Moltnar.

5363     COMMISSIONER LAMARRE: Still speaking of maps, you also submitted as Appendix 4(e) of your application the realistic contours for your proposed stations. If we could get confirmation on what is the receiving antenna height that was used for those calculations.

5364     MR. WRIGHTSELL: I believe on Figure 8 they do have it at 116 metres.

5365     COMMISSIONER LAMARRE: That is the transmitter average antenna height. What I need is the receiving antenna height used for the realistic contours.

5366     MR. WRIGHTSELL: Okay, I will do that.

5367     COMMISSIONER LAMARRE: Thank you. And finally, in your reply to a deficiency letter ‑‑ quite frankly, I have been using that word quite a bit for the past few days and I don't like that word.

‑‑‑ Laughter / Rires

5368     COMMISSIONER LAMARRE: So sometimes I prefer if it would be precisions, because I am sure it is never deliberate.

5369     You were asked whether or not there were alternative frequencies that you would be able to consider should the Commission entertain the possibility of licensing more than one applicant. And in this reply you actually listed a series of frequencies and with their limitations, and I really appreciate that it was done that way.

5370     But what I would like to know is to what extent those limitations and the impact it may have on your business plan have been discussed with your consultant. Would you be comfortable with any of these alternate frequencies should the Commission decide to approve more than one application and not approve your application for the frequency you have asked for?

5371     MR. WRIGHTSELL: Yes, that is fine.

5372     COMMISSIONER LAMARRE: That's fine?

5373     MR. WRIGHTSELL: I understand that, yes.

5374     COMMISSIONER LAMARRE: Thank you very much, those were all my questions.

5375     THE CHAIRPERSON: Well, thank you very much, Mr. Wrightsell, you are done.

5376     MR. BOWLES: Sorry, Madam Chair, actually I do end up having ‑‑

5377     THE CHAIRPERSON: Oh, you do have a question now.

‑‑‑ Laughter / Rires

5378     MR. BOWLES: In light of the questioning posed by Commissioner Lamarre, and I apologize in advance if ‑‑ I must profess of my limitations on the technical engineering aspects, so if I ‑‑

5379     COMMISSIONER LAMARRE: He is getting there, he is getting there.

5380     MR. BOWLES: Slowly, but surely. Slowly, but surely.

‑‑‑ Laughter / Rires

5381     MR. BOWLES: So if I misrepresent the request made, I trust Commissioner Lamarre will correct me.

5382     COMMISSIONER LAMARRE: Gently.

5383     MR. BOWLES: With respect to the confirmation that the Figure 8 map and, specifically, the shaded areas on the map, represent the potential interference area and the commitment gave with respect to that, would it be possible to get a date from you by which you would be able to comply with this request?

5384     MR. WRIGHTSELL: What timeline would you like me to abide by?

5385     MR. BOWLES: Well, usually the earliest is unsurprisingly preferable.

5386     MR. WRIGHTSELL: Okay.

5387     MR. BOWLES: So if you can at least give us some indication as to how early you would be able to provide that and I guess ‑‑

5388     MR. WRIGHTSELL: I will talk to Mr. Moltnar today and I would imagine that he is going to need three or four days, so that ‑‑

5389     COMMISSIONER LAMARRE: No.

5390     MR. WRIGHTSELL: No? You want it faster? End of this week?

5391     COMMISSIONER LAMARRE: I doubt it will take him that much time.

5392     MR. WRIGHTSELL: Oh, okay, so it is a fairly simple process for him to do, right? Okay.

5393     MR. BOWLES: If you can get it to us by Friday at the very least. Can you commit to this?

5394     MR. WRIGHTSELL: Well, it is not a yes or no answer. Yes, I will say yes. I am assuming it is simple.

5395     MR. BOWLES: And one last question. With respect to providing us with the height of the receiving antenna used for the purposes of calculating the realistic contours, I guess the same question, by which date are you willing to commit to providing the information?

5396     MR. WRIGHTSELL: Friday is fine.

5397     MR. BOWLES: By Friday. Thank you very much, those are all my questions.

5398     MR. WRIGHTSELL: Thank you.

5399     THE CHAIRPERSON: You may now leave.

5400     Thank you very much for your application.

5401     MR. WRIGHTSELL: Thank you for your time.

5402     THE CHAIRPERSON: We will take a 15‑minute break, thank you.

‑‑‑ Upon recessing at 1436 / Suspension à 1436

‑‑‑ Upon resuming at 1457 / Reprise à 1457

5403     THE SECRETARY: We will now proceed with item 14, which is an application by Bayshore Broadcasting Corporation for a licence to operate and English‑language FM commercial radio programming undertaking in Gravenhurst.

5404     The new station would operate on frequency 102.3 MHz (channel 272B1) with an effective radiated power of 12,500 watts (non‑directional antenna with an effective height of antenna above average terrain of 71 metres).

5405     Appearing for the applicant is Ross Kentner. Please introduce your colleagues and you will have 20 minutes.

PRESENTATION / PRÉSENTATION

5406     MR. KENTNER: Thank you, Madam Secretary.

5407     Madam Chair and commissioners, it is Ross Kentner again from Bayshore Broadcasting. And with me today is the same group that appeared before you on Monday for the Orillia hearing.

5408     I have on your left Deb Shaw, who is our Assistant General Manager. On your right, Rob Brignell our Manager of Marketing and Development. Kevin Brown is Bayshore's General Sales Manager, beside him is Lois Reid, Business Manager. Behind us Rick Ringer our Operations Manager in Wasaga Beach. Over here, Mariane McLeod, News Director in Wasaga Beach.

5409     And also Jeff Vidler of Angus Reid Strategies, formerly Solutions Research Group, who are responsible for our surveys for this application. And Michael Fockler who is our Programming and Regulatory Affairs Consultant.

5410     It is our pleasure, once again, to come to before you to share Bayshore's vision for what we hope will be Gravenhurst's newest radio station, Cottage Country FM.

5411     It should be noted that when we refer to this area we are including both Gravenhurst and Bracebridge. Our studios will be located in Gravenhurst, but the radio station will serve both communities equally. Combined, we shall refer to this area as cottage country, reflecting this region's relationship with year‑round visits from all across Southern Ontario.

5412     Bayshore has operated radio stations in Central Ontario for many years. This area is our home and, as such, we are uniquely positioned to provide a truly diverse alternative to the current regional broadcaster.

5413     The incumbent, Haliburton Broadcasting, has a veritable monopoly on this area with stations in Parry Sound, Bracebridge and Huntsville, each sending similar programming into the cottage country region.

5414     We believe our application provides the diversity that listeners, retailers and the CRTC desire. Madam Chair, the Commission has repeatedly stated that certain factors, including diversity, are relevant to the evaluation of applications.

5415     Bayshore has undertaken to thoroughly address each of these factors in our supplementary brief. Moreover, we are confident we have met and surpassed the Commission's expectations, fulfilling each of the criteria set out in CRTC policy.

5416     We look forward to further discussing these details with you.

5417     MR. RINGER: Commissioners, I am responsible for the programming aspects of this application. Bayshore's Cottage Country FM will be distinctly different from the incumbent broadcaster. Our classic adult contemporary format will appeal to a broad 35 to 64 demographic, skewing female 35 to 54. Songs from artists like James Blunt, Celine Dion, Don Henley and Sarah McLachlan will provide listeners with a mature sound alternative to the existing local station.

5418     Cottage Country FM will provide 28 hours per week of unique theme programming dedicated to folk, oldies, big band and jazz/blues music.

5419     We are aware that the age demographics of this area are generally older than the Ontario average. According to Statscan 2006 Census the median age of the population in Bracebridge is 45 years, while Gravenhurst is 47, significantly higher than the Ontario average of 39 years. This is well within our proposed target demographic of 35 to 64.

5420     Our daytime Classic AC format, combined with evening theme programming, will provide Cottage Country with a widely accessible music format.

5421     MS McLEOD: Madam Chair and commissioners, when we appeared before you on Monday we described in detail Bayshore's dedication to news and information programming across all of our radio stations, including mine in Wasaga Beach.

5422     Should this application be approved, the same dedication will be brought to Cottage Country FM. The news and current affairs programming on Cottage Country FM will take the same full‑service approach as we proposed in our Orillia application and already in use on Bayshore's other radio stations.

5423     We are committed to providing a minimum of 10 hours and 32 minutes of news and surveillance information each week, of which eight hours and 20 minutes will be core news.

5424     Our three newest radio stations have all been built on this programming model. It is feasible and it is working. In total, we are proposing 21 hours each week of news, public affairs and enriched spoken word content representing 16.5 per cent of the broadcast week.

5425     It should be noted that Bayshore has the highest core news content and the highest combined news and enriched spoken word totals of any applicant for this call.

5426     MR. BRIGNELL: Members of the Commission, Cottage Country FM has allocated $35,000 per year to the development of Canadian content over and above the basic requirements of the CRTC. We will create and foster the Cottage Country Blues Festival, as we have done in our other markets. We will provide funds to area high schools so they may expand their music programs, we are offering $5,000 for post‑secondary bursaries and $2,000 for our regional artist development fund.

5427     In addition, we will continue our commitment to spoken word talent with the Cottage Country reading series. You will recall meeting Dr. Bruce Meyer and Robin Parkes earlier this week discussing their programming ideas for aspiring writers and poets. In total, Bayshore has committed $245,000 over seven years to Canadian content development in its many forms.

5428     MR. KENTNER: Madam Chair and Commissioners, we are small‑market broadcasters and very sensitive to the dynamics of small‑market economics. And so we want to assure the incumbent broadcaster, Haliburton, that we will have a minimal impact on the market.

5429     And accordingly, I ask Deb Shaw and Kevin Brown, our Sales Experts, to provide a financial analysis of this market.

5430     MR. BROWN: Bayshore has valued the total radio advertising capacity of the combined Bracebridge/Gravenhurst market to be approximately $2 million in 2007, with a surplus of $500,000 in unclaimed revenue potential after local and regional stations are considered.

5431     It is Bayshore's opinion there is ample surplus radio revenue available to support our modest financial forecast. The economic indicators and market research set out in our supplementary brief also supports this projection. The remaining revenue will allow for future growth of the incumbent local radio station and regional services from Barrie and Midland.

5432     Solutions Research Group conducted an independent study of area retailers. The findings confirmed our projections were viable and realistic. Mr. Vidler will be pleased to discuss these research findings with you.

5433     There is a need and desire amongst local retailers for a local radio station tailored specifically to listeners in an older‑aged demographic with rates that reflect that market. It can also be reasonably inferred from the research that there are many businesses not currently advertising on radio because they cannot find a music format targeting their patrons.

5434     Local and national rate cards will be published with rates that will appeal to small‑market advertisers and will respond to the desire of local businesses for affordable advertising targeting the local community. Moreover, the rates will remain competitive with the local radio station to assure stability in the market. This will maintain the overall integrity of radio sales in Bracebridge and Gravenhurst.

5435     MS SHAW: Commissioners, we are all concerned about the global economic crisis. I doubt there is anyone at this hearing that has not been affected in one way or another. Certainly, in the case of Bayshore we decided to revisit our application and review the implications of going forward at this time.

5436     You will recall that on Monday Mr. Kentner outlined a worst‑case scenario for our Orillia application based on a theoretical 10 and 15 per cent reduction in first‑year revenue.

5437     Madam Chair, we have conducted the same test of our financial forecast for this Gravenhurst application. Although it would be a challenge, Bayshore can maintain the same financial commitment to both programming and CCD. We determined the station could take an additional two years to realize positive PBIT, but it can be done.

5438     As a broadcasting group, Bayshore is fully prepared to absorb any additional losses without impacting our local news and programming plans. We are confident in our financial forecast.

5439     Bayshore launched three new radio stations in the past three years utilizing similar programming and business models. I am pleased to report, in each case, the three new stations are operating at or above the revenue levels forecast in the business plans approved by this Commission.

5440     In other words, the economic advertiser and audience research completed for our other applicants have been validated, as evident by our revenue figures. Based upon our proven track record, the Commission should feel confident that Bayshore will achieve each of the goals established in our promise of performance and business plan for Bracebridge and Gravenhurst.

5441     MR. KENTNER: In view of the due diligence we have conducted and the tangible evidence provided in our supplementary brief, the Commission should have no concern that Bayshore will unduly impact the incumbent broadcaster despite the limited capacity for radio revenue in the region.

5442     Madam Chair, as requested at the outset of this hearing, we have already submitted documentary evidence attesting to Bayshore's financial capacity to carryout all of the commitments as outlined in our application for both Gravenhurst and Orillia radio stations.

5443     In summary, we will honour all of the commitments and obligations set out in the promise of performance.

5444     We have a management team with in‑depth knowledge and experience operating in small markets like this in Central Ontario and we have very strong ownership with the financial resources able to support this operation. We will offer a music alternative and specialized theme programs that are heard nowhere else in the Muskoka region. We will provide a new independent local news voice for Bracebridge and Gravenhurst.

5445     Bayshore's Cottage Country FM will be a radio station that this area can truly call its own. Thank you for your time. We look forward to your questions.

5446     THE CHAIRPERSON: (off microphone)

5447     It seems the microphones aren't working. Mine is?

5448     COMMISSIONER PATRONE: (off microphone) Cottage Country. Obviously, the people who live there see it as more than just cottage country, it is the place where they live all year round.

5449     Did you ever consider that in your packaging of this particular station?

5450     MR. KENTNER: If I understand your question, Cottage Country FM is a working title, we have not selected a name. If we were licensed in Orillia, it will be Sunshine 89. I promise you we have not yet determined the appropriate name for this radio station.

5451     COMMISSIONER PATRONE: Thank you.

5452     You have spoken a little bit about your plans for providing a distinctive voice for this community. Can you elaborate a little further about how that voice will be distinct from say perhaps others?

5453     MR, KENTNER: I think I will start with ‑‑ what about ‑‑

5454     MS McLEOD: Mariane.

5455     MR. KENTNER: Mariane, would you like to go ahead?

5456     MS McLEOD: As we do in all our other Bayshore Broadcasting radio stations, we provide so much more news and information that is generated locally.

5457     That voice is always heard. You will hear every town council, you will hear mayors, you will hear councillors, you will hear activist groups, you will hear from the ladies who run the reading group at the library. We touch on everything that happens in our local listening areas.

5458     Deb.

5459     MS SHAW: On top of that, with the diversity with the news, I feel that our spoken word programming and our specialty programming is also what is going to be distinctive from the other stations.

5460     MR. KENTNER: And, if you like, I was interested because you, or maybe it was Chairman Cugini, spoke to how one of the applicants would be heard in the cacophony of, you know, the established radio environment.

5461     That is a very real problem and I just thought I would throw out that in Owen Sound, where we operate a successful AM station in today's environment, one of the ways we get our voice heard is we have Bob Durant doing the morning show and Fred Wallace and Christine Curtis as part of what is probably still the leading morning show in the region.

5462     We have two FMs, two regional FMs, there are other FMs coming into the marketplace, but CFOS, after 70 years, continues to be a dominant voice and it is partly because of the personalities we put on that property.

5463     COMMISSIONER PATRONE: So it is going to be the personalities that sort of create that distinctive voice and..?

5464     MR. KENTNER: They will play a large part, along with the quality of the news and the distinctive programming. Certainly, I am on the air daily on five of our stations as the explorer. I record over 900 scripts a year, there are three different versions; the Georgian Bay Explorer, the Lake Huron Explorer, and then Nottawasaga Bay Explorer. They run in different markets, but they run 365.

5465     We are planning to add this feature to other markets. It may not be me who records it in these markets, but you never fail to hear each day about what you were talking about.

5466     Beyond that, we are also doing editorial activity on a daily basis, that generates a huge amount of interest.

5467     MS SHAW: I think the other thing that we take great pride in, when you are listening to any of our announcers at anytime of day, you can tell that they live and are very active in the community. We have an outstanding staff that are extremely involved.

5468     When you talk about cottage country, I live in Meaford and it is cottage country, but we live there and so the things that go on we are at; if it is a fishing derby, if it is the pancake supper at the church. Some of our 67 staff are at pretty much everything and that is the same as it has been in our newest station in Goderich, certainly in Port Elgin and Wasaga, and that is the identity of the Bayshore team.

5469     COMMISSIONER PATRONE: I want to get a little bit further into your programming plans a little later. But I am going to ask a couple of economic business‑case questions.

5470     During the Orillia hearing, as you mentioned again today, you provided us with a worst‑case scenario in case there is a prolonged economic slump. And I believe you used the figure 15 per cent less than what you had anticipated.

5471     Of course, you have applications into Orillia as well as this other market. And if you found yourself in a position of being awarded two licences and, therefore, had to endure such a fate, could you then cope with a prolonged slump being having two separate stations, both whom you found yourself underperforming in during ‑‑

5472     MR. KENTNER: First of all, you have to know that we had long and thorough discussions with the owner about entering this competition for Gravenhurst after we had already applied or committed to apply for Orillia. So there was a conscious decision that it fits Bayshore's business plan to expand to both of these markets.

5473     They are both excellent markets, they are both markets we understand and would succeed in, both from the audience standpoint, from the community standpoint and from our won standpoint, albeit it is a long‑term situation.

5474     And yes, even in the present downturn ‑‑ our owner was here at the beginning of the week with us giving us assurance that if we can be successful he will fund not only these operations, which I am giving you a commitment would be on the air within 12 months, both of them, but beyond that any losses that are incurred will be met.

5475     COMMISSIONER PATRONE: Meaning no service cuts, is that correct, not to staff, news, commitments, that kind of thing?

5476     MR. KENTNER: Yes, and that is the thing. You know, Mr. Patrone, as you heard earlier in the week, I have been in the business for nearly 50 years and Mr. Caldwell and I have an understanding that I will not be around to proceed over any layoffs.

5477     MR. PATRONE: I want to ask you a little bit about your analysis as well. Can you tell us why your estimate of tuning share is 3 per cent fewer or less than the estimate provided by the group that you hired to do analysis, Solutions Research?

5478     Is it just your way of moderating expectations?

5479     MR. KENTNER: Exactly.

5480     MR. FOCKLER: Commissioner, excuse me, just to clarify that point we recognize the validity and the strength of Solutions Research. However, as we said in the brief, our expectation is to not necessarily immediately perform up to that level of tuning. It, of course, always takes a year or two to become established and to get to the point that you are at

5481     Perhaps Mr. Vidler could put some more insight into that.

5482     MR. VIDLER: If you would just pardon me here being a bit of a research geek here for a while, but I will explain to you just the process in terms of how we come to that share estimate. I think it may be helpful in terms of your determination here and in Orillia as well.

5483     The approach that we use is the same approach that we have used at these proceedings for I guess the last 10 years or so and we also use them in proprietary studies that we do for clients.

5484     We present a neutral description of the format being considered in this case. We actually looked at two formats, Adult Standards and Classic AC. And then presented a music montage that represented the music mix of each of the stations.

5485     Respondents were then asked if they were likely to tune the station or not. If they said they were somewhat or very likely, we then asked, "Would this station get you to switch from what is now your favourite station for this to become your current favourite or would it be a second‑choice station or just one of the stations you listen to?"

5486     The key question is, "Would this get you to switch from your current station..?" That is the price in effect that is established. So from that research the Classic AC format showed potential 18 plus, 13 per cent share of audience. Thirteen per cent of the audience we surveyed in Bracebridge and Gravenhurst said that this would become their favourite station serving as a proxy in effect for tuning share.

5487     So that is the projection that we presented to Bayshore, and then the one that they used. And I think, given sort of track history of most radio stations, not necessarily hit the ground full steam right off the top, it takes a year or two, three years to develop to that potential.

5488     COMMISSIONER PATRONE: That leads into my next question quite nicely, it is about the potential impact on CFVG. You have described in your estimate that the impact will be minimal. Our staff analysis suggests that your targeted audience accounts for a large part of CFVG's audience, in other words you are kind of after very similar audience numbers or listeners.

5489     Is it possible that you have underestimated that impact?

5490     MR. VIDLER: No, if you look at the way that we calculated the impact from the research itself, we looked at those people who would be potentially weekly listeners to this station and identify what stations they currently listen to. And, from that, we developed an estimate of impact.

5491     Now, you know, the other thing that our research showed, because we do ask about current tuning now, currently. CFVG, the Moose, has a dominant share in the marketplace. They have 28 per cent share of audience 18 plus.

5492     So as much as we estimate that, as much as 31 per cent of the audience to this station may come from those. And by the way, about 35 per cent would come from the other sort of regional stations in the area. That 31 per cent of what would be 10 per cent in the first year or even up to 13 per cent, it is still a relatively small percentage of what the Moose currently has.

5493     Moose is currently 28 share, so even 10 per cent of that would be ‑‑ they still have a 25 share of tuning in the market.

5494     COMMISSIONER PATRONE: You spoke a little bit about there being ample surplus radio revenue available there as part of your justification for moving into this market.

5495     How did you come up with that number that you did?

5496     MR. KENTNER: Kevin, could you address that?

5497     MR. BROWN: Well, we based that on, again, the Financial Post Survey of Markets and we took a look at the market valuations of both Gravenhurst and Bracebridge separately. With retail sales in the Gravenhurst market at over $4 million per year and out of Bracebridge over $20 million a year.

5498     Again, going through the total advertising capacity of the market, you are looking at $4 million in Gravenhurst, you are looking at almost $9 million in Bracebridge. Working that down to again 15 per cent for radio, you are looking at $650,000 plus dollars in Gravenhurst and $1.3 million in Bracebridge. So that is how we see as ample.

5499     And then basing what we believe the incumbent is already taking out of the market, we believe there is at least $500,000 left in the market and our first‑year projection is $360,000.

5500     COMMISSIONER PATRONE: As you are aware, there has been an ongoing ‑‑

5501     MR. BROWN: Yes.

5502     COMMISSIONER PATRONE: ‑‑ debate and discussion around the possible disconnect between retail sales and being able to monetize that form of advertising. Largely, when you are talking about seasonal numbers, as far as retail sales are concerned, that can skew those numbers a bit. Do you have any thoughts about that?

5503     MR. BROWN: Well, I guess my only thought is that we do and we successfully have done the other cottage country in Ontario for a number of years, and that is the Lake Huron shoreline where we have two stations. We have two stations on Georgian Bay, being Owen Sound and Wasaga Beach. It is the same type of seasonal markets.

5504     And we don't base our forecasts on winter, summer, that type of thing, we build it on a business plan per year and we set out to find 52‑week advertisers and we make it work.

5505     COMMISSIONER PATRONE: Except Wasaga is almost close enough to the GTA that, you know ‑‑ and I see you shaking your head ‑‑

‑‑‑ Laughter / Rires

5506     MR. BROWN: Well, it is close enough to the GTA that it hurts us, because all the money goes to the GTA and all the money goes to Barrie.

5507     For example, it was brought up in the Orillia hearing that our rates may destabilize the market. You know what, we are in Wasaga, which is just as close to Barrie and our rates are these type of rates. We haven't destabilized the market. If anything, I don't think they know we exist some days.

5508     COMMISSIONER PATRONE: I would like to ask you about your estimate of growth in the retail sales area as being 28.7 per cent over five years. As far as we have been able to determine, that number came out before much of the economic upheaval.

5509     Do you want to revise that figure or do you still feel comfortable on that?

5510     MR. BROWN: I think at this point in time we are still comfortable with that, because we wouldn't be going on the air today, we would be going on the air within a year. Hopefully, things do pick‑up in six months. I can also tell you in our other markets we are holding stable with last year. We are not seeing the growth right now, but we are not slipping behind, so we are still confident that it is out there.

5511     COMMISSIONER PATRONE: So you found that your numbers are relatively flat from 2006/2007?

5512     MR. BROWN: Actually, up to the end of November we were ahead of last year quite considerably, but Christmas slid back, and January seems okay. I mean, it is not booming, but it is holding.

5513     COMMISSIONER PATRONE: I want to turn a little bit to programming. Bayshore is committed to 85 hours of live‑to‑air programming.

5514     Can you tell us at what time in the broadcast day the live‑to‑air programming will be broadcast?

5515     MR. KENTNER: I am going to ask Rick Ringer to address that.

5516     MR. RINGER: That is 6:00 a.m. to 6:00 p.m. seven days a week ‑‑ excuse me, 6:00 a.m. to 7:00 p.m. on Friday, 6:00 a.m. to 6:00 p.m. the other six days of the week.

5517     COMMISSIONER PATRONE: Okay. You have chosen a fairly broad demographic that you are skewing female with a targeted age of women 35 to 64. And I guess my question has to do with trying to appeal to really generational differences in listening tastes and then challenges that you see as far as that is concerned.

5518     How do you reach both I guess mother and daughter in some cases?

5519     MR. RINGER: Well, you have heard of the term "family friendly radio," and in fact I believe we used that in our application on Monday, that it is Bayshore's tradition, both musically and in terms of our spoken word content and whatnot.

5520     We are definitely going for the older demo. Our target is 35 to 64 and super‑serving the 35‑54 female core. Whereas the Hot AC incumbent is definitely stronger, 18 to 49.

5521     Will there be an agreement between mother and daughter? Not necessarily. It is difficult to be all things to all people and especially given the average age of both Gravenhurst and Bracebridge's being mid to late‑40s, we feel that our target demographic is right in line with the average age of the two communities.

5522     COMMISSIONER PATRONE: Have you tailored intentionally to suit perhaps an aging demographic, retirees moving in, that sort of thing?

5523     MR. RINGER: Well, you know, certainly there are aspects of the programming. As we said in our presentation, the combination of the smooth sound, the very pleasing to the ear sound I guess you would call it during the day, and then that specialty programming in the evening.

5524     That is certainly with the jazz and blues shows, with the folk and roots, and especially with a big band night would more specifically target that older retiree generation.

5525     COMMISSIONER PATRONE: You have committed 8 to 10 per cent of your Canadian content for new and emerging artists. So basically, we are talking about what, roughly one in 10 Canadian songs coming from emerging artists? And I am wondering how that fits in with the format that you have selected or that you are proposing?

5526     MR. RINGER: Well, I would say that certainly emerging artists for the most part, except for the folk and blues night are, for the most part, going to be exposed during our regular daytime programming, our regular daytime day parts.

5527     There certainly is room, like I said, in the folk and roots night, the other nights tend to skew a little bit older in terms of the gold quantity. Although, the jazz and blues nights as well, there are a number of great emerging artists. In fact, Michael Kaeshammer who is performing in Barrie next week is a good example of that that we can use to enhance the emerging artist content.

5528     COMMISSIONER PATRONE: And I spoke a little bit with you about your plans for your news operation in your proposed Orillia station. Can you talk a little bit about what you have in store for this particular market?

5529     MS McLEOD: This market will be very similar to what we are proposing for Orillia with three staff members, two of whom work weekends and a few weekdays and also act as reporters attending municipal councils and that sort of thing. And Monday to Friday morning, host who will do the news as well.

5530     COMMISSIONER PATRONE: Obviously, you are looking to incorporate news synergies with your other operations, is that correct?

5531     MS McLEOD: There might be some synergies to be had from ‑‑ we will be using the same network, and so if a story can't be followed up necessarily by the folks who are in Gravenhurst, a phone call can be made by someone in Orillia.

5532     MR. FOCKLER: Commissioner, just allow me to clarify that.

5533     When Ms McLeod mentioned the word "network" she was in fact referring to the computer networks that they use to transfer files back and forth.

‑‑‑ Laughter / Rires

5534     COMMISSIONER PATRONE: Not CNN or whatnot?

5535     MR. FOCKLER: No.

5536     MR. KENTNER: I would just maybe like to add to what Mariane said, that I see stringers as being important in Muskoka, very important. There are some key municipalities, smaller centres that, in order for them to have a voice in the Muskoka station here, need a stringer who can participate, do news stories from their village, be heard on the open line show perhaps every couple of weeks to talk about what is going on there.

5537     COMMISSIONER PATRONE: Then you talk about your commitment towards diversity in your news voice as well as cheques and balances as far as editorial content.

5538     MR. KENTNER: I don't know if I can add anything to what I said the other day, except that if you are going to editorialize it is a big problem if you are not going to do it well. And we have done it for a long time and we keep honing our skills, trying to ensure that there are cheques and balances.

5539     As I said earlier in the week, the first premise is that if someone in the public has a different point of view it is incumbent on us to give them like time to air their point of view. We always correct any mistakes and draw attention to that.

5540     In terms of diversity, first we will be I think a diverse news voice for a number of reasons in the area. I mean, we are not operating in this market at this point in time. And I we are a strong news voice. We will be looking, for example, to engage a native reporter. I think that is very important on this side of the bay as well.

5541     COMMISSIONER PATRONE: You have committed to a public affairs show. Will any of that part be live or is it strictly pre‑taped?

5542     MS McLEOD: You are talking about the weekend one?

5543     COMMISSIONER PATRONE: Yes.

5544     MS McLEOD: Yes. We expect that, as in Orillia, what we will do in that case is use some of the sound that may not have made it onto the air through the course of the week.

5545     Perhaps if there was a longer interview done with a town councillor or with a fire chief at a fire or something, that tape would be used during that show, as well a some pieces that were too juicy to just play once.

5546     MS SHAW: If I can add to what Marian has said, what we have found in Wasaga Beach and I am expecting we will find here, with a lot of the residents being transient it is good to have a forum where the council meetings and the other activities that happen during the week if you are not here to hear the news the following day you certainly can get similar information just reported more in‑depth or a different story when you come up on the weekend. So that is our thinking there.

5547     MR. KENTNER: If I could, just one other anecdotal story. Two weeks ago in Wasaga Beach there was a very unfortunate story of a seven‑year‑old boy falling through a crack in the ice on Georgian Bay and drowning.

5548     And what was interesting ‑‑ and that was covered as breaking news and so on and so was the other follow‑up stories ‑‑ but it lead at one point to an in‑depth interview with an expert on what happens when you get exposed to cold water. I actually heard that interview air I think on CFOS.

5549     It was done in Wasaga Beach, but I eventually heard it on our AM program and it had a lot of validity. Anywhere where you have a community on open water it is important for people to know how to lookout for ice that could be faulty and what to do if you do get in trouble.

5550     So that is just an example of how a news story, you know, keeps going in a sense.

5551     COMMISSIONER PATRONE: News you can use sort of thing.

5552     MR. BRIGNELL: If I could weigh in with everybody else.

‑‑‑ Laughter / Rires

5553     MR. BRIGNELL: When you look at Bayshore Broadcasting as a whole, we likely have one of the largest news teams in all of Ontario when you look at all of the news teams in all of our stations. All of the stories that we produce and write are posted on our mainframe computer. Each news office or news division can look at those stories.

5554     So if there is a situation that is happening in environment, say in Goderich, that mirrors one that is happening in Wasaga Beach or perhaps in Orillia we then can get those two communities and those two stories and the players involved in those working together and expand and grow that story so that it is very interesting for all parties.

5555     So it is a big advantage for us, in doing news the way we do it and being so intensive with it.

5556     COMMISSIONER PATRONE: So you have editorial meetings between all the various stations in the morning, is that how it works?

5557     MS McLEOD: It is a casual kind of a meeting schedule because we are on air so much. But, yes, we do have editorial meetings.

5558     COMMISSIONER PATRONE: On page 10 of your supplementary brief you speak a little bit about the theme shows and recruiting experts in various genres. And these are not brokered. I guess you are talking about no advertising?

5559     MR. KENTNER: We didn't say no advertising.

5560     COMMISSIONER PATRONE: Okay, not brokered.

5561     MR. KENTNER: We said that they are not brokered, which means that we do not broker the time to someone who then goes out and sells it and does his own show.

5562     COMMISSIONER PATRONE: Oh, I see.

5563     MR. KENTNER: But what we do do is we try and engage program hosts in the different centres who are aficionados of that genre and experts and who can actually host. So I believe, at the moment, we are actually running two different jazz shows, one in Wasaga Beach and one in ‑‑

5564     MR. BRIGNELL: Yes. In our station in Port Elgin we are building a jazz program. It is different than the one in Wasaga Beach, in that we have our own host, and our host happens to be a jazz and blues entertainer who lives in Port Elgin.

5565     So we are teaching her the radio side of the business. She brings her own vision, she also has access to a lot of Canadian jazz and blues artists who will be incorporated into the program. So we try and take those speciality formats and make them our own on each of our stations.

5566     MR. RINGER: Mr. Commissioner, if I can just add as well, these programs are all produced in Bayshore's own studios.

5567     COMMISSIONER PATRONE: Okay. And these are unpaid positions by segment producers and hosts, is that correct?

5568     MR. KENTNER: No, these are paid positions.

5569     COMMISSIONER PATRONE: So you are recruiting people ‑‑

5570     MR. KENTNER: Yes.

5571     COMMISSIONER PATRONE: ‑‑ with a mind towards paying them as well?

5572     MR. RINGER: In some cases existing staff as well, who have a passion for the certain night of theme music that we air.

5573     COMMISSIONER PATRONE: Okay. I thank you very much for your presentation today.

5574     Madam Chair, those are my questions.

5575     THE CHAIRPERSON: Commissioner Lamarre.

5576     COMMISSIONER LAMARRE: Merci, Madame la Présidente.

5577     Two issues I would like to touch briefly, and it is going to be brief because I am turning into an ice‑cube here in the doorway.

‑‑‑ Laughter / Rires

5578     COMMISSIONER LAMARRE: I note from your submissions that you are not planning to use an existing transmitting tower, you are actually planning to build a new tower. So I am sure you are aware that Industry Canada has a national tower policy that encourages sharing of towers by different radio communication and broadcasting services.

5579     So I would like to know what prompted you to go into, to put it mildly, the trouble of building a new tower?

5580     MR. KENTNER: I wish that our consulting engineer was with us today, but I can tell you without any equivocation there was not a suitable existing tower that would provide coverage of the market area and that is why we sought a suitable site.

5581     And the interesting thing is I believe there is already a tower on the site that we have leased, so that at least it is already in use for that purpose, but that is the reason.

5582     COMMISSIONER LAMARRE: You have mentioned at the beginning of your presentation that because of your other stations you are quite cognizant of the realities of the regions. So do you foresee any major difficulties in trying to get local municipality authorizations to be able to erect that tower?

5583     MR. KENTNER: We have had discussions with the municipality and I think they are very supportive.

5584     They know what we are proposing. They felt it wasn't an infringement on their planning or on their goals for the area. It is quite close to the highway and we have their assurance that they will attempt to expedite it.

5585     There would, I am sure, have to be a public meeting, which we have certainly orchestrated in the past, because we have built a number of towers in the past few years.

5586     COMMISSIONER LAMARRE: In your application form, in section 5.1, the section on cost and funding, there is there an item for transmitting plan of 200K, does that include the building of that tower?

5587     MR. KENTNER: Yes.

5588     COMMISSIONER LAMARRE: Thank you. Now, turning to ‑‑ and I am sure you are going to have the answer to this ‑‑ turning to your answer of October 14 in your letter to the Commission you provided the realistic contours in Map 9.

5589     Could you please confirm, at this time or with an undertaking, the receiving antenna height that was used for those calculations?

5590     MR. KENTNER: We can have that to you by Friday.

5591     COMMISSIONER LAMARRE: Thank you. Those are all my questions.

5592     THE CHAIRPERSON: Thank you, Commissioner Lamarre. And thank you for knocking another question off my list when you said that you would be prepared to launch within a year.

5593     But you are not scot‑free. One point and really only one point of clarification, and it deals with the issue of Category 3 programming.

5594     In your presentation you said 28 hours and in your supplementary brief you said 12 per cent of weekly hours. Now, 12 per cent of 126 is 15.2. So we need to know if it is 15 hours or 28 hours.

5595     MR. KENTNER: (off microphone)

5596     THE CHAIRPERSON: Sure. And you will appreciate, it is because sometimes the commitment to Category 3 programming is what sets you apart because it is a COL. So that is why we are so nitpicky on this one.

5597     MR. FOCKLER: And if I can direct you to page 10 of the supplementary brief. Bayshore has provided a chart referring to 28 hours per week of theme programming of which 16 hours would be Category 3.

5598     THE CHAIRPERSON: I am sorry, can you give me the page reference again?

5599     MR. FOCKLER: Page 10.

5600     THE CHAIRPERSON: Okay. And in the 16 hours ‑‑ that is your chart of all Category 3 programming?

5601     MR. FOCKLER: All Category 3 music would be 16 hours, yes.

5602     THE CHAIRPERSON: So the 28 hours that you said today is incorrect?

5603     MR. RINGER: The 28 is total theme programming.

5604     THE CHAIRPERSON: Okay, I understand.

5605     MR. KENTNER: Some of this ‑‑

5606     THE CHAIRPERSON: Twelve hours may not be Category 3.

5607     MR. RINGER: Correct.

5608     MR. KENTNER: Exactly. Some of the theme programming is not Category 3.

5609     THE CHAIRPERSON: Okay, so we will take the commitment at 12 per cent for Category 3, excellent.

5610     Legal counsel.

5611     MR. BOWLES: Actually, no, I have no questions for this applicant. Thank you.

5612     THE CHAIRPERSON: The one time I remember to throw to him.

‑‑‑ Laughter / Rires

5613     THE CHAIRPERSON: Well, Mr. Kentner, and to your colleagues, thank you very much for your application this afternoon.

5614     We are adjourned for the day and we will see you all promptly at 8:30 tomorrow morning. Have a good evening.

‑‑‑ Whereupon the hearing adjourned at 1543 to resume

on Thursday, January 29, 2009 at 0830 / L'audience

est ajournée à 1543 pour reprendre le jeudi

29     janvier 2009 à 0830

REPORTERS / STÉNOGRAPHES

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Johanne Morin Sharon Millett

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Jennifer Cheslock