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Decision
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Ottawa, 2 October 1987
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Decision CRTC 87-831
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Reconsideration of Decision CRTC 87-166 issuing licences to Telemedia Communications Inc. and Muskoka-Parry Sound Broadcasting Limited, on behalf of a company to be incorporated, to carry on an English-language FM radio undertaking to serve Bracebridge, Ontario; and to Muskoka-Parry Sound Broadcasting Limited to operate an English-language FM radio network consisting of the new Bracebridge FM undertaking and its FM undertaking in Huntsville
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Order-in-Council P.C. 1987-961
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Following a Public Hearing in the National Capital Region on 1 December 1986, the Commission in Decision CRTC 87-166 dated 10 March 1987, approved an application by Telemedia Communications Inc. and Muskoka-Parry Sound Broadcasting Limited, on behalf of a company to be incorporated (Telemedia-Muskoka Broadcasting), for a licence to carry on an English-language FM radio undertaking in Bracebridge it also approved an application by Muskoka-Parry Sound Broadcasting Limited (Muskoka Broadcasting) to operate an FM radio network consisting of the Bracebridge FM station and its FM operation in Huntsville, previously approved by the Commission in Decision CRTC 87-150 dated 2 March 1987.
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Decision CRTC 87-166 also denied competing applications from Hugh and Michael Mackenzie, representing a company to be incorporated (the Mackenzies), for an FM licence to serve Bracebridge, and from Rogers Broadcasting Limited (Rogers) for a network licence to link CHFI-FM Toronto with the FM station in Bracebridge proposed by the Mackenzies.
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By Order in Council P.C. 1987-961, dated 8 May 1987, the Governor in Council referred Decision CRTC 87-166 back to the Commission for reconsideration and hearing. The Order-in-Council stated, in part:
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Whereas the Governor in Council is of the opinion that it is material to the application for the issuance of the said licences that the Commission consider the representations of the local residents; and
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Whereas the Governor in Council is of the opinion that the Commission failed to consider adequately these representations in rendering Decision CRTC 87-166;
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Therefore, Her Excellency the Governor in Council, on the recommendation of the Minister of Communications, pursuant to section 23 of the Broadcasting Act hereby refers Decision CRTC 87-166 of 10 March 1987 approving the applications for licences of Telemedia Communications Inc. and Muskoka Parry Sound Broadcasting Limited, on behalf of a company to be incorporated, and of Muskoka-Parry Sound Broadcasting Limited back to the Canadian Radio-television and Telecommunications Commission for reconsideration and hearing by the Commission.
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On 9 June 1987, the Commission issued CRTC Public Notice l 987-146, which established the procedure to be followed in the reconsideration of Decision CRTC 87-l66. Interveners of record at the 1 December 1986 Public Hearing were invited to submit written comments to the Commission on the matter set out in Order in Council P.C. 1987-961, as noted above. The competing applicants (the Mackenzies and Rogers) were invited to file their written comments on the matter as well as written replies to any comments received, following which Telemedia-Muskoka Broadcasting and Muskoka Broadcasting were invited to file written replies to any comments received.
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Background
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CRTC licensing decisions result from an extensive public Process Pursuant to the Broadcasting Act. The Commission's process is designed to provide it with a comprehensive record upon which to base its decision. The record typically includes the submissions of the parties and the representations of interveners, who may be residents or broadcasters in the area affected by the decision to be made, competing applicants, or any other member of the public with an interest in the matter before the Commission. Such submissions and interventions may be made in writing or presented orally at the time of the Public Hearing or both, and may address the many factors which the Commission must weigh in coming to a decision in the public interest.
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The Commission's initial call for applications for a licence to carry on an FM radio service in the South Muskoka region was made on 15 October 1984 (CRTC Public Notice 1984-254).
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Two proposals were received in response to the 1984 call: one, from the Mackenzies to establish an FM station at Bracebridge and from Rogers to create an FM radio network to supplement the programming of the Mackenzie station with programs from CHFI-FM Toronto, and the second from Joseph F. Duchesne, representing a company to be incorporated (subsequently incorporated as Muskoka Broadcasting) (Duchesne), to establish an TV station at Bracebridge.
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The Commission heard the applications from the Mackenzies, Rogers and Duchesne at a Public Hearing in Toronto on 8 October 1985, and subsequently denied all the applications in Decision CRTC 86-136 dated 25 February 1986. Although neither proposal was fully acceptable to the Commission at that time, the large number of interventions received from local residents in support of one or other of the proposals and evidence submitted by the applicants convinced the Commission that there was a demand and a need for a new FM radio station to serve the South Muskoka market. Accordingly, on 18 April 1986 the Commission again called for applications for a licence for an FM station to serve South Muskoka (CRTC Public Notice 1986-88), and invited all interested parties to respond, addressing the concerns raised in Decision CRTC 86-136.
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Once again, applications were received from the Mackenzies and Rogers for a new FM licence to serve Bracebridge and a network licence to link the Mackenzies' proposed Bracebridge FM station with CHFI-FM Toronto. Applications were also received from Telemedia-Muskoka Broadcasting for an FM licence to serve Bracebridge and from Muskoka Broadcasting for a network licence to link its proposed new FM stations at Bracebridge and Huntsville. These applications were heard in the National Capital Region on 1 December 1986, and resulted in Decision CRTC 87-l66. A total of 192 interventions were received in that proceeding, the majority from year-round and seasonal residents of the area strongly in support of a new FM service. A total of seven interveners appeared at the hearing, of which four supported the Mackenzies' application and three opposed some or all of the applications.
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As noted in Decision CRTC 87-166:
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In arriving at its decision, the Commission has taken into account the submissions of the parties involved, as well as the interventions received in response to these applications. In particular, it has considered the many expressions of support for a South Muskoka radio service as well as the concerns expressed by Playland Broadcasting Limited, licensee of CKLP-FM Parry Sound, and CHAY Limited, licensee of CHAY-FM Barrie, about the potential negative effect of such a service on existing area broadcasters.
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The Commission has also taken into account the limited capacity of this market to support a "stand-alone" operation, the a relative similarity in the Telemedia-Muskoka Broadcasting and the Mackenzies' applications with respect to locally-originated programming and the substantial differences in their proposals for programming in non-local time periods, as well as the technical Parameters.
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In arriving at its decision to licence Telemedia-Muskoka Broadcasting, the Commission further stated in Decision CRTC 87-166:
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Based on all the information available, the Commission considers that the Telemedia-Muskoka Broadcasting proposal to provide complementary regionally-oriented programming from Huntsville has greater merit than the competing proposal to Provide Toronto-originated programming. It is also of the view that the TV operation proposed by this applicant should have less of an impact on existing broadcasters, including Muskoka Broadcasting at Huntsville. In this regard, the Commission has taken into consideration the fact that the Mackenzies' new FM station would reach both Huntsville and Parry Sound, as well as Muskoka Broadcasting's statement at the hearing that it would lose some national advertising revenues in Huntsville if the competing applications were approved.
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The Commission therefore has decided to allow two broadcasters with experience in adjacent small markets and a strong interest in minimizing the impact on the existing stations to provide FM radio service to the undeserved Bracebridge Cravenhurst area. In this regard, it has noted Telemedia-Muskoka Broadcasting's intention not to solicit advertising in Parry Sound as well as Telemedia's undertaking that CFOR Orillia will discontinue soliciting advertising in Gravenhurst. It has also taken into account Telemedia's experience in markets of similar size in Ontario and Quebec and its expressed interest in enhancing regional news programming through the exchange of material among its radIo stations in the area.
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Comments Received Pursuant to Public Notice CRTC 1987-146
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In Public Notice CRTC 1987-146, the Commission called upon interveners who had participated in the 1 December 1986 hearing to submit written comments, specifically concerning the Governor in Council's opinion that it was material to the proceeding that the Commission consider adequately the representations of the local residents. The Commission received 152 comments in response to Public Notice CRTC 1987-146. Of these, all but two reiterated the need and desire for a new TV radio service in the South Muskoka region. Several interveners expressed no preference between the two proposals.
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The two interventions opposing the decision to licence any applicant for a new TV service expressed the opinion that the market could not support such a service. In this regard, no comments received pursuant to CRTC Public Notice 1987-146 have presented new evidence to convince the Commission to change its conclusion
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The remaining comments expressed a preference for one or the other proposal. Some interveners offered reasons for their preference, which essentially fell into three broad categories which proposal would result in better local service; the relative advantages of local ownership versus the involvement of an established broadcasting chain; and which proposal offered more attractive programming.
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Some interveners felt that the Telemedia-Muskoka Broadcasting proposal would result in better local service, because of Muskoka Broadcasting's demonstrated involvement in and commitment to the region, and because Telemedia could contribute its considerable resources to newsgathering and other efforts in the region. On the other hand, others considered the Mackenzies' application to be more likely to provide good local service, and several mentioned their proposal to implement a fully local service over a ten-year period.
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The question of local ownership drew many comments. A number of interveners, considering the residence of several members of the Mackenzie group in the Muskoka region, expressed the opinion that such local ownership would result in better local service. Others emphasized Telemedia's positive presence in radio in the region as a reason to support the Commission's decision to award the licence to the Telemedia-Muskoka Broadcasting group.
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In terms of programming, there was some concern that the decision to issue a new FM licence to the current holders of AM licences in the adjacent markets of Orillia and Huntsville would result in duplication of existing services on the new FM station.
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On the question of non-local programming, several interveners expressed a preference for the type of programming currently provided by the Telemedia station CFOR in Orillla, and that provided by CFBR Huntsville (now changed to CFBR-FM Huntsville as a result of Decision CRTC 87-150 dated 2 March 1987), operated by Muskoka Broadcasting. Other interveners expressed the opinion that Rogers' Toronto station CHFI-FM would provide a better quality of programming, or that the Toronto station would be of greater interest to local residents. Some interveners also expressed the view that the existing market lacked diversity of programming, a situation which would be improved by the addition of a new FM station, particularly one with non-local programming from CHFI-FM. Other interveners pointed out that as CHFI-FM is available on cable in the region, the Telemedia-Muskoka Broadcasting proposal would contribute more to Program diversity.
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Conclusions
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The Commission thanks all the interveners who submitted comments on this reconsideration. The interest generated by the proposals for a new TV service in this region confirms the Commission's assessment of the demand and need for such a service, as noted initially in Decision CRTC 86-136.
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The Commission has carefully examined the issues and concerns which were expressed in the comments received from interveners and applicants on its reconsideration of Decision CRTC 87-166. In particular, the Commission recognizes that concerns of area residents such as the importance of local ownership, their preferences as to the source of non-local programming, and their strongly-expressed need for a truly local service, are important elements to be taken into consideration.
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It is an essential part of the Commission's public licensing process that those members of the Public who wish to express an opinion on a matter before the Commission be given a full opportunity to do so. In this case, the Commission notes that opinions were divided on which proposal should be favoured. In such a context, the Commission further notes that such considerations as the market's ability to support a new licensee, the possibly detrimental effect on existing CRTC licensees, the ability of a prospective licensee to establish and continue to operate a station without lowering the quality of its programming or that of its competitors, and the desirability of maintaining diversity in programming while ensuring that radio's value as a local medium is maximized, are all elements of a decision to issue a new radio licence.
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The Commission is not persuaded that any arguments have been presented on the reconsideration and hearing that would warrant a change in Decision CRTC 87-166. Therefore, pursuant to section 23 of the Broadcasting Act, the Commission hereby confirms Decision CRTC 87-166 issuing the licences to Telemedia-Muskoka Broadcasting and to Muskoka Broadcasting, together with the conditions of licence and other requirements expressed therein. The condition of licence found in Decision CRTC 87-166 relating to the deadline for completion and operation of the station is deleted and replaced by the following: It is a condition of licence that construction of the station be completed and that it be in operation within twelve months of the date of the present decision or such further time as the Commission may, upon receipt of a request for extension before that date, deem appropriate under the circumstances.
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The Commission further notes that in Decision CRTC 87-166 it concluded that the coverage proposed by Telemedia-Muskoka Broadcasting could be achieved using a Class A frequency, and did not require the Class B frequency which the applicants proposed to use. In accordance with paragraph 22(1)(b) of the Broadcasting Act, the Commission will issue an FM licence to Telemedia-Muskoka Broadcasting if it is in receipt of written notification from the Department of Communications, within four months of the date of this decision, that a Class A frequency has been found for this FM undertaking and that it will issue a, Technical Construction and Operating Certificate. No licence will be issued if the Commission does not receive this notification within said period, or such further period as the Commission may, upon receipt of a request for extension before the expiry of the said four months, deem appropriate under the circumstances.
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Fernand Bélisle Secretary General
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