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Decision
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Ottawa, 3 June 1988
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Decision CRTC 88-376
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New Brunswick Broadcasting Company Ltd.
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Fredericton and Saint John, New Brunswick -872460100 -872459300Halifax, Nova Scotia -872458500
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Following a Public Hearing in Sydney on 15 March 1988, the Commission approves applications by New Brunswick Broadcasting Company Ltd. (NBB) to amend the broadcasting licences it holds for English-language television broadcasting undertakings at Fredericton and Saint John, by changing the authorized channel from UHF 41 to VHF 11 in the case of Fredericton, and from UHF 23 to VHF 12 in the case of Saint John; and by decreasing the effective radiated power from 53,600 to 9,000 watts in Fredericton, and from 134,000 to 18,300 watts in Saint John.
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An application by NBB to amend the broadcasting licence for its English-language television station at Halifax was considered by the Commission at a Public Hearing in the National Capital Region on 12 April 1988. Specifically, the applicant proposed to change from UHF channel 20 to VHF channel 8 and to decrease the effective radiated power of the Halifax station from 128,200 to 10,800 watts. This application is denied.
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Background
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NBB was originally granted authority for the stations at Halifax, Fredericton and Saint John and for a fourth station at Moncton in Decision CRTC 87-59 dated 22 January 1987.
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For many years, NBB has operated as licensee of the CBC affiliate station CHSJ-TV Saint John and its rebroadcasters, which provide the only source of English-language CBC television network programming to New Brunswick residents. Throughout that period, in numerous decisions and notices, the Commission has expressed its serious concern regarding the fact that New Brunswick remains the only province in which the CBC does not own and operate English-language television broadcasting facilities. As noted by the Commission in Decision CRTC 87-59:
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Given the CBC's current budgetary constraints, there appears to be little likelihood that any such facilities will be established in the near future. Although CHSJ-TV has earned a solid reputation for the service it has provided during more than 30 years as a CBC affiliate, as such it broadcasts considerably less CBC network programming than do CBC owned-and-operated stations. The lack of full CBC service has been a source of long-standing dissatisfaction to the people of New Brunswick, as has been made clear to the Commission on frequent occasions through representations at public hearings by various municipal and provincial politicians.
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Accordingly, in that decision, the Commission emphasized the importance with which it views the terms of an agreement reached between NBB and the CBC whereby, upon commencement of third television service in the communities of Halifax, Fredericton, Saint John and Moncton, the amount of CBC programming on CHSJ-TV and its rebroadcasters will increase by approximately 30 hours per week to a level which the Commission noted would be "equal to or greater than, the amount of CBC network programming broadcast by many CBC owned-and-operated stations".
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At the 1986 hearing at which NBB's applications for third service were considered, the CBC recommended to the Commission that the terms of the agreement be made a condition of CHSJ-TV's licence. The Commission agreed that such a condition would be appropriate, but noted that its addition could only be considered within the context of the station's licence renewal. The Commission went on to state:
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Accordingly, the Commission advises the applicant that this condition will be dealt with at the time of licence renewal, and that it intends to impose a requirement that NBB adhere to the terms of its agreement with the CBC, as a condition of the CHSJ-TV licence. In the interim, it expects the licensee to adhere to its commitment in this regard. Moreover, should the CBC choose to terminate its agreement with NBB at some future point and establish CBC owned-and-operated facilities in New Brunswick, the Commission would not envisage renewing the licences for CHSJ-TV and its rebroadcasters for a further term and would, moreover, strongly expect NBB to surrender its licences for these services.
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NBB had originally proposed to launch its new over-the-air third service in two stages, with service to the three New Brunswick stations being introduced a year after the commencement of service at Halifax. However, because of the importance it places on the early introduction of the greatly expanded CBC service in New Brunswick, the Commission specified in Decision CRTC 87-59 that the new service should be launched simultaneously in Nova Scotia and New Brunswick "at the earliest feasible date". Accordingly, it stipulated, by condition of licence, that the four television broadcasting undertakings "be completed and that they all be in operation within twelve months of the date of this decision or such further period as the Commission may, upon receipt of a request for an extension before the expiry of the said twelve months, deem appropriate under the circumstances". On 15 January 1988, the Commission granted administrative approval to a request by NBB for an extension of the implementation date until 5 September 1988.
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The Current Applications
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Among the reasons put forward by NBB in support of the current applications was that the lower capital and operating costs associated with the use of VHF transmitters would place it in a better economic position to respond to the Commission's expectation that it extend third television service throughout the Maritimes at the earliest possible date.
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NBB's presentation stressed the technical advantages of VHF transmission, in particular the fact that VHF signals tend to be less susceptible to interference and degradation than UHF signals over a given distance.
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According to the applicant, there would be a net increase of approximately 8,400 people resident within the new Grade B contours proposed for the Fredericton and Saint John stations. The applicant indicated, however, that the proposed Grade B contour of the Halifax station would encompass approximately 5,400 fewer people than those inside the Grade B contour currently authorized for this station.
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In addressing the diminished coverage that would result under the Halifax proposal, NBB argued the following:
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While it is true that some 5,400 people located outside the B contour of the proposed channel 8 facility may not receive the signal, the offsetting factor is that, within the channel 8 coverage area, the signal will be much more consistent and reliable, resulting, we believe, in a net gain in population over UHF distribution.
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At the 12 April hearing NBB submitted that, from a marketing standpoint, the opportunities for the successful introduction of the new service would be greatly enhanced by its availability on VHF channels:
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If our application is denied, (viewers without cable television service) would have to use UHF off-air receiving equipment and tune to the higher channel on the set ... Ease of tuning, including a more familiar position in the VHF range, is a very significant advantage, especially in the launching of a new service.
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Further in this regard, NBB noted that 35% of households in the Fredericton and Saint John viewing areas, and 22% in the proposed Halifax coverage area, do not subscribe to cable. The applicant suggested that it could cost viewers who are not cable subscribers between $100 and $400 per household to install outdoor antenna equipment necessary to receive an adequate UHF signal.
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In response to the concerns expressed by three cable television licensees that NBB's proposed use of VHF channels would impair basic cable channels and displace existing services, the applicant noted that the VHF channels will likely be put to use eventually, at which time the disruption described by the cable companies would inevitably occur. NBB added that such disruption could scarcely be viewed as a new or unexpected phenomenon and expressed doubt that it would have any lasting harmful effects.
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At the Sydney hearing, the CBC presented an intervention opposing NBB's Fredericton and Saint John applications. The Corporation stated that it was its intention not to exercise an option contained in its affiliation agreement with NBB to extend this agreement beyond its first term of ten years, and that it intended to establish CBC owned-and-operated facilities to serve New Brunswick at that time.
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The CBC noted that its agreement with NBB may be terminated at an earlier date with the consent of both parties and that, should this occur, the Corporation's Board of Directors has resolved to advance implementation of its plans. The CBC advised, however, that its commitment to proceed was conditional upon there being VHF channels available for its use at Fredericton and Saint John.
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The CBC's concerns relate to the absence of any firm commitment on the part of NBB to surrender its licences for CHSJ-TV and its rebroadcasters at such time as the CBC is in a position to proceed with establishing its own facilities. According to the CBC, the other option of installing and operating UHF transmitters to serve Saint John and Fredericton would be prohibitively expensive.
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At the Sydney hearing, the CBC confirmed that there has been no response to a request made by the Corporation to the Minister of Communications in May 1987 that these VHF channels be reserved for future CBC use. In the circumstances, however, given that the frequencies sought by NBB for Fredericton and Saint John may well be the last VHF frequencies available for use at these locations, the CBC requested that the Commission deny these two applications.
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Alternatively, the CBC argued that should NBB be authorized to use these VHF frequencies, the expectation expressed by the Commission in Decision CRTC 87-59 that NBB surrender its licences for CHSJ-TV and its rebroadcasters upon disaffiliation from the CBC should be "converted into a formal legal commitment" on the part of NBB.
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In responding to the CBC's intervention, NBB stated that any commitment it might offer to relinquish the frequencies it uses for CHSJ-TV and its rebroadcasters would be "premature and unnecessary" and that any condition requiring it to do so would place NBB at a disadvantage in possible future negotiations for a sale of assets to the CBC.
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The Commission's Decision
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The Commission has considered all of the evidence before it, including the various arguments advanced by NBB in support of its applications, as well as the concerns and objections raised in interventions submitted by Fundy Cable Ltd. and Dartmouth Cable TV Limited. Based on this evidence, in particular the fact that the technical amendments proposed in NBB's Fredericton and Saint John applications will increase the number of viewers in those areas who will have over-the-air access to the new third service, the Commission is convinced that approval of the Fredericton and Saint John applications is in the public interest.
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As for the CBC's request that the Commission deny the Fredericton and Saint John applications solely for the purpose of ensuring the availability of VHF channels for use by the Corporation, the Commission considers that this would be inappropriate, given the acknowledgement by the CBC that it could be as long as ten years before it is in a position to establish owned-and-operated facilities in New Brunswick.
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With respect to the CBC's alternative request that the Commission impose a condition requiring NBB to surrender its licences for CHSJ-TV and its rebroadcasters once the Corporation is in a position to implement full CBC owned-and-operated service in New Brunswick, the Commission is of the view that this matter should more appropriately be addressed in the context of CHSJ-TV's licence renewal, which is scheduled to be considered at a public hearing later this year. The CBC will then have the opportunity to discuss this matter and to report on any further developments in its plans to implement full owned-and-operated service in the province of New Brunswick.
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The Commission's decision to deny NBB's Halifax application is based on its determination that the general advantages which the applicant attributed to the use of VHF transmitters do not outweigh the clear disadvantages of such use in the present case. Specifically, the Commission is concerned that the proposed Grade B contour of the Halifax station would encompass at least 5,400 fewer people than those inside the Grade B contour currently authorized for this station.
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In addition, the Commission has taken into account the various technical restrictions which Communications Canada would have to impose on the operation of channel 8 at Halifax, which would effectively preclude the possibility of any future power increase or other remedial measures to expand the signal coverage.
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The Commission acknowledges the interventions opposing NBB's Halifax application submitted by Atlantic Television System, Dartmouth Cable TV Limited, G.&.R. Kelly Enterprises Ltd. and Halifax Cablevision Limited.
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The Commission reiterates the importance it attaches to the prompt introduction of a third television service in Halifax, Moncton, Saint John and Fredericton and the related introduction in New Brunswick of expanded English-language CBC television coverage. In this regard, it reminds the licensee that it remains a condition of the licences issued to NBB that the four broadcasting undertakings be completed and in operation by 5 September 1988.
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Fernand Bélisle
Secretary General
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