ARCHIVED - Decision CRTC 2001-626

Decision CRTC 2001-626

Ottawa, 4 October 2001

9098-7280 Québec inc.
Ottawa, Ontario/Hull, Quebec 2001-0281-4

22 May 2001 Public Hearing
National Capital Region

New classical music FM station in Ottawa/Hull

At a public hearing in the National Capital Region, the Commission considered eleven applications for FM stations to serve the Ottawa/Hull area. In this and other decisions published today, the Commission has approved a total of four applications for new FM stations : one English-language dance music station, one that will have an Aboriginal focus, a multicultural station, and an application for a French-language classical music service. The Commission's overall approach to applications for radio stations to serve the Ottawa/Hull market is discussed in Public Notice CRTC 2001-105 issued today.

1.

The Commission approves in part the application for authority to carry on a new, specialty-format, French-language commercial FM radio station to serve Ottawa/Hull. The Commission will issue a licence provided the applicant, within two months of the date of this decision, files an application proposing use of a frequency, and the Commission and Industry Canada each confirm in writing that the frequency is acceptable. If issued, the licence will be subject to the terms and conditions specified in the appendix to this decision, as well as to those contained in the licence itself.

2.

The applicant had proposed to operate the new station on frequency 97.9 MHz (Channel 250B1). Four other competing applications that proposed to operate on the same frequency were also considered at the public hearing of 22 May 2001. As noted in Public Notice CRTC 2001-105 that introduces this and other decisions issued today, the Commission approves three further applications to operate radio stations in Ottawa-Hull. As indicated in that notice, the Commission has decided to assign the frequency 97.9 MHz to another applicant (Decision CRTC 2001-625). Consequently, the Commission will issue a licence to the numbered company provided, (1) it files, no later than 2 months following the date of this decision, an application proposing the use of another frequency and (2), the Commission and Industry Canada each confirm in writing that the proposed frequency is acceptable. The Commission notes that, even with the three other decisions published today issuing licences for new FM stations in Ottawa/Hull, according to the discussions that took place with the applicants during the public hearing, there are other radio frequencies available for use in the Ottawa/Hull market.

3.

The applicant proposes to operate a new, specialty-format (classical music), French-language commercial FM radio station to serve the Ottawa/Hull area. It intends to broadcast classical music that is light and accessible, similar to formats that, over the past few years, have been used in Montréal and Toronto. The applicant stated that it wishes to introduce classical music to the public - young people in particular, and help audiences gain a better knowledge of such music by offering content that is popular and well known.

4.

The applicant made a commitment to devote 70% of its musical programming to concert music (subcategory 31) and 15% to jazz and blues (subcategory 34). These commitments are the subject of conditions of licence (see appendix). Spoken word programming, including local and regional news, will account for 15% of the program schedule.

5.

9098-7280 Québec inc. is a wholly-owned subsidiary of Radio Nord Communications inc. Radio Nord is a regional broadcaster that operates radio and television stations principally in the Ottawa/Hull area and in Quebec's Abitibi-Témiscamingue region. Radio Nord has been active in the Ottawa/Hull area for more than 20 years, and operates the French-language television stations CHOT-TV (TVA) and CFGS-TV (TQS).

6.

The Commission assesses applications for new radio stations in light of the objectives set out in the Broadcasting Act (the Act), and the various Commission policies that help to articulate those objectives.

7.

In recent decisions involving competing commercial radio applications, the Commission has identified four main factors as generally being relevant to its evaluation of such applications. While their relative importance can vary according to the specific circumstances of the market, these factors are: the likely impact of a new entrant or entrants; the competitive state of a market; their implications with respect to the diversity of editorial voices in the market; and the quality of the applications.

Impact of a new entrant

8.

The Commission is generally of the view that increased competition and diversity, and the improvements in the overall quality of available services that these promote, are in the public interest. At the same time, the Commission seeks to be satisfied that the impact of a new entrant to a radio market will not impinge unduly on the ability of incumbent stations to meet their programming responsibilities under the Act.

9.

The Ottawa/Hull radio market is performing well financially, with both the English and French-language stations achieving an average profit before interest and taxes of 20% in 2000. Projections on the record of this proceeding demonstrate that future increases in advertising revenues should enable the French-language radio market to absorb an additional commercial station without undue impact on existing stations.

10.

After careful review of the record, the Commission is persuaded that the Ottawa/Hull radio market can support the operations of the station licensed in this decision.

Competitive state of the market

11.

As a factor in the Commission's consideration of applications proposing new commercial radio stations, the competitive state of a market is generally most relevant in markets where the applicant is the licensee of an existing station. In such cases, the Commission's concern is that its licensing actions not create an undue competitive market imbalance.

12.

Given the large number of radio station acquisitions by major players in this industry sector in recent years, including those that have occurred in the French-language market, the Commission considers it important to provide Radio Nord, as a regional broadcaster, an opportunity to expand and thus become more competitive.

Diversity of editorial voices

13.

As mentioned above, Radio Nord currently operates two television stations in Ottawa/Hull. The Commission notes, however, that while the recent wave of mergers and acquisitions has tended to reduce the overall number of radio voices, the applicant's proposal will represent a new player in the French-language Ottawa/Hull radio market.

14.

The Commission generally considers four main criteria when assessing the quality of a new radio application. These are: the applicant's local programming proposals and plans for providing reflection of the local community; its Canadian content commitments; the quality of its business plan (including the proposed format); and commitments in support of the development of Canadian talent.

15.

The Commission is satisfied that the applicant has presented a quality application, as measured against these criteria, and that, overall, it has put forward the best application for a new, French-language station in Ottawa/Hull.

Community reflection

16.

The applicant intends to place particular emphasis on events connected with the artistic and musical environment of the National Capital Region and to work with the existing local Radio Nord television stations to provide coverage of local concerts. Its programming approach will be to provide greater accessibility by young people and the general public to its classical music genre.

17.

The Commission considers that this new French-language radio station in Ottawa/Hull will make an important contribution to Francophones and Francophiles in the market by enhancing their ability to be entertained and informed in the language of their choice.

Level of Canadian content

18.

The applicant proposed in its written application to broadcast 10% Canadian content in Category 3 (special interest music) each broadcast week - that is, the minimum level required under the regulations. The Commission discussed this proposal with the applicant at the public hearing in the context of Commercial Radio Policy 1998 (Public Notice 1998-41). Among other things, the Commission stated in this policy that, upon renewal of their licences, commercial FM stations operating in a specialty-format will generally be expected to increase the percentage of Canadian music they broadcast, and to justify the levels they propose.

19.

Discussions at the public hearing revealed that the availability of Canadian music recordings in Category 3 does not pose a problem at this time. The advent of light classical music stations in Montréal and Toronto has encouraged Canadian musicians to produce more music in this category. In light of this fact, the applicant made a commitment to devote, immediately upon commencing operations, 15% of all category 3 musical selections broadcast each broadcast week to Canadian selections, which is 5% over the 10% level required by the Radio Regulations, 1986 (the regulations). The Commission has accepted this commitment which is the subject of a condition of licence (see appendix).

Business plan and programming format

20.

In approving this application, the Commission has taken into account the applicant's extensive knowledge of the market and the fact that the opportunities for synergies with its existing television stations in the market will help to ensure the viability and profitability of the proposed station. The applicant indicated that it intends to share the cost of certain administrative, technical and computer services with its television stations. In addition, it stated that the local news broadcasts by the new radio station will be produced in co-operation with the CHOT-TV and CFGS-TV news rooms, which already provide coverage of current events in the National Capital Region. In addition, given the success of the Montréal and Toronto stations that operate in musical formats similar to that proposed, the applicant is convinced that its service will appeal to a large segment of the public in the National Capital Region.

Development of Canadian talent

21.

In its written application, the applicant proposed allocating an annual budget of $25,000 to support the development and promotion of Canadian talent. Of this amount, $15,000 in direct expenditures will be allocated to the project "Studio - musique classique" to fund the recording and broadcast of ten annual concerts staged by the principal music schools in Quebec and Ontario. These programs will be broadcast in rotation in a one-hour block each week.

22.

An additional $10,000 in direct expenditures will be allocated to annual scholarships that will be awarded to young Canadian artists at the various music schools in the National Capital Region. The applicant indicated that the criteria to be used in the awarding of these scholarships would be drafted in close co-operation with educational institutions, conservatories and other institutions in the region. The Commission expects the applicant to file details concerning the mechanism it will use to select the winners of these annual scholarships and concerning the composition of the selection board.

23.

Moreover, in response to the intervention by the Association québécoise de l'industrie du disque, du spectacle et de la vidéo (ADISQ), the applicant committed to increase its total contribution to the development of Canadian talent from $25,000 to $27,000 a year. The additional $2,000 will be allocated to MusicAction. The above-mentioned commitments with respect to Canadian talent are the subject of a condition of licence (see appendix).

24.

In its written intervention, the Canadian Broadcasting Corporation expressed concern regarding the possible impact of the new station on the services provided by its French-and English-language cultural networks in Ottawa/Hull and on their contribution to Canadian talent. In response, the applicant stated that CBC normally broadcasts musical works in their entirety, as well as long periods of analysis and commentary. In contrast, the new station will broadcast the more popular excerpts from these works, less spoken word and commentary, and will have a faster, younger pace.

25.

BBM surveys in recent years show that, in fact, the advent of the light classical music stations in Montréal and Toronto has had an impact on the CBC cultural networks' audience share. Nonetheless, the success of these stations demonstrates that they meet a clear demand and contribute to the musical diversity available in these markets. In addition, as pianist, composer and conductor François Cousineau pointed out at the public hearing, these stations assist in developing an audience for the instrumental music recorded by Canadian artists such as Angèle Dubeau, André Gagnon, himself and many others. They thus provide a new showcase for the music of these Canadian artists, who sometimes find it difficult to get air time on the commercial radio stations with popular music formats.

26.

The Commission wishes to thank all those who participated in the public process leading to this decision, either through their written interventions or through their presentations at the public hearing.

Related CRTC documents

Secretary General

This decision is to be appended to the licence. It is available in alternative format upon request, and may also be examined at the following Internet site: www.crtc.gc.ca

Appendix to Decision CRTC 2001-626

Terms and conditions of licence pertaining to the licence to be issued to 9098-7280 Québec inc. for a new FM station to serve Ottawa/Hull

The Commission will only issue the licence, and it will only be effective at such time as:

B. the licensee confirms in writing that it is ready to begin operation. This confirmation must take place within 12 months of the licensee having received Commission approval for the use of a new frequency and obtained the necessary authorities from Industry Canada. Any request for an extension to that deadline requires Commission approval and must be made in writing within that period.

The licence, when issued, will expire 31 August 2008.

The Commission encourages the licensee to consider employment equity issues in its hiring practices and in all other aspects of its management of human resources (Public Notice 1992-59).

The licence will be subject to the conditions specified in the licence to be issued, as also set out in Public Notice CRTC 1999-137. The licence will also be subject to the following conditions:

The Commission expects the licensee to file details concerning the composition of the selection board within three months of the date of this decision, as well as the mechanism it will use to select the winners of the annual scholarships for talented Francophone musicians in the region served by the station.