ARCHIVED -  Decision CRTC 96-762

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Ottawa, 18 November 1996

Decision CRTC 96-762

9016-7974 Québec inc.

Shawinigan/Trois-Rivières, Quebec - 952710200

New FM Station - Denied

Following a Public Hearing held in Québec beginning on 9 July 1996, the Commission denies the application for a broadcasting licence to carry on a French-language FM radio programming undertaking at Shawinigan/Trois-Rivières on the frequency 96.5 MHz (channel 243B) with an effective radiated power of 19,000 watts.

The applicant proposed to carry on a new independent adult pop FM undertaking broadcasting 126 hours of local programming per week, including 89 hours with a program host, and with musical content featuring hits from the '60s, '70s and '80s. The applicant indicated that its primary goal is to [TRANSLATION] "give Shawinigan its first radio service". It expressed the view that no other broadcaster has offered a truly local service in the Shawinigan market since CKSM Shawinigan reduced its local programming to 2 hours 30 minutes per week in June 1995 and replaced the difference with programming retransmitted from CHLN Trois-Rivières.

The applicant also indicated that its plans for a new FM station make provision for service to the Mauricie region, including its largest urban centre, Trois-Rivières. It noted in this regard the close proximity of Shawinigan to Trois-Rivières and the strong economic ties between the two areas. The applicant added that, because the Trois-Rivières radio stations have access to the Shawinigan market, the reverse should apply to the proposed station so that all stations would be on an equal footing. Although it expected to generate most of its advertising revenues in the Shawinigan market, the applicant added that access to the Trois-Rivières market would nonetheless be necessary to ensure the viability of the proposed service.

The Commission received six interventions to this application, including two in support, three opposed and one comment. Appearing at the public hearing in opposition to the application were Télémédia Communications inc. (Télémédia), licensee of CHLN and CHEY-FM Trois-Rivières; Radiomutuel inc. (Radiomutuel), licensee of CKSM Shawinigan and CIGB-FM Trois-Rivières; and Robert Pilotte, representing a group of unionized communications workers.

These interveners pointed to the turmoil in Quebec's radio industry in 1994 following the restructuring of Télémédia and Radiomutuel, the subsequent creation of the Radiomédia network in Quebec, the closure of station CJTR Trois-Rivières in the fall of 1994, and the reduction in local programming on CKSM Shawinigan in the summer of 1995.

The opposing interveners submitted that current CKSM and CHLN programming meets the expectations and needs of Shawinigan residents, and that the addition of another station would only lead to a revisitation of the situation that existed in the area before CJTR closed. They also cited the economic fragility of the Shawinigan and Trois-Rivières markets and the fact that the introduction of a new signal in the region would be detrimental to existing undertakings. Télémédia and Radiomutuel further submitted that the various editions of the reports for the Shawinigan and Trois-Rivières radio markets also show that the markets do not meet the criteria contained in the Commission's radio market policy regarding profitability of existing stations.

In Public Notice CRTC 1991-74 dated 23 July 1991 and entitled "Radio Market Policy", the Commission set out the procedures and criteria that it generally uses in the processing of applications for new conventional commercial AM and FM stations. Further, the Commission established as the basic criterion that the introduction of an additional commercial station must not unduly affect the ability of existing commercial stations to discharge their programming responsibilities.

Given that the proposal submitted by the applicant is to target both the Shawinigan and Trois-Rivières markets, the Commission examined its application in the light of the radio market policy mentioned above. The Commission also noted the licensee's statements at the public hearing, in reply to the opposing interventions, that the reports on the Shawinigan radio market are based on the performance of only one station, CKSM, whereas the advertising revenues drawn from Shawinigan by the Trois-Rivières stations are compiled in the reports as part of the Trois-Rivières market. It also argued that the reports on the Shawinigan and Trois-Rivières markets took into account the losses of both CKSM and CJTR, whereas the latter station has been closed since 1994.

In order to determine whether a market can support an additional radio station, the Commission generally considers the financial results of the last five years. That analysis indicates that the Shawinigan and Trois-Rivières markets do not meet the criterion regarding collective profitability, because the overall profit margin of all radio stations in these markets has been negative for the last five years. Using its market policy criteria as the primary indicator, the Commission has more closely examined the impact of the closure of CJTR and of the creation of the Radiomédia network. Even though CJTR's closure led to an improvement in the financial situation of all other radio stations in Trois-Rivières, the Commission is of the view that these improvements are too recent to enable any conclusion to be drawn that the market has recovered in the period since these events. Given these circumstances, the Commission considers that current conditions in these markets do not support a conclusion that the introduction of a new FM station, at this time, would not unduly affect the ability of existing stations to discharge their programming responsibilities.

The Commission notes, however, that the Shawinigan area has a population of over 60,000, and it considers that these residents are entitled to expect adequate local radio service. In this regard, the Commission notes the statements at the public hearing by Radiomutuel and Télémédia that, beginning in September 1996, CKSM would increase local programming by 15 minutes each weekday, yielding a weekly total of 3 hours 45 minutes of local programming. The Commission also notes Radiomutuel's intention to expand its local radio service in Shawinigan eventually, should economic conditions in the area improve. The Commission will closely monitor improvements in the radio services provided to the population of Shawinigan.

Allan J. Darling
Secretary General

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