Broadcasting Notice of Consultation CRTC 2015-288

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Ottawa, 29 June 2015

Call for applications - Radio stations to serve Vancouver, British Columbia

Introduction

  1. The Commission announces that it has received applications by Sher-E-Punjab Radio Broadcasting Inc. (Sher-E-Punjab) for a broadcasting licence to operate an AM ethnic commercial radio station for Vancouver, British Columbia and by South Asian Broadcasting Corporation Inc. to amend the broadcasting licence of its ethnic commercial radio station CKYE-FM Vancouver by adding a rebroadcasting transmitter in Surrey, British Columbia. The Commission hereby calls for applications from other parties wishing to obtain a radio licence to serve this area.
  2. Persons interested in responding to this call must submit a duly completed application to the Commission no later than 17 September 2015, using the appropriate application form for a licence to operate a new radio station. Applicants are also required to submit all necessary technical documentation to the Department of Industry (the Department) by the same date.
  3. Applicants will be required to provide evidence giving clear indication that there is demand and a market for the proposed service. In this regard, and given the market’s background described below, the Commission’s preliminary view is that the Vancouver market would best be served by proposals targeting the ethnic communities. However, it does not preclude any other types of applications.

Background

  1. Following a public process to consider licensing new radio stations in Vancouver, which included an appearing hearing that began on 27 January 2014 (the Surrey hearing), the Commission approved applications by South Fraser Broadcasting Inc. for a broadcasting licence to operate a new English-language commercial FM radio station to serve Surrey and by 0971197 B.C. Ltd. for a broadcasting licence to operate a new English-language specialty commercial FM radio station to serve Vancouver (Broadcasting Decision 2014-412).
  2. The remaining applications were denied. With respect to an application by Sher-E-Punjab, the Commission also indicated that the denial would provide it with time to examine the issue of broadcasting services transmitted from locations outside Canada but which appeared to serve Canadian markets.
  3. Subsequent to that Decision, the Commission noted in Broadcasting Notice of Consultation 2014-426 that Sher-E-Punjab, Radio India (2003) Ltd. and Radio Punjab Ltd. appeared to be broadcasting in whole or in part in Canada without a licence or pursuant to an exemption and transmitting from Washington State into lower mainland BC in contravention of the Broadcasting Act (the Act). The Commission called these entities to a public hearing to show cause why the Commission should not issue mandatory orders requiring them to cease these activities.
  4. On 13 November 2014, the Commission issued its decisions regarding these matters as well as mandatory orders in respect of each of the entities and the primary individuals involved in each. Among other thing, Sher-E-Punjab, Radio India (2003) Ltd., and Radio Punjab Ltd. were ordered to not carry on a broadcasting undertaking in British Columbia, or anywhere else in Canada, except in compliance with the Act.Footnote 1
  5. The Commission is of the view that the existence of these cross-border stations indicates that there is demand in the Vancouver market for additional ethnic radio programming services. Therefore, as indicated in the introduction of this notice, the Commission will give preference to proposals to serve the market’s ethnic communities. It should be noted, however, that, in making this call, the Commission has not reached any conclusion with respect to the licensing of any service at this time.

Use of the 106.3 MHz frequency in Vancouver

  1. In Broadcasting Decision 2015-282 dated 25 June 2015, the Commission revoked the broadcasting licences of the Type B Native radio stations in Toronto, Vancouver, Calgary, Edmonton and Ottawa held by Aboriginal Voices Radio Inc. effective 25 July 2015.
  2. That decision set out as a priority, the Commission’s intent to issue a call for applications for services to the underserved urban Aboriginal communities in those markets. The Commission intends to issue that call separate from the current process.

Factors for evaluation of applications

  1. In assessing applications for new commercial radio services in a market, the Commission will consider the following factors, which were first set out in Decision 99-480.

Quality of the application

  1. In its analysis, the Commission will evaluate the applicant’s programming proposal and commitments in a number of areas. These will include the manner in which the applicant will reflect the local community, including the community’s diversity and distinct nature. Accordingly, the Commission will consider commitments related to local programming and the benefits that such programming will bring to the community.
  2. The Commission will also consider commitments regarding the percentage of Canadian content of musical selections, contributions to Canadian Content Development (CCD) and, where applicable, the percentage of French-language vocal music.
  3. The Commission does not regulate the format of AM or FM stations that base their programming on popular music. The Commission will, however, assess the applicant’s business plan in light of the proposed format since the two are interrelated. The business plan should clearly demonstrate the applicant’s ability to fulfill its proposed programming plans and commitments. Further, the Commission will examine the programming proposals submitted by the applicants to determine which overall proposal best suits the market.

Diversity of news voices in the market

  1. This factor relates to concerns regarding concentration of ownership and cross media ownership. The Commission seeks to strike a balance between its concerns for preserving a diversity of news voices in a market and the benefits of permitting increased consolidation of ownership within the radio industry.
  2. The Commission will therefore assess how approval of the application would add to or serve to maintain the diversity of voices available in the market, and how approval of the application would increase the diversity of programming available to listeners.

Market impact

  1. The possibility that licensing too many stations in a market could lead to a reduction in the quality of service to the local community remains of concern to the Commission. The economic condition of the market and the likely financial impact of the proposed station on existing stations in the market will therefore be relevant.
  2. The Commission will therefore evaluate how the proposed station’s programming, general and core target audience, and projected audience share overlaps stations already present in the market. While the Commission may also consider the profitability of existing station groups in the market in its assessment of the proposed station on existing ones, this will be only one factor in its evaluation.

Competitive state of the market

  1. In markets with fewer than eight commercial stations operating in a given language, the Commission’s common ownership policy permits a person to own a maximum of three stations, with a maximum of two in any one frequency band. In markets with eight commercial stations or more, a person may own a maximum of two FM and two AM stations in any given language. The concentration of ownership resulting from this policy may increase the possibility of competitive imbalance in a radio market.
  2. The Commission will therefore consider factors such as the number of radio stations that an applicant already owns in the market, the profitability of its station(s) and the concentration of ownership in that market in making its licensing decision.

Importance of factors

  1. The relative importance of each of the factors set out above will vary in each case, depending on the specific circumstances of the market.

Financial summary for the Vancouver market

  1. For the convenience of interested parties, the financial summary for the Vancouver radio market can be found at http://www.crtc.gc.ca/eng/publications/reports/BrAnalysis/radio2014/radio33.htm. In addition, information relating to Vancouver’s ethnic radio market can be found in Appendix 5 to this notice.

Technical approval from the Department of Industry

  1. The Commission intends to consider the applications at a public hearing. However, the Commission advises applicants that it will withdraw any application from the public hearing if it is not advised by the Department, at least twenty days prior to the first day of the hearing, that the application is technically acceptable. The Commission must also be advised by the Department, at least twenty days prior to the first day of the hearing, that any alternative frequencies proposed by the applicant are technically acceptable. Otherwise those frequencies will not be considered as part of the proceeding.

Eligibility of applicant

  1. The Commission also reminds applicants that they must comply with the eligibility requirements set out in the Direction to the CRTC (Ineligibility of Non-Canadians), and the Direction to the CRTC (Ineligibility to Hold Broadcasting Licences).

Update of applications

  1. Sher-E-Punjab Radio Broadcasting Inc. and South Asian Broadcasting Corporation will be given the opportunity to update their applications and to provide the essential information set out below within the same period provided for the submission of applications by other parties.

Essential information that applicants must provide

  1. To assist the Commission in its assessment of applications, each applicant is required to provide all the information requested in the appendices to this document for the type of service that it proposes to operate. An applicant must clearly demonstrate that its application includes the required information and submit the appropriate completed application. Requests for information by Commission staff will seek to clarify specific facts or to resolve minor discrepancies in the applicants’ proposals.
  2. The Commission will return any application that fails to provide the required information and that application will not be considered as part of this process.
  3. At a later date, the Commission will announce the public process for considering applications and how the applications may be examined by the public. As part of that process, the public will be given the opportunity to comment on any application by submitting written interventions to the Commission.
  4. Notice of each application will also be published in newspapers of general circulation within the area to be served.
  5. Applications filed in response to this call must be submitted in electronic form by using the secured service “My CRTC Account” (Partner Log In or GCKey) and by filling in the “Broadcasting Online Form and Cover Page” located on this web page. On this web page, applicants will also find information on submitting applications to the Commission: “Submitting applications and other documents using My CRTC Account”. Applicants who are unable to file their applications using Partner Log In or GCKey should contact the Commission’s single point of contact for small undertakings at 1-866-781-1911.
  6. The Canadian Radio-Television and Telecommunications Commission Rules of Practice and Procedure (the Rules of Procedure) set out, among other things, the rules for filing, content, format of applications, as well as the procedure for filing confidential information and requesting its disclosure. Accordingly, the procedure set out in the Notice of Consultation announcing the public hearing must be read in conjunction with the Rules of Procedure and its accompanying documents, which can be found on the Commission’s website under “CRTC Rules of Practice and Procedure.”

Secretary General

Related documents

Appendix 1 to Broadcasting Notice of Consultation CRTC 2015-288

Requirements for new commercial radio licences

Applicants should provide the information set out below so that the Commission may evaluate their applications in light of Commercial Radio Policy 2006, Broadcasting Public Notice CRTC 2006-158, 15 December 2006.

Programming information

Musical content
Contributions to Canadian content development
Local programming

In addition, applicants for new ethnic commercial radio licences should provide the following information so that the application can be evaluated according to the Ethnic Broadcasting Policy, Public Notice CRTC 1999-117, 16 July 1999:

Commitments as conditions of licence

Applicants are required to provide their views on the possibility of the Commission imposing any or all of the above commitments as conditions of their licence.

Technical information

Applicants are required to provide the following information:

Financial information

Applicants must provide an overall business plan that includes the following information:

Ownership information

Appendix 2A to the application form

All of the information requested below must be provided:

Appendix 2B to the application form

The applicant must provide a statement regarding who controls/will control the licensee and by what means. If the control is to be held by a shareholder corporation, a statement regarding who controls/will control the shareholder corporation and by what means must be provided.

Appendix 2C to the application form

The applicant must provide a copy of the constituting documents (certificate and articles of incorporation or amendment, amalgamation documents, by-laws, partnership agreements, etc.) that are not already on file with the Commission, for:

Appendix 2 to Broadcasting Notice of Consultation CRTC 2015-288

Requirements for new community or campus radio licences

Applicants should provide the information set out below so that the Commission may evaluate the application in light of the Campus and community radio policy, Broadcasting Regulatory Policy CRTC 2010-499, 22 July 2010.

Community support

Programming information

Musical content
Local programming

In addition, applicants for new community stations that intend to devote at least 60% of their programming to ethnic programming and at least 50% of their programming to third-language programming should provide the information set out below so that the Commission can evaluate the application according to the Ethnic Broadcasting Policy, Public Notice CRTC 1999-117, 16 July 1999.

Commitments as conditions of licence

Applicants are required to provide their views on the possibility of the Commission imposing any or all of the above commitments as conditions of their licence.

Technical information

Applicants are required to provide the following information:

Financial information

Applicants must provide:

Ownership information

Directors and officers, and corporate documents

Appendix 3 to Broadcasting Notice of Consultation CRTC 2015-288

Application for a native Type B service

Applicants should provide the information set out below so that the Commission may evaluate the application in light of the Native Broadcasting Policy, Public Notice CRTC 1990-89, 20 September 1990.

Native community support

Programming information

Musical content
Aboriginal talent development
Programming orientation
Commitments as conditions of licence

Applicants are also required to provide their views on the possibility of the Commission imposing any or all of the above commitments as conditions of their licence.

Technical information

Applicants are required to provide the following information:

Financial information

Applicants must provide:

Ownership information

Appendix 4 to Broadcasting Notice of Consultation CRTC 2015-288

Application for a technical amendment

Applicants wishing to file a technical amendment application as part of this call for applications must complete application form 303. All of the information required in form 303 must be included.

Appendix 5 to Broadcasting Notice of Consultation CRTC 2015-288

Financial summary of the Vancouver ethnic radio market

CRTC - FINANCIAL SUMMARY - RADIO

Revenue
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Reporting Units 5 5 n/a 5 n/a 5 n/a 5 n/a n/a
Local Time Sales 11,009,537 11,801,587 7.19 12,320,798 4.40 12,430,094 0.89 12,227,254 -1.63 2.7
National Time Sales 1,576,884 1,418,814 -10.02 1,738,113 22.50 1,539,607 -11.42 1,300,119 -15.56 -4.7
Network Payments 0 0 n/a 0 n/a 0 n/a 0 n/a n/a
Syndication-Production 71,918 65,412 -9.05 53,363 -18.42 34,920 -34.56 67,486 93.26 -1.6
Government/Corporate Grants 0 0 n/a 0 n/a 0 n/a 0 n/a n/a
Other Revenue 892,121 927,089 3.92 1,070,989 15.52 1,224,211 14.31 1,083,270 -11.51 n/a
Total Revenue 13,550,460 14,212,902 4.89 15,183,263 6.83 15,228,832 0.30 14,678,129 -3.62 2.0
Expenses
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Programming 5,297,108 5,373,138 44 5,802,026 7.98 5,893,569 58 5,613,150 -4.76 5
Technical 584,378 545,923 -6.58 621,869 13.91 706,677 13.64 769,147 8.84 7.1
Sales and Promotion 2,274,196 2,607,050 14.64 2,716,381 4.19 2,793,947 2.86 2,236,690 -19.95 -0.4
Administration and General 3,744,823 3,481,934 -7.02 3,550,696 97 3,908,349 10.07 3,922,704 0.37 2
Total Expenses 11,900,505 12,008,045 0.90 12,690,972 5.69 13,302,542 4.82 12,541,691 -5.72 3
Performance
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Operating Income 1,649,955 2,204,857 n/a 2,492,291 n/a 1,926,290 n/a 2,136,438 n/a n/a
Depreciation 259,908 253,263 -2.56 234,114 -7.56 234,388 0.12 274,236 17.00 4
Profit Before Interest and Taxes (P.B.I.T) 1,390,047 1,951,594 n/a 2,258,177 n/a 1,691,902 n/a 1,862,202 n/a n/a
Interest Expense 129,187 95,778 -25.86 98,116 2.44 191,999 95.69 154,014 -19.78 n/a
Adjustments Gain (Loss) 106,561 321,329 201.54 60,409 -81.20 48,558 -19.62 72,828 49.98 n/a
Pre-tax Profit 1,367,421 2,177,145 n/a 2,220,470 n/a 1,548,461 n/a 1,781,016 n/a n/a
Programming (%)
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Programming Expense / Expense Total 44.5 44.7 n/a 45.7 n/a 44.3 n/a 44.8 n/a n/a
Programming Expense / Revenue Total 39.1 37.8 n/a 38.2 n/a 38.7 n/a 38.2 n/a n/a
Staff
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Total Salaries 5,226,465 5,399,959 3.32 5,939,324 9.99 6,232,446 4.94 5,816,753 -6.67 2.7
Avg Staff Count 175.0 171.0 -2.29 182.0 6.43 184.0 10 181.0 -1.63 n/a
Avg Salary ($) 29,866 31,579 5.74 32,634 3.34 33,872 3.79 32,137 -5.12 9
Salaries/Expense Total (%) 43.9 45.0 n/a 46.8 n/a 46.9 n/a 46.4 n/a n/a
Profitability (%)
($) Fiscal Year 2010 2011 Var % 2012 Var % 2013 Var % 2014 Var % CAGR* (%)
Operating Margin 12.2 15.5 n/a 16.4 n/a 12.6 n/a 14.6 n/a n/a
P.B.I.T. Margin 10.3 13.7 n/a 14.9 n/a 11.1 n/a 12.7 n/a n/a
Pre-tax Margin 10.1 15.3 n/a 14.6 n/a 10.2 n/a 12.1 n/a n/a

*CAGR = Compound Annual Growth Rate

Footnotes

Footnote 1

See Broadcasting Decision 2014-587 and Broadcasting Order 2014-588, Broadcasting Decision 2014-589 and Broadcasting Order 2014-590, and Broadcasting Order 2014-591 and Broadcasting Order 2014-592. The orders also required the parties to cease all arrangements and contracts under which their programming would be broadcast over-the-air from transmitters located outside Canada whose signals reach into Canada.

Return to footnote 1

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