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:

Sussex Ballroom                       Salle Sussex

Future Inns Cambridge                 Future Inns Cambridge

700 Hespeler Road                     700, chemin Hespeler

Cambridge, Ontario                    Cambridge (Ontario)

October 21, 2008                      Le 21 octobre 2008

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:

Michel Arpin                      Chairperson / Président

Rita Cugini                       Commissioner / Conseillère

Elizabeth Duncan                  Commissioner / Conseillère

Peter Menzies                     Commissioner / Conseiller

Stephen Simpson                   Commissioner / Conseiller

ALSO PRESENT / AUSSI PRÉSENTS:

Cindy Ventura                     Secretary / Sécretaire

Joe Aguiar                        Hearing Manager /

                                  Gérant de l'audience

Anthony McIntyre                  Legal Counsel

                                  Conseiller Juridique

HELD AT:                          TENUE À:

Sussex Ballroom                   Salle Sussex

Future Inns Cambridge             Future Inns Cambridge

700 Hespeler Road                 700, chemin Hespeler

Cambridge, Ontario                Cambridge (Ontario)

October 21, 2008                  Le 21 octobre 2008

- iv -

           TABLE DES MATIÈRES / TABLE OF CONTENTS

                                                 PAGE / PARA

PHASE I (cont'd)

PRESENTATION BY / PRÉSENTATION PAR:

Blackburn Radio Inc.                              318 / 1815

United Christian Broadcasters Canada              384 / 2201

Frank Torres (OBCI)                               455 / 2698

My Broadcasting Corporation                       517 / 3040

PHASE II

INTERVENTION BY / INTERVENTION PAR:

Sound of Faith Broadcasting                       563 / 3338

Forest City Radio Inc.                            569 / 3370

Blackburn Radio Inc.                              571 / 3400

PHASE III

INTERVENTION BY / INTERVENTION PAR:

Karen Elliott                                     572 / 3409

The Kiwanis Music Festival of London Inc.         578 / 3451

Orchestra London                                  584 / 3481

Fanshawe College                                  591 / 3519

University of Western Ontario                     597 / 3546

Chad Hatcher                                      608 / 3596

             Cambridge, Ontario / Cambridge (Ontario)

‑‑‑ Upon resuming on Tuesday, October 21, 2008

    at 9:00 a.m. / L'audience reprend le mardi

    21 octobre 2008 à 0900

1809             THE CHAIRMAN:  Good morning.  Order, please.

1810             Madam Secretary, could you introduce the next applicant?

1811             ASSISTANT SECRETARY:  Thank you, Mr. Chairman.

1812             We will proceed with Item 6, which is an application by Blackburn Radio for a licence to operate an English‑language FM commercial radio programming undertaking in London.  The new station would operate on frequency 91.1, Channel 216B1 with an average effective radiated power of 4000 W, maximum effective radiated power of 7000 W, with an effective height of antenna above average terrain of 106.5 m.

1813             Appearing for the applicant is Mr. Richard Costley‑White.

1814             Please introduce your colleagues and you will then have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

1815             MR. COSTLEY‑WHITE:  Thank you.

1816             Good morning, Mr. Chair, Members of the Commission and Commission staff.

1817             My name is Richard Costley‑White.  I am the controlling shareholder and Chief Executive Officer of Blackburn Radio Incorporated.  It is my honour and privilege to be here before you today presenting an application for an exciting new FM radio station in London.

1818             Now I would like to introduce our panel.

1819             With me today, to my immediate left, is the General Manager for our stations in Sarnia, Ron Dann.  Ron was born and raised in London, is a graduate of the Fanshawe College radio broadcasting program and currently sits on their advisory board.  His 25 years experience in the broadcast industry includes 11 years with Blackburn and covers such areas as operations, programming and sales.  Ron will coordinate our responses to your questions today.

1820             Next to Ron is Walter Ploegman.  Walter is our Operations Manager in Chatham and has been a radio broadcaster for more than 26 years, resulting in a Resume that includes experience as an on‑air host, music director and program director.  Walter also oversees and manages our distribution of Canadian Content Development funds.

1821             To Walter's left is Sue Storr.  Sue is the Program Director for CHOK in Sarnia.  She also studied at Fanshawe College's broadcast journalism program and has spent the last 19 years in the broadcast industry as a reporter, news announcer and talk show host.  Sue also taught broadcast journalism for 10 years at Lambton College.  Sue will speak to our plans for news and public affairs programming.

1822             Finally, in the front row is Stephanie Lindau, Director of Community Relations in Sarnia.  Stephanie has worked closely with the community service groups in Sarnia and surrounding area for more than five years.  Stephanie will outline how we will approach community service in London.

1823             In the second row, starting from your right, is Jason Ploegman who is responsible for our new media initiatives and website development.

1824             Next to Jason is Debra McLaughlin, President of Strategic Inc.  Debra has prepared many economic and market reports on new radio, television and other applications before the Commission.  She conducted both consumer and economic research of the London market for us.

1825             Next to Debra is Carl Veroba.  Carl was President and General Manager of CFCO‑AM, CKSY‑FM and CKUE‑FM for 20 years and now consults for us covering a wide variety of technical matters.

1826             Beside Carl is Marianne Fritz, the Vice President of Human Resources for Blackburn Radio.  She is responsible for establishing proper guidelines in regards to our employment equity policies and oversees all hiring policies and practices.

1827             We are here today to present our proposal to add an exciting new station that will add to the London market with an adult album alternative format commonly known as Triple‑A.

1828             Blackburn Radio is the licensee of a number of radio stations serving markets in mid‑and southwestern Ontario.

1829             I am the great grandson of Arthur S. Blackburn who first brought radio to London in 1922, first as CJGC and later as CFPL‑AM.  Later my grandfather, Walter J. Blackburn, brought one of Canada's first FM services on the air with CFPL‑FM in London in 1939.

1830             Today Blackburn Radio stations in Chatham‑Kent, Windsor, Sarnia, Wingham and Leamington operate in challenging circumstances and have done so for many years.  We have learned that a combination of strong local service and prudent business practice leads to success.

1831             Our stations share an operating philosophy.  They feature large newsrooms, community marketing departments and strong and autonomous local management.  This permits them to reflect their communities with high‑quality news, to work with community groups, and to give attention to local artists in their programming.

1832             At the same time, synergies between our stations in the areas of news, programming and promotions allow them to control costs and enrich their service.

1833             Blackburn proposes to provide London a radio station that adds to the diversity of the city with a unique format that has never been available in London, comprehensive news and information from a new voice that knows London well, a commitment of 40 per cent of spins dedicated to Canadian performers, showcasing new and emerging talent through a commitment of 25 per cent of our Canadian content to these artists, CCD programs that have direct financial benefit to local artists, cultural and educational institutions.

1834             FREE‑FM will be locally owned, locally managed and programmed with a new and more diverse sound that will bring listeners back to radio.

1835             Now I would like to turn it over to Ron Dann to speak to the details of our proposal.

1836             MR. DANN:  Thank you, Richard.

1837             Good morning, Commissioners.

1838             London is a growing vibrant city and is well positioned to weather today's economic turbulence.  We believe that with strong growth in both radio revenues and profits, and strong economic fundamentals, London can support new radio choices.

1839             A review of the market assessments submitted by most of the applicants here today leads us to a single conclusion:  London is lacking in diversity in a number of ways.

1840             The local commercial stations are held by three large companies, all of whom have multiple broadcast properties in the market.  There are only three local radio voices.

1841             Most of the research indicates that London residents, regardless of their preferred music format, want to hear different music.  They find there is too much repetition.

1842             When the Commission issued its call our market knowledge told us that London could easily sustain new radio choices and that there were three unserved radio formats, a youth‑oriented CHR, an older folk, a soft AC or easy listening format, and a rock‑based diverse adult format.

1843             To help us choose which format to propose, we commissioned Strategic Inc. to complete consumer research.  They surveyed 900 respondents ages 15 to 64.

1844             I will now ask Debra McLaughlin of Strategic Inc. to outline the consumer format research.

1845             MS McLAUGHLIN:  Thank you, Ron.

1846             When we survey a competitive market like London we use a multifaceted and iterative approach.

1847             First of all, we look at tuning trends in the market from BBM to identify any changes in radio usage across demographics.  Given the robust sample BBM collects in these markets and that these data can be viewed over time, BBM is an excellent means of revealing gaps in service.

1848             In London there have been losses in tuning on a per capita basis in several demographics.  Comparing spring data from 2008 to that from spring 2004 shows that tuning is down significantly in three groups, teens, adults 25 to 54, and adults 35 to 64.

1849             The largest loss of hours tuned has occurred among adults 25 to 54 and 35 to 64.  To be specific, teens have lost approximately 69,000 hours, while tuning by adults 25 to 54 has declined by 640,000, and among adults 35 to 64 the decline is approximately 331,000.

1850             While teen tuning is off in almost every market across the country, the loss of tuning among the demographic ‑‑  typically the largest user of the medium, 25 to 54 ‑‑ is unusual and indicates that a cornerstone user group is not finding what they want.

1851             To better understand what was driving this loss of youth we looked at BDS data and specifically at the tracks being played.

1852             BDS reveals that while there appears to be a variety of services there is a significant overlap of what is being played across stations.  According to BDS data from the first two weeks of October of this year under 3 per cent of artists in the market account for almost 20 per cent of the tracks played.  Further, duplication among stations is as high as 20 per cent.

1853             These findings led us to ask respondents their impressions and we found that among them 63.4 per cent agree that they would listen more if programming they liked were available; 61.3 per cent thought stations in the market offered similar types of programming; 53.5 per cent felt there was insufficient variety in the music played; 61.1 per cent reported going to other sources to find their preferred music; and only 20.6 per cent described themselves as being very satisfied with radio.

1854             Finally, we tested the interests of each of the groups showing the greatest loss of tuning and specifically tested three formats, youth, easy listening and Triple‑A.  It became quite clear that it was Triple‑A that would provide the programming to address the gap identified by respondents.

1855             Those reporting the highest interest in adult album alternative showed a higher likelihood to listen more and scored among the lowest in measures of satisfaction with current services.  They reported a very low usage of radio compared to those interested in the other formats and they were also more likely to be tuning to spill services or completely tuning out.

1856             Over 80 per cent of London respondents stated that they would definitely or probably listen.

1857             MR. DANN:  Triple‑A addresses the demand for greater variety through the provision of multiple genres, more artists and new music.  It specifically serves 35 to 64, an age group that typically accounts for over half of the hours tuned to radio, and yet in London this group is tuning out of radio.

1858             Based on Strategic Inc.'s research and these facts, we concluded that Triple‑A was the best new format for London.  We have reviewed the research from other applicants and we note that the findings of Strategic Inc. are confirmed by other data filed in these proceedings.  For example, the research conducted by Hendershot Research on behalf of Forest City indicated that more respondents selected the Triple‑A format as most preferred than either pop oldies or CHR.

1859             Triple‑A is a format for music lovers.  For those of us who grew up in the era of underground or freeform radio stations like CHUM‑FM or CHOM‑FM in the late '60s and early '70s, or CFNY in the '70s and '80s, the format is like a return to an era where diversity was the watchword of radio.

1860             Those formats like FREE‑FM were successful by playing a wide range of music, from blues and blues rock to folk rock, country rock and straight ahead rock 'n roll.  They feature lots of interaction with musicians and audiences who are knowledgeable about music and mix a blend of the familiar with exciting new discoveries.  They were not driven by format charge from the trade publications.

1861             FREE‑FM will have fewer repeats than any other London stations and go deeper into albums.

1862             FREE‑FM will sound different, diverse and unique.  Artists like Steely Dan, Bob Dylan and Van Morrison continued to release new material, but they don't fall into current format options and they don't get played.

1863             Closer to home, Bruce Cockburn released an instrumental album in 2005 called Speechless which was largely ignored in Canada because it didn't fit the formats.

1864             Innovative musicians like Montréal's Rufus Wainwright or Nova Scotia's Ryan Neilsen faced the same problem:  they don't fit formats.

1865             This music has merit.  It's great music, it wins numerous awards, but if you live in London you will never hear it.

1866             The list is long.  Artists like Jesse Winchester, Tracey Chapman, John Prine, John Hiatt, the Crash Test Dummies, Joe Jackson, the Cowboy Junkies, Jack Johnson, and many more.

1867             FREE‑FM will air old and new alternative material from rock artists like Robbie Robertson, Elvis Costello, Peter Gabriel, Squeezed, Pete Townsend and Radiohead, combined with the folk influenced music of Lynn Miles, Joni Mitchell, Jackson Brown, and blues artists like Keb Mo, Colin James and Sue Foley.

1868             FREE‑FM will address the interest in more niche music styles.  The mix will also include all country from artists like Corb Lund, Emmylou Harris and a Be Good Tanyas, and even a bit of reggae from Bob Marley or Toots and the Maytals, or Ottawa's The Mighty PoPo.

1869             We used BDS to compare the playlists of the London stations with our proposal.  Approximately 80 per cent of the music FREE‑FM will play is not being heard on London radio and the maximum duplication with any one station is about 12 per cent.

1870             FREE‑FM will provide a wide range of special‑interest programs, including a Sunday night blues show and a Sunday morning folk show.

1871             We have committed that a minimum 10 per cent of the music we play will come from Category 3.

1872             Not only will the music be different, but the way we present it will be different as well, a much more relaxed style without hype.

1873             Our commitment to serve the music fan will mean that one of the focuses of our spoken word will be the music itself.  This presents an opportunity for the promotion of performers and releases not typical of other formats.

1874             Here is what Canadian artists, their managers and their labels have to say about our proposal.

‑‑‑ Video Presentation / Présentation vidéo

1875             MR. DANN:  To talk about our commitment to Canadian artists I will turn to Walter Ploegman.

1876             MR. W. PLOEGMAN:  Thank you, Ron.

1877             Mr. Chair and Commissioners, in approaching our support for Canadian talent in this application we thought long and hard about where to put our efforts and where to put our money.

1878             First of all, the recording industry has often told you that airplay for Canadian artists in general and for emerging artists is the greatest contribution that radio can make to Canadian content.  We propose 40 per cent Canadian content for Category 2 music and 30 per cent for Category 3.  We also propose that 10 per cent of our weekly spins will be dedicated to new and emerging artists like See Spot Run, The Tokyo Police Club, Tupelo Honey, The Joys and Hello Beautiful, and we propose an innovative program to support these artists.

1879             Every two weeks we will feature a new and emerging Canadian artist or band by putting their songs in regular rotation on the station, providing interviews and other on‑air information about the band and featuring them on our website, 981FREEFM.com.

1880             If the band agrees, listeners can download a feature track or demo, use a hot link to go to the band's web page and download other info on the artist, and we will pay them $2000 to help in production of their CDs or in promoting themselves.  We will hook them up with our other rock stations to provide an additional boost.

1881             That is but one component of the substantial financial contribution of more than $1.5 million we will make above and beyond the basic requirement.

1882             The FREE‑FM New and Emerging contests will give artists the opportunity to be part of a southwestern Ontario‑wide initiative using all of the Blackburn stations.  This project will involve live performances, a recording session for each of the regional winners and, ultimately, a CD that will be distributed free of charge to the participating artists for promotional purposes.  Again, winners will be featured on air on FREE‑FM, on 981FREEFM and on other Blackburn stations.

1883             We will also provide support for musical performance for diverse musical styles with $105,000 over the term of the licence to both the popular Home County Folk Festival and the London International Blues Festival.

1884             Beyond this financial support there will always be indirect benefits to these festivals with live on‑site promotional support and on‑air support through interviews and dedicated features on the artists and their music.

1885             Our CCD plan includes supportive music festivals, events and performances in both the public and separate school systems, to ensure that these programs have the funds necessary to grow into the future.  Events like the Elementary Arts Festival, the Variety Is Festival.  Choralfest and Celebri will receive yearly financial contributions that will total $350,000 over the first seven years of operation.

1886             Finally, in keeping with Blackburn Radio's long‑standing support of post secondary education, we have dedicated $126,000 to continued support of journalism students at both Fanshawe College and the University of Western Ontario.  Our programs will have a particular focus on women and multicultural students.

1887             Of course, we will also provide $360,000 over the term of license to FACTOR.  We have asked them to direct this money to artists from London where possible and from Ontario.

1888             In keeping with our company's belief in strong local service through news and community support, FREE‑FM will also have a strong commitment to news with an emphasis on interactivity with our audience.

1889             To speak more about news, here is Sue Storr.

1890             MS STORR:  Thank you, Walter.

1891             Good morning, Mr. Chair and Members of the Commission.

1892             Blackburn Radio has a long‑standing tradition as a leader in news and information.  Blackburn has a total of 31 new staff covering mid and southwestern Ontario.  We will bring the same dedication to comprehensive news coverage to London.  With the newsroom of four persons, supplemented by a student intern and stringers in surrounding communities, we will ensure a full news service to our listeners.

1893             FREE‑FM will provide its listeners a regular schedule of newscasts starting at 6:00 a.m. until 6:00 p.m. in the evening at a late‑night wrap at 11:00 p.m.  In total FREE‑FM will broadcast 102 newscasts every week, traffic and weather, sports and a daily commentary.  The daily commentary will be made open to the listening audience who can also submit commentaries.

1894             Our daily free and interactive feature will be a 15‑minute segment broadcast three times per day where listeners will take part in conversation through e‑mail, text messaging, by leaving their comments on a specially designated listener comment line, or by calling in live.

1895             We will provide over five hours a week of pure news, with 75 per cent being local and a total of over 10 hours of information.

1896             The Blackburn network of stations are partners in news gathering by sharing the latest information from multiple locations across the south and midwest.  Chatham‑Leamington, Windsor and Sarnia share upwards of 200 stories a month, partner in election and sports coverage and exchange stories on a daily basis.

1897             FREE‑FM will also offer a new and innovative interactive way for our listeners to access news, not only from London but from all of the Blackburn stations.  Listeners will be able to access a central database for all online news content throughout London‑Middlesex.

1898             FREE‑FM will work with the broadcast journalism program at Fanshawe College to present a weekly program that will allow for a deeper study of local issues.  With supervision from their outstanding staff and from our news director, the program will provide a tremendous learning opportunity for students in the program.

1899             Our news coverage will be supplemented by a wide range of other surveillance and community information involving service groups, multiethnic organizations and not‑for‑profit groups in the city.

1900             In Sarnia, our Director of Community Services is Stephanie Lindau who has helped establish these programs in our other branches and will do the same in London.

1901             Stephanie...?

1902             MS LINDAU:  Thank you, Sue.

1903             As the Director of Community Service it is my responsibility to develop contacts with all the not‑for‑profit groups, the various community organizations, as well as the municipalities to provide access through our stations to our listening audience.

1904             I work closely with United Way, the Autism Society, Bluewater Health, Breast Cancer Society and many more.

1905             Through the Community Services Department in all of the Blackburn radio stations, these organizations have access to a person who assists them with their needs when it comes to public events, fund raising and the news department.

1906             We provide detailed marketing plans for fund‑raising events, create long‑term awareness campaigns and assist with arrangements for on‑air interviews or press coverage.

1907             We act as MCs at events, speak on behalf of the nonprofit groups and connect personally with the community.

1908             I would be happy to further expand on this role during the question period.

1909             And now to sum up here is Richard Costley‑White.

1910             MR. COSTLEY‑WHITE:  Mr. Chair, we believe that our application more than adequately addresses the Commission's criteria for evaluating new stations.  The market can sustain new radio.  There will be no negative impact on competitive balance.  In fact, approval will ensure a better competitive balance with a new diverse voice in the market.

1911             The application is of high quality, with a strong business plan based upon solid research, strong plans for local reflection and the commitment to Canadian content above the regulated level.  We propose a substantial package of Canadian Content Development initiatives focused on emerging artists and the London musical community.

1912             Blackburn started as a journalistic organization in this city two years before it was incorporated.  We have been an integral part of the history and growth of London.  Our proposal will bring a station to London that will add to the diversity of the city from a company that will be managed and locally owned with head offices located in the heart of London.

1913             Connections to the local health, education and arts community won't have to be established.  Those connections have always been and will always be there, no matter what the future may hold.

1914             Nor will we have to establish credibility with the consumers or advertisers.  We have always been a part of the larger London community with support for local charities, hospitals, education and the arts.  London has been Blackburn's home and our base of operation in three different centuries.

1915             We hope that you will give us an opportunity to expand our contribution to the city with a new and diverse radio station.

1916             Thank you very much for your attention and we look forward to your questions.

1917             THE CHAIRMAN:  Thank you for your presentation.

1918             I'm asking Commissioner Cugini to initiate the questions.

1919             COMMISSIONER CUGINI:  Thank you, Mr. Chairman.

1920             Mr. Costley‑White and your colleagues, good morning.

1921             You know, I was reviewing the questions that I had prepared this morning and I said geez, you know, I don't have a lot of questions because your application was quite complete, and then you went ahead and answered some of them during the oral presentation so it might be a short morning.  But that's not to say my colleagues won't have further questions.

1922             Like most times that I question applicants I like to start with format because it is essentially where it all begins and your choice of format.

1923             This is not the first application, that I have heard anyway, on the Triple‑A format.  I absolutely understand why it's so attractive.  You can provide a variety of music choices, and in your application you in fact say selections of new music, gold library, some folk, world beat, blues and jazz, and it casts a wide net in terms of where you can draw music from.

1924             But my question is this:  When we look at the Triple‑A format why should we not think, you know what, this is just a death by a thousand cuts when it comes to adding musical diversity to a particular market?

1925             I absolutely appreciate the fact that in your oral presentation you did the overlap test or the duplication test with tracks that are currently being played in the London market, but that can change.  We all know that that can change.

1926             So why isn't this a little bit of death by a thousand cuts when it comes to what's currently available?

1927             MR. DANN:  When we conducted the research with Strategic Inc., what we found was there is a large segment of the population that is suffering from what we would refer to as chart fatigue and this audience that we are approaching is an audience that is not loyal to any one radio station at this point in time.  They might be the P2 or possibly P3 listeners of any radio station and they have a tendency to punch around from station to station trying to find music that they like.  In many cases what they are doing is they are going out of market to possibly a radio station from Kitchener.  The use of the Internet to find music they like among this age group or this group is very high, or they simply don't listen at all.

1928             So the Triple‑A format that we are proposing based on the research that we found, there is a wide and diverse amount of music that goes into it, but Strategic Inc.'s research found that there is a high level of interest.

1929             First of all, rock and classic rock was at the top, but also in that mix was almost a 50 per cent interest amongst respondents in music like folk and reggae and blues.  So what we are trying to do is approach a segment of the listening audience that simply is not finding what they want in the radio stations anymore.  They have heard the top 100 hits a thousand times.

1930             They grew up in an era where albums were important as opposed to chart singles and they grew up in a time where the release of an album meant something.  Now in most radio stations a popular artist, the top five or six records might be getting spun at any one time.

1931             This format allows us to go deeper into albums, to play albums that they remember and introduce them to new music that's not being played by any of the other radio stations.  This group is interested in hearing new music, not only new music ‑‑ new and emerging talent, but new music from artists that simply aren't being played on radio stations anymore.

1932             Bands like Steely Dan and Bruce Cockburn still continue to release music, but they are not fitting in anywhere so they don't get played, and yet if they go to Alumni Hall or Centennial Hall, they sell it out.  That's the audience that we are trying to approach, this audience that is disenfranchised or chart fatigued with the music that is being played.

1933             COMMISSIONER CUGINI:  Because of the variety in your music ‑‑ and, like I say, when I do look at your playlist I will add some of my favourites are on here ‑‑ there has to be quite a bit of talent in threading this music together when it comes to the listener.

1934             MR. DANN:  Yes.

1935             COMMISSIONER CUGINI:  What kind of talent are you going to be able to attract to this market in terms of DJs that are going to be able to provide that kind of information that you are saying this target audience is looking for, not only to listen to the music but also to go deeper into the music that you will be airing?

1936             MR. DANN:  Blackburn, with its history, is a well‑respected broadcast company and even since we have filed this application the number of people that have come forward to us interested in coming back to work for us if we are granted the licence has amazed me.

1937             But outside of that, we are a fairly deep company.  We have radio stations in Windsor and Sarnia with top‑notch broadcasters.

1938             In Sarnia for example, in a market that has 116 different signals, including 76 from Detroit, we have top‑flight broadcasters, and in fact some of the broadcasters that are working in Sarnia have been hired from London.

1939             I have no concerns about hiring top‑flight on‑air talent to work at this radio station.

1940             COMMISSIONER CUGINI:  What comes first your choice of format or the target demo in choosing?  When you go into a market what do you say:  You know what, I want to bring this format into this market?  Or do you say this is the demography that is not being served and therefore what's the best format to serve that market?

1941             MR. DANN:  We actually looked at it in two different ways.

1942             I came into the market ‑‑ and I grew up in the market and I still have family in London so I'm in London quite a bit and am familiar with the London radio stations and I had an inclination of what the three potential formats were.  But beyond that I wanted some further verification in my own thoughts, which is why we ask Strategic Inc. to come into the market and give us their thoughts on what was going on in the London marketplace.

1943             I think I will ask Deb McLaughlin from Strategic Inc. to talk a little bit about her research and how it all came to fruition.

1944             COMMISSIONER CUGINI:  Sure.

1945             MS MCLAUGHLIN:  As I mentioned in the opening remarks, we take an iterative approach and we do start with demographics because, in the end, even if a music format has high appeal if there isn't a business case and that there isn't the population or a significant size in terms of the demographic it's not going to work for the applicant.  So we do start with demographics.

1946             And as I outlined ‑‑ and I won't repeat, but we did find that there were huge losses atypically in some of the demographics that we often think of as being best served.  Certainly, they are best served, in terms of being provided very focused stations and formats, but there are people who, as Ron has said, are disinterested in the high repeat factors, and listen ‑‑ they are the early adopters, as it were, of MP3 players in the older demographic, because they want the variety that they can't get.

1947             So we are not appealing to 35‑64 ‑‑ necessarily everyone.  Some of them are very well served.  We are appealing to those people who have said, "I am not listening to radio any more," or, "I am going to reduce my listening to radio for local news and information."

1948             As I have mentioned to you in other markets, I think that this is a trend.  This isn't an isolated survey.  If you look at the numbers, it started as far back as Fall 2004, and I think we are going to see that in a lot of markets.

1949             COMMISSIONER CUGINI:  Yes, I have been called disenfranchised in various proceedings.

‑‑‑ Laughter / Rires

1950             COMMISSIONER CUGINI:  I am going to go through some specifics on your Category 3 music commitment.

1951             I note that you do accept ‑‑ or are willing to accept as a Condition of Licence that 10 percent of the music played during the broadcast week will be Category 3 music.  Is this going to be day‑parted at all?

1952             MR. DANN:  No, it is going to spin through the entire format.

1953             It addresses that percentage of the population ‑‑ almost 50 percent ‑‑ who say that they want to hear this type of music.  So we are quite confident that we can blend it in with everything else we are doing and keep the listener satisfied.

1954             COMMISSIONER CUGINI:  In your oral presentation this morning you said that 30 percent of that Category 3 music will be Canadian.

1955             MR. DANN:  Yes, it will.

1956             COMMISSIONER CUGINI:  And you will accept that as a Condition of Licence?

1957             MR. DANN:  Yes, we will.

1958             COMMISSIONER CUGINI:  Now, in terms of the other formats that you have identified ‑‑ or the other music genres that you have identified in your application, do you have a percentage of how much of your playlist will be new music and how much will be gold selections?

1959             MR. DANN:  Sixty percent of the music we play will be from the seventies and eighties, 20 percent will come from the nineties, and the remaining percentage will come from current music.

1960             COMMISSIONER CUGINI:  Okay.  Thank you.

1961             I know that you have provided us with a summary of your application in terms of commitments, and, specifically, I would like to talk a little bit about your CCD commitment.

1962             Even in this chart ‑‑ like I say, it's not new information, it is a summary.  Just for the record, it is a summary of your commitments.

1963             You say that your over and above, or above and beyond seven‑year commitment is $1.5 million to CCD.

1964             MR. DANN:  Yes, it is.

1965             COMMISSIONER CUGINI:  Does that include the basic contribution?

1966             MR. DANN:  No, it does not.

1967             COMMISSIONER CUGINI:  So the basic contribution is over and above.

1968             MR. DANN:  Yes.

1969             COMMISSIONER CUGINI:  Is over and above the over and above commitment of $1.5 million.

1970             MR. DANN:  Yes, it is.

1971             COMMISSIONER CUGINI:  Now, because we always like to look at the projections and assumptions made in your business plan ‑‑ and perhaps in these times it is more important than ever ‑‑ in your business plan you project an audience share of 3.9 percent to 6.7 percent, which basically ranks you in the middle ‑‑

1972             MR. DANN:  Yes.

1973             COMMISSIONER CUGINI:  ‑‑ of all of the other applicants.

1974             But your revenue projections ‑‑ $1.2 million to $2.2 million ‑‑ over the course of the licence rank you second from the bottom, if we were to exclude the two religious applicants.

1975             Am I missing something there?

1976             If your audience projections rank you at just about the middle, have you underestimated your revenue projections?

1977             MR. DANN:  We did two different models for our revenue projections.  Based on our experience in launching rock‑based formats in three other marketplaces, we started with an inventory level of 34 percent, which is what we have traditionally found across the three other formats that we have launched.

1978             COMMISSIONER CUGINI:  Inventory sell‑out level?

1979             MR. DANN:  Inventory sell‑out level of 34 percent in the first year.

1980             We based it on a very conservative commercial rate of $42, and that's how we came up with our $1.2 million.

1981             Then we projected ‑‑ we took, essentially, the graphs that we have used in other markets and built that revenue over that seven‑year period of time to a level that ‑‑ to a business plan that we are comfortable with.

1982             We may have projected under, but our own experience of what we have done in other markets shows us that this path is something that we can do without putting undue stress on the sales team and still follow a business plan that we are comfortable with.

1983             COMMISSIONER CUGINI:  The reason I ask is that, at times, when I look at these things, I think:  Did they underestimate the revenue to minimize the potential impact on the incumbents?

1984             MR. DANN:  That was not what we set out to do.  As I said, we based it on a model of what we were comfortable with, based on our past history.  There was no ‑‑ we didn't ‑‑

1985             The market share, when we were doing the revenue ‑‑ as I said, we did two different models.  The second model was based on Strategic Inc.'s information, and her model may come closer to the numbers you are looking for.

1986             But, as I said, we based it on our own history, and our own business models, and our own business plans, and it may be even more prudent, considering the current economic times.

1987             We understand that this format is not what you would consider a blockbuster format.  The radio stations in London have done a tremendous job of identifying their audience, identifying their advertisers, and we know that, in the middle of the pack, this radio station will be viewed by some as eclectic.

1988             So we took a very conservative approach, an approach that we were very comfortable with when we put together this business plan.  We wanted to make sure that we could execute it and still remain viable in the marketplace.

1989             COMMISSIONER CUGINI:  I see, from your business plan, that, essentially, you plan on breaking even by Year 3.

1990             MR. DANN:  Yes.  Slightly.

1991             COMMISSIONER CUGINI:  What happens if you ‑‑ I mean, we do understand that these applications were filed some months ago, before the economic worldwide crisis.  What happens if a third of your projections, or only two‑thirds of your projections are realized?

1992             MR. DANN:  Like I said, we were conservative in our approach to what we did with revenue.  We are still very optimistic about the London marketplace, right up to and including yesterday, when we had Debra McLaughlin continue to study the marketplace, and I think I will ask Debra to speak a little bit about the market for London for the coming years.

1993             MS McLAUGHLIN:  The downturn in the economy in London actually preceded the downturn in the Canadian economy, because the second biggest employer ‑‑ or employment group ‑‑ is manufacturing.

1994             When we do an assessment on a market, we don't simply look at the current material from the Conference Board or RBC or the Bank of Montreal or any of our sources, we trend them.

1995             If you go back three reports for the Conference Board, for example, they started talking about a potential slowdown in the market.

1996             When we were factoring in, as we do ‑‑ we do the top‑down, as you know, and the client always does the bottom‑up.  We took the share point value and we discounted it, because they were going to be a standalone and they weren't going to be able to develop the kind of leverage, being a standalone in this market, that their competitors would have.

1997             We also didn't grow the market, or the value of that share point, in the manner that you would do in a market that was expecting a lot of growth.

1998             If we were doing something out west, for example, there are a lot more indicators there.

1999             All that is to say that the degree wasn't known, but the direction was known.  So, instead of growing the share point value, for example, as you would to reflect the average growth that has taken place in the years before in the radio industry, we only grew it by the rate of inflation.

2000             So we grew it by the rate of inflation, and we discounted it to represent that they would be a standalone.

2001             When we look at what the Conference Board is saying ‑‑ I am painting a negative picture only because the cautionary notes, that, I think, people would look for in a budget if you were going to the bank, have already been built into this model.

2002             In talking to the Conference Board, they have reduced the GDP for this market.  In their most recent published it went from 2.6, I believe, to 2.2.  Now it is down to 1.3.

2003             Importantly, that is still growth.  It is not robust growth, but it is growth.

2004             So we tried to balance a very diverse market ‑‑ London is at .94 out of a 1 rating on diversity, and that is very high ‑‑ with the realities that the job loss in the first quarter, for example, in London was 3,000.

2005             We knew that when we wrote this application.

2006             So where that goes, we don't know.  How long the recovery will be in the automotive sector, which is very important to this market, we don't know, because it is not tied to our economy.

2007             But we do know that this was coming, and we do know that it is going to be a little while to get out of it.  So that informed our budgeting, really.

2008             COMMISSIONER CUGINI:  Because, in these times, negative equals cautionary, equals conservative.

2009             MS McLAUGHLIN:  That's right.

2010             COMMISSIONER CUGINI:  Now I appreciate ‑‑

2011             MR. DANN:  To further answer the question which I think you are asking, which is, "Can we sustain," I will let Richard answer that one.

2012             MR. COSTLEY‑WHITE:  Yes, it is probably appropriate for me to chime in, as the owner.

‑‑‑ Laughter / Rires

2013             COMMISSIONER CUGINI:  It's probably the one time you get to speak.

2014             MR. COSTLEY‑WHITE:  Yes.

2015             I guess the answer that I would give you is that I am in this industry for the long term.  I come from an ownership family, and we are used to weathering storms, and also enjoying the good weather, and it will come.

2016             I have budgeted the CapEx for this project, and I have also ‑‑ we have budgeted the working capital requirements that are there, and also put in a cushion.

2017             So from the standpoint of financing the project and getting it off the ground, we will be able to do it and sustain it.

2018             COMMISSIONER CUGINI:  Thank you for that.

2019             Because we are talking about the market ‑‑ you know, you are facing quite a challenge.  We know who the incumbents are.  We know how strong those incumbents are in this market.  You add to that 28 percent of out‑of‑market tuning.  Ms McLaughlin did mention that you will be a standalone broadcaster in the London market.  What challenges and/or opportunities does that provide you?

2020             MR. DANN:  First of all, I am not sure that we really view ourselves as a standalone.  We already have head offices established here in London.  We have office space, and that would mean the sharing of accounts receivable and human resources, and all of these things have already been established.

2021             For a standalone, we are a fairly large company, with lots of resources available to us.  Some of those shared duties would be things like accounting services, traffic services, and built into our business plan is a savings in engineering, simply because we have qualified engineers already hired by the company, and that is part of our business plan as well.

2022             Production services, when needed, in case of illness or vacation ‑‑ because the production service is already available outside, in our other Blackburn operations.

2023             We already have a regional salesperson who works with Blackburn, and is familiar to London advertisers, who deals with companies like TSE and Tim Hortons, the John Labatt Centre, Trial Management, and they would incorporate the London market into that as well.

2024             We have a great array of on‑air talent to share voices for commercial production, and, again, when needed in times of illness.

2025             We share in the ordering of promotional materials across all of our radio stations.  We have found that larger coordinated buys on things like banners and signs and backdrops, even things like shirts, can have substantial savings for a company.

2026             We have regular branch meetings amongst all of our operations in the area of sales and programming, where they bounce ideas off each other, and promotional ideas.

2027             One of the biggest benefits that we have found has been indirectly, with CCD, where we have established great connections in Sarnia with some of these up‑and‑coming bands that are more than willing to come and do events for us, and get exposed to audiences.

2028             In fact, one of the bands that we have worked closely with, See Spot Run, opened for Bon Jovi at Bayfest.

2029             We pass that information along to other radio stations, in the hope that that will be further developed within them.

2030             We have regular meetings in engineering.

2031             We have tremendous resources and opportunities available to us.

2032             So, as much as we will be one station in London, we don't view ourselves as a standalone operation in any way, shape or form.

2033             COMMISSIONER CUGINI:  So while Blackburn doesn't have a radio station yet in London, your head office is in London.

2034             MR. DANN:  Yes, it is.

2035             MR. COSTLEY‑WHITE:  I can comment on that, if you would like.

2036             COMMISSIONER CUGINI:  Please.

2037             MR. COSTLEY‑WHITE:  It reflects our historical roots there, and the fact that our head office is a fairly efficient head office, and the people who work in it have worked for Blackburn in the past and are wonderful employees, if I may say so.

2038             COMMISSIONER CUGINI:  Mr. Dann, you did, of course, outline a number of synergies that would result, and speaking specifically about the newsroom, will there be sharing of stories with the other Blackburn stations and the London station, if granted the licence?

2039             MR. DANN:  Yes, there will be.

2040             Because London is a regional hub for so much of what happens in southwestern Ontario, from transportation and education to medicine, there are stories of interest, whether it be traffic tie‑ups on the Bluewater Bridge, for transportation purposes, or health stories that happen in London that are of interest to outlying areas.  Yes, we will share stories.

2041             Just to further expand on that, I will ask Sue Storr to comment.

2042             MS STORR:  Thank you, Ron.

2043             If I can pick up on what Ron had mentioned about the sharing of information and the stories, our news directors in all of our Blackburn stations are in daily contact.  They talk about stories that they have covered, upcoming stories that they would like to cover, and perhaps the passing of interviews back and forth.

2044             When Ron mentioned the Bluewater Bridge, some people may think that that's not of interest to London, but Windsor and Sarnia are the busiest border crossings when it comes to truck traffic, and quite often the bridge, especially in the summertime, is backed up.  And when the trucks are backed up, or the bridge is closed, which we have seen happen, and this summer as well, that stops production.  And if London is a manufacturing area, where a lot of the auto parts plants and supplies come from, then that just‑in‑time delivery doesn't work.

2045             When that happened, we were in contact with our Windsor news station, sharing the information and interviews, and passing the stories along.

2046             That doesn't mean that the stories that go to air are carbon copies; they are not.  We pass the information along, and they write it to fit their audience ‑‑ their listeners.

2047             COMMISSIONER CUGINI:  One other area that you touched briefly upon in your oral presentation is:  You will offer a new, innovative, interactive way for listeners to access news.

2048             Could you expand a little bit further on that, exactly how that will happen, and whether the intention here is to have listeners submit news stories?

2049             Expand on that a little bit for me.

2050             MS STORR:  I will, and what I would like to do is ‑‑ that is something that we are looking at with all of our Blackburn stations, and it involves our websites ‑‑ interactive that way.

2051             If I could, Commissioner, I will pass that to Jason Ploegman, who is actually working on that right now.

2052             COMMISSIONER CUGINI:  As we speak?

‑‑‑ Laughter / Rires

2053             COMMISSIONER CUGINI:  I see his computer up.

2054             MR. J. PLOEGMAN:  That's why I have the laptop.

2055             Basically, what we have found is that news is one of the most important things to our listeners.  Our website traffic is primarily for news content.  It comes down to, people don't just want their news at the top and the bottom of every hour, they want it when they want it.

2056             What we have begun already developing is what I would call a central database of news content.

2057             Because, with the internet, it is so easy to transfer data, what we are effectively doing is, as news content goes to our websites, we store it centrally, and then what we could allow doing is not only getting traditional news content on our websites, but supplementing that with video and audio commentary, et cetera, and also allowing them access to our other branches.

2058             So, first and foremost, they would get their London news, but they would have the opportunity to look at Chatham, Windsor, Sarnia, Wingham news from any market.

2059             In addition to that, yes, there is a system that will be in place for them to submit video, audio, text information, which would then go through the system, and each individual news director could decided:  Is it important?  Should we post this information?

2060             COMMISSIONER CUGINI:  So if listeners were to post their own stories, the news director would ultimately be responsible for vetting it before it goes on your website.

2061             MR. J. PLOEGMAN:  Yes.  Before anything goes up, the news director would vet it and decide its importance.

2062             MS STORR:  If I could add to that, news among our Blackburn organizations is a 24/7 commitment.  All of our news staff wear pagers.  If news happens after hours, after 6 p.m., we have journalists ‑‑ we have news staff who will go and cover those events.

2063             So that information will be updated not only on the air, but on our websites as well.

2064             It is 24/7.  We don't stop on Friday at 6 o'clock, we continue right through.

2065             COMMISSIONER CUGINI:  Thank you for that.

2066             One final question from my end.  Your oral presentation did say "radio choices" ‑‑ plural ‑‑ "new radio choices".  How many radio stations should we license for the London area?

2067             MR. DANN:  At least one for us.

‑‑‑ Laughter / Rires

2068             COMMISSIONER CUGINI:  Shocker.

2069             MR. DANN:  Yes, shocking.

2070             While we believe that our application for 98.1 really does address the diversity issue in the marketplace, we believe that there are other opportunities in the market.  We believe that we could coexist with any of the other applicants.  We don't really see much in the way of conflict, certainly, with the CHR stations or the Christian stations, and even the pop/oldies station.  We are talking about completely different genres of music that we will be presenting.

2071             We believe that we could exist with two radio stations coming into the marketplace.

2072             COMMISSIONER CUGINI:  So no more than two.

2073             MR. DANN:  No more than two.

2074             COMMISSIONER CUGINI:  Thank you all very much.

2075             Thank you, Mr. Chairman, those are my questions.

2076             THE CHAIRPERSON:  Thank you, Commissioner Cugini.

2077             I would ask Commissioner Menzies if he has any questions.

2078             COMMISSIONER MENZIES:  Thank you.

2079             I have a reasonably quick question.  Your newsroom, how big is it?  How does it compare to incumbents and competitors?

2080             MS STORR:  For the applicants here, we are proposing the largest news staff with this licence application.  We will have four full‑time news staff.  We will have an intern summer student.  As well, we will make use of stringers in outlying communities within our listening area, that are accredited journalists who perhaps work at the local community weekly papers.

2081             As I mentioned earlier, we have a news pool within our Blackburn stations that we can draw from when it comes to expertise.

2082             COMMISSIONER MENZIES:  Why?

2083             MS STORR:  Why will we have four ‑‑

2084             COMMISSIONER MENZIES:  Why do you like having that number of news people?

2085             MS STORR:  Blackburn, traditionally, is committed to news.  We at Blackburn radio, and Richard Costley‑White, take news and information, and how it is presented and delivered to the audience, very seriously.

2086             In order to provide 75 percent local content, as we are suggesting in our application, we would provide 12.84 hours of spoken word.  We can do that effectively and efficiently with four full‑time staff.

2087             We are serious about the news, and giving the audience the information they want.

2088             People can get news 24/7 by flipping on your internet, your TV ‑‑ there are all‑news station networks, but they can't get the local news, and they can get that from us 24/7.

2089             MR. COSTLEY‑WHITE:  It is part of our company policy to provide that.

2090             I am sure you have heard the term many times "super service", and this is a component of what we try to do.

2091             COMMISSIONER MENZIES:  One of the reasons I ask that is because I am still trying to get a handle on what your edge is.  These things are difficult, trying to sort through everybody.  There are lots of very good applications, and that sort of stuff, so what is your edge?

2092             I mean, why you?  Why should you get to dance?

2093             MR. COSTLEY‑WHITE:  We have presented ‑‑ I hope we have presented, and developed, a well‑researched and data‑driven case.  It is very much data driven for our format proposal, and for our analysis of the market.

2094             We are confident that it will bring listeners back to radio and actually start growing the radio market again, which, as we have seen, has become a little soft.

2095             We are proposing the news coverage that we know Londoners want and expect from the Blackburn name.  So there is a certain amount of, perhaps, family pride there.

2096             We have a great team, and a very supportive team in the region.  We have the opportunity to bring incredible strength, enriching our programming, from our other operations.

2097             And we have the financial wherewithal to weather the storm.

2098             I guess, in summary, we know the community, and the community knows us, and we are here to participate.

2099             COMMISSIONER MENZIES:  Thanks.

2100             We heard an argument yesterday, in part ‑‑ and you have addressed this in part, but I would like to touch on it again ‑‑ given the multiple ownership among the incumbents in the market, that it is very hard competing against them.

2101             What is your view on that?

2102             MR. COSTLEY‑WHITE:  Our view is, when you look at the fact that we are competing in Windsor against what has been called the "death star", which is the Detroit radio market, and others, we actually have ‑‑ we are pretty good scrappers, actually.

2103             In Sarnia we get ‑‑ and I think it is on an unsuppressed reach basis ‑‑ we get 80 stations on the dial?

2104             MR. DANN:  There are 116 different signals that come into the Sarnia marketplace.  Seventy‑six of those are from the Detroit/Michigan area.

2105             MR. COSTLEY‑WHITE:  So we know how to fight the good fight, as it were.

2106             COMMISSIONER MENZIES:  Thank you.  That's all.

2107             THE CHAIRPERSON:  Commissioner Simpson?

2108             COMMISSIONER SIMPSON:  Thank you.

2109             Good morning.  I have a couple of questions, which all lead to a specific area of interest, which is the profile you have in your mind's eye, in terms of who you are programming to.

2110             The first question goes to the format.  I am curious as to how you are going to ‑‑

2111             The album business is a curious one from my experience, in that it is so highly subjective, and it cuts in so many different ways.  It is not like a standard rock and roll format, where there is a profile that is both, in demographic, but taste level ‑‑

2112             Because you are doing quite an across‑the‑board assortment in your programming, I am curious as to what this profile is in your mind beyond the pure demographic, in terms of who you are programming to.

2113             I am wondering if somebody could sort of paint me a picture of that.

2114             MR. DANN:  I think what you are asking is, what does this person look like, and who is the listener.

2115             As we said, this person is an audiophile.  They are a music fan.  They are somebody who grew up in the seventies and eighties, primarily, who grew up at a time when album releases mattered.

2116             We were having this discussion last night, and I guess the person that this format is appealing to is that person who goes to a concert.  At every concert you go to, there is that one song that every fan of the band knows, and yet was never a chart hit.  Everybody who is a fan of that band knows exactly what the song is.

2117             As far as the profile from a demographic standpoint, I think I will ask Debra McLaughlin, who really did a lot of research into what this person ‑‑ who this person is, speak a little bit about that.

2118             MS McLAUGHLIN:  As Ron said, the age group is 35 to 64.  There will be tuning in the 25 to 34 range, in fact even younger, simply because new music and music for music fans knows know age boundaries.

2119             They have a range of education, so it's a very broad format.  Sometimes you hear, with easy listening, that it's higher education, higher income, but this covers a range of incomes, and obviously it covers a range of occupations.

2120             They are defined more by a lifestyle, so they attract advertisers who are interested in people who are spending money on entertainment, and attending venues in leisure time.

2121             So they do have some spending differentials that you can identify.

2122             They change from market to market, because they are predicated on the composition of the market, so it's a little difficult to tell you without having that station on the air here, but I can tell you that in other markets where I have surveyed, some of them where there is a large student population, they have a lot of students in the upper end ‑‑ graduate students, people who are exploring music.  They get into it.

2123             It has a lot of the early adopters, people who are using technology to find their music.

2124             But it also attracts people who predominantly use radio now just for news.

2125             I may not be clearing it up entirely.  I guess what I am trying to paint for you is that, the way it is programmed, it is not the format as we know it today.  Therefore, the audience it attracts doesn't fit into the little boxes that we usually stick audiences in.

2126             Is it attractive to advertisers?  Very.  Because what is very important about this group is that they are light users of radio.  They tend to be light users of television.

2127             When you are doing a media plan, one of the things you look for is trying to balance those consumers who use traditional media in your media plan with the people who do not.  And when you find a station that attracts what is Q1 or Q2 users of media, which are the lightest, they tend to get better placement on your media buy.  They may only get a small portion, but it's because, once you get a station that attracts the light users, you are finding the rare advertiser, or the rare client ‑‑ consumer ‑‑ that you can't reach in other media.  That's who this group tends to be.

2128             I don't know if that answers your question fully.

2129             COMMISSIONER SIMPSON:  I am not sure that it did, either.  I think that it further illustrated my question.

2130             Let me do this.  Let's try it from a different angle.  Let's talk about the advertiser.

2131             I found it interesting that in your prospectus you have upped, I would say more than ever so slightly, the ratio of your national advertiser to your ‑‑ beyond the traditional 80/20 split.  It is up, by my bad math, at somewhere around 25 percent.

2132             I am wondering, rather than explaining to me why you have done that, if you could give me the elevator pitch to the national advertiser as to who your audience is, and why you think you are going to be able to capture that extra 5 percent.

2133             MS McLAUGHLIN:  I will try to do it without the jargon.

2134             There is a whole group of consumers out there that you are missing ‑‑ if you are the agency ‑‑ that you are missing when you buy traditional media.

2135             If you look at the trends, both in television and in radio, what you see is a group of people who are falling off the map.

2136             Are they important consumers?  Yes, they are.  They are consumers who have a lot of money.  They are consumers who, when they don't have a lot of money, are a very important point in the buying cycle, in the development of your customers.

2137             The customers who I am talking about are the people who are younger, who haven't formed their loyalties.

2138             You can get, with this station, a combination of those people.  You can get the people who haven't formed their loyalties and the people who have a lot of money.

2139             What links them together is a love of music.

2140             When you look at the way this station will deliver an audience, it will have a lower reach than a Top 40 station, but it will have a longer listening period.  And, most importantly, for the fragmentation that happens with all of the clutter that goes on with all of the media choices and how consumers are bombarded, this is active listening.

2141             You hear people talk about it all the time, but these are people who are tuning into the radio not for background and not to hear that familiar song necessarily, but to hear songs they love.

2142             Music is an important part of their life.  It's not background, it's not filler, they are listening.

2143             If you, as an advertiser, have the choice to put your ad on a station that reaches a lot of people, some of whom will hear it, or in a station where people are actively listening, your money would be better spent putting it on a station where your ad will be heard and probably retained and actually transact or transform someone's behaviour.  So I think you should advertise with this station.

2144             MR. DANN:  I can't say it any better than that.

2145             COMMISSIONER SIMPSON:  Thank you.

2146             I think what got me onto this line of questioning was that most of the time ‑‑ and I am now moving back to the programming ‑‑ most of the time stations narrow in on a demographic to the extent that they are able to find some type of a marketing term that captures what they believe is going to be the resonant core of the audience they are after.

2147             And I am still finding myself struggling with ‑‑ I understand exactly what you are talking about in terms of that subjectivity of how we build our iPod list that shows no rhyme or reason in terms of the music pattern or specific area of taste level.  Which is, I must admit, also what I find intriguing.

2148             But this goes to my next question, which is to develop a programming model along this line where there is no resonant core, something you can sum up in an elevator pitch to a national rep house, for example.  If that greatest weakness is also going to be your greatest strength, tell me a bit more about your ongoing programming approach, because this obviously is going to be an evolutionary process.

2149             You haven't got charts to guide you, you know, you are in grey water in terms of the need to constantly be pulling out and adding to your playlist and it is not being spoon‑fed to you through programming consultants that, you know, just go to the low‑hanging fruit of what is on the charts and what is popular.

2150             So how are you going to approach a long‑term process of programming so that you know that you are on top of your audience?

2151             MR. DANN:  First and foremost, you are absolutely correct, it is an ongoing process and it will be an ongoing process.  Probably one of the most important aspects will be the interactive feature with the website.  We have heard a lot of the other applicants have similar plans and this station has the same plan.

2152             And first and foremost, will be a portal on our website that says, 'Is there an artist we are missing that you think we should be listening to?' And allow them that input, then we can research the artist and listen to the artist and see if it deserves to be part of our playlist.

2153             When you get past all of the blockbuster formats and you still find there is a large percentage of the population still looking for ‑‑ as you said, the album industry is certainly much different than it was a couple of years ago.

2154             But there still are people out there that are interested in new albums that come out.  The one that strikes me most in the last year was the Bruce Springsteen release, which was a fantastic album.  And yet, widely, only one song got played off that album, although people are saying it was one of the best albums he has ever released.

2155             There has to be interest in additional songs on that album and some of them did show up on the triple A charts.  There are triple A charts that we can follow for new releases.  And they are a wonderful eclectic mix of music, everything from R.E.M. to John Mellencamp to Bruce Springsteen to some folk artists as well.  So we do have somewhat of a guide.

2156             But very important in all of this will be the interaction with the audience through the website, that we will allow them.  Because, trust me, audio files have no problem voicing their opinions about music with a radio station.  We fully expect that we have a long period of time for them to get used to us and us to get used to them.

2157             We anticipate a two or three‑year build as we get used to the music they like to hear from us, always open to the notion that we should be exploring new music at their direction.

2158             COMMISSIONER SIMPSON:  Thank you very much.

2159             THE CHAIRPERSON:  Commissioner Duncan, please.

2160             COMMISSIONER DUNCAN:  I am interested in a couple of comments this morning.  I notice that you indicate that you reviewed the research provided by the other applicants and found that they confirmed the research findings of Strategic Inc.

2161             And so I am particularly interested, given that we have applications for three youth formats, and I know you are not in a position to speak to their decisions, those applicants' decisions, but I am interested in the statistics that you gave and how I am to interpret it seems pretty obvious.  But in light of the fact we have three youth applicants it is not so obvious to me.

2162             Where you say that the teens have lost 69,000 hours, adults 24 to 54 declined 640,000 hours, which is a huge difference, and 35 to 64 the decline is 331,000.  So I am interested in a little more understanding of this and trying to understand as well why you are the only one here applying for triple A.

2163             MR. DUNN:  Deb.

2164             MS McLAUGHLIN:  Thanks.  I point out those differences in tuning because obviously part of what you want to do is to establish where the potential is for growth.  It is easier to get someone engaged in a media that they are familiar with, that at some point in their life they were engaged with than it is to get people who never used the media before or aren't currently using it.

2165             And so we had to look at the demographics and just break them up and see where the hours lost were.  And it was actually sort of surprising to me to see the degree of the loss in this market.  So in terms of having potential it seems to me ‑‑ and we did test youth, youth was never, even on the basis of measuring the hours lost, youth was not off the table as far as assessing in this market.

2166             But what ultimately decided was not the 69,000 versus the 640,000, it was when we went into the market and talked to consumers through the research.  What we found was youth was had a lower score, I believe it was 75.7, I mention it in our brief, in terms of their interest in the format.

2167             When we express interest in the format we add together definitely listens and probably listens and we give you the blanket number of the probable audience or the potential audience.  But contained in our 80.4 for the triple A format and the 75.7 is the breakdown of the definitely and the probably.

2168             There was a higher percentage of youth that only said they would probably listen and there was a higher percentage of the adults that said that they would definitely listen.  That is an important differentiation from the perspective of putting together a business plan, because while youth was interested in having a format that they would listen to, they were less I would say firm in their opinions that they would actually go and listen.

2169             So while the interest was at a 75.7, when you are estimating who would really listen the numbers are significantly lower.  And also when we went through, because we ask all of those points of, you know, would you listen more if a station was available?  They were softer on their answers in that grouping as well.  So it wasn't the 69,000 versus the 640,000 or just the overall interest versus ‑‑ it was a combination as we went through.

2170             We also looked at some of the music interests of that age group.  It was also clear that some of that music was already available in the market, like modern rock, or they were looking for urban music that was edgy which we could never broadcast.

2171             And so the ability to actually really well serve that demographic didn't seem to be as clear as this very obvious group that typically, historically has been the biggest user of the media or radio, grew up with it, still looks to it and is not saying it is ineffective or not saying it just doesn't apply to us, it is actually saying if it could just get better we would use it.  Whereas we found youths were saying, I don't know.  Like, we would have to sell them on the whole medium.

2172             So it was a combination.

2173             MR. DANN:  Because our format is largely a rock‑based format despite, you know, the varieties that we have incorporated into it, it is largely a rock‑based format.  And that addresses the number one issue that they found in the research, that rock music or classic rock music in the London market is still extremely popular.

2174             COMMISSIONER DUNCAN:  I am just wondering, just sort of as a follow‑up to your explanation, when you spoke to the young people that you spoke to would they have had a clear understanding of what the options would have been?

2175             MS McLAUGHLIN:  Between triple A and ‑‑

2176             COMMISSION DUNCAN:  Yes, triple A and what you were proposing for youth if you went in that direction?

2177             MS McLAUGHLIN:  No, because we used a 900 sample and we asked everybody about how they viewed radio, would they tune more if the programming they liked were available, all that whole cast of questions.

2178             The only way that we split it out was when we actually got to the three demand questions, you know, how likely are you to listen and how interested are you in this music?  So they would not have been voting, you know, triple A versus youth.

2179             And I don't only give the impression that they are isn't a market for youth radio, because I have appeared before you before and maybe even again to say there is, and I salute people and broadcasters who have, you know, in fact created youth and they can bring it back.  As a long‑term sustainable service in this market, in a standalone capacity, we found that to be a little challenging.

2180             Every group has an expertise and there was a lot of expertise around this table in rock and in the formats.  So for a lot of very good reasons we thought this was a better choice. So I don't want to suggest ‑‑ 75.7 per cent is a pretty high number for youth.

2181             COMMISSIONER DUNCAN:  Thank you.

2182             THE CHAIRPERSON:  Legal counsel.

2183             MR. McINTYRE:  Thank you, Mr. Chair.

2184             I have two questions for the applicant today.  The first question relates to the commitment made today with respect to Category 3 programming.  I believe that you committed to a COL of 30 per cent Canadian content for Category 3.

2185             It appears that there may be a discrepancy in the application in section 1.1 you propose 40 per cent Canadian content for Category 3.  So I am just wondering if you could clarify what your position is on that?

2186             MR. DANN:  We will commit to the 30 per cent.  And it may have been a typo, but we are comfortable with the 30 per cent for Category 3 music.

2187             MR. McINTYRE:  Okay, thank you.  And today you also confirmed for Commissioner Cugini an over and above CCD contribution of $1.5 million.  I believe on page 30 of your application you provided a breakdown for the seven years of what you would contribute.  Is that something that we could include in your condition of licence?

2188             MR. DANN:  Yes, you can.

2189             MR. McINTYRE:  All right.  And the last thing is just to read into the record the undertaking to file updated proof of financing by October 30.

2190             MR. COSTLEY‑WHITE:  We will do so.

2191             MR. McINTYRE:  All right, thank you.

2192             THE CHAIRPERSON:  Thank you.  Ladies, gentlemen, thank you very much for your presentation.

2193             We will take a 15‑minute break, so we will be back at 10:30 with the next applicant.  Thank you.

‑‑‑ Upon recessing at 1015 / Suspension à 1015

‑‑‑ Upon resuming at 1035 / Reprise à 1035

2194             THE CHAIRPERSON:  Order please.

2195             Ms Secretary.

2196             ASSISTANT SECRETARY:  Thank you, Mr. Chairman.

2197             As a reminder, I would like to ask everyone to please turn off your cell phones, beepers and Blackberries, as they are causing interference with the internal communication system that the translators are using.  Thank you.

2198             We will now proceed with Item 7, which is an application by United Christian Broadcasters Canada for a licence to operate an English‑language FM commercial speciality radio programming undertaking in London.

2199             The new station would operate on frequency 98.1 (channel 251A) with an average effective radiated power of 2,904 watts (maximum effective radiated power of 5,206 watts, with an effective height of antenna above average terrain of 107.4 metres).

2200             Appearing for the applicant is Mr. James Hunt.  Please introduce your colleagues and you will then have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

2201             MR. HUNT:  Thank you.  Good morning, Mr. Chair, members of the Commission, Commission staff.

2202             As you said, my name is James Hunt and I am the CEO of United Christian Broadcasters. With me for the presentation aspect this morning will be:  Rev. Paul McPhail, he is the General Secretary of the Independent Assemblies of God International (Canada); Mr. Mathew Grieve, a local Canadian artist with the group His Season; and Curtis Butler, a local Londoner with some radio experience in the London market.

2203             Those who will be fielding some of the questions with me, unfortunately, Linda Korgamets, our CEO who does some consulting with PricewaterhouseCoopers, was called away so she can't be here this morning; Capt. Timothy Seibert, one of the Directors is here; Mr. Al Baker, Program Director as well as Operations Manager for our Chatham‑Kent licence; and Mr. Garry Quinn, the General Manager of New Projects.

2204             I would like to start off this presentation by sharing a short video which shows the wider context of United Christian Broadcasters and what we are part of.

‑‑‑ Video presentation / Présentation vidéo

2205             MR. HUNT: UCB Canada is a not‑for‑profit Canadian charity.  And from what you have just seen, we are in a relationship with many similar UCB affiliates globally.  Each UCB is totally autonomous but chooses to affiliate together to support each other, share resources, training, ideas, best practice, et cetera.

2206             Part of the success of UCB Canada having only come to air in Belleville five years ago and less than a year in Chatham‑Kent has to do with the strength of this affiliation, a network of shared learning.

2207             Using the 2001 Statistics Canada figures we know that 77.1 per cent of Canadians say that they have some form of Christian religious affiliation.  Even if we only take a quarter of those responses as active in the Christian faith, that would be about 19 per cent of the total Canadian population or about six million people nationally.

2208             We know there is over 1,200 radio and audio services in Canada, that is in 2007, only 43 were Christian format radio stations broadcasting 24 hours a day.  So only 3.6 per cent of all radio and audio services are of a Christian format serving, as I said with a conservative estimate, a population of about six million or 19 per cent of the Canadian population.

2209             And even within the Christian faith‑based stations there will be further variety when it comes to format, music, talk, language, et cetera.

2210             If we take the London community the trend is similar.  We know that 74.18 per cent in 2001 claimed to be aligned to the Christian faith.  Again, if we only take a quarter of those responses as active Christians that will be approximately 65,000 people in London.

2211             There are 639 churches in the greater London area, which would make their average congregation about 100 people.  Do they not have a fundamental right at least to be able to choose a station on public radio that aligns to their faith?

2212             We also know that where there is a UCB station there are a number of people who listen who do not attend or are affiliated with a church.  In addition, there is part of the population who listen to Christian radio who do not have any Christian affiliation.  The Barna Research Group claims that 28 per cent of adults who listen to Christian radio in North America fall into this category.

2213             So there is absolutely no doubt in my mind that there is a need and a demand for a Christian station that covers the whole of London and surrounding areas where there is such a strong Christian community.

2214             If we touch briefly on radio revenues, nationally 71 per cent of the revenues in the English‑language markets come from five of the big operators.  As I experienced within Canada and other countries that when a UCB station comes into a market most of the revenue generated through sales comes from new money into the industry.

2215             Businesses that want to be aligned to a family‑friendly stations, Christian businesses that want to be known as Christian businesses, as well as Churches who want to add to the tithe without concerns of commercials or content being offensive.

2216             We have also seen businesses which are targeting a captive loyal audience will use the Christian radio station to increase their reach.  So I don't see UCB Canada dividing the revenue pie any further, but actually increasing it by tapping into a new market and bringing further competition into a market that we have already heard over the last few days is heavily dominated by a few big players.

2217             Another aspect that UCB stations bring is the inherent desire and focus to help people and their families.  While all businesses need funds to operate and UCB Canada obviously is no exception, profit is not our driving force.  We are a non‑for‑profit charity with our funds going towards achieving our charitable objectives rather than making a profit.

2218             For 2007 currently we have an excess in our disbursement quota of over $670,000. That basically means that we spend more than required by the Charities Directorate on our charitable objectives.  It is not just about compliance, but it is why we exist.

2219             Our positioning statement is changing lives for good. We not only do this by getting involved in the community we are a part of, but on air as well as in the print media we address community needs and cover topics such as debt, depression, fear, parenting, teen suicide, alcoholism to name but a few.  And we work with local support groups to educate and promote what is available locally.

2220             As you saw in the video, we also offer a prayer line for people to call.  And we get requests from families, teenagers, prisoners, community leaders asking for prayer, information, literature.

2221             The station has been professional, entertaining, compelling, which goes without saying, but we are here to add value to a community beyond just broadcasting or looking for advertising dollars.

2222             As you have seen in the application, UCB Canada is here before you by invitation, invited by community leaders to submit this application on their behalf.

2223             We practise partnering with the local community, for the local community.  Approximately 65 percent of our revenue comes from individual givers, which emphasizes the point I'm making, and even this London project so far the community has raised the funds to get us to this stage.

2224             I would like to hand over to Rev. Paul McPhail, who will be saying a few words.

2225             REV. McPHAIL:  I'm Rev. Paul McPhail, from Chatham‑Kent, Ontario.  I'm honoured to speak in support of UCB Canada's London application having experience firsthand with UCB Canada's work in a community.

2226             I was involved at an early stage, supporting many of their functions, and was invited, like many other church and business leaders, to business meetings, fundraising, information sessions and UCB Canada worked hard, and continues to do so, to involve the local community in what is taking place.

2227             I, as a longtime pastor and member of the Ministers Association in Chatham‑Kent affirm that UCB Canada has also had a positive impact on the church community.  There's been more interaction and more cooperative efforts in the church community because of UCB Canada and the proactive role that they take in the community.

2228             UCB Canada has not sided with one denomination or group.  UCB Canada has been professional in presenting well‑rounded religious programming, as well as providing local interest stories, events, news, sports, et cetera.

2229             As the national leader, the General Secretary of the Independent Assemblies of God Canada, I am involved in many communities, as we have 750 ministers and over 500 churches across Canada.  Within London, Independent Assemblies of God Canada has a number of churches, including many multi‑ethnic African, First Nations, Slavic congregations.

2230             UCB Canada will be a positive addition to the London faith community.  From what I have experienced of UCB Canada, they will be a uniting and welcomed addition to this community.

2231             Thank you.  Thank you for your consideration of UCB Canada's application.

2232             MR. HUNT:  Thank you, Paul.

2233             UCB Canada is also committed to Canadian content development and we have strong relationships with many artists, some of whom wrote letters to you supporting our application.

2234             If there are only 43 Christian formatted radio stations in Canada, the possibility for Christian Canadian content development is very limited, with very few funds channelled here.  This is an area that is in need of focus locally, as well as nationally, if we are to grow and sustain this talent pool.

2235             I would like to call Matthew Grieve, from the group His Season, to say a few words.

2236             MR. GRIEVE:  What I think is very important to understand is that for the artist radio can make or break you.  With that said, for Christian artists this is not an exception.  I have been singing all over the country for the last 15 years and have sung in over 1,200 churches in Canada.  In fact, for a year‑and‑a‑half I was living my dream by being a full‑time Christian artists in Canada.

2237             We have seen that it was a tough road for many Christian groups before us but took the plunge anyway, and I would say that the lack of Christian radio in this nation is probably one of the biggest reasons that my group, His Season, and countless other groups and soloists, have not survived to make a living doing what they love to do.

2238             I say this knowing that in the United States over 1,400 Christian radio stations continue to pump out their Christian artists music and know that if we wanted to leave Canada and sing only in the United States our chances of being successful would be far greater.  The royalties from one's songs, to the publicity that radio brings to the artists, and just in general the radios pushing local events, brings a credibility to the artist.

2239             Years ago, when Christian radio finally came to this country, so many of us were so excited about the future, but unfortunately for us Christian radio has, in most cases been, I'm sad to say, less that top‑notch, from programming to DJs to lack of bandwidth or the overall lack of professionalism that has been associated with many of these stations.

2240             All that said, I have had nothing but wonderful experiences in our dealing with UCB Canada.  All that is lacking in many Christian radio stations in so many places in Canada can be found in this station, I believe.  In my travels I have heard nothing but great things about them and know that their many listeners tune in regularly to back up what I am saying.

2241             Giving them the station is good for me, the artist, and, in my opinion, good for this country.

2242             MR. HUNT:  Thank you, Matt.

2243             I would like to finish off with the last person in this presentation, and that's Mr. Curtis Butler.  He's a local Londoner with some radio background in this market.

2244             MR. BUTLER:  Well, good morning.

2245             UCB Canada has a proven record of success with the Christian radio market.  Their flagship station in Belleville, Ontario is a B class licence, as is the Chatham‑Kent station.  They now have repeater stations in two other cities and will bring another two more to air within the next few months.  Their programming is uplifting, encouraging and promotes positive family values, which is a pleasant change from what many of the other stations offer.

2246             It should also be noted that UCB Canada's stations are being listened to not only by those who identify themselves as Christians, but also by listeners who simply do not identify their lifestyle by what's promoted through the music and talk on secular stations.

2247             Their staff have proven experience in the radio industry, UCB are avid supporters of Canadian talent development and their professionalism and the overall product that they provide is a complement to the other stations in their markets.

2248             London needs a Christian formatted radio station that can truly meet the needs of the Christian demographic, as well as those who enjoy this type of programming.  We need a high‑powered, professional Christian station, backed by an organization that has the proven success that UCB does.

2249             Now one might say there's already a Christian station in London so why do we need another.  I do not believe that the current provider of Christian programming to the London market is effective to the level that a station should be.  I, for one, cannot receive their signal clearly in my driveway and I live 10 minutes from their transmitter.  And even though they have been in the London market for over five years now, some Londoners are not even aware that we have a Christian station.

2250             The radio market in London already has a number of stations and formats.  My concern is that some of the applicants' formats are similar to what we have in London and the market does not need more of the same by adding to this.  One would wonder how many advertising dollars can there possibly be for stations targeting the same or similar demographics.  The finances of a Christian station come primarily from listener donations which, in most part, would not take away from the current market.

2251             I would ask that you truly find favour with the application put forward by UCB Canada and I sincerely thank you for your time and for the privilege of speaking here today.

2252             MR. HUNT:  Thanks, Curtis.

2253             I don't believe that by adding another pop oldies format or adult contemporary music format or hit radio, whatever it is, to the existing menu will serve the wider London community.  There are already about 19 stations, if you take into account some of those coming from Stratford and out‑of‑market, in the market, with a fair amount of overlap, as we have already heard from a number of incumbents.

2254             For a city of this size, that has such a strong Christian community, it seems disproportionately unbalanced to have so many stations without there being one high‑powered Christian station.

2255             As requested, UCB Canada is able to provide this to the wider London community, as we have shown in the Quinte and Chatham‑Kent areas.

2256             That concludes our presentation, and thank you.

2257             THE CHAIRPERSON:  Thank you very much, Mr. Hunt.

2258             Commissioner Menzies.

2259             COMMISSIONER MENZIES:  Thank you.

2260             I would like to start by trying to build some context for us, in terms of your application.

2261             I'm struck by the 74 percent of Londoners with a Christian affiliation and my question really is to try to determine your ability to reach all of that, which you aspire to, I take it, from your presentation.

2262             I will put it this way, it's a little maybe unusual, but the first question is to find out more about you and the next one is to find out more about the audience that there is, so....

2263             One of the really interesting things about Christianity is the wide range of people to which it can appeal, and that means that among that 74 percent of Londoners ‑‑ and I will stick some categories on ‑‑ that there are people who would fall into the categories of Pierre Trudeau Christians, Jimmy Carter Christians, Tommy Douglas Christians, Preston Manning Christians, Shane Doan Christians, Cindy Claussen Christians, Ukrainian Orthodox, Sabitarian, Christians who don't watch TV and there's "Ned" Flanders and Homer Simpson Christians, right?

2264             So where are you guys in that?  Where do you fit?  What's your theological core?

2265             MR. HUNT:  Okay, to start off with, those figures of 74 percent:  since 2001, obviously, Statistics Canada no longer asks that question on their survey, so...and we took a conservative approach saying, "Let's say only a quarter of them are active in some form in the Christian faith".

2266             So I'm not proposing we will reach all 74 percent, but, if we are conservative, there's a number of that percentage which we would reach, and in a couple of areas.

2267             With the number of churches there are, there's already a network, so to speak, that we have access to that a number of other incumbents don't have: groups that meet regularly, weekly, if not more than that, and the ability to contact and be part of local ministerials and groups, et cetera.  So in one sense there's a network in place that we can be part of.

2268             To go to your question about theology and where we are, Christianity, and the position of the stations that we look at, it's a lifestyle choice based on the Bible.  And as you have said, there's interpretations of that, and I understand that.  And within cultures there's ways of worship, as we clearly showed in the video, that we are very sensitive and aware of cultures, of diversity in local areas that would like to access Christianity in their preferred style.

2269             So what we would say, it's theology, it's based around the Bible, and it's as generic as that.  So as Rev. Paul McPhail said, we will never be controlled by one group or influenced by one group because we are here to serve the wider Christian community.

2270             COMMISSIONER MENZIES:  Okay.  With the Assembly of God association, I was thinking ‑‑ and you can dispossess me of this notion ‑‑ that it had a Pentecostal association, in terms of that.  Or is that just a part of the Board?

2271             MR. HUNT:  That's my understanding.

2272             I will ask, actually, Rev. Paul McPhail, if he wouldn't mind answering some of that, being in the business.

2273             COMMISSIONER MENZIES:  Yes.

2274             REV. McPHAIL:  Mr. Commissioner, the Endocrine of the Assemblies of God has been in Canada since 1890 and they are sovereign congregations all across Canada.  We have over 500.  Many of them are Pentecostal, but you will find many that have Baptist, Presbyterian, Anglican.  In fact, I spoke in a United Church on Sunday.  That's our roots,

2275             And that's what I appreciate about UCB Canada is that they are able to work with many that accept a label of being Christian:  Roman Catholic, Protestants, independent congregations.  That's been my experience.

2276             COMMISSIONER MENZIES:  Okay, thank you.

2277             It just came up because I googled you. I googled Assembles of God and Pentecostal was the first thing that came up, so I wanted to make sure.

2278             Thank you for that.  That's helpful.

2279             In terms of that, in your application one of the things we need to clarify about it is we need a bit more detail on the nature of the programming, in terms of that.  Like, how much of the spoken word is religious?  Is it all religious?

2280             MR. HUNT:  No, it's not all religious, and we can talk to some of that now.

2281             COMMISSIONER MENZIES:  Sure.

2282             MR. HUNT:  You are obviously going to want some more facts and figures about that ‑‑

2283             COMMISSIONER MENZIES:  Yes.

2284             MR. HUNT:  ‑‑ which we can give to you.

2285             It's not all religious.  You know, even if we take simply news, and local news, it's not religious.  It's news whether you are a Christian or a non‑Christian.  We do interviews, we do street interviews, we do health things, we do something called table talk, where it's topical issues, and we invite people of different points of view and persuasions to discuss it.

2286             So it's not all religious in that sense, but, obviously, it's predominantly religious.

2287             COMMISSIONER MENZIES:  Okay.  And to clarify, I think you may have just answered the next part, because for any religious broadcasters the Commission requires some sense of its dedication to balance, alternative ‑‑

2288             MR. HUNT:  Yes, yes, yes.

2289             COMMISSIONER MENZIES:  ‑‑ views, that sort of stuff.  You have just kind of mentioned that.  We need something on the record regarding your intention for your programming to be consistent with the religious programming ‑‑

2290             MR. HUNT:  Yes.  No, I understand that.

2291             COMMISSIONER MENZIES:  ‑‑ guidelines.

2292             MR. HUNT:  I understand that.  And, again, I will talk from what we are currently doing because that will be the basis of the foundation of what we are proposing.

2293             So even in the other two stations that we have, we solicit responses on air for different opinions.  We have a call‑in, we have a dedicated comment line, we go out on the street and do topical things, where we interview people.  And we target different opinions.  I think it's healthy to debate.  And from a Christian standpoint, it's healthy for people to know what they believe and why they believe it, so....

2294             COMMISSIONER MENZIES:  And those are opinions from within the faith and outside the faith, as well?

2295             MR. HUNT:  Yes, definitely...well, we just walk on the street, so it's not even targeting anyone within the faith.  We will just speak to people, and particularly minority groups or particularly groups that show the diversity of the community we are in.

2296             COMMISSIONER MENZIES:  Okay, thank you for that.

2297             Staff would probably like me to get you to accept ‑‑

2298             MR. HUNT:  No, no.

2299             COMMISSIONER MENZIES:  ‑‑ that as a condition of license ‑‑

2300             MR. HUNT:  Yes, no problem.

2301             COMMISSIONER MENZIES:  ‑‑ in terms of that.

2302             Thank you.

2303             You have obviously got a broad international base.  Do you have a template for handling of complaints that arise?  Or how do you managed those, typically?

2304             MR. HUNT:  Are you talking complaints from the public, rather than internal ‑‑

2305             COMMISSIONER MENZIES:  Yes, yes.

2306             MR. HUNT:  ‑‑ employee complaints?

2307             COMMISSIONER MENZIES:  Yes, public complaints.

2308             MR. HUNT:  We do, and I will ask Al Baker to speak to that in a moment.

2309             We do.  I wouldn't say it's an international template that we use because ‑‑

2310             COMMISSIONER MENZIES:  Okay.  I don't care if it is, I just ‑‑

2311             MR. HUNT:  No, you just mentioned that, okay.  You mentioned that, because, obviously, compliance is different in every country and in ‑‑

2312             COMMISSIONER MENZIES:  Yes.

2313             MR. HUNT:  ‑‑ different areas.  So we do, roughly.

2314             Do you want to speak to that, Al?

2315             MR. BAKER:  Yes.

2316             From time to time we get complaints.  Mostly it's about the type of music or if, you know, a particular commercial that somebody may not like, you know, something along that line.  And depending on what the complaint is, you know, the person will either get a phone call or a written response within a 24‑hour period of time.

2317             COMMISSIONER MENZIES:  Okay.

2318             MR. HUNT:  If I could just add something, sorry.

2319             COMMISSIONER MENZIES:  Sorry.  Go ahead.

2320             MR. HUNT:  If I could just...the thought's gone out of my mind, so you carry on.

2321             COMMISSIONER MENZIES:  Okay.  Just as long as you have a complaints procedure for that, that's helpful.

2322             MR. HUNT:  Sorry, what I was going to say ‑‑ I knew it would come back as you wanted to move on.

2323             What I would say is, actually, we are a station that has a really loyal listeners' base because it's a lifestyle choice.  You know, as people might choose to be healthy and go to the gym and put that in the way they behave or what they do, or outdoor people, or whatever, for a lot of people it's a lifestyle choice.

2324             And we do get complaints, because rather than just change the dial to something else if they don't like something on the program, they will actually voice an opinion and say, "We don't like this" or "We don't like what we are hearing"  or "We don't like the music" or "What about this for the kids?".

2325             So the feedback, actually, it's very positive, it helps us.  But there is a fair flow of feedback from our listeners.

2326             COMMISSIONER MENZIES:  Okay.

2327             You addressed it in your presentation, the incumbent Christian broadcaster here.  They obviously have an application here to expand their capacities.  They made it pretty clear in their presentation that they have a lot of technical challenges, in terms of that.  They also made it fairly clear that if another Christian station came in that would pretty much be the end of them.

2328             I would you to address that and expand on your thoughts regarding how you feel about what they had to say and what you would like us to take away from that, in terms of a decision.

2329             MR. HUNT:  Okay, and if other of the panel want to jump in, as well, it's fine.

2330             We were invited by, as I have mentioned, a group of community leaders saying, "Would UCB consider bringing a high‑powered, you know, Christian station to the community?" and put an application in on our behalf, those community leaders.  We spent a long time debating with those leaders should we or shouldn't we because what's the impact going to be on the existing Christian radio station.

2331             So back in March I went and met with the chair of their board saying, "Let's do something together.  Our heart is that there is a large Christian community in London that should be served, why don't we work together?" and the response was they chose not to at that time to pursue that avenue.

2332             It was a month before the closing date on this application, nothing had been put in, so rather than lose the opportunity ‑‑ and I said up front, I said, "We're going to go ahead and put something in because when is another opportunity going to come for an FM station in London.  And we have been asked by a number in the community to do something, so we are going to put the proposal forward and it's obviously up to the commissioners to decide what's best use of that frequency".

2333             COMMISSIONER MENZIES:  Have you talked since?

2334             MR. HUNT:  No, other than just informalities and basic greetings.  But there hasn't been on this particular application.

2335             And we purposely haven't gone out and surveyed the market.  We do not want to create a "them and us" or people in the London market have to choose.  We don't want to go down that road until the CRTC make a decision.

2336             COMMISSIONER MENZIES:  Okay.

2337             Can you give me a few "for instances" on the community leaders who approached you to ask you to do this?

2338             MR. HUNT:  I can.  And, again, they have not wanted to put forward who they are because they are in the community and they want to support Christian radio.  So they don't want to undermine one for the favour of the other, and I understand that.

2339             COMMISSIONER MENZIES:  You don't have to ‑‑

2340             MR. HUNT:  No, no, I ‑‑

2341             COMMISSIONER MENZIES:  If they don't want their names, that's fine, but can you give me ‑‑ like, are they ‑‑

2342             MR. HUNT:  Yes.  Yes, that's not a problem.

2343             COMMISSIONER MENZIES:  Well, that would be a bit a of a giveaway of the name is I asked you, "Is it the mayor?", but, for instance, are they political leaders?

2344             MR. HUNT:  No, they are not political leaders.

2345             COMMISSIONER MENZIES:  Are they business leaders?  Are they firemen?  Are they ‑‑

2346             MR. HUNT:  They are a diversity of business leaders, church leaders, denominational leaders.  So it was a smattering of people aligned with the Christian faith that hold, you know, positions of responsibility and employees in the local ‑‑ employers, sorry, in the local London market.

2347             COMMISSIONER MENZIES:  How many would you say?

2348             MR. HUNT:  Well, we only have started working with a panel of about 12.  We didn't want to pursue anything further than that until ‑‑

2349             COMMISSIONER MENZIES:  Okay.

2350             MR. HUNT:  You know, because, again, we don't want to be divisive, so....

2351             COMMISSIONER MENZIES:  Sure.

2352             I will come back to the application a bit, but I would like to know a little bit more of the organization's assessment about the strength of the Christian music industry in Canada, and if you foresee a time when Christian artists would perhaps have the same level of access to Christian radio as secular artists have to secular radio?

2353             MR. HUNT:  I will kick off with that, and then I will hand over to Al Baker, and maybe, you know, Matthew, the artist, would like to talk to this, as well.

2354             MR. GRIEVE:  Yes.

2355             COMMISSIONER MENZIES:  I would like to hear from him.

2356             MR. HUNT:  Yes.

2357             So I think Christian radio in this country is still in its infancy, if we look across the border where they have so much more.  And, you know, the appeal to a lot of Christian artists to go across the border or to other countries is there because the financial appeal of how they can sustain what they are trying to do.

2358             So just proportionately they don't have access to the markets because a number of them choose that they don't try and market their product through secular stations.

2359             So I will ask Al to kick in there and see....

2360             MR. BAKER:  Mr. Commissioner, I'm not sure if I understand exactly what it is you are asking.  You are asking:  how can we provide more time or ‑‑

2361             COMMISSIONER MENZIES:  No, I'm not ‑‑

2362             MR. BAKER:  ‑‑ what is the impairment?

2363             COMMISSIONER MENZIES:  I'm going outside the fence on this a little bit.  I'm just trying to get a broader sense from you.  I'm taking this opportunity to get a little bit more data on the challenges that Christian artists are facing in Canada.

2364             To help make it a bit more specific, when you mentioned people going to the States, you also mentioned the relatively low number of Christian stations in Canada as a percentage of the overall numbers.

2365             Are the numbers in the U.S. that much better that Canadian artists are drawn to the States rather than having the opportunities here?

2366             MR. BAKER:  Well, yes, there are some Canadian artists on American charts and a "for instance" would be a group called downhere, you know, and there are others.  I believe that there is more opportunity down there, but the competition in the States is a lot stiffer.

2367             Because Canada never started licensing Christian radio stations until 1993, I think that's why.  You know, there are only 43 right now.  Christian radio has been active in the United States for, you know, quite a longer period of time, so people have had time to get into the genre.  The genre has had an opportunity to develop down there through the medium of radio and it hasn't really had that much of an opportunity here.  That's why it's in its infancy.

2368             I think there are two problems at work here, you know.  I mean, because of the lack of Christian radio stations in the country, the avenue is not that prominent for Christian artists to get going.  Okay?  And also, I mean, without radio, why bother, you know?  I mean, if they are having a hard time getting on an American station and there's no Christian radio station here, they are confined to churches, and so they stay unknown.

2369             COMMISSIONER MENZIES:  So what would be the percentage of Canadian content in your music overall?

2370             MR. BAKER:  Fifteen percent.

2371             COMMISSIONER MENZIES:  Fifteen percent.  That's kind of what I'm trying to get.  It's applications here for ‑‑

2372             MR. BAKER:  Yes.

2373             COMMISSIONER MENZIES:  ‑‑ secular stations are ‑‑

2374             MR. BAKER:  Thirty‑five.

2375             COMMISSIONER MENZIES:  ‑‑ 35, 40 percent, and that sort of stuff, and obviously I'm just trying to get to the point that, at 15 percent, do you think that's enough space to encourage the pool of Canadian artists, Christian artists, that are there to really get the same leg up in Christian radio that secular artists are given in secular radio?

2376             MR. BAKER:  Well, you have to bear in mind that not all Canadian Christian music endeavours are of the same quality, and I think that speaks to the stage of development that the Canadian Christian music industry is in right now.  It's a little bit better than embryonic, but it's far from maturity.

2377             COMMISSIONER MENZIES:  Okay.  I would like to hear from the artist on this.

2378             MR. GRIEVE:  You know what, I can tell you that if you want to choose to plant your feet in this country, as a Canadian artist, it's virtually a death sentence to you.

2379             I have been singing, as I said, in 1,200 churches, probably one of the busiest Canadian groups in the country.  We have done that strictly basing ourselves in churches and coming to the market that exists there.  There's been not a lot of help from Christian radio based on the fact, as already has been mentioned, that there's not a lot of them.

2380             There's a couple of great stations that do the job very well, some locally and some a little bit farther away, but with that said it's not been ‑‑ yes, there's a lack of some calibre, there's no question, based on probably the same fact:  that there's not a radio to keep artists out there, keep them going, so people die along the way.  But yet there is some phenomenal talent that's there.

2381             I mean, as far as the whole 15 percent, yes, I don't know if that's spectacular by any standards, but at the same point, I think that the cream would rise to the top in that percentage as well, I would hope.

2382             If there's any particular question that you would love to know, I don't know if I have missed....

2383             COMMISSIONER MENZIES:  No, no, that's helpful.  And just would you be looking for opportunities to play music that would be suited to your audience and your format from artists that wouldn't necessarily be designated as Christian?  I think of, just off the top of my head, Paul Brandt, for instance, has some tunes out there that would be very well suited and attractive to your audience.  Would you be looking to use people like that?

2384             MR. BAKER:  Yes, we do play Paul Brandt.  Paul Brandt crosses different genres, you know.

2385             COMMISSIONER MENZIES:  Yes.

2386             MR. BAKER:  Primarily he's a country artist.  He also does some Christian stuff, and we play his stuff, too.

2387             COMMISSIONER MENZIES:  Okay, thanks.

2388             MR. HUNT:  If I could, could I just add something?  And I don't obviously need to tell you what the minimum is, it's 10 percent of Canadian Christian artists, you know, CCD, for religious broadcasting, so we are going to have 15 percent.  But over and above that, what we do try and do is, if there is a group that ‑‑ as Al mentioned, the professionalism is an important part because you can't just play shoddy stuff on air and expect you audience just go along with it, right, just because they are loyal.

2389             The other thing is with the affiliated network that we have is that we very easy can work with other groups in other countries when tours work or "Have you heard this latest CD?"  Or, you know, groups from different countries coming here or groups from this country wanting to go to other countries to do a tour, we connect them.  So it does have a benefit that way, as well.

2390             COMMISSIONER MENZIES:  Thank you.  That was helpful.

2391             In your application it states you intend to offer a minimum of 42 hours of local programming.  Forty‑two hours is, in fact, the minimum you have to meet if you want to sell advertising.  It seems to me that you haven't left yourself much of a margin of error.

2392             Are you still comfortable with the 42 hours of local or did we miss something, in terms of the breakdown in your application?

2393             MR. HUNT:  I think it was more my interpretation of the question.

2394             We are not prepared to go ‑‑ as you said it's compliance ‑‑ before 42 hours.  So that's the bare minimum we would even consider a condition of license.  We are looking at 74 hours, possibly even more, of local content.  I just interpreted the question that way, so in our proficiency questions that's how we have answered it.

2395             COMMISSIONER MENZIES:  Right.  Did you want to change your application?  Do you want to stick with the 42 on your application?  Would you like ‑‑

2396             MR. HUNT:  No, no, no.  In the deficiency we have said .8, .3 in our quotes.  The application form states provide a commitment to minimum level.  This stated 42 hours is minimum UCB is prepared to go.

2397             Local programming would be approximately 74 hours, so that can be a condition of licence, that's fine.

2398             COMMISSIONER MENZIES:  Okay.  But then just for the record can you break that down again for us in terms of spoken word, syndicated, news and surveillance ‑‑

2399             MR. HUNT:  Yes.

2400             COMMISSIONER MENZIES:  ‑‑ in terms of exactly what we are looking at?

2401             MR. HUNT:  Can do.

2402             Al, do you want to take that?

‑‑‑ Pause

2403             MR. HUNT:  I'm sorry.

2404             While Mr. Baker is just trying to find his position, what again we have put in our deficiency ‑‑

2405             COMMISSIONER MENZIES:  You don't have to give it to us right now.

2406             MR. HUNT:  Oh, okay.  I thought you wanted to hear it.  Yes, not a problem.

2407             COMMISSIONER MENZIES:  If you could give it to the Secretary this afternoon?

2408             Is that okay?

2409             MR. HUNT:  We can.

2410             If they are wanting more definition than what's in the deficiency answers we have, we might even take a little longer than this afternoon, but we certainly can make arrangements to get it sooner.

2411             COMMISSIONER MENZIES:  I will leave it to you to work it out.

2412             MR. HUNT:  Okay.

2413             COMMISSIONER MENZIES:  Good.

2414             And now that I know we are talking about 74 hours instead of 42 hours, I just want to know how you would focus your local programming in order to attract the audience that you will need to form the basis of your business plan.

2415             What's the main focus of your local programming?

2416             MR. HUNT: I will ask our Program Director to respond to that.

2417             MR. BAKER:  We actively court different people in the community, different community leaders, say from a health unit, local city councillors, representatives of the United Way, things like that, to come onto our morning program and we have about a 10 minute interview segment that we do.  This is something we actively pursue and are proactive about including in the programming.

2418             We also have community events, both prerecorded and live, that we offer to any nonprofit organization.  If they are not‑for‑profit then they qualify for free airtime.  So we promote any and all events, if it's like a concert series in the park or something or a yard sale or something along that line.

2419             COMMISSIONER MENZIES:  What are your capacities for local news coverage in that sense?

2420             MR. BAKER:  Well, we don't have a local newsperson on staff, but what we do is we can have ‑‑ the morning announcer would do a newscast and what we do is a couple of ideas actually, we have community stringers, you know correspondents feeding us information about local events, and we also have an arrangement with the local newspaper.  They supply of stories in exchange for mentions.

2421             COMMISSIONER MENZIES:  That would be the London Free Press?

2422             MR. BAKER:  Well, I'm speaking in the context of our Chatham station right now.

2423             COMMISSIONER MENZIES:  Right.

2424             MR. BAKER:  But there are a number of ‑‑ I'm just saying these are avenues that we would pursue ‑‑

2425             COMMISSIONER MENZIES:  Right.

2426             MR. BAKER: ‑‑ for this application.

2427             COMMISSIONER MENZIES:  Okay.

2428             Just a couple of things on your CCD initiatives.

2429             It's not 100 per cent clear to us ‑‑ from what we know of them so far and that's why we want to clear this up ‑‑ that they would be 100 per cent qualified to meet our criteria.

2430             So could you elaborate on, for starters, the eligibility criteria for the most improved student award?

2431             Who would be selecting that student?

2432             MR. HUNT:  That in the past has typically been the institution that we are working with for that award.  They have the criteria to define that and we work with them.

2433             COMMISSIONER MENZIES:  So it would be a third‑party thing ‑‑

2434             MR. HUNT:  It's a third‑party, yes.

2435             COMMISSIONER MENZIES:  ‑‑ that would be selecting.  Thanks.

2436             Now, if somehow that initiative proved not to be eligible, how would you redirect the funding?

2437             MR. HUNT:  Again if I could just use current examples of things that we are doing, in two weeks time we have a workshop for songwriters, so we got a prominent artist/songwriter spending a day doing workshops with a number of people who are aspiring to be songwriters or starting off and that evening having a concert as well.  So there are quite a few avenues.

2438             As Matt mentioned, there is a real need in the market and so a shortage of trying to put the funds within that Canadian development, it's not difficult.

2439             COMMISSIONER MENZIES:  To make a long story short, you would be happy to work it out with the staff to make sure it was going some place that was ‑‑

2440             MR. HUNT:  Oh, yes.  Yes.

2441             COMMISSIONER MENZIES:  Okay.

2442             Also, we need a bit of a budget breakdown on the talent contest.  For instance, how would the winners be selected and how will they be able to use the coaching and studio time.

2443             MR. HUNT:  Are you wanting that now are to be provided later?

2444             COMMISSIONER MENZIES:  You can get it to staff later.

2445             MR. HUNT:  Yes.  Okay.

2446             COMMISSIONER MENZIES:  Not too later.

2447             MR. HUNT:  No, I can do that today.  I mean we know how we do it, so that's not an issue.

2448             COMMISSIONER MENZIES:  That would be great.  Thank you.

2449             Last couple of questions.

2450             I'm curious to know ‑‑ just hang on ‑‑ how does your business model work to inspire such high levels of donations and do you have any pledges in hand going into this?

2451             MR. HUNT:  Within the London market we haven't solicited pledges in hand other than informal by ‑‑ some of the groups that we have spoken to ‑‑ businesses as well as churches ‑‑ said they would get behind it.  Again I said we haven't actively solicited because I don't think there is a need to go down that road until, you know, you guys decide what the avenue is.

2452             Our listener base in any market we are in are exceptionally loyal.  As I said, it's a lifestyle choice that's taken based on faith and so there is a choice of a preference of a radio station that they would like to listen to that is encouraging, brings hope, uplifting, positive, as well as brings news and things of current affairs that affect people every day.

2453             We do not do any kind of scaremongering or anything like that, you know, we will close if this happens.

2454             We have people that give a dollar a day, we have had that type of approach; we have people who give one‑time gifts, we have people who give monthly.

2455             So it's a sense of ‑‑ you know, people will invest where they are being fed.  We are in financial difficulty now, we don't see hundreds of churches closing.  Actually, in difficult times people often turn to some kind of faith‑based organization for encouragement.  So in that sense people support what they value and are a part of.

2456             And we obviously have fund‑raising drives, we will do various events, but it's not manipulative or twist your arm, it's just straightforward, this is who we are, this is what we need to be on‑air.

2457             We did that in Chatham and we said:  Bottom line, this is what we need before we even go to air.  A number of businesses got on board and said we will give donations, some pre‑bought advertising that helped as well.

2458             COMMISSIONER MENZIES:  It's true, there aren't a lot of atheists in foxholes whether they are economic or otherwise.

2459             But can you give me ‑‑ I'm just trying to figure out how much of your time is ‑‑ I'm curious to know, do you solicit on‑air?  Do you solicit your donations off the air?  How do you ‑‑ what's your business plan on that?

2460             MR. HUNT:  It's both.  It's both.

2461             We don't regularly solicit on‑air, other than saying we are a supporter based station and people understand what that is.

2462             The Church network is a great network to be part of, go and present, share what we are doing, get interviews, get people from the church, the pastors interviewed on air, we run regular features, different churches to a community.  So that network is already in place, we don't have to go and knock on doors, we access it.

2463             You know, Garry has been involved in some of the marketing things as well, so I will ask Garry to jump in in a moment.

2464             So we do that, we present to businesses, we are a part of the Chamber of Commerce, we are part of Rotary clubs where we get opportunities because, as I have said, our motive is really to be a positive influence in the community.  So there are a number of avenues that we do.

2465             Garry, I don't know if you want to add anything there.

2466             MR. QUINN:  It's an honour to be here to appear before you as a panel and the CRTC, you know, just to put forward our application from an organization that I believe is quite capable of doing what we propose to do, but I am very passionate about the format of this radio station.

2467             You know, as James mentioned, it is people will support where they are being fed.  And it is quite incredible when you think of ‑‑ when I look at Chatham for instance when we went in to set up a radio station in Chatham, it's incredible and it's unique and it's unprecedented for a group or company to enter a community to raise the total funds needed, a quarter or a half a million dollars needed to bring a radio station to air, and I'm sure our friends at Blackburn and Chatham and Quinte Broadcasting in the Belleville area would never use that business plan to start a radio station, but the lion's share of the funds that come together to bring this radio station to air comes from the local community.

2468             So why would Joe the plumber or whoever give to a radio start‑up like this?  Because there is no opportunity for ownership in this, there are no shares available, there is no financial benefit for that person to be involved, but what compels people to give is the message and the music and the spoken word that resonates with them.

2469             And many of our listeners are new to radio, where some have not listened to radio stations because the message, the music, the spoken word doesn't align with what their beliefs are.

2470             So it's absolutely incredible to see people come forward with their times, their talents, their financial resources to help bring the station to air.  In the Chatham area businesses came forward and offered furniture, equipment, office space, and again there was no financial benefit to them, but they seen the benefit that it would bring to the community.

2471             So we do bring a message and we do bring a value to the community that many community leaders see the need for and they support it financially.

2472             COMMISSIONER MENZIES:  Okay.

2473             We have asked the other applicants, the economy is much more uncertain now than it was at the time when you put for forward your application.  A large part of your business plan depends on donations.  Accepting the fact that people will spend money where they are being fed, nevertheless they have to have money to do it.

2474             So have you taken a look at your business plan and revised it or reconfirmed?  Because the donations come from peoples' ‑‑ this is all disposable income that's being sent your way.  So are you still confident that your business plan would stand up if you had ‑‑ say your donations were one‑third of what you were looking at or have you in any other way had a chance to look at that and considered how times of economic uncertainty might in fact impact your business plan?

2475             MR. HUNT:  Mr. Commissioner, I mean that question you have obviously asked a number of groups.

2476             COMMISSIONER MENZIES:  Hopefully everybody.

2477             MR. HUNT:  Yes.  And we are at risk because it's disposable income, so I mean we understand that.  So we have considered it.

2478             As you will see just from our staffing and set‑up costs, I mean it's very slim to start with.  So we are not going with huge overheads.

2479             There obviously are overheads, but as Garry said, you know, historically Belleville, as well as Chatham, given people from the community coming in to build studios.  People saying well, I will cover the material costs or a business owner saying I own this particular type of store, that will be our donation to you.

2480             So it's going to be tough.  It will be tough.

2481             We also do monthly newsletters.  We do, as we mentioned on there, this daily devotional.  We are doing 60,000 a year within Canada, globally it is the biggest ‑‑ it's the second biggest in the world at 5.5 million every quarter.

2482             So there are ways of connecting and sustaining donor relationships which is ‑‑ it is vital, particularly during difficult times.

2483             So it will be tough, but I am confident that we will be able to weather it.

2484             As I said earlier, during tough times people often turn to the church for an area of hope and encouragement rather than just hearing the negativism ‑‑ what they perceive negativism all the time.  So it is a potential time to grow listening audienceship that we then have to move to donors as time progresses.

2485             COMMISSIONER MENZIES:  Okay.

2486             Thank you, gentlemen.  That concludes my questions.

2487             THE CHAIRPERSON:  Thank you very much, Commissioner Menzies.

2488             Commissioner Cugini...?

2489             COMMISSIONER CUGINI:  Thank you very much.

2490             Just a couple of questions in particular for you, Mr. Grieve.

2491             I was just on your website and you are quite busy, especially on weekends, almost exclusively on weekends.

2492             Is that correct?

2493             MR. GRIEVE:  Yes, 90 per cent of it.  As I mentioned, being in churches is our bread and butter, that happens to be on the weekends.

2494             COMMISSIONER CUGINI:  I noticed also that you are playing in Toronto at Missionfest.  Just so you know, when you Google Missionfest the only link is to your site.

2495             MR. GRIEVE:  Is it?  Okay.  That's good news.

2496             COMMISSIONER CUGINI:  So that's pretty good.

‑‑‑ Laughter / Rires

2497             COMMISSIONER CUGINI:  Are you sponsored ‑‑ are you funded at all by FACTOR?

2498             MR. GRIEVE:  By, sorry...?

2499             COMMISSIONER CUGINI:  FACTOR.

2500             MR. GRIEVE:  No.

2501             COMMISSIONER CUGINI:  So all your CDs are produced independently?

2502             MR. GRIEVE:  100 per cent.

2503             COMMISSIONER CUGINI:  Okay.

2504             Mr. Hunt, I did hear you say earlier when you were speaking with Commissioner Menzies that there is an opportunity to connect Canadian artists if they want to tour abroad.

2505             Currently do your stations around the world play Canadian music?  Like and I hear Matt Grieve in your stations around the ‑‑ in other stations outside of Canada?

2506             MR. HUNT:  Commissioner, I don't know that answer, not knowing the program directors of the different stations.  I mean, I know them but I don't know what is their playlist and their compliance issues within their country.  They obviously have to play local artists as well.

2507             But we know his season pretty well and, you know, if Matt or any of the others say we are looking at a tour, can you connect us, it would be the easiest thing to connect from the UK to other parts of Europe to Australia, New Zealand, Philippines, Jakarta.  It's really easy because each affiliate is totally autonomous and run themselves, but there has been a huge benefit in sharing what's hot and what's good, and these guys are good.

2508             So I would have no issue and it would be really easily done.  So I can't say yes they do play, but you know I'm ‑‑ I don't know, they would need to answer that.  I mean we have program director meetings and sharing things so you might be able to.

2509             COMMISSIONER CUGINI:  I guess the first question to that should have been is there an opportunity for Canadian artists ‑‑

2510             MR. HUNT:  Definitely.

2511             COMMISSIONER CUGINI: ‑‑ to submit their music for play across the UCB network?

2512             MR. HUNT: Definitely.  Definitely.

2513             MR. BAKER:  There is quite a bit of interaction between the program directors of the UCB stations around the world, and that's the answer to the first question.  I mean people want to know what, you know, what each other is playing.

2514             Second, I have seen playlists from our Australian affiliates and they do play Canadian artists.

2515             COMMISSIONER CUGINI:  Terrific.

2516             Thank you very much.  Those are my questions.

2517             THE CHAIRPERSON:  Thank you very much, Commissioner Cugini.

2518             On the same line I think, maybe Mr. Grieve could answer because he is collecting royalties and when royalties come back to Canada, sometimes it takes a long time before you see the cheque, but you know from which country it's coming from.  So could you confirm if you are played in other countries?

2519             MR. GRIEVE:  I would say that again 99.9 per cent would be Canadian played, if we are played.

2520             THE CHAIRPERSON:  So even through your royalties you haven't been able to notice that you had been played, say in Australia as Mr. ‑‑

2521             MR. GRIEVE:  Yes, that's correct.

2522             I mean, a group like us was actually invited to sing two years ago at the White House.  We came down, the only Canadian group of 60 that were there for a Christmas thing.  Nobody would have ever heard about that, not even anybody in Canada based on the fact again that it's ‑‑ I mean it's not for lack of talent in this country.

2523             I mean if you look right even in the secular market from a Celine Dion, a Michael Buble and a Shania Twain, the talent comes from Canada, it's just unfortunately there is no opportunity for the Christian ones.  And I can see groups 10 times better than us that are floating around and didn't make it just from lack of being able to keep themselves out there and keep themselves busy.  It's definitely work.

2524             THE CHAIRPERSON:  Thank you.

2525             Commissioner Simpson...?

2526             COMMISSIONER SIMPSON:  Good morning.

2527             I'm going to go back to a line of questioning that will, hopefully for all of the Commission and particularly myself, get a better understanding of your relationship with your Christian audience, how that translates into the relationship with Christian radio, their desire or ability to fund your endeavours and the like.

2528             So I will start off by going back to your initial presentation where you used a term that intrigued me.  Again I'm pursuing this with respect to your economic model viability use of the station by your audience.

2529             You had said that you defined ‑‑ you used a term of defining active Christians in the community and I was wondering if I might get a bit of a cross‑section of what you define as an active Christian, beyond the obvious issue of them practising Christianity.

2530             MR. HUNT:  I think I would use those synonymously as practising and active as the same.

2531             You put out a survey and you say, you know, what religious affiliation do you have and often people just by default, because there is no other religious affiliation they have on the paper, they put Christian.  So I'm using practising and active as the same terminology.

2532             COMMISSIONER SIMPSON:  On that line, of individuals who would consider themselves to be practising Christians, is there some kind of a percentage that actually goes beyond the daily practising of their belief to the point where they become demonstrative in the practice of their religion, you know, to the extent where they are showing up at church, to the extent that they are making, you know, outward gestures that do more than just practice their beliefs internally?

2533             MR. HUNT:  I will answer that first from a broadcasting point of view and, Al, if you want to jump in, and then Reverend McPhail would be a good one to answer that as well.

2534             COMMISSIONER SIMPSON:  Again, what I'm trying to do, if you will pardon the expression, divine an understanding of how much they are willing to put their money where their faith is.

2535             MR. HUNT:  Yes.

2536             I think we make sure that ‑‑ one of our values is uniting the Christian Church, the wider church, the generic church I'm talking, so we will not align ourselves with an extreme activist group under a Christian banner because that doesn't help anybody from a broadcasting point of view.  Yes, their point of view can be heard, but we are not going to align ourselves with it.

2537             What we have found, even in the church community, again if I just look at Belleville which has got a slightly longer track record, one of the values in the Christian faith is about giving, generosity, some of it is giving to your local church, what is known as a tithe, and others are getting beyond that.  And when we go into a community there are some church leaders who are concerned that their finances will dip because we are soliciting funds from a prescribed pot.

2538             What we have actually found is that their finances increase, because during some of the spoken word there is teaching on this topic.  We are neutral in our church affiliation, so it just goes back to this is the generic believe from the Bible and the Christian faith on giving, et cetera, and people have responded to that within their church.  Over and above that it comes to the station.

2539             Al, I don't know if you want to respond or, Reverend McPhail, you want to respond?

2540             MR. BAKER:  As with anything else there are some who give and some who do not and the same is true in this context.

2541             What we try to do is we try to get around to do presentations of our product in churches and let them know who we are, what we are about and how we can work together with them.

2542             Some churches, many churches, will donate ‑‑ they will take up specific collections a couple of times during the course of the year for our cause and they will donate that.  In turn, churches get free advertising for their various functions.  It is a partnership, it's a win‑win and we strive for a symbiotic relationship with as many churches as we possibly can.

2543             COMMISSIONER SIMPSON:   Thank you.

2544             Pastor, please...?

2545             REV. McPHAIL:  Yes.  Many times when we look at groups we have a nucleus, so that's a small core of people, and within church communities that's what you are going to find.  And you are also going to find a few that will associate on special events.  And in around Christian radio I believe that you will find a nucleus that will be supported in each community, you will find people that will support the fund raising or some special emphasis, and then of course you will have some fringe that will not get involved no matter what you do.  So that small nucleus is what we are talking about.

2546             Also within our Christian community there is a strong teaching not only on giving but also on tithing and so many of our churches, many of our ministries are involved in supporting other ministries.  So UCB Canada supports each other.

2547             So that's part of your core support and that's what you will see as far as stability.  No matter what happens economically you are going to see that stability.  And that's what happens across the world, as we understand it in the church community.

2548             Thank you.

2549             COMMISSIONER SIMPSON:  Thank you very much.

2550             That line of questioning was, from my standpoint, derived from looking at your pro forma and seeing a considerable percentage of the revenue coming from donations, 2 to 3 to 1 in terms of donations to advertising.

2551             I may be asking the obvious, but that is coming from experience in your revenue models from the other stations?  Okay.

2552             Excuse me, I will just get my glasses back on.

2553             From the financials that you had put forward I was wondering if you could give me an insight as to your depreciation schedule, because I noticed that it is not your standard flat rate schedule that I'm used to seeing.  I'm certainly not an accountant like Commissioner Duncan, but I'm wondering what's happening in years four and five, because I don't see a recapitalization at that point but I am seeing an increase in the ‑‑ a decrease and then an increase in the schedule and I'm wondering what's happening there.

2554             MR. HUNT:  Mr. Commissioner, I'm certainly not an accountant either and our CEO, as I said consults with PriceWaterhouseCoopers, would have been able to rattle off without even thinking.  So I don't know if I can answer adequately in this hearing and I'm happy to get back to you on that.

2555             I don't know if any of the other panel feel they can answer that.

2556             I do know, because my wife is an accountant, when she was looking at some of these she said, oh, that makes sense in year four and five for writing off computers and various other things.  She said, that is how it works, but I'm afraid I cannot give you the detail on that.  I can get it to you, but I just can't give it to you now.

2557             COMMISSIONER SIMPSON:  May I ask for some advice here?  I would like to know.

2558             What would be a reasonable request in terms of submission of that information?  Would it be before the end of the hearing or is that possible or is it possible that it come in later than that?

‑‑‑ Pause

2559             MR. HUNT:  I'm sorry, who are you asking?

2560             COMMISSIONER SIMPSON:  I'm actually asking staff.

2561             Oh, this is a poser.  I actually have a good one going.

2562             MR. McINTYRE:  I guess part of that would hinge on how fast you think you could get that information to us.  Obviously the sooner the better.

2563             MR. HUNT:  I mean I can make a call to someone who prepares the accounts, but I don't know if I'm going to get them immediately.

2564             So I will try to give it to you by the end of the hearing, but I cannot put my head on a block to say that will happen.

2565             Within a week easy, within a couple of days possibly, you know.  I don't know what time scale you are working towards so you let me know what you think is reasonable.

2566             MR. MCINTYRE:  I think by the end of the hearing, Phase IV would probably be the time that we would be looking for.

2567             MR. HUNT:  Okay.  I will certainly look at what we can do.

2568             COMMISSIONER SIMPSON:  Not to make a mountain out of a molehill, but it just does put you into a loss position in what I believe is year six and it just sticks out so again my curiosity is ‑‑

2569             MR. HUNT:  Yes, and I understand that.  It is year six, you are quite correct.

2570             As I said, we are not‑for‑profit so we can't squirrel away funds some way and that's not our intention, but it shows a loss in that year of $5,000.

2571             COMMISSIONER SIMPSON:  My last question is to do with the role of Christian radio from your perspective.

2572             We are seeing trends in this world that are causing ‑‑ I'm thinking in the areas of voting apathy, we are seeing clusters of people who share a mutual interests such as their nationality, their aggregation through interest groups and so on having a tendency to not turn out, you know, for the vote for example.

2573             This is an 80,000 foot level questions so it's nothing specific, but it is to try and get a sense of the role you are playing in the community, the role you are playing nationally and internationally in terms of trends.

2574             Are you finding, as individuals who are in the business of talking to Christians, and giving them product that they can consume at the other end, on radio, that as being a different kind of relationship with Christians than perhaps the traditional model, which was to have them come to you on a Sunday, for example?

2575             Are you seeing elevations in your interests and audiences, and are they corresponding to declines in other ways that they practise their religion, to the point where you are playing an active role?

2576             MR. HUNT:  Thanks, Commissioner.  I will kick off on that question, and, again, I will ask anyone to chip in.

2577             Mr. Seibert, just from a personal point of view, is a director and has been involved right from the beginning, so he might shed some light on that.

2578             We are definitely seeing a global trend of people leaving the traditional church.

2579             This is my personal opinion on this.

2580             Whatever the terminology is, "fluid church", "new church", we are seeing a number of people dissatisfied with what they have become used to as a form of practising their religion.

2581             Now, a number of churches are trying to address that, taking into account new media, new lifestyles, even different family structures in society nowadays.

2582             There is a church based just outside Toronto, which, to me, took me a bit of time to get my head around.  There are a number of people who travel from Hamilton every week to go to Toronto, and that group said:  Why are we going there?  Why can't we just have our church in our community, with the main teaching being beamed in by satellite, and we will watch it on a screen?

2583             To me, how does that work?  How do you build a relationship with the pastor?

2584             So the model is being questioned.

2585             And that is working really successfully, because they have relationships with the community, and then they beam in a certain teaching or the ethics they want.

2586             We are finding that a number of people, again ‑‑ and I would say globally, depending on what country ‑‑ third world countries are slightly different, and where there is persecution it's different, as well, in certain countries ‑‑ China, India, and various other ones.

2587             But there is in the greater western world a general discontent:  Is church doing what it should do.

2588             That is from my perspective.  Again, I would love to hear from Reverend McPhail on that.

2589             But people turning to media and saying, "How else can I be fed?  How else can my faith be supported?" we personally ‑‑ and this is a UCB value ‑‑ we strongly support that everyone in the Christian faith is connected to and part of a local church.

2590             We are not trying to set up a church.  We are not trying to take from a church.  We do believe that that is the way people should connect to their faith on a regular practice.

2591             That is how I am seeing the trends nationally and globally.

2592             I wonder if you would like to respond to that.

2593             REV. McPHAIL:  Yes, we are seeing a number of churches ‑‑ organizations ‑‑ that are changing.  Some are downsizing.

2594             If you were to Google "Churches for Sale", you would find that there are all kinds of churches for sale across Canada.  But at the same time, we are seeing quite a shift, as far as people getting involved in different types of worship, music, demonstrating their faith, as far as rolling up their sleeves and meeting social needs throughout the community, and doing that in the name of their faith.

2595             It is interesting for me, as a national leader, to walk into communities and find nucleus ‑‑ core groups in virtually every community, even isolated communities, that are very committed to their faith.

2596             That is where the answer is, as far as I am concerned.

2597             Yes, in different nationalities you will have a strong emphasis on a traditional church service and worship service, and in other groups it will be very informal.  But, once again, it becomes a virtual church, and Christian radio helps in spreading that message.

2598             COMMISSIONER SIMPSON:  Thank you very much.

2599             THE CHAIRPERSON:  Commissioner Duncan.

2600             COMMISSIONER DUNCAN:  Thank you.  I have just a couple of questions.

2601             First of all, Mr. Grieve, I was curious to know how you came to be invited to the White House at Christmas.

2602             MR. GRIEVE:  That was one of the few connections that we did have in the United States, in being involved in a massive convention down in Louisville, Kentucky, where 20,000 people show up every single night for five nights.

2603             We were involved with ‑‑ somebody heard us there, and that's how the door was opened.  It was a very great opportunity.

2604             There were a ton of security checks, and a lot of things that we had to go through, but it was really memorable, for sure.

2605             COMMISSIONER DUNCAN:  That's great.  Thanks.

2606             I was just wondering, looking at your financial projections, if your station will make any contribution to either fund UCB Canada or UCB International.

2607             How are those organizations funded?

2608             MR. HUNT:  I'm sorry, when you say "to fund UCB Canada" ‑‑

2609             COMMISSIONER DUNCAN:  Or UCB International.

2610             I am assuming that they are national and international bodies, and I am curious to know if there are moneys going from this radio station to fund those.

2611             MR. HUNT:  I will take the national one, to start with.

2612             There is not money going from one to the other.  We are quite stringent on what we call "specified funds".  If something is given for a particular project, or a particular ‑‑ like some of the repeaters that are about to come on air, those funds go to that community.

2613             For example, if we take "Daily Devotional", there are funds there that affect more than just one local station.  So there is funding that comes into that, which we will use outside just the local station.

2614             There are synergies, as we said in our deficiency questions, on various things, as other applicants have said ‑‑ on shared services, finances, HR and such.

2615             Do we put a proportion of our operating costs to another station?  Yes, we will look at that as the station grows, but not initially, because that is just something that ‑‑ they don't need a noose around their neck to start with.

2616             If we take the international, we do pay copyright and affiliation fees for this product.  It is the sole copyright of UCB Canada.  This person writes solely for UCB.

2617             So we do have some kind of affiliated fees linked to the proportion of copies.

2618             COMMISSIONER DUNCAN:  Are those fees showing on your "General Admin" line, or are they ‑‑

2619             MR. HUNT:  They are not shown in these projections, because we carry those fees already as a group ‑‑ UCB Canada.

2620             Again, we wouldn't put that expense in a station trying to start up, because it is a cost that they don't need and we are covering already.

2621             COMMISSIONER DUNCAN:  So, at some point, would there be contributions going from your radio station here in London to UCB Canada or to UCB International?

2622             MR. HUNT:  To be honest, I haven't even considered that.  No, I don't see that.

2623             UCB Canada, as the incorporated body, has this arrangement with international affiliation fees and copyrights.

2624             So, no, I don't see that.

2625             COMMISSIONER DUNCAN:  So their revenues ‑‑ UCB Canada and UCB International ‑‑ are through copyrights.

2626             Is that the idea?  Is that how they are funded?

2627             MR. HUNT:  UCB Canada ‑‑

2628             COMMISSIONER DUNCAN:  ‑‑ and UCB International.

2629             MR. HUNT:  UCB International is funded through copyright.  A huge proportion is copyright.  And they are funded by donations, as well, in the various aspects ‑‑ in the various countries that they have a legal entity in.

2630             They don't have a legal entity in Canada.

2631             COMMISSIONER DUNCAN:  This is talking about International.

2632             MR. HUNT:  Yes.  Sorry, this is International.

2633             COMMISSIONER DUNCAN:  Just so I understand, is UCB ‑‑ the station you are proposing in London, is it independent of, or is it a station owned by UCB Canada?

2634             MR. HUNT:  It will be a station owned by UCB Canada.

2635             So the licence ‑‑ and jump in here, Garry or Tim, if you want to ‑‑ the licence holder will be UCB Canada.

2636             COMMISSIONER DUNCAN:  Okay.  Thank you.

2637             MR. HUNT:  Does that answer your question?

2638             COMMISSIONER DUNCAN:  It does, yes.  Thank you.

2639             THE CHAIRPERSON:  In your financial statements, I see that you have forecasted programming revenues.  Are they revenues of programming locally ‑‑ obviously, locally produced ‑‑ that you will be selling to other radio stations?

2640             What will be the source of that revenue?

2641             MR. HUNT:  Again, Al, if you want to jump in ‑‑ those are organizations that pay to be on our radio station.  So they would be funds coming to us, to be on our radio station.

2642             THE CHAIRPERSON:  So it is not programming that you are, yourself, producing and selling.

2643             MR. HUNT:  No.

2644             THE CHAIRPERSON:  It is programming ‑‑ it is time that is purchased ‑‑

2645             MR. HUNT:  Exactly.

2646             THE CHAIRPERSON:  ‑‑ by various Christian organizations ‑‑

2647             MR. HUNT:  Yes.

2648             THE CHAIRPERSON:  ‑‑ that are soliciting donations.

2649             MR. HUNT:  Who are soliciting donations?

2650             THE CHAIRPERSON:  Yes.

2651             MR. HUNT:  No, they don't solicit donations.

2652             Well, I say no.  There are times that they have, but we have a fairly stringent relationship with them on how that works.

2653             They sell product, but they don't necessarily solicit donations.

2654             I don't know if you want to add to that, Al.

2655             MR. BAKER:  No, you just said what I was going to say, that from time to time they do, but they do offer a lot of product ‑‑ books, CDs ‑‑ of the various teachings.  That is primarily what they do.

2656             THE CHAIRPERSON:  I will ask legal counsel if he has any questions.

2657             MR. McINTYRE:  Thank you, Mr. Chair.

2658             I have a question about your spoken word commitment.  In your application, you submitted that you would provide 35 hours a week of spoken word programming.  You also submitted your intention to abide by the guidelines in our Public Notice relating to balance and ethics in religious programming.

2659             What I was hoping you could provide us is a breakdown, per week, on the minimum level of balanced programming that you would provide, as well as the weekly amount of religious programming that you would provide within that spoken word commitment.

2660             MR. HUNT:  We can do that.

2661             Just to clarify something about the spoken word, the 35 hours, that is syndicated spoken word.  When I say "syndicated", it's teaching.

2662             We have more spoken word, and we can get the figures to you on that.  There may be an additional 10 hours a week over and above that, but we will certainly give you the breakdown on that.

2663             MR. McINTYRE:  Sure.  If you could just specify how many hours, and just reiterate what you will be offering.

2664             MR. HUNT:  Yes.

2665             MR. McINTYRE:  And, I guess, also to that end, maybe a description of the type of balanced programming you will provide, as well.

2666             MR. HUNT:  Yes, we can do that.

2667             MR. McINTYRE:  If you could provide that to us by tomorrow, that would be great.

2668             MR. HUNT:  Okay.

2669             MR. McINTYRE:  I believe there was an undertaking requested by Commissioner Menzies to submit the budget for the talent contest, the CCD initiative.  If you could have that for us by tomorrow, as well, please.

2670             There was, also, another undertaking to explain the depreciation expense in the financial projections you provided us.

2671             MR. HUNT:  Yes.

2672             MR. McINTYRE:  There was another undertaking that was mentioned relating to balanced programming in local programming.  I guess that would be addressed in the undertaking that you said you would provide to us tomorrow.

2673             MR. HUNT:  That was the breakdown of the 74 hours of local programming.  Correct?

2674             MR. McINTYRE:  Right.

2675             I think we actually have that information on our file.

2676             MR. HUNT:  You do.

2677             MR. McINTYRE:  So, unless there is anything else ‑‑

2678             MR. HUNT:  No.

2679             MR. McINTYRE:  Okay.

2680             MR. HUNT:  Are you are saying that you are satisfied that we do not need to provide that again?

2681             MR. McINTYRE:  That's right, yes.  We have that information.

2682             I believe the only other undertaking is to submit the confirmation of financing for the radio station by October 30th, as the Chair outlined yesterday.

2683             MR. HUNT:  I'm sorry, let me get some clarity on that.

2684             If we are wanting to amend our financing, is that what you are saying?

2685             MR. McINTYRE:  No, just a confirmation that you currently have ‑‑ that your financing arrangements are still in place, in light of the financial markets.

2686             MR. HUNT:  Okay.

2687             THE CHAIRPERSON:  Mr. Hunt, gentlemen, thank you very much for your presentation.

2688             We will break now for lunch, and we will come back at one o'clock.

2689             MR. HUNT:  Thank you.

‑‑‑ Upon recessing at 1200 / Suspension à 1200

‑‑‑ Upon resuming at 1305 / Reprise à 1305

2690             THE CHAIRPERSON:  Order, please.

2691             Madam Secretary.

2692             THE SECRETARY:  Thank you, Mr. Chairman.

2693             For the record, we wish to inform you that the Applicant Sound of Faith has submitted their revised financial projections in response to undertakings, and this afternoon it will be added to the public record, and copies will be available in the examination room.

2694             We will now proceed with Item 8, which is an application by Frank Torres, on behalf of a corporation to be incorporate, for a licence to operate an English‑language FM commercial radio programming undertaking in St. Thomas and London, Ontario.

2695             The new station would operate on Frequency 98.1, Channel 251B, with an average effective radiated power of 18,579 watts, a maximum effective radiated power of 48,000 watts, with an effective height of antenna above average terrain of 107.4 metres.

2696             Appearing for the Applicant is Ed Torres.

2697             Please introduce your colleagues, and you will then have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

2698             MR. E. TORRES:  Good afternoon, Mr. Chair, members of the Commission, and Commission staff.  My name is Ed Torres.  I am the President and Co‑Founder of Skywords Radio, and the Chairman of CIDG‑FM.

2699             I would like to begin by thanking the Commission for entertaining our application for a new blues format FM radio licence to serve London.

2700             Seated to my right is my brother Frank Torres.  Frank is the Chief Operations Officer at Skywords.  Together we founded Skywords in 1991, and today it is a national radio company, with offices in several Canadian major markets, including Ottawa, Halifax, Markham, and our newest base of operations in Edmonton.

2701             To my left is Robyn Metcalfe.  Robyn is the Vice‑President of Programming at Skywords.

2702             On Frank's right is London resident Greg Simpson.  Greg has extensive radio experience in the London market, where he served as Music Director for CJOE, and for 14 years was Music Director at CFPL.  During this time he was twice named Music Director of the Year by the Canadian Music Industry Awards.

2703             If our station is licensed, Greg will serve as Operations Manager of DAWG FM.

2704             Greg is also the Chairman of the Great Lakes Blues Society.

2705             In the second row, seated directly behind me, is Ron Ford.  Ron is a chartered accountant and the Chief Financial Officer for Skywords.

2706             To the left of Ron is Aubrey Clarke, Director of Business Development at Skywords, and former National Sales Manager for Skywords.

2707             In the second row, to your far left, is Yves Trottier.  Yves is the former Operations Director at Couleur fm in Gatineau.  He held various program director positions prior to joining Skywords as the General Manager of Quebec Operations.

2708             Finally, beside Yves is Tod Bernard, the General Manager of Eastern Canada Operations for Skywords, and part owner in this application.

2709             On August 26th, the Commission granted this group its first broadcast licence.  Radio Station CIDG‑FM will broadcast from the nation's capital, and will be the first all‑blues format commercial radio station in North America.

2710             The blues is what this application is all about.

2711             Our presentation today will illustrate that London can sustain an additional entrant into the market, which will increase plurality and provide the only independent news voice for St. Thomas and London.

2712             Our national network operations provide a natural infrastructure, which will assist us in fulfilling our strategic plan of being a national Canadian broadcaster.

2713             We provide a missing, highly desired, extensively researched radio option to the listeners of the region, and our format will help break and launch new Canadian blues artists through commercial airplay of their music on FM airwaves.

2714             We have received over 1,700 letters of support for our blues radio station applications, including letters from Dan Akroyd, Jack DeKeyser, a JUNO winner, Tom Lavin of the Powder Blues Band, the Grand River Blues Society, the Great Lakes Blues Society, and 670 expressions of support for this application alone.

2715             We have commissioned extensive formal research by Census, an independent, third party research firm, into the viability of our proposed format in 10 markets across Canada, including London.

2716             Further, we created an online survey at "bluesincanada.com", a website that we own, and it has generated hundreds of responses.

2717             Overwhelmingly, we found in our research that blues is the first music choice for 30 to 60 percent of people, and it is almost universally accepted as a second choice.

2718             Our London survey results surprised us.  We know that London has a vibrant blues scene, championed by the Great Lakes and Grand River Blues Society, an exhibit at many blues fests, which attracts thousands of festival goers to the region every year.

2719             To speak firsthand about the blues in London, we are fortunate to have Greg Simpson, Chair of the Great Lakes Blues Society, here with us today.

2720             MR. SIMPSON:  I was named Chair of the Great Lakes Blues Society a few months ago, and I have been a member of its Board since its inception, and a member of the Board of its predecessor for three years before that.

2721             I am also a former broadcaster, with 20 years of experience, and I have spent my entire life, since high school, in the music business in one way or another, always working with London as my home base.

2722             I have worked for record companies, production companies, and retail record sellers, and I am currently a freelance music consultant, working on a contract basis, presently, for Canadian Music Week and its Radioactive Conference, programming the latter and facilitating both events every March.

2723             In Canada there are hundreds of local and regionally based blues bands and performers, a relatively small number of whom have achieved national or international prominence.  Unfortunately, most of these exceedingly talented musicians receive little or no airplay on Canadian commercial radio.

2724             Blues fans must rely on satellite radio and/or cable services to hear only some of the incredible wealth of domestic blues talent, while local and regional blues artists get virtually no airplay at all.

2725             Even the music channels offered through our cable TV package do not feature Canadian acts generally, as they are programmed, in many cases, out of the United States.

2726             The Great Lakes Blues Society, and others associated with us, present an average of 18 to 20 shows a year in London, and artists of the calibre of Jack DeKeyser, Cheryl Lescom and Chris Chown have proven to be popular attractions for us, but we are forced to use them, most of the time, in a support role, as our goal is to expand our audience.  To do so we must look to Chicago, Detroit, and other American cities to supply us with our headline acts.

2727             The reason, we feel, is that very few of these artists receive any airplay at all on commercial radio.  Even the CBC tends to ghettoize this forum, offering it only at late night on the weekends.

2728             A blues‑oriented FM radio station will go a long way toward providing the exposure that our Canadian blues musicians deserve.

2729             When one reviews the high calibre of entertainment available in the blues idiom, beyond those already mentioned, such as the Downchild Blues Band, Sue Foley, Powder Blues, Colin James, along with the late Dutch Mason and Jeff Healey, and then add to that list the fast‑rising younger talent, like Steve Strongman, Garrett Mason, Bill Durst, and so many others, all of whom deserve a national profile, one must come to the conclusion that the star‑making machinery can use a voice of its own to further that cause.

2730             There are Canadian record labels specializing in the development of great Canadian blues talent, but they must, increasingly, turn their attention south of the border to achieve their aims.

2731             The Great Lakes Blues Society has over 400 members, all resident in London and the nearby satellite communities, and attendance at our shows and other blues shows that we support in the market ranges from 100 to 1,200 attendees at each and every show.

2732             Our larger shows feature headline acts alongside domestic support acts, and our attendees come for the music and for the good times that we can offer them.

2733             At the heart of the good times, of course, is the music itself.  Blues is universal in its appeal, and we find that blues fans are loyal and determined to support not only the music and the promoters of the shows, but give up tens of thousands of dollars a year to support the charities that we identify with each of our shows.

2734             Having a local blues‑based radio station will not only help us in our aims, but it will give us an opportunity to help our charities in a much stronger way than we could possibly imagine at this time.

2735             It is my belief that, despite solid support for the blues in every market, London is unique, in that the blues has always been an integral part of the local community, thanks in no small way to some dedicated music professionals who put their love of the genre above their own financial needs, in many cases.

2736             Having the support of a local blues music radio station would not only increase their odds of success, but would, obviously, increase the opportunities for many Canadian acts that have talent equal to that of others in any genre, but less opportunity for exposure, other than hitting the road and playing for what amounts to a not‑for‑profit exercise.

2737             In my role as Chair of the Great Lakes Blues Society, and as a consultant and resource to the broadcast and music industries at large, I applaud the CRTC's bold move to support the DAWG FM application in our nation's capital.  I believe that London is every bit as sophisticated as Ottawa, and that it is, in fact, the best blues town in Canada.  We want and deserve our own radio station.

2738             By awarding the Torres concern with this licence, it will not only enhance our own market, but, through the Great Lakes Blues Society partnerships and associations with other blues societies in the region, will enhance the genre throughout southwestern Ontario, from Windsor to Kitchener, and from Lake Erie to Tobermory.

2739             MS METCALFE:  DAWG FM will be more than a radio station.  It will be a community, a community of listeners who appreciate this indigenous art form, and a community of employees who will come together in a positive and enjoyable workplace.

2740             In employees we look for people with a passion for radio, and a team mentality, who will work together to come up with great products and amazing radio that is locally focused.

2741             How will we be different from a rock station?  Well, DAWG FM's bark is worse than its bite ‑‑ no Metallica, no Guns N' Roses, no Van Halen.

2742             In its place you might find Derek and the Dominoes, Marvin Gaye, or Aretha Franklin.

2743             Our morning drive periods will have a rock edge ‑‑ a rock‑blues edge ‑‑ to get you up for the day and give you that energy to feed the kids and get them ready for hockey after you get home.

2744             Middays we will keep the energy up, but we will feature more R&B and swing, as we aim to be your office companion.

2745             Overnights, dim the lights ‑‑ Venus Fly Trap is going to get you through the night shift by laying down the R&B groove all night long.

2746             We like to say that we aren't the big "DAWG" on the block, but we have attitude.  Our radio station will have a brand, and it will have a feel ‑‑ the feel of the blues.  I would like to play you a sample of our feel.

‑‑‑ Audio presentation / Présentation audio

2747             MS METCALFE:  Our station will be a good corporate citizen, engaged and connected with our community and environmentally responsible.  Yes, the blues are green.

2748             We take pride in proposing that DAWG FM London will be the second carbon‑neutral radio station in Canada.

2749             DAWG FM promotions will be different.  Instead of a week in Mexico on a beach, listeners will win a blues tour of Chicago, Memphis or New Orleans.  Ratings promotion will see listeners whisked away on a cruise, but not just any cruise, it will be a blues cruise, bands on every level of the ship playing into the late hour.

2750             MR. TROTTIER:  You have probably seen the Blues Brother movie, but have you ever checked the songs on the soundtrack?  You will find no traditional blues songs whatsoever on that soundtrack.