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Ottawa, 20 March 1986
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Decision CRTC 86-232
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Licensing of a New Private FM Radio Station to serve Toronto
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At a Public Hearing in Toronto on 3 December 1985, the Commission heard 13 applications, each seeking authority for the use of the frequency 97.3 MHz (channel 247) to provide a new FM radio service in Toronto. The applicants included licensees of existing Toronto AM stations seeking joint FM licences, current or past owners of broadcasting undertakings in markets outside of Toronto, and a variety of groups seeking to enter the broadcasting industry for the first time. These applications, among others considered at the hearing, were submitted in response to a call issued by the Commission on 15 October 1984.
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The call followed the Commission's announcement, in May 1984, of the lifting of a long-standing freeze on private FM applications for southern Ontario. This freeze had been imposed by the Commission in April 1979 to allow the CBC time to develop its long range plans for the extension of its network radio services. A public hearing was held in April 1982 to assess the implications of the CBC's plans on the utilization of available FM channels, particularly in areas such as Toronto, where shortages had been identified. The Commission issued its conclusions in February 1983, and following further studies, announced on 31 May 1984 that the FM freeze was no longer in effect.
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I. CRTC Ruling on Requests for Postponement
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Prior to the hearing, the Commission received letters from the Canadian Ethnocultural Council, ATW Management Communications, Dr. Ralph Agard and Multifax Communications Corp., essentially expressing concern about the procedure leading up to the hearing and requesting an opportunity to make special representations at the hearing.
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As the Rules of Procedure do not permit special representations that relate directly to applications which are being considered, the Commission could not grant their request. However, the Commission granted these parties intervener status so that they could appear at the hearing. All but the Canadian Ethnocultural Council did so, and a motion was made requesting the Commission to adjourn the hearing or failing that, to postpone its decision with respect to the applications for use of the frequency 97.3 MHz, and to issue a call for further applications for new ethnic FM services on that frequency.
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The following are among the points raised by one or more of them. Some expressed the view that parties who might have wished to provide new broadcasting services directed to Toronto's ethnic communities had not been given an adequate, fair or equal opportunity to compete with conventional broadcasters for use of the frequency 97.3 MHz. They stressed, among other things, the large size of Toronto's ethnic population in relation to the availability of ethnic language broadcasting services in that city. They remarked that, between the date of the Commission's announcement of plans to conduct a comprehensive review of ethnic broadcasting on 24 May 1984, and the eventual publication of the ethnic broadcasting policy in its final form on 4 July 1985, prospective applicants for licences to provide new ethnic broadcasting services had no firm policy framework within which to develop programming proposals and marketing strategies or to arrange financing.
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They also suggested that the period between the announcement of the 4 July 1985 call for applications to provide new ethnic broadcasting services in southern Ontario and the 30 August 1985 cut-off date specified by the Commission for the receipt of such applications did not allow sufficient time for applicants for new ethnic broadcasting services to adequately prepare their applications.
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Members of the Commission at the Toronto hearing considered the interveners' motion that the hearing be adjourned, but determined that an adjournment would not be fair to the applicants. Instead, applicants were invited to address the interveners' concerns during the hearing, and further consideration was reserved on the request to defer a decision and issue a call for further applications until the matter was discussed by the Full Commission.
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The applicants at the hearing expressed unanimous opposition to the interveners' request. Applicants noted that the proceeding had been conducted in accordance with CRTC rules of procedure, and argued that any further delay in the licensing of a new FM station on the frequency 97.3 MHz would create additional, unwarranted expense for those who had completed their applications on time. Some applicants reminded the interveners that, since the call in 1984, the scheduling of the Toronto hearing had been delayed more than once to allow the Commission to formulate its ethnic broadcasting policy and permit prospective applicants for new ethnic broadcasting services to amend or prepare new applications.
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After the hearing, the Commission carefully examined the arguments raised by all of the parties of record. With specific regard to the interveners' request for a delay in issuing a decision on the licensing of a new FM station in Toronto, the Commission has not been persuaded that such a delay would serve the public interest and, accordingly, denies that request.
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The Commission notes the fact that, prior to the 30 August 1985 deadline, it had not been advised that any prospective applicant was encountering difficulties in completing an application on time. It also notes that three applicants for new ethnic-language broadcasting services in southern Ontario filed applications in time to be considered at the hearing. Furthermore, applicants who had requested more time were granted an extension of almost a month and a half, until 11 October 1985, to complete their applications. Moreover, nothing precluded filing applications prior to 4 July 1985 and subsequently amending them after the ethnic broadcasting policy was announced; at least one applicant did so.
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The Commission shares the interveners' concerns that there be adequate sources of ethnic programming in Toronto, particularly given the large size of the ethnic population in that city.
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Under the Commission's ethnic broadcasting policy, conventional radio and television broadcasters are encouraged not only to provide multicultural programming, but also to broadcast some ethnic-language programming, in order to reflect the cultural diversity of the communities they serve.
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In this regard, the Commission notes that a variety of ethnic programming is available to radio audiences in and around Metropolitan Toronto through the services provided by CHIN and CHIN-FM Toronto, CHWO Oakville, CJMR Mississauga and CKMW Brampton.
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In addition, as a consequence of decisions already taken by the Commission on applications considered at the 3 December 1985 hearing, the range of ethnic-language programming available to Toronto radio listeners will expand considerably in the near future. One such application was by CIRC Radio Inc. for a new ethnic-language FM radio station at Toronto on the frequency 88.7 MHz. This application is approved by the Commission in Decision CRTC 86-236, and the new station should be in operation within a year. Also considered at the hearing, and approved in Decision CRTC 86-235, is an application by the licensee of CKMW Brampton to change from an English to an ethnic-language station. In a third decision (CRTC 86-64, dated 10 February 1986) the Commission approved an application by the licensee of CKFM-FM Toronto to make use of this station's Subsidiary Communications Multiplex Operations (SCMO) facilities for the distribution of a Greek-language programming service.
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Ethnic programming is also available on television to viewers of CFMT-TV Toronto and on cable to subscribers of Telelatino and Chinavision. Such programming is also available via a number of closed-circuit cable services, on cable community programming channels and on conventional English-language television stations.
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The Commission also notes that a number of options may be available to further augment the range and variety of ethnic programming services, including: the development of ancillary services such as the Vertical Blanking Interval (VBI) and SCMO facilities to provide narrowcast, special services to individual ethnic communities; closed-circuit cable audio (cable FM) to provide service to single-language groups whose needs, owing to spectrum limitations, cannot be adequately met by existing conventional broadcasters; increased access to the cable community channel and to segments of time (up to 40%) within the program schedules of conventional radio and television stations; and the use of an AM frequency or low power FM frequencies for the broadcast of new ethnic programming services.
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II. Decision
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Accordingly, after a careful analysis of all of the competing applications, and for the reasons outlined in this decision, the Commission announces that it approves the application (851084400) by Robert Redmond, on ehalf of a company to be incorporated (Redmond), for a licence to carry on an English-language FM radio broadcasting transmitting undertaking at Toronto, operating in Group I on the frequency 97.3 MHz with an effective radiated power of 4,000 watts. The licence will expire 30 September 1990, and will be subject to the conditions of licence specified in this decision and in the licence to be issued.
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The other 12 applications listed in the appendix to this decision, which were competing with Redmond for use of the frequency 97.3 MHz, are consequently denied.
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III. The Market
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Toronto is the largest and, from a revenue standpoint, the strongest broadcasting market in Canada. Gross revenues for the city's radio stations amounted to $75 million in 1984, and this figure may well have risen to $80 million in 1985. On average, these stations enjoy a profit margin that is 66% greater than the national average. Even so, the amount of untapped advertising revenue available in the market ranges between $5 million and $15 million, according to various estimates given at the hearing.
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Based on these and other indicators, the Commission is satisfied that the market can support the introduction of a new radio service at this time, without creating any undue harm for existing broadcasters. In this regard, the Commission notes the absence of interventions from existing Toronto broadcasters opposing an increase in the number of FM stations.
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IV. Assessing the Applications
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In the course of its deliberations, the Commission has rigorously examined various factors, including the applicants' programming proposals, their ownership, broadcasting and management experience, their financial strength and proposed marketing strategy. It has given special attention to the programming plans and commitments of each applicant in order to gauge how the quality and diversity of programming available to Toronto listeners would be increased, and what benefits would accrue to the development and promotion of Canadian talent, both on a local and national basis.
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Various other matters were examined, including whether an applicant's commitments appeared to be realistic, achievable and supported by adequate staff and financial resources. Such considerations as the potential economic advantages associated with the licensing of a new joint FM station were weighed against the benefit resulting from the licensing of a new media voice in the Toronto market.
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The proposed programming formats were compared with those currently offered by stations licensed to serve Toronto, as well as by those other stations whose signals are readily available in the Toronto market, and were further analyzed against the background of the city's demographic composition, in order to measure the breadth of their appeal and assess the degree to which their availability would contribute to the diversity of music programming in Toronto.
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In terms of the extensiveness of the research, the effort evident in the preparation of the individual proposals and the innovation of their programming plans, the Commission found the quality of these applications generally to be above average. The frequency 97.3 MHz is the last high power FM frequency available for use in the Toronto area and, as such, is a valuable resource. Given these facts, the Commission conducted its deliberations on the important question of which applicant would best serve the public interest.
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The various formats proposed by the applicants were directed at different demographic groups and targeted at a broad spectrum of radio listeners. They covered an equally broad range of music, from classical to uptown or urban country, from jazz and dance to softer rock and easy listening instrumentals. One of these applicants proposed to offer a predominantly ethnic-language FM radio service; the rest were for conventional English-language services.
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Five applicants proposed to operate in Group I which covers a broad range of music from the softer side of the pop and rock music spectrum. One of these applicants proposed a Group I (contemporary MOR) station while the four others, including Redmond, proposed Group I (easy listening, beautiful music) stations. The Commission notes that Toronto is served by stations, such as CKFM-FM and CHFI-FM, whose musical mixes have much in common with that proposed in the contemporary MOR application. On the other hand, there are no easy listening, beautiful music stations licensed to serve Toronto.
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It was emphasized by the applicants whose proposals were for an easy listening format, that the age group between 35 and 54 represents a large and growing segment of Toronto's population, and one for which easy listening stations have a strong appeal.
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Two applicants proposed formats featuring predominantly jazz music or a mixture of jazz, softer pop, rock and classical music. A third proposed a Classical Fine Arts music service. While there are no commercial stations licensed in Toronto which broadcast predominantly jazz or classical music, significant quantities of jazz-oriented, and classical music in particular, are readily available in Toronto from the programming schedules offered by existing public and private radio stations in the area. The Commission also notes that the availability of jazz and classical music in Toronto will expand considerably when the new CBC French-language FM service (Decision CRTC 86-65) and the new Student/Community FM service (Decision CRTC 86-237) commence operation.
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Two applicants proposed services operating in an uptown or urban country format (Group III). The Commission notes that there are no country radio stations licensed to serve Toronto as a primary market, and that the signal of the popular country music station in nearby Richmond Hill is readily receivable in the Toronto area.
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Two applicants proposed (Group IV) stations featuring predominantly dance music. This music format, which integrates a number of musical influences, is targeted to a predominantly younger audience. It is currently very popular in Montreal, where Canada's only full-time dance music station is located. The Commission has considered the number of enthusiastic interventions received from a wide segment of Toronto's population, as well as the questions raised during the hearing regarding the stability of this format in the Toronto market.
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V. The Licensee
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Based on the particular characteristics of the Toronto market and taking into consideration the various factors noted above, the Commission is convinced that, of all the proposals, the Redmond application offers the strongest combination of benefits and will make the best use of the frequency 97.3 MHz. In particular, it offers increased musical programming diversity to a large adult segment of the Toronto market which is currently underserved in terms of easy-listening instrumental music. Moreover, the applicant's proposals are in close conformity with the requirements and goals of the FM policy and the applicant itself offers management expertise, a proven record of performance as a broadcaster with access to financial resources and a firm commitment to Canadian talent development.
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The applicant company will be owned 100% by Redmond Communications Limited, which is the licensee of CHSC and CHRE-FM St. Catherines. Redmond Communications Limited is ultimately controlled by Mr. Robert Redmond, who also controls CHNR Simcoe, Ontario and CKRY-FM Calgary.
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During his career in broadcasting, Mr. Redmond has established a record of sound business management and a reputation for meeting programming
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commitments and FM policy requirements. Mr. Redmond also has expertise with the easy listening format proposed for the new Toronto FM station, as it was the format in which CHRE-FM St. Catherines operated between 1967 and 1985.
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In the Commission's view, the applicant has developed a realistic business plan and has assembled a strong and experienced management team, with considerable broadcasting experience in the Toronto market, to oversee its implementation.
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Local input in the direction of the licensee company will be provided by the three Toronto residents who will serve on its five-member Board of Directors. The applicant will also establish an eight-member advisory board, with representatives from Toronto's arts community and music industry, among others, to advise station management on the most appropriate means of promoting Canadian talent.
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The station will broadcast 11 hours of Traditional/Special Interest (category 6) music per week, much of which will be given prime time air play, including a two-hour classical program each weeknight at 8:00 p.m. Redmond also proposed a small vocal: instrumental ratio (35:65), with a lower maximum repeat factor (7) and a more limited use of hits (25%) than the other Group I applicants.
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The applicant stated that its objective is to offer a "quality music" service and spoken word programming targeted primarily to listeners between 35 and 54 years of age. The applicant estimated that a majority of the station's listeners would be 50 years of age or older.
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The station will feature predominantly instrumental softer pop and rock music. This is a music mix which is not currently available on any station licensed to serve Toronto. As a consequence, between 4% and 7% of the total radio tuning by Toronto residents has been to out-of-town easy listening stations in recent years. No other music format provided by out-of-market radio stations has approached this level of popularity with the Toronto radio audience. The service proposed by Redmond will fill an obvious void in easy listening music and will contribute significantly to the diversity of music programming in the Toronto market.
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The Commission notes that the commitments contained in the FM Promise of Performance submitted by Redmond are consistent with FM policy objectives and that they meet and, in some respects, exceed the minimum regulatory requirements for an independent FM licence. Specifically, the Commission notes Redmond's commitment to broadcast a minimum of 18% Foreground programming and a minimum of 45% Mosaic and Foreground programming combined. The Commission is also satisfied that the applicant has made adequate provision for staff and other resources to fulfill these commitments.
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Redmond has proposed a total of 23 hours 15 minutes of Spoken Word programming per week, offering a good mix of news, foreground and mosaic features scheduled in a balanced fashion throughout the day and the week. Foreground programs will include "Toronto Entertainment Express", a weekday magazine program which will "tour" local galleries, museums, theatres and concert halls; a weekly program featuring children on-air and directed to youth between 9 and 12 years of age; an hour-long weekday foreground special at 1:00 p.m. dealing with a variety of themes and subjects on a rotating basis; and "Toronto Heritage", a series of 30 minute docudramas featuring historical events and personalities. The applicant intends to make use of non-staff talent to produce these and other programs, and has allocated an annual budget of $55,000 for such non-staff production.
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The Commission encourages licensees to become involved with activities in the communities they serve by broadcasting community events, including live musical concerts. In this regard, the Commission notes Redmond's commitment of $30,000 annually for the production of a weekly series of live, half-hour concerts by music students and professional musicians, performing easy listening or classical music. One project stemming from this proposal will be a series of concerts dedicated to the memory of Glenn Gould.
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Other financial contributions in support of Canadian talent include a minimum annual commitment by the applicant of $100,000, of which approximately $85,000 will be allocated to a talent contest (Star Search). Under this intiative, young musical artists will be given professional advice and assistance in the preparation of demonstration tapes, ultimately for the purpose of encouraging the production of new easy-listening music albums. The remainder of the $100,000 will be allocated, in amounts that could vary from year to year, to a literary awards program (under the licensee's own sponsorship), the Canadian Arts Foundation, and to FACTOR/CTL or an equivalent organization.
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Redmond's financial commitments to non-staff Canadian talent total $185,000 per year, of which $130,000 will be allocated to the new musical projects described above. The station's advisory board will provide ongoing guidance on the best way of implementing these financial commitments for the development of Canadian musical talent.
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The applicant undertook to implement all its programming plans and commitments as filed, and not to change them regardless of its financial performance. The Commission has taken note of this important commitment. It also commends the applicant's proposed initiatives in support of Canadian talent and will follow their implementation with interest.
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At the hearing, the Commission discussed with the applicant its general approach to the future use of the station's SCMO capacity to distribute an ethnic-language programming service. In the absence of developed programming details, the authority to implement the SCMO facility is denied at this time. The Commission notes the applicant's intention to submit an application with details of its proposal at a later date.
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In accordance with paragraph 22(1)(b) of the Broadcasting Act, the Commission will only issue the licence, and the authority granted herein may only be implemented, at such time as written notification is received from the Department of Communications that it will issue a Technical Construction and Operating Certificate.
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It is a condition of this licence that construction of the station be completed and that it be in operation within twelve months of the date of receipt of written notification from the Department of Communications that it will issue a Technical Construction and Operating Certificate or such further period as the Commission may, upon receipt of a request for extension before the expiry of the said twelve months, deem appropriate under the circumstances.
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This authority will only be effective at such time as the Commission receives documentation establishing that the company has been incorporated in accordance with the application in all material respects.
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Fernand Bélisle
Secretary General
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APPENDIX TO DECISION CRTC 86-232
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The following applications were competing with Redmond for use of the frequency 97.3 MHz at Toronto and are denied.
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Richard Boraks, on behalf of Heritage Radio Limited (a company to be incorporated) - 852322700
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Mike Kilbride, representing a company to be incorporated - 851128900
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Dr. Martin G. Unger, on behalf of FM Radio 97.3 Limited Partnership (a company to be incorporated) - 851092700
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Martin Rosenthal as sole proprietor - 851023200
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R. Daniel Pickett on behalf of CHDP-FM Ltd. (a company to be incorporated) - 851058800
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Steven Murray Harris, on behalf of a company to be incorporated - 851029900
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J. Robert Wood, representing a company to be incorporated - 851044800
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Robert Keith Whyte on behalf of CKKX-FM Limited (an incorporated company) - 851028100
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Moffat Communications Limited - 851037200
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Telemedia Communications Inc. - 851036400
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Key Radio Limited - 851035600
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MI Radio Ltd. - 851096800
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The Commission wishes to point out that an application by Grant Broadcasting Limited to amend the licence for CKQT-FM Oshawa by, among other things, changing the frequency from 94.9 MHz to 97.3 MHz was gazetted for consideration at the Toronto hearing, but was withdrawn prior to the hearing at the applicant's request.
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