ARCHIVED -  Transcript / Transcription - Kitchener, Ontario - 2002-10-29

Multiple broadcasting applications /

Demandes de radiodiffusion multiples

HELD AT: TENUE À:

Four Points Hotel Hôtel Four Points

105 King Street East 105, rue King Est

Kitchener, Ontario Kitchener (Ontario)

October 29, 2002 le 29 octobre 2002

Transcripts

In order to meet the requirements of the Official Languages

Act, transcripts of proceedings before the Commission will be

bilingual as to their covers, the listing of the CRTC members

and staff attending the public hearings, and the Table of

Contents.

However, the aforementioned publication is the recorded

verbatim transcript and, as such, is taped and transcribed in

either of the official languages, depending on the language

spoken by the participant at the public hearing.

Transcription

Afin de rencontrer les exigences de la Loi sur les langues

officielles, les procès-verbaux pour le Conseil seront

bilingues en ce qui a trait à la page couverture, la liste des

membres et du personnel du CRTC participant à l'audience

publique ainsi que la table des matières.

Toutefois, la publication susmentionnée est un compte rendu

textuel des délibérations et, en tant que tel, est enregistrée

et transcrite dans l'une ou l'autre des deux langues

officielles, compte tenu de la langue utilisée par le

participant à l'audience publique.

Multiple broadcasting applications /

Demandes de radiodiffusion multiples

BEFORE / DEVANT:

Joan Pennefather Chairperson / Présidente

Stuart Langford Commissioner / Conseiller

Barbara Cram Commissioner / Conseillère

Jean-Marc Demers Commissioner / Conseiller

Ron Williams Commissioner / Conseiller

ALSO PRESENT / AUSSI PRÉSENTS:

Peter Foster Hearing Manager / Gérant

de l'audience

Pierre LeBel Secretary / Secrétaire

James Wilson Legal Counsel /

Conseiller juridique

HELD AT: TENUE À:

Four Points Hotel Hôtel Four Points

105 King Street East 105, rue King Est

Kitchener, Ontario Kitchener (Ontario)

October 29, 2002 le 29 octobre 2002

PAGE / PARA NO.

PHASE I

PRESENTATION BY / PRÉSENTATION PAR

Aboriginal Voices Radio Inc. 234 / 1559

Douglas E. Kirk 318 / 2133

Sound of Faith Broadcasting 402 / 2669

Trust Communications Ministries 470 / 3069

Kitchener, Ontario / Kitchener (Ontario)

--- Upon resuming on Tuesday, October 29, 2002

at 0835 / L'audience reprend le mardi

29 octobre 2002 à 0835

1552 THE CHAIRPERSON: Order, please.

1553 Mr. Secretary.

1554 MR. LEBEL: Thank you, Madam Chair.

1555 Item 4 on the agenda is an application by the Aboriginal Voices Radio Inc. (AVR) for a licence to operate an English, French and Aboriginal language Native Type B FM radio station in Kitchener-Waterloo.

1556 The new station would operate on frequency 102.5 MHz (Channel 273A) with an effective radiated power of 460 watts.

1557 You have 20 minutes to make your presentation.

1558 THE CHAIRPERSON: Good morning. Any time you are ready.

PRESENTATION / PRÉSENTATION

1559 MR. FARMER: Good morning. We have a script for you.

1560 Greetings, Commissioners, Commission staff, other applicants as well, and members of the public who are here in attendance today.

1561 We are honoured to appear here before the CRTC Commission hearing this morning.

1562 It's a beautiful day. It may be cold and cloudy, but we have lived another day -- something we should always be thankful for, of course. Aboriginal people are very thankful people. It's our way. It's how we taught our children and we will continue to teach our children.

1563 With that thought in mind, we want to give thanks to the original people here, among the Ojibwa, the Haudenosaunee or the Iroquois, and the Potawatomie. We want to thank them for taking care of this land for so long.

1564 It is somehow fitting that we of many nations are gathered here in Kitchener, on the banks of the Grand River. I say that because the river has always been a "common ground" for Native Nations, both in pre-Columbian times and since then.

1565 We should also give a brief word of thanks to the Creator because we are grateful that we humans have survived since those days long ago when just the Native Nations walked this land.

1566 We should also remember that although she struggles with environmental degradation, we must offer a silent prayer for Mother Earth as she continues to provide what we need to nurture the coming generations.

--- Silent Prayer

1567 MS TWO SHOES: Now it is time to introduce the members of the AVR presentation today.

1568 My name is Minnie Two Shoes. I am an AVR Development Team member working in the areas of community relations, the news department and media development.

1569 I also serve as the team's liaison to the AVR board of directors and provide administrative support to AVR operations and management.

1570 I helped found the American Indian Journalists Association 18 years ago, and I am a freelance journalist who has worked in radio, television, magazine and at daily and weekly newspapers all of my career.

1571 With that, I would like to introduce our team members.

1572 They include, to my right, Gary Farmer.

1573 Gary is President of the board of directors and a long-time instigator for the development of AVR. He supplies AVR with a creative vision and helps our team-building efforts, as needed, to formulate a national radio service that is sensitive to the needs of each of the communities we reach.

1574 He is an actor who is also a film director and a producer of both radio and television.

1575 To his right is Elaine Bomberry.

1576 Elaine is an AVR Development Team member, serving as its Aboriginal Talent Development director. She works with programming, format and music at AVR. She has been involved in the music industry for many years, promoting, managing and staging Aboriginal music events.

1577 To my left is Diane Maracle Nadjiwon.

1578 Diane is a long-time community member and program manager for Anishinawbeg Outreach, a social services agency in Kitchener.

1579 Behind me, on my far right, is Sue Keedwell.

1580 Sue is an active member of the Kitchener community, serving as a volunteer on the boards of directors for a couple of non-profit organizations, including Anishinawbeg Outreach. She is interested in the preservation of our languages, which she sees as an important way to sustain the Aboriginal culture.

1581 In the back we have John Matthews.

1582 John is the Broadcast Technical Director at AVR. He operates Promethean, a national business supplying radio technology and services. He handles issues at AVR that relate to technical, coverage and broadcast services.

1583 The last member of our team is at the Xerox machine. His name is Mark MacLeod.

1584 Mark is the Director of Licensing and Development at AVR. He has international and community radio experience and many years of licensing and proposal efforts for AVR and other radio entities.

1585 As a side note, AVR Technical Director Chris Spence was required in Toronto today and will not be with our team.

1586 And Kitchener Community Elder Millie Falconer has also been unable to join with us this morning.

1587 MR. FARMER: You will have to appreciate that I don't have my glasses with me today, and it is a little dark in here.

1588 Members of the Commission, first let me give you a little history of Aboriginal radio in the area.

1589 While there are currently no Aboriginal radio programs airing in Kitchener, both local campus and community stations have previously offered Aboriginal programming here.

1590 CKMS-FM at the University of Waterloo aired a single weekly program for years until recently, and CKWR-FM, the local community station, at one time offered a three-hour morning show time slot, five days a week, to Native programming.

1591 Unfortunately, the need in the Kitchener-Waterloo Aboriginal community has continued to dramatically increase, even as these programming hours disappeared.

1592 For these reasons and more, we ask you to provide us with a radio broadcast licence for the Kitchener and Waterloo area.

1593 We will use the radio frequency to serve the public with a wide range of cultural programming that will highlight an Aboriginal world view and provide a venue for the products of many of our musicians, singers, songwriters and recording labels.

1594 We believe AVR will be a new catalyst for communications that will break down the barriers between the Native and non-Native communities.

1595 We have a vision which focuses on human need, because we know that Mother Earth is in declining health because of pollution, overcrowding and wasteful use of natural resources.

1596 The service that AVR proposes offers a vision of a better future for our community and our children, because our unique world view includes environmentally sound understandings that are an important part of our culture and tradition.

1597 We are here with you today with a vision of the Kitchener and Waterloo Aboriginal communities that are no longer isolated from the rural communities of the reserves or the bustling lifestyle of the megacity nearby.

1598 Instead, through a new programming service by AVR, these communities can take a more meaningful place in the discussion of local, regional and national issues that affect the Native lifestyle and that of all Canadians.

1599 During our presentation today we want to share with you, the Commissioners:

1600 (1) a glimpse of the proposed broadcast service;

1601 (2) the proposed programming service;

1602 (3) the need for an Aboriginal radio service in Kitchener-Waterloo;

1603 (4) our plan for a radio service designed to fulfil the need and better sustain the future in store for this area if our request for a licensed frequency is granted.

1604 MS BOMBERRY: Sago. I am Elaine Bomberry. I am the Director of Aboriginal Talent Development.

1605 AVR proposes to provide the community in the Kitchener-Waterloo area with a 24-hour radio service of national Aboriginal news and music programming via a rebroadcasting signal transmitter.

1606 AVR proposes to provide the community in the Kitchener-Waterloo area with radio programming with an Aboriginal slant. Despite their large populations in many urban areas, media coverage of events and issues relating to Aboriginals is often minimal or even non-existent. AVR wants to fill that gap with a full slate of Native specific programming that includes regular and timely news reports and programs that encourage language retention and cultural awareness.

1607 Other areas of focus include national call-in talk shows about Aboriginal relevant issues, programs that highlight parenting and homemaking or business and economic development. Gender and age specific round table discussions, documentaries and docu-dramas will all have a place in the programming grid that is AVR -- not to mention the wide and plentiful array of musical styles and talents that permeate Native society.

1608 The emergence of a national Aboriginal radio network through Aboriginal Voices Radio can only help boost the continued development of an Aboriginal music industry in Canada.

1609 Native people would not only benefit from AVR on the radio dials in Kitchener-Waterloo, all Canadians will reap the benefits of a culturally-specific radio service.

1610 Intolerance is often fuelled by ignorance and misunderstanding can easily prop up prejudices. AVR and its programming will bring a breath of fresh air to a Canada that needs access to news about Aboriginal issues.

1611 AVR is confident that it has what it takes to bring the world the Aboriginal viewpoint in a way that benefits all Canadians.

1612 MS MARACLE: Good morning. Sago.

1613 As was previously said, I am Diane Maracle Nadjiwon. I am the Program Manager for Anishinawbe Outreach Employment and Training Incorporated.

1614 We specifically support the efforts to establish Aboriginal radio services in urban areas, and I am happy that Aboriginal Voices Radio took the time to try and bring this service to our community even if we aren't a giant city like Toronto or Ottawa. We need Aboriginal radio here in Kitchener-Waterloo -- a service that will be good for all Canadians.

1615 Specifically, within our community we have roughly 300,000 people of mixed cultures. Of those individuals, we have another probably 5,000 to 6,000 Aboriginal people that come and go throughout our community as the year progresses.

1616 Predominantly our organization is interested in bringing meaningful opportunities for employment and training to those individuals. We have been in existence since 1997, and we work with our partners Weejeendimin and Native Resource Centre through White Owl Native Ancestry Association and through our housing partner with KW Urban Native Wigwam Project, which serves some 40 families in subsidized homes.

1617 Our partners at Six Nations with CKRZ, their frequency does not reach our area. By that, we are not able to tune into their programming.

1618 University of Guelph offers a brief show that does not reach the Kitchener community but can be heard in Guelph at the time that they broadcast.

1619 Other than that, what we have available to us is APTN. It is not a radio program; it is a television program. We can look to broadcast on that for visual types of entertainment and knowledge.

1620 Within this community we are anxious to have Aboriginal Voices Radio show us a national platform where we can take a look at economic development and interests for our people in the community. As a result of that, we hope to be able to enjoy some of the tactics that we might use for small business development.

1621 We would also like to look at employment and training initiatives that are going on across the country, because what is theirs is ours as well.

1622 We would like to enjoy the entertainment, music, discussions and editorials that Aboriginal Voices Radio can offer us, and we would like to do it in our home community.

1623 Thank you for this opportunity to speak on behalf of Aboriginal Voices Radio. Nya Weh.

0850

1624 MS KEEDWELL: Good morning. My name is Susan Keedwell.

1625 I am here today because I believe that the people of Kitchener-Waterloo need to hear the voice of the national radio network that is being created by Aboriginal Voices Radio.

1626 A national network would allow us to know what is going on in the Aboriginal world outside our community. It's not just a one-way street either. Not only do we need to know what is going on our there, but if for some reason our community is involved in an issue or event that had significance to the national Aboriginal community we would be able to get our story, our perspective, out into a national arena.

1627 Can you imagine a Kitchener resident on a national call-in talk show talking about our community and adding our perspective to the mix that the is the national Native scene.

1628 I can see so many uses for AVR in Kitchener-Waterloo. We have a real need for more access to Ojibwa language and other Native language lessons. Our children want to learn more about our languages and our traditions and our cultures.

1629 Many times as parents we don't always know about all about our own culture. I know that I don't. And I and other parents want and need cultural programming that would make our jobs easier to raise our children as Aboriginals and learn about our own culture.

1630 Our community has worked hard to create programs for our youth and other people in our community; and while the response by young people to the opportunities we provide has been good, radio programming would allow us to promote these activities and more.

1631 We also have a large community of Native college students from all over Canada that would also benefit from hearing the news and the music of their home communities, as well as possibly becoming involved in the programming.

1632 With an Aboriginal radio service here, we could tell people we are having a feast next week or that the community meeting is going on this weekend. We could give our elders the ability to talk to us about our culture, have programs that stress our traditional teachings so that we can share and pass on more of our culture to our children.

1633 Having an Aboriginal radio station here will not only bring national programming, it would allow us to provide local programming some time in the future. If AVR provides the transmitter that brings the world and the nation to Kitchener-Waterloo, our community will rise to the occasion.

1634 I say that because the technology exists for us to use the AVR transmitter to send our local programming to AVR for broadcast in our community.

1635 We have also been able to find money before for our projects in Kitchener-Waterloo, and I know our community would find a way to get local programming, even if it starts off in a small manner that, with continued support, would allow us to grow in the future.

1636 Without this partnership with AVR, our community would never afford or even think about an Aboriginal radio service.

1637 Please give us that tool. If AVR doesn't get this licence in the Kitchener-Waterloo area, we will never be able to get Aboriginal programming because there will be no frequencies available. If this happens, the people of this area will miss the last chance to take part in the national discussion on Aboriginal affairs that will take place in the near future because of AVR and its national programming.

1638 Thank you.

1639 MR. FARMER: The launch of a Kitchener Aboriginal radio service is a significant element in AVR's long-term business planning.

1640 Although KV tends not to be widely recognized with the other ten largest urban centres in Canada, it is a high priority to national advertisers in their planning and, as such, offers AVR a substantial boost in revenue potential and financial sustainability.

1641 The licensing of a new Aboriginal radio station in Kitchener will also benefit local existing and emerging Native broadcasters.

1642 In addition to the direct role AVR's station in Kitchener will play in supporting the development of a new national Aboriginal radio service, it can also serve as an important future component of the now fast developing central and southern Ontario regional network of Native stations.

1643 An unprecedented new ambition to develop Native radio is emerging right now at Christian Island, Georgina Island, Wahta and Wasaksing. Walpole Island is renewing its drive for better coverage, and CKRZ at Six Nations has just launched a new 24-hour programming service which will also serve the local area but is also available via satellite across Canada.

1644 The national network AVR is building will provide nationwide distribution for some of the best programming these stations produce, but AVR has also met with these stations to foster participation in a Central and Southern Ontario regional programming network.

1645 The development of this type of expanding regional Native network service will be greatly accelerated as Aboriginal broadcasters gain access to larger urban communities like Windsor, London and Kitchener.

1646 As the Commission is aware, this hearing process provides the opportunity for Aboriginal broadcasting in Kitchener.

1647 In conclusion, AVR is here to bring colour to the airwaves of Kitchener-Waterloo through a radio service that brings with it the perspective of a people of colour.

1648 We are here today to share our vision of a radio service that opens the door to the Aboriginal world for listeners in Kitchener-Waterloo. A look through a door that allows us to showcase the talents of our people and provides a news venue for events and issues that are important to our society.

1649 We are here because AVR can provide the Kitchener area general public with the knowledge they need to become better educated and more understanding of the Aboriginal experience.

1650 We are here because AVR gives us a chance to provide our people with the media representation they need to become better citizens for their nation, Canada and the world.

1651 Last of all, we are here because AVR is a long-awaited chance for everyone to learn about and to appreciate the very real asset that Aboriginal people are and can be to Canada, now and in the future.

1652 Thank you.

1653 THE CHAIRPERSON: Thank you very much, Mr. Farmer and your group.

1654 Commissioner Cram, please.

1655 COMMISSIONER CRAM: Have you caught your breath? Are you settled in?

1656 MR. FARMER: Yes, Barbara, I certainly am; thank you.

1657 COMMISSIONER CRAM: I want to start by talking about your local programming.

1658 It is at Section 5 of the application, 5.1, where you are talking about that.

1659 You say that you expect to broadcast a minimum of 2.3 hours of station-produced programming during each broadcast week.

1660 That will be produced locally?

1661 MR. FARMER: I will direct that to Mark.

1662 COMMISSIONER CRAM: It's 5.1 in the application.

1663 MR. MacLEOD: Sorry, I was digging this out to give to Gary to provide the answer.

1664 Could you repeat which section of 5.1 you were asking about?

1665 COMMISSIONER CRAM: It is 5.1(a), where it says you expect to broadcast a minimum of 2.3 hours.

1666 That will be locally produced?

1667 MR. MacLEOD: Yes. We are going to make sure that the programming is produced either from our national centre or locally here in Kitchener-Waterloo, if the resource is available.

1668 The gathering of the material that would make up that local programming, which is essentially community information, news going on the community, will be gathered locally; and if there is a resource we can employ here in Kitchener to actually put that together, then we will.

1669 That is why it is a bit fuzzy as to whether it is locally produced or just local programming.

1670 If the resource is not here, then one of our staff members will handle the actual editing, recording and providing of that programming. But it will all be gathered locally, and it will relate to the local community.

1671 COMMISSIONER CRAM: So it won't necessarily be produced locally, then.

1672 MR. MacLEOD: I don't know if there is an MAPL for what qualifies as local programming.

1673 Certainly as local programming develops in Kitchener, that would be one of the first things that would be handled.

1674 I guess I want to give you assurance that if we don't have that capability locally because it takes us a year or two to actually develop some local programming, that will be produced by one of our staff members out of Toronto.

1675 There certainly exists now radio talent that we have identified here in the community. It is just that by the time we finish this licensing process, we don't have those people under contract so they may not be here. The back-up plan is that we would produce it in Toronto.

1676 We are only talking about a community calendar-type recording, so it doesn't require a tremendous amount of technical skill. There are certainly a number of people that we have identified in the market that are interested in this project that could fill that role. We would expect from day one that that would be the case.

1677 Again, the back-up is that we would add that to the responsibility of the person who is doing the same thing in Toronto. They would simply produce that extra programming.

1678 The local part of it will still be gathered here in Kitchener-Waterloo through Anishinawbeg Outreach, through the resource centre and through other organizations that already pull that material together by faxes, by mail, by Internet.

1679 They are already well connected, and there is a good distribution system in place for the activities that are taking place. There is simply not the venue to let everybody in the community know what is going on. That is the role that the radio station would play.

1680 COMMISSIONER CRAM: This 2.3 hours, then, is in fact the 1-to-2 minute activity calendar?

1681 That is on page 10 of Schedule 3.

1682 MR. MacLEOD: Yes. It may well have a more attractive name by the time it hits the air. But it is the activity calendar; that's correct.

1683 COMMISSIONER CRAM: So the 2.3 hours will consist of the 1-to-2 minute activity calendar. Is it going to be updated daily?

1684 MR. MacLEOD: Yes. The plan now is that it will be updated before noon of each day, so you would not be airing old material by the time you roll into the afternoon.

1685 I hope that we will get to talk about our vision for local programming in Kitchener-Waterloo. At such time as there is actually a fulltime person here, that could well be updated -- with the technology that exists now, that could be updated two or three times a day.

1686 The intention from our Toronto situation is to edit this material digitally. So it is quite easy to alter the programming and make it very current.

1687 This activity calendar would not just focus on what is happening that night; it would be a calendar that essentially looks ahead to the major events coming up in the community. So it will promote things that are happening the coming weekend and the following week, that type of thing.

1688 COMMISSIONER CRAM: Then would it be, at a minimum, an hour and 15 minutes of original local per week?

1689 MR. MacLEOD: That would be a reasonable estimate of how much of that would be original and how much would be repetition of the original, yes.

1690 COMMISSIONER CRAM: I saw in your application there was a reference to volunteers.

1691 You are not exactly aware that there are production studios here. Is that the concept?

1692 MR. MacLEOD: Yes. We have spoken to a number of groups that have facilities here and even taken a quick eye as to any of the rooms that might be easily converted to something where this could be produced.

1693 The other option of course that exists is, in addition to commercial broadcasters here, we do have support from both the campus and community stations -- not specifically necessarily to offer the studios here in Kitchener-Waterloo, but across the country that has always been an option for us in the major urban centres.

1694 Those places already essentially take in people who are interested in producing programming like us and find a spot for them on their own airwaves. They have certainly competent studios where this production could take place, if it is convenient.

1695 COMMISSIONER CRAM: Ms Keedwell, you talked about the fact that there were volunteers ready to assist AVR?

1696 MS KEEDWELL: Yes. I believe that many people in our community have already shown support by coming out to the original presentation put on by AVR.

1697 COMMISSIONER CRAM: In terms of co-ordination of the volunteers, would you then assume that it would be Ms Keedwell and her centre that would be doing the co-ordination?

1698 MS KEEDWELL: Just to clear that up, I was past president of Anishinawbeg Outreach, but I am still quite involved in the Native community and would volunteer myself to assist.

1699 COMMISSIONER CRAM: And then your back-up plan is that the collection will be done here, and the production will be done in Toronto.

1700 MR. MacLEOD: Yes, that is correct. Of course, so much of the information these days is being distributed by the Internet. So it is essentially no extra work for Anishinawbeg Outreach to forward anything they have that looks like it would be of interest to a virtual mailbox where somebody in Toronto edits that.

1701 As I said earlier, there is competent broadcasting talent in the community already certainly able to handle that level of production.

1702 It is just the case that we haven't contracted anybody specifically for that work right now. I would expect that we would probably employ somebody on whatever limited basis is required to prepare that material on a daily basis.

1703 COMMISSIONER CRAM: That is where I was getting into the $6,000 a year you had in your pro forma that talked about programming expenses, starting in Year One.

1704 Is that for the production of this hour and 15 minutes of original programming?

1705 MR. MacLEOD: In a sense, it is a contingency fund if that was required. If we could not take it out of our own salaried staff and there were costs associated with it locally, then that would be the maximum we would see.

1706 It is possible in the first year that none of that $6,000 would be spent toward that. It might all be absorbed in the Toronto office.

1707 At AVR we certainly are optimistic about future development. But we are trying to be conservative in our projection of how that might practically develop.

0905

1708 COMMISSIONER CRAM: This 2.3 hours is then further broken down, in subparagraph (c) again in 5.1 in the programming information, into 2 hours and 20 minutes English, 5 minutes French and, if I have it right, 5 minutes Aboriginal languages.

1709 MR. MacLEOD: Yes, that is correct. In a sense, it is perhaps too fine a point to put in the application. But certainly the activities in the community do include language lessons, do include a lot of cultural programming which will include French and various Aboriginal languages included. They may well be mostly incidental rather than specific extended portions of language use.

1710 The point in putting that in -- there was a debate as to whether that was worth separating out. But we wanted to give the Commission the idea that at least incidentally throughout the programming there will be references to culture. People will hear the tongues, the sound of languages that they don't often hear. Even Aboriginal people might not have heard a lot of Dine, for instance, or they might not have heard a lot of Migma.

1711 Our intention is to spread at least incidental languages throughout the programming to kind of maintain the idea that English is the language of convenience. It is the practical language to use. But we want to make sure that people understand this is a cultural programming service.

1712 COMMISSIONER CRAM: Would AVR accept a COL of one hour and fifteen minutes of original programming from Kitchener, primarily in English but with incidental Aboriginal and French language?

1713 MR. FARMER: Yes, we would, of course.

1714 I also would like to add that we are entering into a relationship with the Aboriginal Peoples Television Network in terms of regional coverage of news. There exists here currently a Native journalist working for CTV, and that is the relationship that APTN is in.

1715 COMMISSIONER CRAM: Yes. APTN has an agreement with CTV.

1716 MR. FARMER: That's right. So we hope to actually negotiate prior to licensing that some coverage here from a professional journalist on a daily basis would be in place by the time we go to air.

1717 Yes, we would accept that COL.

1718 COMMISSIONER CRAM: Condition of licence.

1719 Then your application says that you will introduce local programming over the term of the licence. This is distinct from the 2.5 hours that you are talking about.

1720 Mr. MacLeod, you are nodding your head up and down?

1721 MR. MacLEOD: I wasn't sure if Mr. Farmer would answer the question. He is certainly aware of our plans for development of the program.

1722 The group of people that we have dealt with since we developed the application and have gone through the process of preparing for the hearing are very enthusiastic. But not having these people as employees means that we want to have a conservative projection as to who will be available at the time.

1723 Sue can comment further on that, or Diane.

1724 There is a lot of interest in developing youth-focused programming to air later on in the afternoon, or perhaps to take a more traditional route of having a morning program. The interest is there.

1725 We have only taken it as far as a conversational development stage until we are awarded the licence. At that point I would expect that the major organizations in KW would look at putting forward funding proposals to the various government bodies that they already approach with different programs. Now they would have a new direction to take some of the outlets of their funding proposals.

1726 COMMISSIONER CRAM: When you do introduce the more local, there would certainly then be a plan for local studio and staff.

1727 MR. FARMER: That is certainly the ambition. We have had discussions with especially Anishnawbic -- I don't know if you want to comment on that.

1728 MS MARACLE: There is a variety of different mediums that we can do this through. There is a local radio station where we could do local programming or we could borrow space and time to do programming here.

1729 The University of Guelph has already offered their expertise. They do have Aboriginal people that work at the radio station who could help us to produce, as well.

1730 There is a number of individuals who visit our centre who are looking at doing production, direction, radio, camera, all types of different types of media-oriented production careers.

1731 For those individuals we can access any number of different funding providers -- First Nations, Métis associations, Inuit Tapirisat, Human Resources Development Canada -- to build training programs in order to train these people in these careers.

1732 As Gary indicated, we do have Aboriginal staff in the community through CTV that provide Aboriginal programming as far as television is concerned, and they would be more than willing to at least work with those individuals that we have that are interested in careers in the field. It is something that we are looking forward to developing a relationship for.

1733 Our goal is to employ Aboriginal people and also to get our voices out there and heard amongst the greater population of Canada.

1734 It is also a demand that we have that comes into our office on a regular basis: just basic education. Who are we? What are we doing? Where are we going in the future?

1735 This is just a beginning point for us. Thank you.

1736 COMMISSIONER CRAM: This whole local production issue, in excess of the 2.3 hours, is predicated on as resources become available.

1737 What is the minimum amount of resources that you would need to start this up?

1738 MR. FARMER: I would like to direct that to Mark.

1739 MR. MacLEOD: Our budget already includes having the capability at the transmitter site to be able to do insertions of programming from remote locations. So technologically it is not expensive to simply add programming.

1740 If you were looking at adding extensive hours, say five or ten hours a week of programming, you would probably want to pay for a landline or a microwave link to the transmitter site. At that point not only are you into an initial expense, but you are into an ongoing expense.

1741 It is why we have shied away from taking that step beyond producing occasional programming to a commitment for a morning show or an afternoon show, that type of thing. Our financial planning doesn't allow us to look at investing that kind of money in the Kitchener market at this point in our development. We are not a revenue-generating machine yet, so we really need to move to a position where the network is on the air and generating revenue before we can look at investing further in the local community.

1742 As we have talked all along, a more likely scenario than AVR inserting staff into this market and setting up facilities, the community here has already proven its ability to be very active, to generate funding for other projects.

1743 We have not forced them into a room and got them to repeat after us: Radio is good. They appreciate that this is as exciting as anything that they have gotten funding for, perhaps more attractive to the type of people that they currently receive funding from.

1744 So they feel very positive that they will be able to get funding to produce language programming, to produce youth-oriented programming, elders, all these things. They have previously gotten funding without the outlet that this radio station will provide, so everybody is very hopeful about it.

1745 Again, we are trying to be conservative in our projections. There is no moving away from the fact that this is primarily intended to connect up Kitchener-Waterloo with Calgary and Ottawa and other markets rather than to be primarily a local service to allow Kitchener-Waterloo people to communicate with themselves.

1746 That second element will certainly develop as funding becomes available.

1747 COMMISSIONER CRAM: As you raised it, it's a nice segue into the plan and your strategy.

1748 Step 1 in your application was launching Toronto, and your application referred to an implementation date of June 2002.

1749 Am I correct that you are on air now?

1750 MR. FARMER: Yes, we are on the net on air. We had hoped to be in Toronto by now, but we are meeting some complications on the big tower.

1751 John, are you prepared to give us the latest update?

1752 MR. MATTHEWS: Certainly. There were some construction delays on the rooftop of First Canadian Place, but we are expecting to be testing within two weeks from today.

1753 COMMISSIONER CRAM: So you are on the net. How many hours of programming per day?

1754 MR. FARMER: We do 24 hours a day, but it is on satellite distribution right now, from 9:00 a.m. to 9:00 p.m. every day currently.

1755 COMMISSIONER CRAM: Do you have the programs as in your schedule as you originally filed?

1756 MR. FARMER: No, we probably won't be launching the full service until March 1, 2003. We will be testing until December and starting community announcements and some news programming starting in December with some staff recruitment coming in. That is the current plan.

1757 So full programming service won't be launched until March 1, 2003, at which point we will be distributing to all of the stations that are currently within our network.

1758 Maybe Mark can give you some update on some of the satellite communities who are currently receiving our distribution.

1759 MR. MacLEOD: Yes. Since the beginning of this project when we looked at going beyond the Toronto market, we have had interest, especially in the east where there are no established Native broadcasting networks; essentially pressure from them for us to get our service upon satellite or even on high-speed Internet so that they can have programming on which to found their stations or to increase their overnight programming, and that type of thing.

1760 Even at the level of the service we are providing now, we haven't hired our full complement of news staff or programming staff because we want to make sure they are going to have something to do besides put it over the Internet.

1761 Right now we have interest from existing Native broadcasters in four provinces, I think a total of nine stations. One of them is currently testing carrying our signal right now and the other ones have requested the technology from us to be able to receive that service.

1762 We are putting programming over satellite 12 hours a day right now, from 9:00 in the morning to 9:00 at night. Thanks to a benefactor, we have the capability of equipment to allow 12 existing broadcasters to carry our signal.

1763 Our long-term plans are to distribute our signal through a subcarrier of APTN and either/or Star Choice or Bell ExpressVu. But until we have our full complement of programming, that is still a couple of months away.

1764 COMMISSIONER CRAM: What kind of programming is being transmitted now?

1765 MR. FARMER: Exclusively a music service. We are just testing the service as a music service right now, running 24 hours a day of music programming. The community news calendar and some news will start in early December.

1766 Right now we are just doing an exclusive test of just a music service.

1767 COMMISSIONER CRAM: The music is the kind of music you anticipated putting on the final product, if I can call it that?

1768 MR. FARMER: It is 100 per cent Aboriginal music, yes.

1769 COMMISSIONER CRAM: In December you are going to start. How many staff do you have working on it now?

1770 MR. FARMER: Currently, we have just employed four -- well, they are contracted staff -- for six months. So we have four, and we will be kicking in about four to five new positions in December in the programming and news department.

1771 COMMISSIONER CRAM: So four fulltime staff now, and you will be adding two in news in December?

1772 MR. FARMER: Possibly three: two in Toronto, one in Ottawa. And also some programming staff, specifically a program manager.

1773 COMMISSIONER CRAM: There is no advertising?

1774 MR. FARMER: Not yet. There is no advertising yet, but soon, very soon.

1775 COMMISSIONER CRAM: Have you got sales people? How is that happening?

1776 MR. FARMER: We are in discussion with a lot of sales in the national sales office. We will probably be handling that ourselves in December and using a national sales representative. We will work on it as we go to air. We will probably go non-commercial launch and then start to work on the advertising.

0920

1777 MR. MacLEOD: Perhaps I could add a comment here.

1778 We have actually been approached by a number of agencies that heard about our service. They had heard that it was going to be up in June, and they have continued to call with clients that are interested in advertising.

1779 I am not suggesting to you that that is our budget. But clearly there is interest out there already.

1780 The primary focus of our advertising revenue, of course, is national ads. That would be significant companies. We understand the interest is not just in reaching one market but being able to reach multiple markets with their ads at the same time.

1781 We would love to get as much money as we could as soon as we could. It really makes sense for us to focus on a March timeline where we are potentially up in Ottawa, Calgary and Toronto and where the interest for advertising on the network will be far greater.

1782 MR. FARMER: And Vancouver, of course.

1783 COMMISSIONER CRAM: March is also when you are going to bring in the programs, the talk programs. Is that how I understand it?

1784 MR. FARMER: That is correct.

1785 COMMISSIONER CRAM: That you are looking at now.

1786 MR. FARMER: Yes. It will be at the launch of our programming service, yes. It won't be the full complement of what we promised in our original licence, of 40 per cent, but it will be somewhere up there.

1787 COMMISSIONER CRAM: Now am I hearing that step two, which is the repeaters of your plan, of the strategy, introducing local repeaters into the major Canadian market, which you said in your plan will be done by June of next year, you are actually trying to move that up for Calgary, Vancouver and Ottawa to March.

1788 Is that right?

1789 MR. FARMER: That is correct.

1790 COMMISSIONER CRAM: For the purpose of advertising, obviously, so you will get the value out of the advertising.

1791 MR. FARMER: We know that those situations will be cleared up, and Ottawa and Calgary are ready to go with us. Actually, Toronto is the major problem for us right now. Calgary and Ottawa are fine.

1792 COMMISSIONER CRAM: And Vancouver you have found something, I gather.

1793 MR. FARMER: I don't want to get into that.

1794 COMMISSIONER CRAM: No, we don't.

1795 The timeline, then, is March. The three others presently awarded, Calgary, Vancouver and Ottawa, and, if awarded, Kitchener, will all be up by March of '03.

1796 MR. FARMER: That is ideal, yes.

1797 COMMISSIONER CRAM: Right. That's ideal.

1798 What is your fallback position on getting these up? What is the less than ideal? What is the deadline? What is the drop dead time?

1799 MR. FARMER: We are confident that Ottawa, Calgary and Toronto will be up for sure for March 1st with the programming launch. We have enough dollars to do that.

1800 It is all in place, and we are ready to go. So I don't see any fallback plan currently.

1801 Maybe Mark might answer that.

1802 MR. MacLEOD: We should be clear that in the case of both Ottawa and Calgary, the only remaining elements to launch there are concluding an agreement which would have a start date for when we start making payments on the lease of the transmitter site and ordering equipment.

1803 In both cases we are going into a master antenna system that has been constructed, and our portion of the cost that we have put into that is about half a million dollars.

1804 Essentially, we are holding off. We wanted Toronto to be resolved sooner. But we are ready to place the final orders for the remaining equipment for both Calgary and Ottawa as soon as we conclude an agreement with the transmitter site owners.

1805 The major stumbling block there is the fact that clearly as soon as they sign the agreement they want money starting. Like I said, we are not the revenue generating machine we want to be yet, and we are looking at probably March realistically for advertising dollars. That is when we will start seeing some revenue coming in.

1806 COMMISSIONER CRAM: So for those three, Calgary, Vancouver and Ottawa, am I right that the capital you require is about a million, a million and a half, and that's all in place?

1807 MR. MacLEOD: I think there is approximately $100,000 remaining to be spent, in total, for all those markets.

1808 COMMISSIONER CRAM: So all the capital has been committed actually and disbursed.

1809 MR. MacLEOD: Yes. It's gone. It was nice while we had it, but it's gone now.

1810 MR. FARMER: Your assumptions are correct.

1811 COMMISSIONER CRAM: So about another $100,000.

1812 Here, if I read your application right, the capital is about $80,000. I think it was $80,000.

1813 Is it your plan that if this was awarded and if a decision was out, Kitchener would go on line at the same time, March of '03?

1814 MR. MacLEOD: Yes. Gary was just suggesting that I point out to you that essentially because of the delays in Toronto, we have been forced to take a bit of a financial change in strategy.

1815 Our plan at the time when we applied for Kitchener-Waterloo included us essentially capitalizing the equipment immediately, purchasing it just like we have done previously. But because of the delay in Toronto, our plan now is to have a lease-to-buy type of agreement with the equipment. In that way we are not going to be encumbered by that full $80,000 right off the start.

1816 It is important that we keep some reserve of funding. As we know, advertising is unpredictable and we want to have the most conservative situation we can.

1817 I hate to see that money go to some leasing company, but it really makes sense for us at this point not to put the $80,000 out right away. Our first year expense is going to be closer to $30,000, $35,000.

1818 COMMISSIONER CRAM: Then is the plan to have Kitchener at the same time, March '03?

1819 MR. FARMER: With these new leasing arrangements that we have solidified, that is the current plan, yes, if we are awarded the licence.

1820 COMMISSIONER CRAM: Then the plan talks about enhancing local and regional programming with news bureaus across Canada. It says again "as resources become available by June '04".

1821 That is the plan?

1822 MR. FARMER: Yes.

1823 COMMISSIONER CRAM: In some format, I guess, depending on volunteers and other associations. Is that the concept?

1824 MR. FARMER: I think this new relationship that we are developing with the Aboriginal Peoples Television Network -- I don't know if they have announced it, but they have a new CEO, who has been very supportive of our project. We have worked together, actually, on this project.

1825 We have already been talking about the newest development of journalism across the country and shared resources in that regard.

1826 In Calgary we are entering into a relationship with the CBC, as well, to possibly utilize some of their existing facilities and some of the major cities across the country in regard to real estate and the CBC using us as a tenant assisting with them.

1827 We are working with them a lot on many of their towers across the country, so that makes a lot of sense. We are going to enter into a relationship with them, as well, to speed up this process of regional news departments and local markets across the country.

1828 MR. MacLEOD: Perhaps I could add a comment to that, as well, Commissioner Cram.

1829 We have had a series of meetings with some of the local nations that are in the Calgary area about having studios situated on reserve land and having programming produced there, morning programming. They are very interested in that.

1830 We were hoping maybe we would have something concluded in that regard to bring to this hearing, but it is not concluded yet.

1831 Vancouver and Calgary and some of the other markets have very urban reserves which bring a lot of reserves right to that community, more than in Kitchener where there is Anishnawbic help and other organizations like that.

1832 As far as the model of having news bureaus go in the markets where there is an urban reserve, the future is very bright that that is where that centre of programming will be.

1833 I think we mentioned earlier that we will have an Ottawa news bureau from day one, right from the beginning of programming. Perhaps it won't be totally functional for our programming before March 1st, that we are putting up on the satellite and Internet. But by March 1st that office will be providing daily news reports to our service from Ottawa.

1834 COMMISSIONER CRAM: This is just curiosity.

1835 Your satellite programming is 9:00 a.m. to 9:00 p.m. What about the night time? That is when I understood Native broadcasters were having problems.

1836 MR. FARMER: It is just a temporary situation. That should be rectified, and we should be going 24 hours a day by the first of -- I'm sorry, it is December 8th that we will be going 24 hours a day on the satellite in our current location.

1837 COMMISSIONER CRAM: Particularly, isn't it B.C. where they are using programming from some Vancouver station as opposed to --

1838 MR. FARMER: That's right. There is a rock station going into Northern Native Broadcasting from Vancouver, yes, which I think they have backed off on already.

0930

1839 MR. MacLEOD: I would like to make sure it is clear that this was a donation to us of this service, this 12 hours a day, and it is something we couldn't refuse.

1840 It almost felt like a taunt. It was like, these are the wrong 12 hours. Why not the other 12?

1841 COMMISSIONER CRAM: Give us the low cost hours.

1842 MR. MacLEOD: What is has allowed -- clearly those existing broadcasters out there are more interested in the other nine hours in the overnight programming. Essentially, what we are going to be doing between now and March is giving them a chance to pick up, to listen to our programming and decide what parts they want.

1843 We don't make the assumption that what we are going to be offering will fit every market at any particular time. It is clearly up to them to decide what makes sense in their own location.

1844 COMMISSIONER CRAM: Moving on to Aboriginal language programming, your application states that 2 per cent of your programming will be Canadian Aboriginal language programming.

1845 Would you accept a COL to that effect?

1846 MR. FARMER: Yes, of course.

1847 COMMISSIONER CRAM: Then at 5.5(c) of the application you talk about a minimum of 25 per cent Aboriginal music selections, although you expect them to be 40 to 60.

1848 That is Canadian Aboriginal, is it?

1849 MR. FARMER: That is correct.

1850 COMMISSIONER CRAM: Would you accept a COL for the 25 per cent?

1851 MR. FARMER: That's no problem. That would be fine.

1852 COMMISSIONER CRAM: Thank you.

1853 Then there is spoken word. How much was spoken word to be of the total?

1854 MR. FARMER: It is 38.5 per cent originally, yes. We will climb to those numbers, but not at launch.

1855 COMMISSIONER CRAM: Would you accept a COL?

1856 MR. FARMER: Of?

1857 COMMISSIONER CRAM: Thirty-eight per cent spoken word.

1858 MR. FARMER: In Kitchener-Waterloo?

1859 COMMISSIONER CRAM: Yes.

1860 MR. FARMER: From day one?

1861 COMMISSIONER CRAM: We can only talk on this, yes.

1862 MR. MacLEOD: I'm tempted to say slow down, big boy.

1863 COMMISSIONER CRAM: Once I get rolling on COLs, you should see what I did to Rogers in Toronto.

1864 MR. MacLEOD: We're all getting a little nervous here.

1865 Clearly the COLs that you are asking for are the absolute minimums. We have no problem agreeing to the various ones.

1866 It is when you start talking about some of the ones that are perhaps more ideally minimal but really could end up being in reality the minimum we could offer. When you get into spoken word, clearly there is a direct relationship to the amount of cost involved in producing it.

1867 We don't feel that it is necessary to put a condition of licence on our spoken word that is as high as the percentage that we are putting in our licence application.

1868 I would respectfully say that we would like to hold it at the level that we have promised in the other stations and not to commit the Kitchener licence to some higher percentage of spoken word than what is minimally required in the other markets.

1869 COMMISSIONER CRAM: What did you commit to in other markets?

1870 MR. MacLEOD: It seems to me that we had -- I think it was 25 per cent. I am not sure. It could have been 30 per cent.

1871 The tendency for our spoken word programming is probably going to be upwards.

1872 COMMISSIONER CRAM: It's 25 per cent.

1873 MR. MacLEOD: That did ring a bell that it was 25 per cent. If you look at our program schedule -- and we have every intention of carrying those programs. If you add it up, it's way over 25 per cent.

1874 It is like our commitment to Native language, our commitment to Aboriginal music. As Gary said earlier, right now our music on the satellite service is essentially 100 per cent Aboriginal. We know the Commission won't complain if we exceed these totals, and it is our intention to. If resources are available, we will certainly be way up there in all these categories.

1875 COMMISSIONER CRAM: So you would accept a COL for 25 per cent spoken word.

1876 MR. FARMER: Yes.

1877 COMMISSIONER CRAM: Thank you.

1878 Employment equity. Have you an employment equity plan?

1879 MR. FARMER: I think Minnie Two Shoes has our policy right with here.

1880 MS TWO SHOES: We have a draft policy on which I did some research. Some people were very kind to us and allowed us to look at their equity policies.

1881 It was kind of an amusing situation because it was like: Oh, we have to guarantee that we will give ourselves jobs?

1882 It is going on the agenda of the next board meeting, which is actually this coming Monday, of the Aboriginal Voices Radio board of directors. It is a very simple policy. We have been assured that it holds legal air -- is that a good word? Legal water. I don't know, but it's good.

1883 We do have this in place, but it has not been specifically authorized by the board. They have it.

1884 It specifically says that we recognize women, Aboriginals, disabled people and visible minorities.

1885 COMMISSIONER CRAM: Any thoughts about getting a positive exemption, the affirmative action exemption?

1886 MR. FARMER: Sure. I haven't had any thoughts about it specifically.

1887 COMMISSIONER CRAM: You may or may not know that the Indian Gaming in Saskatchewan has an exemption to the point of 80 per cent Native employment.

1888 In other words, you get an exemption from the Human Rights Commission saying that you can positively prefer employment of Native people to a certain extent.

1889 I was just wondering if you had done that.

1890 MR. FARMER: Minnie has made notes of it.

1891 COMMISSIONER CRAM: Minnie, I'm not a practising lawyer any more, so don't trust me.

1892 MR. MacLEOD: I can add to that.

1893 When our timeline originally showed us going on in Toronto in June -- and we certainly hoped to be on at that time -- we carried out an extensive recruiting process in April and May of this year. We had over 350 applications, and it was our intention to hire staff leading up to full staffing for June.

1894 At that time our lawyers advised us on negative discrimination, on possibilities for exemption. But it does not seem that that is required in our case.

1895 We are essentially a gender-balanced organization at this point. Obviously, Aboriginal quota is not a problem. We have every intention of including persons with disabilities fully in our staff. It is part of our recruiting campaign.

1896 We don't feel like we need a special exemption.

1897 In our hiring process, while we outlined the requirements in some of the positions for knowledge of Aboriginal issues, we were not exclusive in who could apply. We got some excellent candidates who were non-Native and will be considered for employment.

1898 Essentially, the staff will be predominantly Aboriginal.

1899 COMMISSIONER CRAM: I want to move on to your advisory board. It is at page 68 of your supplementary brief.

1900 I know you actually referred to it, Mr. Farmer, about APTN having a new CEO. Mr. Nadeau is still in your list of the advisory circle.

1901 Have the people in your advisory circle changed?

1902 MR. FARMER: Well, there are always new additions. The ones we have maintained on that list are still very much part of our advisory.

1903 Ron Nadeau, of course, ran Native Communications prior to going to APTN, so he is always going to be bilingual to us and a dear friend.

1904 COMMISSIONER CRAM: So there are more on your list? Is that what you are saying? There are more on the advisory circle?

1905 MR. FARMER: I think there have been some additions to the advisory circle in the recent times, yes.

1906 MR. MacLEOD: I can offer a comment on that, Commissioner Cram.

1907 I would be afraid to suggest that I can remember everybody who has come on, but we have added a couple of notable people recently in relation to our continuing expansion into the various areas of the country.

1908 For instance, we have Bernard Herveau, who I believe is the Executive Director...

1909 MR. FARMER: And SOCAN up in Québec. They are also assisting in our Montreal application, of course, in terms of French language programming. We are entering into a relationship with them.

1910 COMMISSIONER CRAM: Perhaps what you could do is give us a list of the advisory circle as of now. Perhaps that would be best.

1911 MR. MacLEOD: This advisory circle list is probably three or four months old at the time. We filed back in -- I don't know when the deadline for applications was in April. It is evolving.

1912 There are a couple of people on this list who are not in the advisory circle any more, as well. So it's a bit of a fluid list.

1913 Again, I don't want to downplay the importance of the advisory circle, because these people are a tremendous resource. We have not utilized them fully up until now. As we get a more functioning organization, we will use these people a lot more than we have in the past.

1914 Their commitment to us is, in a sense, to be available to us as we need them rather than to be a functioning meeting kind of board or organization.

1915 If you look at this list, if you recognize some of these names, it would be folly to suggest that we could get these people together any time. They are some of the busiest people in Canada.

1916 As we move into fuller operations, we will have conference calls where we have perhaps larger groups of these people when there are legal matters that we are dealing with or dealing with issues of language programming, et cetera.

1917 Essentially, these are people who have agreed to provide advice to us.

1918 To be specific, at the time when we put this list out, I believe it wasn't public yet that Ron Nadeau wasn't the CEO, although I seem to remember I thought: Should I change it or not? I thought it was better just to leave him in there until it was known that he had left the organization.

1919 MR. FARMER: Just to give you an example, I met with Doug Mayling(ph), who is on that list, just last week in regard to the four up-start stations that are going to be on satellite distribution with us when we launch.

1920 Last week from that list I also met with Derek Andrews from Harbourfront, who is helping me in a fund raising concert for the Aboriginal Voices Radio launch at Massey Hall in Toronto in the new year.

1921 So I consult them a lot, personally.

1922 MR. MacLEOD: If I could add one more comment, we talked earlier about resources in the local community, including the development across the country of local programming. We have always had a good relationship with National Campus Community Radio Association.

1923 Most of those stations and markets have at least an hour of Aboriginal programming and have Native volunteers.

1924 One of the new people in our advisory circle is Melissa Kasner, who is the Executive Director of the Association based in the national office in Montreal.

1925 Now that we are moving closer to actually launching, they have an interest in linking up more strongly with us in various markets. They have essentially suggested that they could solve our studio access problems in all the cities that they have members, because they are open access studios as it is.

1926 So we are very pleased to have her in this group, as well.

1927 COMMISSIONER CRAM: The next question I was supposed to ask is: Have they met?

1928 I think you have answered that, Mr. MacLeod. They have never really met. They are sort of counsel in the sense that you phone them for advice.

1929 Is that a fair way to say it?

1930 MR. FARMER: They also participate actively in helping us raise awareness, and dollars as well. They are very supportive.

1931 COMMISSIONER CRAM: They are good at dollars.

1932 MR. FARMER: They are good at dollar raising, yes.

1933 COMMISSIONER CRAM: Do you anticipate that they would in fact meet in the future or that they simply remain the way they are, this advisory circle?

1934 MR. FARMER: AFBA, I guess; that is, as funds become available.

1935 COMMISSIONER CRAM: As funds become available? I notice that a lot in here.

1936 I understand there is a Kitchener Local Media Advisory Circle. Can you simply give us a list of them and a biography of each, just file it with us?

1937 MR. MacLEOD: Actually, there was included in our application, as in other markets, a proposal that if we are licensed in the market we would form such an advisory circle.

1938 No doubt you are seeing members of that advisory group on this panel today, and you will have some intervenors appearing.

1939 There are no shortage of people interested, but it is not our intention to officially form that group until such time as we are licensed in the market.

1940 In fact, although things are a little more solid in some of the other markets, those groups haven't really been active yet because in a sense they are at the end of a long line waiting for closer proximity to launch time.

1941 For instance, in Ottawa that group hasn't really met yet. We keep them up to date. I would expect you are going to see those various groups start to meet in January or February to start advising us about how we should cover stories in those markets, et cetera.

1942 Again, it is not really an active group in an organized fashion. We are in contact with those people, and they offer us free advice already. But the more formalized organization will take place as the transmitting facilities become operational in those markets.

0945

1943 COMMISSIONER CRAM: Moving on to local advertising, it is not your proposal to solicit local advertising now.

1944 MR. FARMER: That is correct.

1945 COMMISSIONER CRAM: If you wished to solicit local advertising, you will seek our approval to do so.

1946 MR. FARMER: That is correct, yes.

1947 COMMISSIONER CRAM: You, however, don't want a COL allowing local advertising once you reach 42 hours a week local programming.

1948 MR. MacLEOD: That is correct. We don't feel -- we feel that the Commission should allow us some flexibility, as things develop, for us to be able to come to the Commission and say: Okay, here is the point where it makes sense for us to have local.

1949 The Commission should appreciate that it has as much to do with our realistic expectations of how much could be generated locally as it does with the direct connection to local programming.

1950 If we thought that local advertising in Kitchener could be a huge revenue potential for the network, then we would be a lot more aggressive in suggesting that we wanted to have it at only ten hours or five hours, or whatever.

1951 It makes sense, clearly, to have local advertising connected to local programming. And until such time as we are offering that, we see no reason in committing or planning to have local advertising.

1952 We would like the Commission to leave that flexible. You will have the opportunity in the future to consider and turn us down, if you feel that you think it is detrimental.

1953 I don't think any of the commercial broadcasters in Kitchener-Waterloo need fear our take out of the market, for whatever our local advertising ends up being. It will be a very small amount of money, no doubt.

1954 Not that I want to discourage any future salespeople who may be interested in trying to sell. But that is our projection.

1955 COMMISSIONER CRAM: I wanted to go a little bit into the demand issues.

1956 Mr. Doering(ph) isn't here. His study didn't include Kitchener-Waterloo.

1957 Do you have any studies showing the demand in Kitchener-Waterloo itself?

1958 MR. FARMER: The first thing, we don't have anything that we have underwritten to any marketing studies here in Kitchener-Waterloo.

1959 Maybe Diane or Sue could speak to that matter.

1960 MS MARACLE: I don't know, but I would say there isn't anything here for Aboriginal programming, period, at this point in time.

1961 Is there a demand? Yes, I want to be able to turn on the radio and hear about Aboriginal programming across the country, as I am sure the greater part of my clientele, 400 a month in this community, would also want to hear that.

1962 But as far as any kind of documentation or study to that effect, I can't share that with you. Sorry.

1963 MR. FARMER: I also wanted to point out that at CKWR-FM, the local community broadcaster, did have a three-hour Native program here, so that demonstrated to me that there is definitely a potential here. The broadcaster just changed location, so when he left, so went the program.

1964 There has just been a void in terms of someone taking that. But that was successful here in his tenure. It ran for at least a couple of years -- four years actually, is what I am told.

1965 COMMISSIONER CRAM: There is reference in the application to a study. It is Schedule 3, at page 5. It is a study quantifying the local Aboriginal community at 9,000.

1966 Could you file a copy of that study with us?

1967 MR. MacLEOD: Yes.

1968 COMMISSIONER CRAM: Thank you.

1969 Ms Keedwell, you talked about every year there are college students who are also Aboriginal, and I would think you would mean in addition to this 9,000.

1970 Any idea of the numbers?

1971 MS KEEDWELL: No. Unfortunately, we don't have any solid documentation stating that.

1972 MR. FARMER: Minnie has an answer.

1973 MS TWO SHOES: As part of trying to get here to the hearing, I talked to many people within the community. One of the people who attended our first community meeting when we talked about this station was a women from the Conestoga College, which is just a very small college. But they have over 20 Aboriginal students.

1974 Then if you take the University of Waterloo and some of the other educational -- Sir Wilfred Laurier -- there are many students here. There are 35,000 students just in this town.

1975 My indication, in talking to councillors and people who have been involved in it, is that there are quite a few students.

1976 MR. FARMER: I think you will get some numbers, as well, with people who come and support us. Many of those are from the educational area.

1977 Also, the First Nations Secretariat -- I don't think they are coming, but they have several students. There is about 20 neighbouring communities here, and this is a university town. Many of their people are here studying.

1978 COMMISSIONER CRAM: Moving on to revenues, you are estimating $55,000 a year in your pro forma. This is network advertising, national.

1979 So the value of the incremental 430,000 people reach, is that where that money is coming from?

1980 MR. MacLEOD: Unfortunately, I need to correct you on the 430,000. The 430, I believe, is not the interference-free coverage.

1981 COMMISSIONER CRAM: I was just talking about the population.

1982 MR. MacLEOD: Sorry. Yes, we would like all 430,000, but I don't think that is going to happen.

1983 In a sense, you are correct. We took at look, in consultation with national advertisers, if we added Kitchener to our portfolio, as it were, how much is that likely to increase our total national sales?

1984 It's a bit of guesswork. It's clear that the amount that we put down as a revenue total for Kitchener-Waterloo in a sense is a balance point for the expenses we see in Kitchener-Waterloo. The number will be some measure higher than that, but there was no need to show some kind of revenue situation in Kitchener because it is not a separate corporation here running it. It is all part of the same network.

1985 Kitchener-Waterloo is clearly -- and I have heard other commercial broadcasters. Mark mentioned this before. It tends to be undervalued by people who don't know what goes on in this market. In fact, advertisers value it much greater than is the perception across the country.

1986 We have found as far as revenue potential goes, both for fund raising and for advertising, that Kitchener-Waterloo is fairly impressive in the interest in reaching this market.

1987 So adding it to a network that includes Toronto, Ottawa, Calgary and Vancouver, that would certainly add -- I think we put 10 per cent, 11 per cent -- to our total.

1988 COMMISSIONER CRAM: Thank you very much, Mr. Farmer.

1989 THE CHAIRPERSON: Thank you, Commissioner Cram.

1990 Commissioner Langford.

1991 COMMISSIONER LANGFORD: Good morning.

1992 Your application is clear, and certainly your answers to Commissioner Cram have cleared up most of my questions.

1993 I just have one question arising from a statement that you made in your opening remarks with regard to frequency. I don't have your opening remarks, but it was basically a now or never kind of statement; that if we don't get this frequency now, it may not be available.

1994 As I said, I don't have the exact quotation.

1995 Have I captured it correctly? Is that your position?

1996 MR. FARMER: Yes. We feel that there is no more room in the Kitchener area. As it is, we can't even get the full market area.

1997 Maybe John could add to that.

1998 MR. MATTHEWS: Just to put that into context. What is more at issue is how congested the Kitchener area is. When a frequency is tied up in a market like Toronto or Hamilton, that sanitizes a certain number of potential frequencies in a market like Kitchener.

1999 It is the population density in southern Ontario that makes it so uncertain that any future opportunity for frequency would still be there.

2000 COMMISSIONER LANGFORD: I am not an engineer, so forgive me if I am completely out to lunch here -- and that wouldn't be unprecedented either, I have to tell you.

2001 I am looking at your own application, and you speak of having an alternate yourself. You are looking for 102.5, and no one else is. So in that sense there is no threat.

2002 Then you say if you can't have 102.5, you will take 94.3.

2003 I am not sure, Mr. Secretary. Is anyone else looking for 94.3?

2004 THE CHAIRPERSON: Yes.

2005 COMMISSIONER LANGFORD: Someone is. So there is pressure there.

2006 But that doesn't seem to me to be a now or never situation.

2007 If we didn't approve your application today -- I am not prejudging this. I am simply putting this up as an academic question.

2008 If we did not approve your application today, 102.5 would still be available, would it not? Or is there something that I am missing?

2009 MR. MATTHEWS: We can't be certain that it would remain available. That is the problem.

2010 To put this in context, you have to also consider that we have an FM station in Cambridge that is changing frequency. For instance, we would be expecting people to name the frequency that they are leaving as a second choice.

2011 You have a good number of worthy applications to consider. We wouldn't want to second-guess the Commission on how many worthy applications it would wish to approve. It only has so many frequencies to choose from.

2012 So there is still a certain amount of uncertainty as to whether anything would remain in two or three years time.

2013 COMMISSIONER LANGFORD: What I am thinking here is you have an enormous amount of projects on your plate right now. You are launching Toronto. You have Calgary, Vancouver and Ottawa, a lot of -- I am mixing my metaphors madly here now, but there are a lot of irons in the fire.

2014 If there is no competition for this frequency, isn't there some wisdom to being a little more prudent in how much you take on at this stage?

2015 Doesn't it make sense -- I'm not trying to be avuncular here; your Uncle Tony giving you good advice or anything.

2016 It just seems to me that you have so much on the go, and money is so uncertain, why not get some of the other ones up and running? There would be a lot of benefits to it, it would seem to me.

2017 People would see a track record. Money may flow, as your colleagues have said. And there isn't a risk at this point, as I understand it, to this frequency. It can't be handed out unless we hand it out. So we do have a certain control there.

2018 I just put it to you. As between stretching yourselves so thin, I wonder if you had thought of this strategy.

2019 I could understand it if there were five other people here looking for this frequency and you said: Look, we are in trouble. We rushed this application out because we need it. There is huge competition.

2020 But there is no one else. Wouldn't you in a way be doing yourself a favour taking the pressure off a bit and come back in a year or so?

2021 MR. FARMER: I don't know. We don't feel any pressure. Granted, we have had some slow-ups in mechanics, mostly with business development, as we come into business for our new business. Those have been slow-ups.

2022 We have been meeting some problems, of course, just dealing with large corporations as we slide into place. But the time is now.

2023 We have applied also in Montreal and Edmonton, as you know, this year. To me, this is 40 years too late.

2024 We have the time now. We have the energy. You can see our team is here, have come to this hearing because there are signals available. We were advised that there isn't a lot of room left there; that we can't get a full service station in Kitchener right now. We can't reach Guelph or Cambridge with the signal without being competitive with the commercial market.

2025 We didn't want to compete against the commercial market, but we wanted our foot in here. It is one of the ten major cities in the country. This is a big part of our business plan.

2026 We are trying to roll out in 27 major markets right across the country. We are not going to stand still and wait around for something not being available to us and have to buy in. So we are here up-front presenting our plan. We feel confident.

2027 I have no problems, once the service is launched and operational, that we will be successful. As far as I am concerned, we have waited 40 years too long for this development. Now is the time.

1000

2028 COMMISSIONER LANGFORD: I am sympathetic, but I am not as optimistic as you are. It seems to me that you have a huge amount of work. I am looking upon you as I would look upon any business plan. I am speaking merely about a business plan at this time.

2029 In the kindest way I can put it, I have grave reservations about just how much you can roll out. You are talking about 27 cities. That is a huge amount of work, even for people with incredibly deep pockets, which by your own admission you don't have. It is a huge undertaking.

2030 As I say -- and I don't want to be repetitive. You have answered me and I have heard you. And that is what this is all about, build a record. I ask questions and other questions are asked and you answer them. So you need not actually respond to this; you already have.

2031 But I want to give you a sense of where I am coming from.

2032 If, as I said, to repeat myself -- but I think it is important that you understand where I am coming from. If there were huge competition for this frequency and it was do or die, I think that might be one thing. But when I look at the situation where that isn't the case and where you have so many other projects on the go and so many other projects planned, I just wonder from a business point of view whether this is a prudent approach to take on so many more.

2033 In fact -- and I am not in any way trying to be insulting. But in fact you haven't even got one up and running yet. You are on the net, but you haven't got one up.

2034 I don't point any finger or blame, but that's just a fact. I don't know if you want to respond to that.

2035 MR. MacLEOD: Commissioner Langford, I would like to make a comment here.

2036 It has been suggested, and I am sure it will continue to be suggested within our group and by people who give us advice and support us, that you guys should get your service up and running, get generating some revenue; get four markets up and hold off on applying. Clearly, we have talked about this.

2037 People say: Why don't you go to the Commission and ask them to reserve a frequency for you. Don't they think that Aboriginal broadcasting is important enough that you say: Okay, there are seven totally congested markets. We ask you to reserve this frequency in those markets.

2038 That has been suggested to us.

2039 Our advice in this market and our understanding in this market is that there is a high probability that this is our large chance. If the subject is being brought up of why don't we switch to asking the Commission to reserve this frequency for us for some future time rather than awarding it to us, given the timelines that play out in these processes, I don't know if that will really make any difference.

2040 You are going to take a certain number of months to make your decision. You are going to give us a year to get the service up and running. Assuming that we have the four markets up and running in March, adding Kitchener to that some time in the next 15 months, 14 months, whatever we are talking about here, should not be an onerous task.

2041 Your suggestion is valid, and people have said: Why don't you try that? Why don't you ask them if they would reserve some frequencies?

2042 It is kind of a chicken and egg. Until we are up and proven that we are broadcasting, why in a sense should you take an even further step than giving us a licence by reserving something for us and preventing anybody else from using it if we are not even in front of you giving you a valid reason as to why we can use it.

2043 In Kitchener-Waterloo, it perhaps isn't perfect timing for us. Maybe we would rather you had not made this call for applications for another year. That might have worked out for us better. But as someone said to me the other day: We don't have time machines yet. We can't wait for five years from now when we have enough money and then go into the time machine and come back and show you the money and get the licence.

2044 I am not a technical guy. If your point is valid that a year from now we could come back and apply and get the same thing that we are applying for now, then perhaps there is wisdom in that. But that is not our understanding.

2045 Our understanding is that this process is likely to give away the frequencies. As Mr. Matthews mentioned earlier, it is out-of-market circumstances that can relate to what is available in Kitchener, as well.

2046 We are here. We feel that in the next 14, 15 months, if you award us the licence, we will add Kitchener to the network and be operating fully.

2047 Clearly, we are as nervous as you might be in going from running to stumbling and falling. We are trying to balance things out, but we don't feel that Kitchener is a step too far. We feel we can handle Kitchener at this time in our timeline.

2048 Thank you.

2049 COMMISSIONER LANGFORD: Thank you for that.

2050 You have heard me, and I want you to know that I am not speaking from any position of prejudging this or something. Sometimes the best advice you can give people, when you want them to succeed, is go slow. You are running very quickly.

2051 I understand why. You are running from a 40-year handicap. I understand that well. Mr. Farmer has put it eloquently and comprehensively. That message is not lost on the Commission. It certainly is not lost on me.

2052 I think the past decisions of the Commission must give you a good deal of comfort, but I do bring this up at this point. I don't know where my fellow Panelists stand on this. It is simply something that I bring out.

2053 I have heard your answers and I am grateful for them. But I must tell you that I have grave reservations about the business plan at this stage and where we could perhaps bring some measure of caution to this process without jeopardizing your long-term plan.

2054 That is certainly something that I think a responsible decisionmaking body has to explore. That is really the last word I could say on it, although certainly you are welcome to respond to it.

2055 MR. FARMER: I just want to say that I think we have cut our costs down to a minimum to expand service to Kitchener-Waterloo. The programming is going to be in place for the most part already. It's not a big deal to come into Kitchener-Waterloo with our signal when it is up.

2056 I consequently don't understand your flag raising. I understand the issue. It has been brought up to us several times. It's not like we don't consider that.

2057 This was a board-approved application to come here some time ago. About a year ago we approved to come to Kitchener in terms of applying for this licence. Whenever Kitchener became available to apply for, we stood in line.

2058 We didn't move into Québec City. We didn't go into Winnipeg when Winnipeg was up. We felt confident that there was a service there. For Québec City, if we had been a little more prepared with our French language, we would have gone in there.

2059 We are going into Montreal now. We have made arrangements in the development of that.

2060 I think we are going in a very logical way, and everything is going to be fine. I don't feel that the Kitchener service is a big issue in terms of our economy or in terms of supplying service to the Kitchener community.

2061 I feel there is a vibrant community here, especially the university youth, who you will be hearing from this week.

2062 So I feel very confident about this particular market.

2063 MR. MacLEOD: Also, Commissioner Langford, we have evaluated the calls that took place for Halifax, for St. John's. And it is important to recognize that we see Kitchener as being important to our business plan in terms of being a net revenue situation to the network.

2064 If this was a Halifax hearing and you were asking exactly the same question, we would certainly be in a lot weaker position, because we would be adding likely a burden to our network by putting a licence in a market that is potentially not going to produce more revenue than it actually costs us.

2065 I want to assure you that we have thought long and hard about this and that we don't see ourselves as being reckless in this regard. We think that applying in Kitchener did make sense.

2066 But you brought it up at the start of your conversation. That is primarily based on the idea that there may not be a future opportunity in Kitchener. As you have heard from the community members on our panel and you will hear in the intervening, the need and the demand are here now. We feel responsibility to make sure that is not lost.

2067 COMMISSIONER LANGFORD: Thank you for that.

2068 I don't want to pick one word, but at no time did I want to give anyone the impression that I was making accusations of recklessness -- over-enthusiasm perhaps, but not recklessness.

2069 I recognize your plan, and it has been consistent. I am grateful for your comments about where you haven't applied. That is very, very helpful to me and put some meat on the bones.

2070 There is no sense of recklessness in my comments at all. I was simply trying to strike a note of caution where perhaps, in light of no competition for that frequency, caution is a luxury you could afford.

2071 If the case were otherwise, I would have remained silent on the issue. It's simply that which prompted me to speak.

2072 Thank you very much.

2073 THE CHAIRPERSON: Thank you.

2074 Commissioner Williams has a question, as well.

2075 COMMISSIONER WILLIAMS: Thank you, Madam Chair. Maybe just a few more words on your business plan progress.

2076 It reminds me of a time when I was quite a bit younger and we were working on a project, and the crew was being pushed quite hard by the supervisor. At one point one of the crew members started issuing cautionary remarks and he said: "You know, Rome wasn't built in one day." The supervisor nodded and said: "That might be true, but I wasn't the supervisor on that job."

2077 I certainly don't have problems with ambitious plans. My understanding of what you are trying to achieve in your business plan is a network. This is really one project with many different elements that are all required in order to achieve the success of the project.

2078 So if some of the parts are missing, some of the success will also be missing.

2079 The Kitchener market, I also understand why it is important to your project, in that the Kitchener market is one of the most profitable radio markets in the country; in fact, one and a half times the Canadian average. It is a very profitable market.

2080 Your plan is 15 to 25 of Canada's largest urban markets to be part of this network. We have heard some of your next few projects as radio calls are coming through, for example, Montreal and Edmonton.

2081 My question is: Will every province be represented in this plan, and the territories?

2082 MR. FARMER: Do you mean every province of the nation?

2083 COMMISSIONER WILLIAMS: Of Canada, yes.

2084 MR. FARMER: And every territory?

2085 COMMISSIONER WILLIAMS: Yes.

2086 MR. FARMER: Well, we certainly have a lot of interest from the North, especially in the Inuit community, to supply language programming to their southern peoples. As well, we understand that their radio infrastructure isn't as fully developed as they had hoped to be. So we certainly have interest in the long term to assist.

2087 We are especially getting a lot of calls in terms of equipment failure, and they need a lot of infrastructure building there. I know that the federal funding policies, the old OCAP funding they have been under, NCAP funding that they have been under, has been under review from the heritage ministry.

2088 You should also realize that we have gotten this far today. We here before you, and have been for the previous five licences that we won, which include the national licence, without any federal monies whatsoever. All this has been started from the support of the private broadcasting in Canada, primarily with Standard and NewCap Broadcasting.

2089 Also, there are some others coming onside, like the folks from Montreal --

2090 MR. MacLEOD: Astro.

2091 MR. FARMER: And Corus, not lately, but we are negotiating with some of our other broadcasters in the area.

2092 THE CHAIRPERSON: You had better keep to this application, Mr. Farmer.

2093 MR. FARMER: Yes, of course.

2094 The North is certainly something that we are willing and able to help with as funds become available, and we are interested to assist in that development.

2095 I am not sure, but any of the 27 markets, as far as I know, don't exist north of the 60th parallel.

2096 COMMISSIONER WILLIAMS: Are there plans for Saskatchewan, for example? There is a large Aboriginal population in Saskatchewan.

2097 MR. FARMER: Yes. I guess because Saskatchewan isn't a large market area for a successful commercial development, there hasn't been any launch there yet for a licence. Of course, it is an area where we have to wait until we are a little bit more sustainable economically before we go into the Regina market, which is a very big interest to us, as well as Saskatoon.

2098 But we are having to play standby ball until we get to air and get our financial wherewithal in place to enter into those markets and launch efforts for licensing in that market, specifically Regina and Saskatoon.

2099 COMMISSIONER WILLIAMS: How many Aboriginal artists do you have in your music library today, approximately?

2100 MS BOMBERRY: We have over 500 Aboriginal artists in our library. The music library won't be restricted to Canadian Aboriginal artists, because we really don't view the border. Our music library is open to indigenous artists worldwide.

2101 There is a vibrant Aboriginal artistic community. We are connecting worldwide like never before with the Sami artists in The Netherlands, as well as in Australia and New Zealand. So there is an existing network that is out there with Aboriginal artists, and we are plugged right in to that whole network.

2102 COMMISSIONER WILLIAMS: If we wanted to listen to your service on our break, what address is it streaming from?

2103 MS BOMBERRY: It is www.aboriginalradio.com.

2104 COMMISSIONER WILLIAMS: From what I have seen so far, I salute this ambitious undertaking. I am of the belief that vast projects cannot be achieved with half-vast ideas.

2105 I wish you continued success. Thank you.

2106 MR. FARMER: Thank you very much.

2107 THE CHAIRPERSON: Thank you, Commissioner Williams.

2108 Counsel?

2109 MR. WILSON: Thank you, Madam Chair.

2110 I just have a few brief questions.

2111 In response to a question from Commissioner Cram, you agreed to file a copy of a study dealing with the local Aboriginal population. I would like to confirm whether you are able to file a copy of that study by the end of the hearing.

2112 MR. MacLEOD: I believe so. I will have to just locate it.

2113 MR. WILSON: Thank you. Could I also ask that you file an updated copy of the list of the members of your Advisory Circle by the end of the hearing?

2114 MR. MacLEOD: Yes.

2115 MR. WILSON: Then two other further questions.

2116 Could I ask that if you were to be awarded the licence out of this hearing, would you undertake to file a copy of your employment equity plan within one month of the decision?

2117 MR. FARMER: Yes, of course.

2118 MR. WILSON: One final question.

2119 Again, if you were awarded the licence out of this proceeding, would you undertake to file a copy of the list of members of your Kitchener local Media Advisory Circle within one month of the decision?

2120 MR. FARMER: Yes.

2121 MR. WILSON: Those are all my questions, Madam Chair.

2122 THE CHAIRPERSON: Thank you, counsel.

2123 Thank you very much, Mr. Farmer and everyone.

2124 We will now take a 15-minute break. Since it is now 10:15, we will reconvene here at 10:30 with the presentation by Douglas E. Kirk.

2125 Thank you.

--- Upon recessing at 1015 / Suspension à 1015

--- Upon resuming at 1035 / Reprise à 1035

2126 THE CHAIRPERSON: Order, please.

2127 Mr. Secretary, please.

2128 MR. LEBEL: Thank you, Madam Chair.

2129 Item 5 on the agenda is an application by Douglas E. Kirk on behalf of a corporation to be incorporated for a licence to operate an English language commercial FM radio station in Kitchener-Waterloo.

2130 The new station would operate on frequency 99.5 MHz (channel 258A) with an effective radiated power of 1,120 watts.

2131 The applicant proposes a New Country format.

2132 You have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

2133 MR. KIRK: Thank you, Mr. Lebel.

2134 Good morning, Chairman Pennefather, Commissioners Langford, Demers, Williams and Cram.

2135 THE CHAIRPERSON: Good morning.

2136 MR. KIRK: My name is Doug Kirk. I represent the group proposing to put a New Country FM licence into Kitchener-Waterloo.

2137 I am controlling shareholder of this applicant, with 61 per cent of the shares. I have 16 years of ownership and management experience in radio broadcasting in Canada. You are probably familiar with some of the other properties that I have an interest in, primarily KX-96 -- that is CJKX-FM in Ajax; CIWV-FM, WAVE 94.7 in Hamilton; and as well, with John Wright, an interest in K-ROCK, CIKR-FM in Kingston.

2138 We represent a team here, and I will introduce them now prior to starting our presentation.

2139 On my far left, your right, is Tom Pippy. Tom grew up in Kitchener-Waterloo. He has recently returned to Kitchener to teach business studies at Conestoga College. He is a participant and shareholder in this application and a shareholder and treasurer of CIWV-FM in Hamilton.

2140 On my right, your left, is Mr. Wright. John Wright is well-known, I think, to the Commission. He has over 30 years of experience in the development and management of radio property and most recently obtained a licence as controlling shareholder of CIKR-FM in Kingston, K-ROCK 105.7.

2141 By video on our presentation today will be Mr. Dan Einwechter. Dan has lived his entire life in Kitchener-Waterloo and is founder of Challenger Group, a major North American transportation company which is located in Cambridge.

2142 Others involved in the presentation: To my immediate left, your right, is Steve Kassay. Steve is V.P. Operations at KX-96 in Ajax and CIWV-FM in Hamilton.

2143 On the back row of the panel today, to my immediate right in the back is Simon Constam. Simon is Sales Manager of CIWV in Hamilton.

2144 With us today we have three artists and producers and recording individuals. They are in the back row, starting with Jim Hopson, Laura Rose and Wendell Ferguson.

2145 In addition, at the side table we have Doug Macaulay, our broadcast engineering consultant, to answer any questions; Eugene Moser, who is Chief Financial Officer of Challenger Group; and Mark Lewis, our lawyer and consultant.

2146 The application you see today is based on a strong, independent team of experienced broadcast professionals, important local individuals and tested entrepreneurs who have successfully built and launched radio stations.

2147 In fact, we have launched three radio stations in the last three years in Canada.

2148 We take our business very seriously, and in fact just coincidentally last Friday both KX-96 and John's station, K-ROCK in Kingston, were given business awards, the Business Leadership Award and Business of the Year Award, from the Ajax-Pickering Board of Trade and the Kingston Chamber of Commerce.

2149 Our application will introduce a new independent voice in Kitchener-Waterloo. We are not connected with anyone else. We are an independent group. We will fill a proven musical void in this market -- country. We will commit to $700,000 of direct Canadian Talent Development expenditures to be spent locally in Kitchener-Waterloo.

2150 We will enthusiastically program 40 per cent Canadian content, and we will serve this market with vigorous local news and community service.

2151 You may ask why are we here. The market, in our view, is ready for additional commercial service.

2152 As you can see in the chart behind me, Kitchener-Waterloo revenue growth has averaged over 8.8 per cent per year over the past five years. That is from the latest CRTC data.

2153 Over the last year Kitchener radio revenue grew 4.2 per cent, which was stronger than the Canadian market average, the ten top markets measured by TRAM. They grew only 2.3 per cent.

2154 So clearly Kitchener is a high revenue growth market, even with the limited number of stations here.

2155 Operating income of the radio business in Kitchener is over $4.7 million. That was in 2001, or 27 per cent of revenue. And for the past five years operating income has exceeded 20 per cent of revenue.

2156 Indeed, this is a healthy market ready for new service.

2157 I will now turn the presentation over to John, who will describe how we reached our format conclusion and our research.

2158 MR. WHITE: Thank you, Doug.

2159 For our application we needed to determine the need for new radio format in Kitchener. We first looked at the three traditional musical genres, pop, rock and country, to see how they were represented in the market.

2160 The chart shows the genres and their derivatives and the local and out of market stations providing that musical style to Kitchener.

2161 The pop music family, in which we include soft A/C, hot A/C and CHR, is represented by local station CIZN and CHYM, which is Kitchener's top rated station.

2162 So two local stations and six out of market radio stations that have a one share or higher.

2163 The rock music family, AOR, Modern Rock, Classic and Rock Hits, is represented by CFCA. It is the number two rated station in Kitchener, plus there are six out of market radio stations with a one share or higher.

2164 The Country Family, Traditional and New Country, has no local radio station and two out of market stations, one of which has more than a one share right now and the other, which just changed to country, we anticipate will have more than a one share when the fall book comes out.

2165 So the Country format is noticeably absent from local Kitchener radio, even though CKGL-FM was a very successful country station in Kitchener for many years.

2166 Our next step was to ask the people of Kitchener about their radio tuning. Specifically, we wanted to know the potential for different music formats, the impact on existing stations and the likelihood of success.

2167 We commissioned Hendershot Research Consultants of Hamilton to conduct a study of radio listening habits in Kitchener-Waterloo. Let's have a look at some of our findings on this chart.

2168 Column 1 shows the various musical styles that we looked at. Column 2 ranks by local station association, and column 3 ranks by no station association.

2169 When we look at column 2 it shows that country has the least impact on existing local radio. Only 2.5 per cent of our respondents associated the country style of music with any local Kitchener station.

2170 CHR, on the other hand, had five times the impact on local stations.

2171 Column 3 shows country music is the biggest void in Kitchener-Waterloo of any of our studied formats. 71.1 per cent of our respondents could not associate any station with country.

2172 The conclusion? The country format will have the least impact on existing local Kitchener-Waterloo stations while providing listeners in Kitchener with the most diversity.

2173 We then looked at the local demand for a New Country radio station; in other words, will it be successful?

2174 Our study indicates that New Country can achieve about an 8.9 share of the tuning in Kitchener-Waterloo. This certainly seems to be validated by the strong history Country has had in Kitchener.

2175 In the 1980s and early 1990s, CKGL regularly had 7 to 10 shares as a country music station. And as recently as 1997 two AM country music stations, CKGL Kitchener and CHAM in Hamilton, combined to take 9.5 per cent of all the hours tuned in the market.

2176 Our research shows the return of country music to Kitchener will:

2177 (1) have the least impact on the existing stations in the market;

2178 (2) add more musical diversity to a market overflowing with pop and rock stations and their derivatives; and

2179 (3) be very successful, achieving an 8-plus share of tuning by satisfying over 40,000 country music fans that lost their local radio station from FM ten years ago and AM five years ago.

2180 MR. KASSAY: We are proposing a country music radio station designed to serve residents of Kitchener-Waterloo. In addition to providing music, we will provide local service. We are well experienced in programming local service to a local audience.

2181 We believe a prime reason our Durham radio station is successful is because we program information of interest to the local audience.

2182 Our morning show hosts, for example, regularly interact on-air with both listeners and individuals of local interest and importance. We are successful because we provide the local information that other stations don't.

2183 KX-99 will be similarly designed to reflect the needs of the local market. We bring a new independent voice and strong independent news voice to Kitchener-Waterloo, broadcasting local news of importance and interest unaffected by any corporate influences or agendas.

2184 We will also provide local traffic coverage and local agricultural news of the day.

2185 Through our combined experiences we have developed first hand a sense of the value area residents place on local lifestyle information concerning their community. On-air, online and in person KX-99 will act as a local information hub, providing no-charge on-air time to the promotion of local events and community events vehicles dedicated to attending local events around the area year-round.

2186 These elements are interwoven into the programming. It results in a consistent local radio service playing a music format not currently offered by any Kitchener-Waterloo broadcaster.

2187 Country music is such an outstanding Canadian success story. It has not only produced such international superstars as Shania Twain and Terry Clark, but it continues to produce a rich crop of exciting young talent from all across the country.

2188 The Kitchener-Waterloo area has its share of talented country artists, notably Beverly Mahood and Jamie Warren.

2189 The country music community is organized and it's progressive. As Doug and I know from our experience at KX-96 in Ajax, Canadian country radio takes great pride in its relationship with these national endeavours. It takes great pride in the relationship with the country music industry, and we work together. We play an important role in the exposure, promotion and in the development of young Canadian talent and the existing stars.

2190 Our vision is to further develop the Canadian country music industry through the implementation of locally focused initiatives in the Kitchener-Waterloo region. Our commitment to a level of 40 per cent Canadian content is not only achievable, but it is progressive and it is appropriate when you consider the rich country music history of this Kitchener-Waterloo area.

2191 The proposed KX-99 commits to invest $100,000 per year in direct Canadian Talent Development initiatives. This amount is 20 times the suggested amount outlined in the CAB guidelines for markets of a like size.

2192 While it would be quick and easy to fulfil the CTD requirements by simply and solely issuing cheques and sending out lump sums of money to national organizations, we choose to take what some broadcasters obviously consider to be the harder road, creating initiatives that provide real help and assistance to develop local artists and local initiatives.

2193 Similar to our KX-96 model, our vision for the Kitchener-Waterloo area is to have these initiatives result in tangible benefits to the local community.

2194 As the track records of our other stations suggest, this is a plan which generates significant and successful results.

2195 Specifically, our vision for developing Canadian talent includes:

2196 - initiating the KX-99/Cradle-to-Rave Talent Search which, among other things, sees the top prize winner win a full two-song recording session;

2197 - inaugurating the KX-99 Annual Birthday Bash, which involves a wide range of performers;

2198 - starting the KX-99 Country Seminar Series, which provides expert information about a range of topics and subjects related to the music business for the benefit of up and coming artists;

2199 - lending support for festival and event sponsorships;

2200 - a contribution to the Canadian Country Music Association's "Country Talent Development Fund"; and

2201 - initiating the KX-99 Roadshow, which involves local performers.

2202 The members of our group have learned through our individual experiences that radio's role is primarily one of community. After all, it is our commitment to the communities in which we operate and in which we live and our passion for radio which brings us before you today.

2203 To help provide the clear picture about how such a plan generates success for artists, the industry and the community, we are happy to have with us Jim Hopson, Laura Rose and Wendell Ferguson, and we are happy to have them provide their comments.

2204 We will start with Wendell.

1050

2205 MR. FERGUSON: Good morning, Commissioners. My name is Wendell Ferguson. Let's talk about me for a minute.

2206 I am a guitarist. I am kind of low man on the totem pole. As guitarist, songwriter, producer, artist in Canadian music, I have had about 45 cuts here in Canada, seven in Nashville, and I garnered five Top Forty hits.

2207 I am a guitar player, and I have recorded with people as diverse as Gordon Lightfoot, Sylvia Tyson, oldies Al Cherney, modern people Gil Jan Sibree(ph), that sort of thing. I am a guitarist for hire.

2208 I am also the music director and the band leader on the CCMA Awards and have done the Bud Talent Search and Today's Country, a syndicated radio show. I have won nine CCMA awards over the years, one OCPFA award and two Juno nominations. And that's all I want to say about me.

2209 The reason I am here today is I wouldn't really have a career if it wasn't for the grassroots level of local country radio stations, citing things like when I was coming up 20 years ago CFGM in Toronto, BX-93 in London and, most of all, CKGL right here in Kitchener.

2210 It was a hotbed of country then and it is now, and they have been without a station for several years here.

2211 CKGL used to put on the Bud Talent Search every year, and they would hire me to put a band together for it. They would have local special events, fairs, openings, charity nights, that sort of thing, and they also sponsored a thing called a travelling road show, where they would bring big acts in and we would back them up.

2212 The sense of community around the KW area was very high, and I would like to see that come back to this area. I am obviously older now and moved on in my career, but there are so many opportunities that radio provides for young people coming up through their stardom and their formative years.

2213 That is basically all I have to say. Thank you very much.

2214 MS ROSE: Good morning. My name is Laura Rose. I am a new artist, so I have won nothing. Thanks for making me look bad, Wendell.

2215 I did release my first CD this year, and my first single went Top 40 on the Can Country Charts. Unfortunately, nobody in my home town of Kitchener ever got to hear that.

2216 I have a new single coming out again in two weeks, but nobody here in my home town is going to hear it, which I find very frustrating.

2217 Also, I want to mention that I play locally here at three very successful country clubs. So there is clearly a demand for this.

2218 When you go to Toronto specifically, there is one small club there. So there isn't really the demand so much. But here we have three huge clubs, all hugely successful, and no radio station. It doesn't add up to me.

2219 The reason that I think this plan specifically is so exciting is because it focuses on new artists and new talent and helping them develop that.

2220 Speaking as a new artist, it is really difficult getting air play to begin with. Steve and KX-96 were very supportive of me right from the start. That is something that is difficult to come by. So I am really excited about their ideas as far as developing new talent. It is very important.

2221 Thank you.

2222 MR. HOPSON: Good morning. My name is Jim Hopson. I was an artist 25 years ago and enjoyed air play in this market on the two stations mentioned that are no longer here.

2223 I am the President of Wellcraft Music. I own two recording studios, one in Oshawa and one on the east shore of Lake Simcoe, as well as having an artist management company and a production company called Cradle-to-Rave, thus spun off Cradle-to-Grave Start-to-Finish.

2224 I have been involved with KX in the Ajax market for about seven years. Steve approached me a few years ago about fostering a contest of sorts to see if we could raise the interest of local talent. We did so. It has become bigger and bigger every year.

2225 This CD is a compilation of the participation of the finalists from last year. This stack of CDs represents participants of the contest over the last three years, all of which have been released to radio or about to be released to radio.

2226 We have contestants driving from Windsor, from Kingston and from North Bay for the day to compete Wednesday nights at the contest. It is a ten-week run, with the finals being in December. It also features airplay on KX-96 for the winner.

2227 We focus on new artists. Cradle-to-Rave Music was created simply to give the newcomer a turnkey kit from start to finish. We have greatly enjoyed working with KX-96.

2228 We also are working in conjunction with a Christmas project for the area that is being released for some local charities, featuring local Durham Region artists.

2229 Thank you.

2230 MR. KIRK: Thank you, Jim.

2231 I would like to now focus the presentation on the local shareholders that we have in this application. It is important to us to do local programming and have it connected in the market.

2232 I will ask Tom Pippy to say a few words.

2233 MR. PIPPY: Thanks, Doug, and good morning, Commissioners and staff.

2234 As a long-time resident of the Kitchener-Waterloo area who has recently returned to teach at Conestoga College, I am delighted to be one of the partners with Doug in this application.

2235 Having grown up in the Kitchener-Waterloo area when there was a local country music station, I see a great opportunity to bring a country music format back to this market.

2236 Based on the research that we have done and in talking to people in the community, I sincerely believe that there is a large number of residents in this area who would listen to a New Country music format, such as the one that we are proposing.

2237 I will turn it back to Doug to introduce our other local partner.

2238 MR. KIRK: As I mentioned at the beginning of the presentation, our other local partner is Dan Einwechter.

2239 Dan Einwechter has built a major company in the Kitchener-Waterloo area from scratch, starting about 30 years ago. Dan is on business in the United States and unfortunately can't be with us here. But we got his presence through a video, which we will run now.

2240 MR. EINWECHTER (Via video presentation): Thanks, Doug.

2241 I apologize to Members of the Commission for not being here today, but unfortunately I am in the United States on business. I did think it was important enough for me to attend in some fashion to attest to what I think are the important needs of this new radio station on our local community.

2242 When I was first approached about this opportunity, I thought it was not only a good business investment on my part but it would be another way to invest in the entire KW area.

2243 I see an important role that I can play as a shareholder to influence how our radio station can benefit our whole region. As President and owner of the Challenger Group of Companies, I am a strong believer in giving back to our community.

2244 At Challenger I have set up a Charitable Donations Committee, where we donate part of our profits to make it a better place to live.

2245 We have contributed significant amounts to such organizations as KW Big Sisters, The Rotary Club, and more recently $100,000 to the Grand River Hospital Campaign.

2246 In discussion with my fellow shareholders, they share this view on what to make as part of the philosophy of our station.

2247 Radio is a local medium and has the ability to include so many people and benefit the area. I can see a great opportunity with this radio licence to do so, such as increasing public awareness of the many wonderful charities that operate in the KW area. I am excited about the prospect of being involved with my fellow shareholders in this new endeavour, as I believe the Kitchener-Waterloo area not only needs another radio station, but one that is more attentive and sensitive to the unique needs of our local community.

2248 MR. KIRK: Thanks, Dan. I hope you can hear us down in the U.S.

2249 Before I conclude, I want to make one final point in this presentation.

2250 What you see before you is an independent radio application by an experienced group of broadcasters. We have a proven track record. You have seen that through CJKX-FM, K-ROCK in Kingston, the WAVE in Hamilton. This is a very talented and dedicated group of people.

2251 The Kitchener-Waterloo licence is critical to us. We have assembled a great group here, and adding a licence in Kitchener-Waterloo will give us the critical mass to sustain the kind of momentum and programs and talent that we have developed through companies that I have put together and John has put together and that we all participate in.

2252 In conclusion, our application will introduce a new independent voice in the Kitchener-Waterloo market. It also has significant local ownership and connection.

2253 It provides a clearly needed musical format to this market. I don't think there is any dispute on that.

2254 It commits $700,000 in direct CTD to be spent locally within the market.

2255 It programs enthusiastically 40 per cent Canadian content.

2256 It has, as you have seen, a vigorous local community and news presence.

2257 And we have substantial experience in the New Country format.

2258 This is what we bring to the table. We are very excited about our application, and we would like the licence. Thank you.

2259 THE CHAIRPERSON: Thank you very much. That is clear.

2260 Commissioner Demers, please.

2261 COMMISSIONER DEMERS: Merci, madame la Présidente. Bonjour, monsieur Kirk, mesdames et messieurs.

2262 My questions will be very down to earth. If your artists can have something to lighten it up, we will be very happy to hear them.

2263 MR. KIRK: We will try our best.

2264 COMMISSIONER DEMERS: All right.

2265 The points I will touch are the Canadian Talent Development, and I will also touch on Category 3 Country Music, the news, the rationale for your application, your business plan, the best use of the frequency and of course the question on cultural diversity.

2266 The first question concerns the Canadian Talent Development proposal that you have. Of course, you underlined a few minutes ago that it is $100,000 a year in total.

2267 The question I have concerns the $20,000 on sponsorship.

2268 You indicate in your application that the Kitchener-Waterloo Kiwanis Music Festival has agreed to this proposal.

2269 My question -- and I am sure you will have a good answer to is -- is: Is the Kitchener-Waterloo Kiwanis Musical Festival a country music festival?

2270 MR. KIRK: I will ask Steve Kassay to amplify the answer on this.

2271 MR. KASSAY: The Kiwanis Music Festival is not strictly dedicated to country music, not strictly. This is a festival that encourages participation from all age groups, primarily youngsters.

2272 I am not a former player; I still play. I am a musician myself. Considering I walked home one day and told my mom that I was taking piano lessons and she said "are you" and I said "yes, I am; there is a lady at school that teaches it", I understand how it can start. It is something that I do to this day. I understand how the bug can bite. This is how things get started.

2273 So it is very important to certainly be present at all the local events and sponsor things that are appropriate to help people within the genre, as well.

2274 At the ultimate grassroots level, this is a wonderful way to get the interest rolling, to get kids interested in music.

2275 COMMISSIONER DEMERS: Would there be proportions of that festival that expose country music?

2276 MR. KASSAY: As far as the Kiwanis Music Festival goes, we have agreed with Mr. Keller at the association to devote the money -- as far as Kiwanis is concerned, to split it evenly between scholarship and bursary programs and to defray some of the costs they are always under pressure to cover every year for the adjudicators, because they do bring people of note in to take care of the judging.

1105

2277 MR. KIRK: Commissioner Demers, we have experience in other markets in this area.

2278 Through CIWV in Hamilton, we sponsored the Kiwanis Festival a year ago, the Greater Toronto Festival, which included participants from the listening area in Burlington, Oakville and other places. We put a substantial contribution towards the festival, and it was particularly for the jazz section.

2279 CIWV is a Smooth Jazz radio station, and we directed it. It was a very helpful contribution, because it allowed the festival in that year to hire a proper adjudicator for that section. It turned out, from the feedback that we got, that that particular section of the festival was the best ever because of the higher quality of adjudication that was available to the young participants coming through the system.

2280 We would do the same here.

2281 COMMISSIONER DEMERS: Do you have an idea of how much Canadian music is showcased at that event?

2282 MR. KASSAY: There are no facts and figures published on it. These are live performances.

2283 COMMISSIONER DEMERS: Thank you.

2284 MR. KIRK: Commissioner Demers, the performers would be Canadian. They are local Canadian performers. They can be in any number of musical genres. We haven't tracked the specific amounts of music in each genre.

2285 COMMISSIONER DEMERS: I am sure you understand why I posed that question, since your sponsorship is for Canadian Talent Development.

2286 You have referred to the Annual Birthday Bash concert, and you have allocated $25,000.

2287 MR. KASSAY: Yes, that is correct.

2288 COMMISSIONER DEMERS: Could you indicate how much you intend to spend, spread it out in a sense, on local, national and international artists for that bash?

2289 MR. KASSAY: Sure, I would be delighted to.

2290 The amount of money being put aside of the $25,000 for the talent is just shy of $15,000, as you know, $14,500. That money will indeed support having talent on stage, international talent. Canadian artists fall in that category now, but specifically local talent, those designated to be Canadian, and international talent as well.

2291 The focus is going to be on the Canadian and local talent. It is a wonderful way to introduce the audience to these new stars, by having them gather at our party and our venue.

2292 As the years go by and the talent search initiatives continue, we will have a better idea of who we can call on to come and help us. We are going to certainly solicit Canadian talent, the big stars in the format. If nothing more is necessary -- and I doubt it will -- that will suffice.

2293 So to answer your question in terms of splitting it between local and national, in this case, it would probably be 60 per cent national and 40 to the local.

2294 COMMISSIONER DEMERS: Thank you.

2295 Do I understand you to say that it would be Canadian talent all the way?

2296 MR. KASSAY: All the way.

2297 COMMISSIONER DEMERS: Who will be responsible for the administration of the proposed initiatives and their related budget?

2298 MR. KIRK: I'm sorry --

2299 COMMISSIONER DEMERS: On that point.

2300 MR. KIRK: On who would stage the Annual Birthday Bash? Is that the question?

2301 COMMISSIONER DEMERS: Yes.

2302 MR. KIRK: The Annual Birthday Bash would be a station event. Ultimate responsibility of the event would be the management of the radio station. Specific organization of the event would be through the operations area, who are in daily contact with the artists. That is how it would be staged.

2303 It would be locally staged and managed in the market by the radio station. Our station manager, Mr. Kassay, does that job in Ajax and in Hamilton in terms of operations. He would be overseeing the station manager in this market, should we win the licence.

2304 That is where the responsibility for organizing and staging the event would occur.

2305 COMMISSIONER DEMERS: Is any money allocated for the direction? In other words, is all that money going to talent, or is it going to some administration?

2306 MR. KIRK: To clarify that, there will be no money from those expenditures to station personnel. It will all be spent outside of the station.

2307 Mr. Kassay will give you a detailed breakdown of how that total of $25,000 will be allocated.

2308 MR. KASSAY: Indeed, this is a big project before it is even off the ground.

2309 The funds would be spent on the talent, as we have already discussed, of course. The other factors would be the venue: the staff at the venue -- not our staff, but their staff; it turns out it is a separate expense, union issues or something -- and stage and light and staging. Obviously we are putting on a show, and we are going to do it right.

2310 That is where the expenses will be directed.

2311 COMMISSIONER DEMERS: Thank you.

2312 Now I will venture into a question on Category 3 Canadian content levels. As you know, like my colleagues, I am not an expert either.

2313 A number of modern and contemporary country format stations across Canada complement their regular music programming with specialty music programming, often consisting of traditional, blue grass, old time country, or some combination of those.

2314 Are you contemplating offering any of this type of specialty music programming on your proposed station in the course of the licence term?

2315 MR. KIRK: I will let Mr. Kassay give you the details on our programming and clarify that question.

2316 MR. KASSAY: No, we are not considering that.

2317 Quickly, to paint a bigger picture, our experience indeed tells us that in this format, being not a teen station and not an "over the hill and gone" station, 25-to-44 or 25-to-54 -- and we have had terrific success with 25-to-44 over the years -- that music isn't appropriate any more.

2318 So no, we have no plans to air any specialty or Category 3 as part of the short or long-term plan.

2319 COMMISSIONER DEMERS: Thank you.

2320 COMMISSIONER LANGFORD: So thanks for coming out, Wendell.

--- Laughter / Rires

2321 MR. KIRK: Commissioner Langford, I think Wendell spans time.

2322 COMMISSIONER LANGFORD: Yes, transcends time.

2323 COMMISSIONER DEMERS: On news, you said that you will be offering to provide something different.

2324 How would your newscast improve news programming in Kitchener?

2325 MR. KIRK: I will start, and I will let Steve fill in some of the more detailed aspects to the answer.

2326 Both CJKX-FM in Ajax and CIWV-FM in Hamilton approach news from the way we see the vision of radio. That news is locally based. Our news resources are focused on local stories first.

2327 There are multiple channels of news via cable television, satellite channels, via our own national networks in Canada, all-news stations. In fact, in this market there is a news station.

2328 We think the broad international events are covered well. Where we make a difference is focusing our news on what is happening in Kitchener-Waterloo for this station and in Ajax, Oshawa and Durham Region primarily for CJKX, and then in the Hamilton-Burlington area for CIWV.

2329 If you will, the local news is the most important news to us. That is where we start. We try to lead with important local items, unless there is an overwhelming international story that needs it.

2330 If you listen to our news, you will hear local first. That is the focus of the station.

2331 I will let Steve amplify on that and how we cover it.

2332 MR. KASSAY: Perhaps there are two angles to this question, Commissioner.

2333 The local aspect is, to generalize it, what it is all about. You will recall years ago when we converted a failing AM to FM, and there was format competition in the market. We overcame that in our market where the signals were duplicated. We won and we won every year, because we provided the local angle that the other station, and other stations indeed the Toronto market, could not.

2334 Second, the country audience is a very loyal audience, as I am sure you know. It is very family oriented. It is very family.

2335 You heard control room stories here yesterday. It is the same with us. I am trying to position this properly; forgive me.

2336 If doesn't go with the breakfast table with the kids sitting around it eating Cheerios, then it doesn't go on the radio station because this is a family radio station. It is a loyal format. It is a family format. You really have to experience it sometimes to understand how vibrant that can be.

2337 We provide local flavour. It is a proven ingredient for success in terms of our information.

2338 Just to reiterate Doug's comment, we don't intend to be a national news broadcaster or an all-talk radio station. We do offer more than one-minute hits, however we heard it described from other stations. And we do this seven days a week with fulltime staff.

2339 COMMISSIONER DEMERS: Thank you.

2340 Could you put that in the context of Kitchener and a particular Kitchener model? What would you bring? Maybe it is a matter of emphasizing things that you have already said.

2341 In what way and what would you bring that is not already there in news in Kitchener-Waterloo?

2342 MR. KIRK: First and foremost, we would bring an independent new voice into the market, which is independent of the other competitive stations and other press and television media in the market.

2343 I would ask Steve to comment more on the approach.

2344 MR. KASSAY: I guess basically through my experience and from talking to people who are team members in the news department, as they travel from station to station, some people work the local contacts very well and some don't. Some stations work it very well and some don't.

2345 Just to refer to the KX-96 example one more time to give you some perspective, when we arrived in town, making as big a splash as we possibly could, it made a real difference and the local news sources appreciated our arrival. It gave them another outlet. It was a fresh new perspective to the news-gathering process.

2346 So we are quite confident the same thing can happen here. An enthusiastic staff, well contacted, working on relationships, building relationships with their contacts. It is the only way. The news always doesn't come to you. You have to go get it.

2347 It is the only way to really develop a good network. The same thing can be done too. The people who supply the news or are working the police desk or are looking to get the word out have another avenue now. It is a fresh perspective, and it is a new perspective.

2348 We will even pay for news. Again, the audience is so loyal. We are on the air pitching the fact that if you see something cooking, let us know. It could be worth something to you.

2349 We are in the business of news gathering. We pay other services for it. We want to deliver the goods.

2350 COMMISSIONER DEMERS: Thank you. Now the rationale for your application.

2351 Do you have any evidence that there is demand -- I think you have shown us that -- among advertisers to reach New Country listeners in the Kitchener area?

2352 MR. KIRK: I will let Mr. Wright speak to the research which established the demand. John can also further amplify on the question of where the dollars will come from in the market.

2353 MR. WRIGHT: Thank you, Doug.

2354 As we stated, about a 9 share of tuning is available to this station in the market in Kitchener-Waterloo. How does that translate into advertiser demand?

2355 We heard this morning from Laura about three major country music clubs in Kitchener-Waterloo. They now advertise outside the market, because there is no country music station in the market to advertise on. Our estimate is that about $200,000 currently goes to out-of-market country music stations for advertisers in Kitchener that would like to advertise on country music.

1120

2356 COMMISSIONER DEMERS: Thank you.

2357 Three applicants have proposed country or New Country format station for Kitchener. Three applicants have also proposed CHR, Top 40 format. Could you please explain why you believe that the New Country format is better suited to the Kitchener market than CHR?

2358 MR. KIRK: Commissioner Demers, we did extensive research which was filed with our application. The research was done in February in the market. It was quite extensive.

2359 John Wright and Simon Constam spearheaded that effort, and I would like John to work through why we came to choosing country as the best new format for a station in Kitchener.

2360 COMMISSIONER DEMERS: And probably in comparison.

2361 MR. WRIGHT: Yes. We identified a number of formats that there was a hole for in the market. CHR was one. A broad-based rock station was another. And country was certainly another.

2362 When we examined our options, the types of things that we look at as an operator is we look at, first of all, how much is it going to hurt? How much pain will it cause to the existing stations in the market?

2363 Two, can it be successful? Can we get an audience and can we sell this audience? If we can't sell the audience, we are not going to be a success.

2364 When we looked at CHR, there was clearly a hole, an opportunity, for CHR.

2365 We felt that that hole or opportunity, the big audience level for CHR is in 12-to-24. As soon as you go beyond 24, the numbers for CHR diminish.

2366 Therefore, as a standalone operator we felt that the revenue options for CHR were questionable. We felt that the revenue opportunities for country were higher than CHR, based on the target demographics.

2367 So we looked at a format that had a good share opportunity, a 9 share opportunity, and we looked at a format that we felt had a better chance of revenue success. Country music deals in the money demo, they call it.

2368 Adults 25-to-54 is where the dollars are being spent. The next step down is adults 18-to-49. The next step down is adults 18-to-34. And the last step in the revenue chain is 12-to-24.

2369 So with country music we have a station that has an audience opportunity. We have a station that has a revenue opportunity.

2370 And because it is so different than the other stations in the market, it also has much less impact in the market than CHR.

2371 CHR is an adult contemporary derivative. So we looked at the fact, -- and I think it came out in the hearing yesterday -- that CHR will have an impact on CHYM. Even though CHYM is not targeting the 12-to-24 target group, they get some of it by default. So a CHR format will have more impact on CHYM and CFCA than a country format will.

2372 So that is why we made our decision.

2373 COMMISSIONER DEMERS: Thank you.

2374 On expenses, your programming expense projections go from $366,000 in Year One to $437,000 in Year Seven. It is well below the levels of other commercial applicants and the incumbent FMs. Can you compete in the marketplace at the projected expense level?

2375 MR. KIRK: The quick answer to your question is yes, we can compete with those proposed expenditure levels and the staffing. We have done a very detailed plan on how the station will be staffed.

2376 I will ask Steve and possibly Tom to comment further.

2377 We have real live models, as well. We have stations that are operating. We have a station that will have very similar characteristics to the new Kitchener station operating in Ajax right now. So we have a model of how to staff it, how to run it, how to do the local news, how to do the community events, how to do the interaction with artists and the Canadian Talent Development.

2378 It is out there, and it works. It works in a very competitive market, and it works at comparable expense levels. We have used that experience to drive our model for this market.

2379 There are obviously some expertise synergies which I am talking about that are translatable, from John's operation in Kingston, from Ajax, from Hamilton, best ways and smart ways to run the business that apply to this.

2380 I don't know exactly how or why other applicants have proposed their expenses, but I can tell you from first-hand experience we are doing this every day, and it will work in this market at these levels.

2381 Steve.

2382 MR. KASSAY: I don't have much to add other than indeed we have working models because in the last few years, as you know, we have converted a station. Perhaps that is almost ancient history. It's been going so well, we are losing track of time. We started up Hamilton, started up Kingston, John did and Doug in Hamilton, and we have a certain goal in mind.

2383 We are independent broadcasters, and we must succeed. We select a plan that works, achieves our goals and this one is similar.

2384 MR. PIPPY: Just to add to that, what we did is we looked at the community and tried to determine what staffing level we required to provide the level of service that we wanted to provide to the Kitchener-Waterloo area. Given that staffing complement, we then looked at the operations in both Ajax and Hamilton. They are not markets of a dissimilar size.

2385 We looked at our cost structure in providing the same type and quality of service to each of those markets. Then we fixed the cost in terms of today's dollars and escalated that at about a 3 per cent level.

2386 All the staff that we planned on hiring will be coming -- the majority of them we certainly want to draw from the local Kitchener-Waterloo community, and we based the salary structures according to wage levels in this community as well.

2387 COMMISSIONER DEMERS: My next question is probably going further in that direction.

2388 Can you be more precise as to what you would get as to synergies from the stations that you already operate, in a more precise fashion?

2389 MR. KIRK: Thank you for asking that.

2390 I think the main synergies that we get are in sharing expertise and how we manage and run the stations, how we get a working model to react well, be successful and then be able to translate that to another market.

2391 What you see here is enough depth to make that work. The companies, the group of people before you, have a number of stations running.

2392 The most important things we do are share problems and try to find solutions. John will talk to that in a minute from our interaction.

2393 It is expertise sharing and just knowing how to do it, knowing how to put the thing together and put it into a new market. I think we have demonstrated that. We have launched two stations in Kingston and Hamilton in the last two years. We have also assisted the group in Cobourg launch a new FM in this last year.

2394 It's really bringing that expertise to the table and knowing the best ways to put things together to make them work.

2395 We don't have the kind of synergies available in market broadcasters where you could another station in an existing suite of operations. There you get obviously the synergies in sharing rent, in sharing back office staff, and so on.

2396 There will be some opportunities between stations to share voices, production voices, creative ideas and work that can be shared around.

2397 This is stronger than a single independent broadcaster coming into the market. There is a fabric.

2398 It is not quite as synergistic as giving a licence to an existing operator within the market. So I think you get the best of both worlds, if you will: a new independent voice in the market with the background and expertise to make it work.

2399 John.

2400 MR. WRIGHT: There are not many independents left. Sharing of knowledge and information and expertise is so important to any business. I can remember years ago in radio we had what we called little performance groups. We would get together every quarter, and we would talk about our promotions, our programming and some of the things we were doing in our markets.

2401 As the major national broadcasters bought up most of the independents, we would find that all of a sudden the people in the group couldn't meet any more because their corporate policy was that they didn't want to share this information outside the corporation, which is probably quite natural.

2402 So the ability for independents to get knowledge and get information started to diminish.

2403 There is also the depth of that knowledge and information. With our little bit of cross-ownership that we have, being shareholders of each other's operations, we now get pretty in-depth in that share of information.

2404 So we get into financials and operations and practices and best standards and all kinds of information that you might not share with somebody that didn't have a strong link to you. This sharing has really helped me in my start-up in Kingston.

2405 I know Doug and I speak usually weekly, and there are always bits of information that might be happening in one market or the other that we can share back and forth and get the benefit of each other's experience.

2406 We haven't yet because we have both been pretty busy launching a couple of radio stations. But our next phase of this that we have talked about is getting our management groups together and have them start sharing, as well as Doug and I.

2407 Right now it is Doug and I and sharing down through our people, and the next level is to get all our management group talking more together and having them share, as well.

2408 I find it a very important ingredient that helps us with our operations and our success.

2409 COMMISSIONER DEMERS: Any sharing of programming?

2410 MR. KIRK: No.

2411 COMMISSIONER DEMERS: Thank you.

2412 On your business plan, as you may know there are two other stations applying for a New Country format on the same frequency in this area.

2413 What differentiates your proposal from the other proposals?

2414 MR. KIRK: We have, as you say, a shared format. I would like Steve to comment on some of the differences in formats and why we think the New Country format is the best format.

2415 Before I do that, I think a couple of the significant differentiating factors are things we have just been talking about. We are independent. We don't have any other major corporate connections associated with our application. What you see is what you get. There is a lot of expertise built up. But we are not connected with other operators.

2416 Second, there is enough experience to launch a station in this market. We are competing for a new licence here if we are fortunate enough to get this licence. It won't be a cake-walk. This is a tough market. It is a very rich market. But you are competing in this market against Rogers and CHUM.

2417 Rogers has 40-some radio stations across Canada. They have major, major resources. They are established in this market, as you heard from them yesterday. They are doing a good job. They have two distinct formats.

2418 Getting on that stage, being able to compete in the market will require expertise level to be able to play on that field. I don't want to diminish that.

2419 CHUM is the same story. They are very, very good broadcasters. I think they own 28 stations across Canada now.

2420 Entering into this market will require the expertise and the ability to compete against the best in Canada, no doubt about it.

2421 I think what we have shown in this group over the last eight years -- starting up in Ajax, we bought an AM station and converted it to FM eight years ago. It will actually be eight years ago on Friday: November 1, 1994.

2422 We had an AM station in the market that had less than a share point, and it was spinning down and about to hit the ground. We established an FM station. The top station in the market in country in Durham at the time was KISS before they changed to "MAD-Dog & Billie" and other associated folks.

2423 It was a very strong country station in the market in Toronto. We had to go in in our region where our signal served, Ajax-Oshawa, take them on and kick them out of town. And we did through the local programming strategies that we had put in place.

2424 I think you need that, as well. So it is a balance of independence and experience, combined with the management experience, and having a well financed plan. All those factors I think distinguish us from the other country applications in the market.

1135

2425 MR. KASSAY: John can respond further on the competitiveness of the retail market. Indeed, this is one experienced market with some very solid broadcasters and endeavours happening in it already. We are well experienced in doing that in our other markets, and that's why we feel not only is our format appropriate but we are ready to take on the challenge. We know how to do it, is our opinion.

2426 COMMISSIONER DEMERS: So I understand it is from the point of view as a group that you feel you are different from the other proposals in country.

2427 MR. KIRK: There is no question I am the controlling shareholder of this and am leading a group of people. But the group that you see at the table here are all directly involved with the station. They all have an interest and a stake in it.

2428 I have an interest in John's station in Kingston, but John runs it. We were able to share that expertise.

2429 Just a couple of other things.

2430 You were asking about other distinguishing factors in this. I think there are two other aspects to this application. Again, they may not be unique.

2431 In addition to the independence and experience, we also do have highly connected local shareholders. As you saw, Dan Einwechter is a major entrepreneur, a major force in Kitchener-Waterloo.

2432 I would ask Gene Moser if he could add a few comments to the kind of impact and local connection that Dan and his companies have in this market.

2433 MR. MOSER: Thank you. Challenger, again, Daniel started it up. It was a university project back in 1974, I guess.

2434 But we will be almost 1,100 tractors and 3,000 trailers across Canada. Locally we would employ I would suggest approximately 800 people. Based on most of my interaction with the people, many of them are country fans also, which also made this very interesting to us, along with just the local focus.

2435 Again, that is what really drew us.

2436 MR. KIRK: So in addition to the independent nature, we do have good local connections into this market. I think it is the best balance of factors.

2437 Including in that we are proposing 40 per cent Canadian content, and we do that enthusiastically, as we mentioned in the proposal. Country is a format where you can play 40 per cent Canadian content, and we embrace that. We think that is a very achievable.

2438 We didn't do that just to be patronizing or anything else. We do it because we believe it.

2439 Currently now Steve is programming KX-96. It runs in excess of 35 per cent. It is not running on minimums. He generally has more than 35 per cent Canadian running at any time on the station.

2440 I think those are a number of factors. Maybe I have over-answered your question, but I hope it conveys some of the reason that we think we should be at the front of the line here.

2441 COMMISSIONER DEMERS: Thank you.

2442 What would the effect on your business plan be if the Commission licensed more than one new station?

2443 MR. WRIGHT: It would depend on which other station you might license. Two country stations, I think it might be severe.

2444 Were you thinking in terms of CHR if you licensed CHR?

2445 COMMISSIONER DEMERS: It would have been my next question.

2446 MR. KIRK: Let's answer the two of them together.

2447 MR. WRIGHT: If the Commission chose to license a CHR and a country station, we think there would be an effect. But remember, as we looked at the demographic appeal of country, we are going to be a 25-to-54 radio station. CHR is going to be a 12-to-24 radio station. So we are going after two very different groupings of people.

2448 I think the effect is such that we would be confident that we can achieve our business plan if you licensed a CHR station as well.

2449 That would not apply if you decided to license two country stations.

2450 MR. KIRK: If I could add to John's comments, which are always very good, in this market you have to realize that the majority of radio tuning in the Kitchener market is to out of market. There are really only four significant stations, commercial stations, in this market.

2451 The argument here is there are too few stations rather than too many. It is a very rich market. But by adding new stations, for example, a country station and a CHR station, you will actually make the Kitchener radio market perform better. There will be more in-market choices which will drive revenue growth, because radio will be more effective in this market.

2452 We have proven that in Ajax when we took country from out of market stations to an in-market station, and that is why KX-96 over the eight-year period -- and don't get me wrong. It was very tough for the first two or three years. It was hard slugging to get that to work. We have proved that the station, because of its local focus, delivered the audience locally. Advertisers appreciated that, and the station became very successful.

2453 The same model will apply in Kitchener. If you license a country station and you license a CHR station, you have very distinct underserved audiences by the local market. That will drive radio to a higher plane in this market with more choices.

2454 John, do you want to comment about K-ROCK in Kingston? The same thing applied in Kingston.

2455 MR. WRIGHT: Just recently I had lunch with my confreres at the other stations in Kingston, and while I don't think the figures are due at the Commission for another few weeks to confirm it -- and they certainly didn't show me their figures. But from what our discussions were about, it certainly looks like the Kingston market this past year, with K-ROCK as an addition to the market, will be up in excess of 10 per cent.

2456 The national growth in radio, as we know looking at the trends, is down around 2 per cent, and yet in Kingston we are going to be up in excess of 10 per cent.

2457 That is adding a much needed station to serve an underserved market. That is what happens. If our station had just come in and duplicated what was there, we wouldn't have had that revenue lift. But because we came in and we are supplying a new service and serving an underserved market, we are able to get quite a revenue lift in our market.

2458 That same thing will happen here by bringing country in, which is the biggest hole. There is a lot of room for a country music station here.

2459 COMMISSIONER DEMERS: Thank you.

2460 Now we come to the use of the frequency. As I think you know, we ask views from the applicants who want to use the same frequency in their application.

2461 What are the compelling reasons to grant you the requested frequency?

2462 MR. KIRK: I will begin the answer, and Doug Macaulay, our broadcast consultant, may want to add some thoughts at the end.

2463 I wrote to you on the question that you asked all applicants on why did you choose your particular frequency. Let me preface the discussion by saying finding a good frequency to serve Kitchener-Waterloo was not an easy problem to solve. It is a very tough problem to solve. There were no unallocated frequencies left in the Kitchener area. You had to go find one.

2464 Doug Macaulay and I spent a considerable amount of time reviewing the various options that were available. We looked at all the potential spots on the band and different potential transmitter sites around Kitchener-Waterloo. We kicked a few things around and eliminated and juggled and finally came up with 99.5.

2465 We did that work last December and early January after the call was announced.

2466 At that point we decided on 99.5.

2467 The main reason for doing that was that the 99.5 channel could be dropped into the Kitchener-Waterloo area with enough power that we proposed to serve all the major communities in Kitchener-Waterloo. That is Kitchener-Waterloo, most of Cambridge and, as well, as you can see in our coverage map, most of the balance of the Region of Waterloo, which actually is slightly north and west of the city of Kitchener.

2468 To us, that was the best pattern. It provided a 3 millivolt signal over all of Kitchener-Waterloo, unlike a number of the other alternatives.

2469 The CBC tower which we proposed at St. Agatha, had space available on it. They were keen to have private broadcasters come in and utilize that space.

2470 For us, the number of limitations on other frequencies to us just made 99.5 the best choice.

2471 91.5, which you heard about yesterday, works if it is collocated with Global TV in Paris. At its proposed parameters, it does not put a full 3 millivolt or local grade signal over all of Kitchener-Waterloo.

2472 The other alternative, some of the lower power alternatives, were limited in terms of their coverage, and if we were proposing this full coverage station with appropriate CTD and all the other attributes of our application, we didn't want to get into a situation like happened to CIZN, which had an inadequate signal to cover the Kitchener-Waterloo market.

2473 For those reasons, we rejected the other smaller frequencies that some of the other applicants have proposed.

2474 That is maybe a long way to get to the answer, but those are the sorts of considerations we went through to choose 99.5 at the place we chose it with the power.

1150

2475 MR. MACAULAY: I will just add a few thoughts to that.

2476 For one thing, any alternative frequencies have pretty serious drawbacks in terms of interference limitations. Then you come to ones like 91.5, which has been touted around, and of course its constraint is that it pretty well has to be situated on the Channel 6 tower in Paris because of the way the rules are written; that it is a threat to the reception of Channel 6 if it is not collocated.

2477 The problem is that the Paris tower is really just too far away from Kitchener-Waterloo to be able to give what we considered a totally adequate service for a commercial station.

2478 You might say: Gee, is the rule really that restrictive? I can cite an experience.

2479 I did file an application for a very low power operation in Kitchener on that frequency, a power level of 5 watts. The Global people put thumbs down; they vetoed it. So Industry Canada returned the application and said "not technically acceptable". So what can you do.

2480 The other category of frequencies are special case ones where in a couple of cases CBC have agreed to accept interference because of duplicate coverage. That's fair enough. These are quite short spaced and subject to a lot of received interference.

2481 Then we have the special case CORUS only and Rogers only frequencies which interfere with their own stations, so nobody else can apply for them. I guess that kind of sums up the situation for frequencies here.

2482 If you say what's an alternate choice, it's all ifs, ands or buts, and you don't know what is going to be left over to choose from at the end. If we don't get 99.5, then we don't know what might be left. But we do know for sure that it won't be anything very good.

2483 I guess that's about all I have to say.

2484 MR. KIRK: You have said it so well, Mr. Macaulay; thank you.

2485 To conclude, we think this is the best technical solution to add new service to Kitchener-Waterloo.

2486 On top of that, what we have all been talking about, if you say "what is the best use", the best use is the best technical use of the spectrum. As well, for all the reasons we have articulated, our independent voice in the market, our needed format, the CTD benefits, the 40 per cent Canadian content, our approach to a very local news and information, vigorous news and community service, and our experience in the format are also the other attributes that say this is the best use for that frequency.

2487 COMMISSIONER DEMERS: Thank you.

2488 I have a last question on cultural diversity. I will read the question, although I think you may have heard it yesterday.

2489 What measures would you take to incorporate and reflect the reality of Canada's cultural, ethnic, racial and aboriginal diversity in the following areas: employment practices, news, music, promotion of Canadian artists?

2490 MR. KIRK: Thank you for that question.

2491 As we have told you, we are small and independent broadcasters, but we take this issue quite seriously.

2492 In our application we did file an employment equity plan. We also undertake, with regard to employment practices, to advertise positions in specially targeted media in the area to ensure that those positions are available for application to the designated groups.

2493 We have researched and found some media that would give exposure to these groups, including Ambassador Magazine, the Aboriginal Voices publication, the Kitchener Multicultural Centre, which is a place, KW Accessibility, which is a job posting situation where these groups could be aware of that.

2494 In addition, we will undertake to work closely with the broadcast program at Conestoga College to ensure all participants in the program are aware of potential opportunities at our station.

2495 This is a program which we have undertaken at other stations. A number of people -- and Steve can speak to that -- are on the advisory board of Loyalist and Mohawk College in their broadcast programs.

2496 So it is something where we have experience, and we have had employees from those broadcast programs come in and start their careers at KX-96 and at CIWV in Hamilton.

2497 With regard to news, our newsroom will be staffed with news professionals who will be intensely locally connected. That is the philosophy we have been talking about. As part of a responsible and comprehensive news reporting, the ethnic and racial makeup of Kitchener-Waterloo will be reflected in our approach to local news.

2498 We will seek and have available local spokespeople of those representative communities.

2499 With regard to music and artists, country music represents probably the cultural composite of Canada: from the western cowboys who you know, people like Paul Brandt and George Fox; to the east coast Celtic sounds, such as the Rankins and Bruce Guthro; and the northern flavour, Susan Aglukark and other artists; to the local Kitchener-Waterloo artists, like Beverly Mahood, Jamie Warren and Laura Rose, who spoke to you earlier.

2500 This station will be a country music intensive station and continue to reflect that cultural diversity through its operations. We are committing to 40 per cent Canadian country music, and we commit to play that enthusiastically.

2501 Steve has a couple of other additional comments.

2502 MR. KASSAY: Yes, just to support it again.

2503 It is all a matter of being active and rounding up your options. As Doug mentioned, I sit on the advisory boards of both Mohawk and Belleville's Loyalist, which is great because I am a Ryerson grad. So that's what happens when you get out in the community: they see you and they want to talk to you -- tongue in cheek to a degree, but that's what it is like on the front line.

2504 You make yourself known. You get out in the community and these people who need help actively seek it and get it, and it works reciprocally when we are looking for people to fill positions.

2505 It is groups like this and endeavours like this that just broaden our perspective, in addition to the things that Doug mentioned, to make it happen.

2506 MR. KIRK: I have one concluding comment in our approach to women in the workplace.

2507 Fifty-three per cent of the staff at KX-96 are female employees, and two of the four management positions are held by women.

2508 We recruit and promote based on merit, and these are earned positions. So we are serious about our commitment to these policies.

2509 COMMISSIONER DEMERS: Thank you, mademoiselle; thank you, gentlemen.

2510 Back to you, Madam Chair.

2511 THE CHAIRPERSON: Thank you, Commissioner Demers.

2512 Other Commissioners have questions.

2513 Just a reminder about cell phones. Please make sure they are turned off.

2514 Commissioner Langford.

2515 COMMISSIONER LANGFORD: This is my morning -- is it still morning? Yes. Maybe I will change by this afternoon.

2516 This is my morning to be a little nasty, I suppose, and I have a nasty question for you, you lucky dog. Mr. Demers has been so nice to you.

2517 I think this one is going to you, Mr. Wright.

2518 MR. KIRK: Wait a minute. I'm between Mad Dog, Big Guy and Commissioner Langford. Is this what is going on?

2519 COMMISSIONER LANGFORD: Mad Dog and I are no longer an item. I am travelling solo today, to get into that country feeling.

2520 MR. KIRK: And you've got a gun.

2521 COMMISSIONER LANGFORD: Tell your ma, tell your pa.

2522 Mr. Wright, I think this is your bailiwick.

2523 I am looking at the Hendershot Research Consultant February 2002 report that you put up on the screen today, and I have been listening very attentively at how nimble a group you are and how able to adjust, and Mr. Kirk is out there in Ajax fighting like Ajax himself, with mythic results.

2524 I wonder how you are going to respond to the fact and how you are going to adjust to the fact that, through no fault of your own or no fault of Mr. Hendershot's, his research is no longer really viable in one particularly strong area. And I think you know where I am coming from.

2525 That is that when the research was done, the station CING-FM Hamilton was actually the third most tuned-to station in this area, and it was running a CHR format. That popular station is now running a country format in your face.

2526 That obviously skews these results. The results were accurate in February, but they are arguably not accurate now.

2527 What are you going to do about that? How does that affect your approach to the sorts of things you have been telling us today?

2528 MR. WRIGHT: The change of scene to country doesn't really change, I think, a whole lot in the research. What it does is it puts another out of market station -- and I think we commented on that on the slide. We said that they had moved from the CHR family over to the country family, and we fully expected them to get greater than a one share in the upcoming fall ratings.

2529 The challenge is the same that any local broadcaster faces with out of market radio stations. We say there is a law, and the law in radio is that if there are two stations broadcasting similar formats, one is local and one is out of town, the local station wins.

2530 That is just the law. It's the way it works.

2531 Ajax has great experience with a country music force, KISS-92, before it changed coming into Ajax, and Ajax being a local New Country station.

2532 Steve can speak to that.

2533 If the local station is a well run good local radio station, it will always be the one that the local market will tune to.

2534 Steve, do you have any further comment on that?

2535 MR. KASSAY: Well, other than saying this town isn't big enough for both of us, indeed that is exactly what happened. We launched in the face of this very big, in terms of country radio station, entity. It has very much affected and changed the format in our area. I don't even know how far that would have extended. It was so overwhelming.

2536 But again, local wins. It is not a rule to work by. That is the law. It happens that way.

2537 Within a couple of years our assent was noticeable, and we remained in a dominant position until -- well, we like to think we made them change, but I doubt that's what happened.

2538 COMMISSIONER LANGFORD: I am not trying to hold you to a new plan at the eleventh hour. That would be unfair and I wouldn't suggest it, and I don't think I would even want to accept it if you had one at this point. It is just too late.

2539 But I would ask you to share with us a little bit of the adjustment you must have made in trying to take on KISS from your original plan. There must have been adjustments.

2540 Do you then go to more spoken word, more news, more local? What kind of adjustments does the newcomer have to make when something like this comes up out of nowhere and all of a sudden you have a competitor where there was no competitor before?

2541 As I say, I am not bringing you to a new plan, but it would certainly help us understand that this is a real study of the word "nimble". What do you have to do? What kind of pragmatism do you have to get involved in here?

2542 MR. KIRK: I wish I was as nimble on the golf course. But we will leave that aside.

2543 In Ajax we inherited a situation. We bought an AM station which had devolved and KISS had encouraged its devolvement, if you will, coming into that market.

2544 KISS was already in the market, and that would be similar to this situation here. You have CHAM. It has been in the market. You have CING. You have to assume they will get some audience here. They are targeting in their very broad coverage as part of this. They will get audience.

2545 It was a similar situation. We had CHAM and KISS in Ajax when we started. The whole plan of the radio station was to target and focus on a defined community. It wasn't just Ajax. It was Ajax-Oshawa-Durham Region, but it was a significant community. It was an area that we could put our arms around.

2546 We walked in with a new plan for this radio station. When we put it on FM, we didn't keep the old call letters. We dropped them. We launched KS-96. This was brand new.

2547 By doing that and by establishing the local news focus, community events focus, participating with artists in the market, doing the work with the country clubs, the bars in the area, promoting that, you get ingrained. You push yourselves in and you push the other guys out.

2548 I would see this situation in Kitchener.

2549 In fact, if CING gets a decent rating in this market, that is terrific news. That says that the country audience here is bigger than we thought, potentially bigger than we thought. That opens up the opportunity for the station to come in and do the same sort of thing. By localizing it to Kitchener, we win.

2550 CING doesn't talk about Kitchener. It's a big, huge, amorphous signal that is looking to Toronto and Hamilton, Niagara and Kitchener, wherever that signal is operating. They are not a local station, the way we do local radio.

2551 We have proved that. John has proved it in Kingston. We have done it in Ajax with the New Country format. We can do it here. The same rules apply.

2552 In sum, probably John Hendershot's research would need to be revamped. But it was accurate when we filed it.

2553 As to the opportunity for this radio station in the market, I don't think it has changed at all.

2554 COMMISSIONER LANGFORD: So the numbers will be different, but the plan still works.

1205

2555 MR. KIRK: Yes. The approach to the market will be the same. It is localization, taking out of market stations out of the play here and putting it into the local market: a local originating station.

2556 As John said, the local originating station wins.

2557 COMMISSIONER LANGFORD: Thank you very much.

2558 THE CHAIRPERSON: Thank you.

2559 Commissioner Cram.

2560 COMMISSIONER CRAM: Thank you.

2561 I have two questions, one on country. We had two stations in this market that went out of country, which fits with what I have heard at other hearings; that the country music genre reached its apex in 1989 -- when you were around, Wendell, and you contributed to that -- and has been in a decline ever since.

2562 I would really like you to help me with this, because the fact that these other two stations went out sort of substantiates this assertion.

2563 MR. KIRK: We have multiple requests to answer this question.

2564 I will start with John, then I will take it and Steve will finish. Maybe Wendell will want to respond to that comment.

2565 MR. WRIGHT: I think the decline of country music is a misnomer. I have the shares of some of the country music stations across the country, and certainly in Kingston, in Ottawa, in Vancouver, in Calgary, right across the country, country is doing very well, thank you, in many, many markets.

2566 The case in Kitchener was a case of too few licences, and therefore each licence had to maximize the audience available to it in order to maximize their revenues.

2567 We had a case where CHYM was on AM and CFGL on FM doing country music. Well, the AC volume, the size of the AC market is greater than the size of the country market. So it was a business decision to take that format and flip it and put the AC, which had much bigger potential as AM music was declining, get that AC format on to FM.

2568 So now the country music format went from FM to AM in Kitchener.

2569 CFCA is a rock station. Again, it is a bigger pie than country. So the two FM stations in Kitchener were already servicing no. 1 and no. 2 sized pies. Number 3 sized pie is country, and it is not here because there are only two FM stations here.

2570 It is not really a function of the demise of country that caused it to leave the airwaves in Kitchener. It is more of a fact that there are too few licences in Kitchener to support the third station, the third big hole.

2571 MR. KIRK: I think a case in point is John's experience in Kingston where the rock format, which was missing from Kingston, has flourished when a third FM station went on the air almost under two years ago. And it has had a fabulous launch, because that third hole in the market was missing.

2572 With regard to country, we have shares of country stations in some of the markets across Canada, which I think if we go through them you will recognize that in the market the size of Kitchener with the number of stations the shares that we are anticipating, around 8 per cent share, could very easily be achieved.

2573 In Vancouver, for example, which as you know is a very competitive market, with probably 20 stations, this spring a 6.2 share; Calgary, 17.7 share, with a significant increase in the fall to spring book; Edmonton, a 10.7 share, again with a significant increase between fall and spring book.

2574 Edmonton has two stations now operating with CISN-FM and CFCW, a more traditional AM country station. When you add them together, it is 15.8 per cent of the market.

2575 Regina has 19.8 per cent; in Saskatoon, again two stations with about 15 per cent; Winnipeg, over 9 per cent.

2576 And London, a similar market just an hour away from here, has had a very successful station, as Wendell mentioned, BX-93, consistently up in the top rankings in the market with a 10.4 share. And it just goes on and on.

2577 Our view is that country has gone through cycles, but it is certainly not a dying format for us. It is a very vibrant format. You can see, with the kind of interest and activity with the artists in this market, it is far from gone.

2578 I think Wendell and Laura may want to add a little bit to this answer.

2579 MR. FERGUSON: I was just going to say that it is cyclic, but I don't think country ever dies. It is a great format. I have been in love with it since I was a kid.

2580 What I do miss, and why I am sitting on this panel with these particular gentlemen and ladies, is that there was a time in radio when it really had a lot of character around here. I used to listen to CKGL on the way home from gigs late at night, and Tom Gentry and The Midnight Highway. It was a real pleasure to listen to radio in those days. This was before a lot of conglomerates got in.

2581 I have nothing against any other applicants who are part of a conglomerate, but it seems like focus groups and marketed research, and all that sort of thing, the whole consulting game that's got into radio, it's so big bucks and all that sort of thing nowadays.

2582 If Commissioner Demers was a country artist up in Thunder Bay, if he was "Dusty Demers" or something like that and he was getting a lot of local attention at the local watering hole and had a few records out, if the radio station up there is on a consultant, then somebody in Toronto or New York is telling them what to play. And it's like no, we can't play Dusty. We have to play Faith Hill again for the 19th time this hour.

2583 I miss the days of radio when the local act was supported by the local area radio stations. That is the whole thing of a star making industry. That is what Canada lacks sometimes, is the oomph to get behind the local people and push them to another level where they can gain national exposure.

2584 That's all. And you are right, I am a dinosaur. I was back when it was hot.

2585 COMMISSIONER LANGFORD: You know, Wendell, he has the office beside me, and I don't appreciate you encouraging him. When he yodels, it's really rough.

--- Laughter / Rires

2586 MR. LEWIS: Commissioner, perhaps I could add a note of interest.

2587 Being a long-time broadcast lawyer, you may recall that in the early 1990s when CKGO was moved to the AM band, the Commission was reviewing its FM policy and there was a freeze on new licensing. Kitchener was even at that time an anomaly in Canadian radio.

2588 It was well known to the previous broadcasters in the market, who have since been purchased by Rogers, that the CFCA group of stations was up for sale. Stations were locked into formats as conditions of licence so even with an easy listening or CHR, there were licence conditions.

2589 I think that the former owners realized that there was a tremendous advantage to be had if they could move their CHR format to the FM band and thereby preclude any other competitor from changing to that format.

2590 Unfortunately -- and this is one of the ironies of the situation -- CKGO was a tremendously well-run, well-managed radio station and very, very profitable.

2591 But the sacrifice at that time -- and everyone knew in the radio business that if you put a music-intensive format on AM, it was not going to succeed as well as FM. The owners at that time realized that there was a better financial benefit to be had by moving formats.

2592 I don't think it had much to do with the quality of the music, the quality of the artists, or for that matter the support of the audience. It was just a business decision and I would say a preemptive move before the regulations changed and the call could take place.

2593 MR. KASSAY: I think rumours like that are greatly exaggerated again.

2594 If you are a fan of the format, you are a fan of the format and you are a fan of the format forever.

2595 Hatlock Country Jamboree which we again sponsored this year -- at KX-96, mind you. We are there all weekend. It's a giant event. It's fantastic. It's been running for over ten years, and this summer was the largest attendance ever.

2596 You are correct, Commissioner Cram, when you cite 1989 as the start to the big roll. Sure, it rolled up and peaked about 1993-94, and it is cyclical, as was suggested, as is every fad and trend and style or fashion or art.

2597 Mind you, we are having a great time in Ajax. Business is great. We just continue to have successes in many areas. We are not at all worried about it.

2598 Let me rephrase that last part.

2599 One of the things that we think made us successful was our commitment to consistency in a format, in an approach. If you are going to be a local radio station, you really have to have something substantial to offer. You can't be changing with every way the wind blows.

2600 You are now a community partner. That helped us achieve our success. Everyone here will tell you that. We tell other people, and we are really proud of it.

2601 Jim had some comments.

2602 MR. HOPSON: While certainly not as old as Wendell, I have been in this business for quite a while, and an artist from 25 years ago as well. I certainly recall the days of getting airplay here in town with Don Sanderson on air, driving through town and coming back from gigs.

2603 I have operated the music studio fulltime for about eight years now, and it is a constant phone calls, phone calls, phone calls, 85 per cent driven by the country genre.

2604 We have done rock acts. We have done punk acts. We have done alternative acts. And we continue to enjoy 85 per cent of our business is built around the country genre music.

2605 I can also tell you that I would suggest that half of those are as a result of either calling the station, participating in our contest or hearing about some joint ventures that we are doing with the radio station, certainly at their Birthday Bash and sponsoring artists like Laura Rose and working with them.

2606 As well, I don't get a phone call saying I really like country but I think I need to consider becoming a rock or a pop artist. The artists that call looking for studio and guidance are country, and they are committed country.

1220

2607 MS ROSE: If I could make one comment as someone who works consistently in the bar scene in Ontario, I play pretty much every weekend all over Ontario, and I have for the past four years. The bars just continue to get busier and busier. There is no demise of anything. If anything, it has become more popular, in my experience, in the last four years.

2608 COMMISSIONER CRAM: For the record, I want you to know I am not anti country.

2609 My next concern is far more serious and one that I don't know how to assess, and I think I have to put it on the record.

2610 You talked, Mr. Kirk, about the issue of how you are different; that you are independent, yes, but your experience. And your experience is based on the fact that there are two or three of you from different areas and the fact that you have connected shareholders.

2611 I see that and I hear that. But how do I compare that in terms of ability to deliver with, say, Rogers, Global? How do I factor that?

2612 I understand the experience that you have, but it is highly individualized. It is based on you, you and you, and it is based on a corporate structure of you, you, you, you. At any time, one of you can leave.

2613 I look at Rogers and I look at that they have been around, and please don't think that I am -- Rogers, Corus, and I see the long-term ability to get into essentially any market.

2614 I look at experience within your group. You add it up, and it adds up to a very impressive amount. But I also know, for example, in Vancouver where we licensed local individuals -- and that was a very big issue to us there -- and then we find out the shares have been sold.

2615 How do we assess your saying that you are experienced and you have local shareholding when, compared to something from Global, this is something that can change and something that in fact could change before you get on air.

2616 We see you here. We give a licence. And then the animal we have licensed may become a bird.

2617 Do you see where I am coming from?

2618 MR. KIRK: I see where you are coming from, and I don't think I can fly.

2619 I will also preface that by maybe a smart ass remark, but Ted Rogers is older than I am, and he is the controlling shareholder of Rogers. They are wonderful broadcasters and are in for the long haul. I have nothing but the utmost respect for the competitors in this market.

2620 I wasn't aware that the Vancouver situation had flown the coop, as you characterized it.

2621 COMMISSIONER CRAM: Three of the shareholders sold out to the fourth.

2622 MR. KIRK: Right. What you see in stations that I have been involved in is that I am the controlling shareholder, and you can look to me. John is the controlling shareholder of Kingston, and you can look to him.

2623 We have been around this business. I have 16 years of experience in it. I am here applying for a licence. I want to grow this company. I want to grow this group of stations. We have a lot of passion for the radio business; this is what we do.

2624 You sort of said well, there's you, you and you. But it is more than that. We have a whole staff in Kingston, in Ajax and in Hamilton running the radio station. You have seen a portion of them here.

2625 Steve has overall operations and programming responsibilities, but there is a whole staff of people beneath Steve who we are encouraging to grow up into positions of more responsibility. That's how it works.

2626 Steve Macaulay, who has been running the slides and has not had a speaking role today, is sales manager at Ajax. He has a team of people working for him. That's why he is here today. It can run so we can come here and pursue new opportunities to grow.

2627 The same can be said for John.

2628 So it is more than just two or three people here. We have a group of people and a group of committed shareholders. This is a model that we have evolved that works extremely well for us. Quite frankly, we are very proud of that. We are proud of the experience.

2629 We turned around a licence in Ajax eight years ago, flipped a dying AM station to an FM, which is now winning in that market. We know what we have to do. We have to beat all the Toronto stations, and we have to beat local competition in Oshawa. We have done that. We love it, and we are there to stay and grow it. We are very passionate about this business.

2630 At any point if I was a one-shot wonder and wanted to get a licence and flip it, there have been many opportunities. I am not interested. We are here. We are here to stay. We are here to grow this.

2631 We also think this is an important licence for us to achieve the critical size to be able to keep this going, to continue to grow and build the resources that we have.

2632 We have seen the kind of quality of staff that we have that have come up through the system. You have to have continuing opportunities for those people to continue their career growth, or you do lose them. That is my point.

2633 To bring these skilled managers along, this is a very important licence for us. I think you get the picture that we are here to build it and grow it.

2634 John, I think, wanted to amplify.

2635 MR. WRIGHT: I think there is a type of person that enjoys building, that has an entrepreneurial spirit. Certainly Doug is that kind of person and I am that kind of person.

2636 I spent quite a number of years in the corporate side of things. I was general manager of CHUM-AM and FM in Toronto. I worked with Country Music Television as the president. I worked with the fine group of people at Rogers. So I have had an awful lot of corporate experience.

2637 What really started to drive me is to be able to have my own business and create my own future.

2638 Kingston was my first application. And thank you, all. We were successful in getting the licence there, and the station is very successful. In fact, we won Station of the Year in our first year at Canadian Music Week.

2639 We have a passion for this business, and we want to be in the business.

2640 The only threat that we have is that we can't grow. We applied for a station in Ottawa, and we were not successful. We are now here applying for a station in Kitchener. We have great energy and great ambitions, and we are looking for long-term growth.

2641 I hope that explains our commitment to this licence and the fact that we want to be here. We want to go into other markets in Ontario. We are regional Ontario broadcasters and where there are other opportunities, we are going to be there too.

2642 MR. KIRK: Just one final piece I would like to add.

2643 This application proposes a significant local connection of shareholders here in the market. As you saw from Dan Einwechter's remarks in the presentation, he is a long-term Kitchener-Waterloo entrepreneur, tremendously successful, and wants to be involved with this application because it can further his long-term goals in this market.

2644 Tom Pippy is back in this market teaching at Conestoga, a significant shareholder in the application. So there is the local shareholder aspect.

2645 In addition, as you will have seen from our proposed shareholder's agreement and how it will work, a number of the people on the panel will also earn shares in this new company. That is Steve, Tom, Simon and others, that will earn shares in this company for bringing this vision to you.

2646 That is how we can help continue to grow it and have skilled quality people committed to the long-term future of radio. This really is a tremendous opportunity for us. I hope we have conveyed that to you.

2647 COMMISSIONER CRAM: Thank you.

2648 Again, I don't want to say that I am anti small station owners at all. I was just trying to weigh these two issues, and how do I weigh your assertion and how much weight should it have when I am looking at this.

2649 Thank you very much, Madam Chair.

2650 MR. LEWIS: Commissioner, I would like to comment briefly.

2651 I think you have raised a very valid point. The Commission has faced many times before this delicate balance of local ownership, first time broadcasters versus the goliath. I think that the happy hybrid that we bring to you today is the experience. I think if you total up the number of years of experience as broadcasters, it is phenomenal. They know the market, they know the region and they are successful.

2652 I think that perhaps is the difference from the Vancouver scenario where there were some people who didn't have the level of experience that we bring to you today.

2653 MR. KIRK: I don't want to belabour the point, but I can understand your concern about licence-flippers; people who win a licence and tell you all these things, that they love the business, and then sell their shares in six months or a year.

2654 That is not on for us. I think you have seen the track record here. You know the kind of experience. We love this business, and we want to grow in the business. This is the way that companies and individuals that you see here of our level and size can really grow.

2655 It is hard to go out and pay millions and millions to buy licences. You have seen dozens of licences pass from individual broadcasters or smaller groups of broadcasters into the hands of majors. The business in English Canada now has basically four -- five, I guess, with Newcap -- major groups that are national in scope. In Québec there are two, maybe three, broadcasters. Where are the independents left?

2656 I think what you can see here is the experience and expertise, the ability to operate in competitive markets, and a significant size now, and with the commitment of the people around this table that we are here to stay and build some growth.

2657 COMMISSIONER CRAM: Thank you.

2658 THE CHAIRPERSON: Thank you to Mr. Kirk and the team.

2659 We will now take our lunch break. It is 12:30.

2660 Today we will reconvene at 2 o'clock, with the presentation by Sound of Faith Broadcasting.

--- Upon recessing at 1230 / Suspension à 1230

--- Upon resuming at 1400 / Reprise à 1400

2661 THE CHAIRPERSON: Order, please.

2662 Mr. Secretary.

2663 MR. LEBEL: Thank you, Madam Chair.

2664 Item 6 on the agenda is an application by Sound of Faith Broadcasting for a licence to operate an English-language commercial Specialty FM radio station in Kitchener.

2665 The new station would operate on frequency 94.3 MHz (channel 232LP), with an effected radiated power of 50 watts.

2666 The applicant is proposing a Christian music service (Specialty format) with at least 95 per cent of the weekly total music drawn from subcategory 35 (non-classic religious).

2667 You have 20 minutes to make your presentation.

2668 THE CHAIRPERSON: Please proceed when you are ready.

PRESENTATION / PRÉSENTATION

2669 MR. JOHNSTON: Madam Chairperson and Members of the Canadian Radio-television and Telecommunications Commission, my name is Bruce Johnston. I am the Chairperson of the Local Faith FM Committee, a group of eleven men and women from a variety of Christian backgrounds and traditions.

2670 I am the producer and a co-host of a Sunday morning radio program called "Sunday Sound of Faith". I have been a broadcaster since 1966, working in the fields of news and public affairs and more recently in Christian broadcasting.

2671 It has been my privilege to live in this progressive community of Kitchener-Waterloo since 1971. I was employed as an announcer, a reporter and a producer in local radio and television operations until my retirement from CKCO-TV in May of 1998.

2672 This day is the day we as a team at Sound of Faith Broadcasting, otherwise known as Faith FM, have been looking forward to for some time: an opportunity to explain our raison d'être and to let you know why we believe it is time for Christian radio in this part of Ontario.

2673 This day culminates over eight years of work on this project.

2674 We are calling today's presentation The Three Ws: first, why Christian radio; second, why Faith FM; and third, why now?

2675 You will meet the other presenters in a few minutes, but let me begin by tackling the question: Why Christian radio?

2676 According to the Statistics Canada Census 1991, under the category of "Population by Religious Affiliation", we learn that at least 77.1 per cent of the people in Kitchener indicated they were associated with a Christian church, and 74.9 per cent of the people in Waterloo declared likewise.

2677 Madam Chairperson and Members of the Commission, these are impressive figures. Some years ago, local secular radio and television stations began to abandon religious programming in favour of more financially profitable programs and higher ratings. This meant that there were few religious programs left on the local dial or channels.

2678 It is our opinion that religious programming, to a large degree, sets the tone for and reflects the morals, ethics and values in a community.

2679 We were fortunate that radio station CKWR-FM 98.5 in Waterloo, Canada's first community radio station, has helped fill the void by providing some religious broadcasting time that some of us with Faith FM are privileged to be a part of each week.

2680 We will have more to say about that in the next part of our presentation.

2681 As you are probably aware, Madam Chairperson and Members of the Commission, the United States is more than well endowed with religious radio stations. According to one reliable source, there are currently 2,250 commercial and non-commercial religious radio stations in that country.

2682 The one station that the Christian community of Kitchener-Waterloo has been able to hear from time to time has been WDCX-FM in Buffalo, New York. And while we as Canadians share common religious values with our American friends and benefit spiritually from stations like that, the programs assume a largely American perspective on topical issues and in music.

2683 At the same time, a large percentage of their advertising revenues are derived from Canadian sources, including car dealerships, financial institutions, Christian book stores and mental health and dental practitioners.

2684 While we certainly would not want to redirect any of those advertising dollars away from them, it does point out that Canadian advertisers realize that by advertising in the U.S., they will benefit from higher sales from Canadian consumers who listen to WDCX Radio. For many of those same advertisers there has not been a Canadian Christian radio outlet where they can spend their money to reach a specific target audience.

2685 Already the locally-produced Christian programs that are carried on stations like CKWR-FM in Waterloo are led by volunteers and supported by Canadian advertising dollars. We at Sound of Faith Broadcasting, for example, have not had any problems finding suitable advertisers to sell their products or services. In fact, in some instances we have turned down potential advertisers because we simply did not have the on-air time available to them.

2686 We are confident that there are sufficient advertising dollars in our community of Kitchener-Waterloo to sustain all but a handful of programs without resorting to on-air appeals for other funds to pay the bills.

2687 The exceptions would be occasional appeals for people to become annual members of the Faith FM family and in a sense have some "ownership" in the station. Other exceptions might be certain religious groups like Key Life Ministries or Trans-World Radio which would purchase blocks of air time from us but raise their own revenues.

2688 Madam Chairperson and Members of the Commission, there are current radio outlets that foster the development of secular musical talent, some Canadian and some foreign. But there are literally hundreds of Christian musical artists in this country, including individuals, singing groups and bands, that have no way of developing and exposing their talent except through the limited appeal of church-sponsored concerts.

2689 Sound of Faith Broadcasting would like to change that picture. In fact, that is already occurring to some degree through the limited programming carried on community and campus radio stations.

2690 Christian artists, like secular artists, need and deserve a broader outlet for their talents. We believe we can do that with a radio station that broadcasts twenty-four hours a day, seven days a week.

2691 In addition, we would like to be able to direct some of the money from any profits we might earn to develop Christian musical talent in this part of Ontario. We could, for example, do that through scholarship funds and by partially subsidizing the cost of recording a CD.

2692 Madam Chairperson and Members of the Commission, I would like to conclude my remarks by saying we have a golden opportunity to address a need to reach a religious community that is not "adequately" served by existing radio services.

2693 At this time, I wish to introduce another member of our Faith FM team, Rachel Wallace-Oberle, who is one of our two local co-ordinators for Sound of Faith Broadcasting and a fellow broadcaster with me on CKWR-FM 98.5.

2694 Rachel will examine the question: Why Faith FM?

2695 Thank you for listening.

2696 MS WALLACE-OBERLE: Good afternoon, Madam Chairperson and Members of the Commission.

2697 My name is Rachel Wallace-Oberle. I am a co-ordinator for Faith FM in Kitchener-Waterloo. I have an education in radio and television broadcasting, as well as journalism/print. I am a freelance writer and operate a business that provides writing and editing services to various clients.

2698 My role with Faith FM includes co-hosting and writing for our weekly program, as well as writing and editing our newsletter The Signal Booster, which you have before you.

2699 That will be in the back of your report.

2700 Working together with the men and women of Faith FM over the past eight years has been an incredible and enriching experience. This is a group of dedicated, committed people who have laboured tirelessly toward this day. This is a group of people who believe in teamwork and in making the vision of Christian radio a reality.

2701 Clearly the community of Kitchener-Waterloo shares our vision. I would like to elaborate on this.

2702 Our members have grown to over 700. They faithfully stand with us financially and prayerfully. They have sent letters of support to the CRTC and are eagerly awaiting the results of your decision. They have caught the vision of Faith FM and are determined to see it become a reality.

2703 Ratings indicate that listeners of The Sunday Sound of Faith program on CKWR number well over 2500. They not only tune in every week, they write, e-mail, phone, call in to participate in contests and give-aways, and they tape us. They ask the three of us to host and speak at events with regard to Faith FM.

2704 When one of us is absent from the program due to illness or vacation, we hear about it from our listeners. There's no question they have caught the vision.

2705 There are currently over 30 volunteers waiting in the wings to participate in some aspect of programming such as hosting, producing, operating, et cetera. A further 22 people are interested in helping in ways such as promotion through their churches, working on the newsletter and the Web site, clerical work in our office, sales and fundraising.

2706 We have done very little canvassing for help; these people have come forward because they believe in our vision.

2707 Advertisers, financial donors and local businesses are an integral part of Faith FM. Along with our many members, they have enabled us to air our weekly program, put out our newsletter, hold community events and finance this application process. They anticipate and appreciate that as a station, we will represent and involve them due to our mandate of 70 per cent music and 30 per cent spoken word.

2708 This is a collaboration and a vision they desire and support.

2709 As co-hosts, the three of us regularly receive invitations to come and speak in churches throughout the region. Pastors and congregations want to be updated and connected with what we are doing at Faith FM. This intense interest includes various denominations and cultures.

2710 We have entered into an agreement with ChristianCurrent newspaper, for which I write, and our newsletter is now part of its distribution to over 300 churches in the Golden Triangle.

2711 CKWR in Waterloo has provided us with a nurturing positive environment. General Manager Paul Scott regards us as colleagues rather than competition.

2712 In addition, CKWR has given us moral support, advice on how to approach this hearing and a great deal of used equipment which they no longer needed as their facilities were upgraded.

2713 As well, they have graciously afforded us the opportunity to be on the air for four and a half years.

2714 The City of Kitchener has also generously supported our vision by giving us permission to use City Hall as a transmitter site. A committee, consisting of the mayor and several councillors, last year passed this decision unanimously. We have a signed legal letter of intent to this effect.

2715 For the countless artists who have and continue to send us their CDs -- which you can see behind us on this table here today -- they promote us at their concerts, and our vision is a matter of utmost importance.

2716 Many of them have no other outlet or means of support and are counting on us to provide them with the exposure they need in order to allow them to do what they are called to do.

2717 As a station, we intend to stand behind these artists through various ways, one of which will be to make available to them extremely low production costs and facilities.

2718 The following artists' statements are certainly confirmation that they share our vision.

2719 Kim Watson of Love Tree Ministries, located in Innerkip, Ontario, says:

"For the past three years Faith FM has been a part of my music ministry. They are the very first station to play my CDs. Because they are local, I presented my music to them with the hopes of airplay. I was warmly received and given the opportunity of a live on-air interview. What a way to boost a career. Since I have had such great support from Faith FM, it's given me the courage to branch out to other radio stations, and today my second CD is played on 45 Christian stations across Canada! I firmly believe that Faith FM should be granted a licence."

2720 Ryan Brueckner of The Unashamed Quartet, in Cambridge, says:

"As musical artists, the members of The Unashamed Quartet are keenly aware of the benefits that a Canadian Christian radio station offers, and it is our most sincere hope that Faith FM is successful in its bid for a broadcasting licence. Over the pat few years, Unashamed has expanded its scope of activity largely with the help of people who support our ministry. At this time, I would like to offer my strong recommendation that Faith FM be granted a broadcasting licence. The addition of this station to the growing number of Christian radio stations throughout Canada will serve to further promote the growth of key parts of Canadian culture, the expression of music and the expression of personal religious freedoms."

2721 Jane Valenta in Kitchener says:

"Over the past year we have seen a great deal of chaos in this world. People are desperate to hear something positive and uplifting, and they find that with Faith FM. Faith FM has opened doors for my ministry in so many ways that I can't begin to thank them for and they've allowed the message of my music to reach so many more than I can do in a concert. As a local artist, they've helped me by promoting my upcoming concerts. They have had me on air more than once to discuss my ministry, giving me exposure and credibility. There are many artists like myself who are truly blessed and thankful for the work already done by the people at Faith FM. I would strongly encourage you to grant Faith FM their fulltime radio station licence. I know from personal experience and years of ministry that thousands of people in the KW and surrounding area would rejoice to have a fulltime Christian radio station."

2722 And finally, Carey B. Grant in Cambridge, says:

"Airplay with Faith FM for my music has helped me as an independent artist get a positive message out into the extremely competitive world of music. My budget ws $10,000; that's all I could afford. It took me four years to do my project. I'm not signed with a major label and do most of my bookings myself. Faith FM's generous act of playing my CD has become a stepping stone for me and a tool to help people who like my particular style of music. It's helping me to grow as an individual, and it's helping me with my dignity as a musician songwriter. I want to do another album in the future, and Faith FM has given me the hope to continue. I want to thank them for their genuine interest in my music."

2723 As you can see, Madam Chairperson and Members of the Commission, this community strongly and enthusiastically supports us in our goal to establish a local Christian radio station.

2724 With it we propose to build, strengthen, encourage and bring people together. Much of that has already occurred. We are sincerely hoping today that you will give us your permission to go on and accomplish this work.

2725 Thank you.

2726 MR. MacDONALD: Good afternoon, Madam Chairperson and Members of the Commission. My name is Dave MacDonald.

2727 I share a role with Rachel Wallace-Oberle who just addressed you. I am also a co-ordinator for Sound of Faith Broadcasting in Kitchener-Waterloo, and I am a member of the board of directors of Sound of Faith Broadcasting.

2728 I would consider myself a veteran local broadcaster. I have lived in this area since 1968, and since 1969 I have been the weekday weatherman on CKCO-TV in Kitchener. Also, I am a trained meteorologist.

2729 I stand before you as one who is well acquainted with the broadcasting arena locally. In addition to my regular weather duties at CKCO, I have been cohosting, on a voluntary basis, a Sunday morning music and spoken word program on Canada's first community radio station, CKWR-FM 98.5 in Waterloo. In fact, I share those duties with the two people who have just spoken to you.

2730 And, together, we have been doing that hour-long program called "Sunday Sound of Faith" since June 1998.

2731 Madam Chairperson and Members of the Commission, the question I wish to address is: Why now? Why should you grant us a licence to broadcast at this time?

2732 First of all, we acknowledge that there is a limited number of frequencies available to do broadcasting of any kind, and it has been our desire to come before you and ask that you grant us the privilege to broadcast while these scarce frequencies are still available.

2733 Second, and more important than that, we as a group of eleven men and women have spent considerable time preparing for this moment -- over eight years, as you heard a few moments ago.

2734 We have tested the waters, so to speak, and are convinced that we can depend on all our members and all of the potential programmers, volunteers behind the scenes, financial donors and advertisers to give credibility to Christian radio in this community.

2735 We have kept in conversation with many of them and kept them apprised of our actions and progress. And there is an air of excitement and anticipation among them and others who constantly ask the question: "When are you going to be on the air?"

2736 Madam Chairperson and Members of the Commission, we did not enter into this project lightly or hastily, because we wanted to make sure it would work before we applied for a licence to broadcast.

2737 I want to add that every commercial radio station that is duly licensed to serve this area, with one exception, is serving a particular demographic, be it the teens and twenties or the 35-to-49 age group. They are good at what they do. Their ratings numbers tell the story.

2738 The one exception is CKWR-FM 98.5, which we alluded to earlier. They are also good at what they do. Their ratings also paint an impressive picture.

2739 They are a community radio station and they do provide wide access for all sectors and ages of our community. They do that with an emphasis on their specialty and multicultural programs, and indeed they have granted us access to broadcast live every Sunday morning with "Sunday Sound of Faith".

2740 We pay them for that time from revenues we receive from our commercial sponsors.

2741 I might add, Madam Chairperson and Members of the Commission, we do just fine too with our ratings numbers. According to recent ratings, our average quarter-hour numbers range around 2500 to 3000 listeners, and we consider those numbers to be excellent for a Sunday morning.

2742 Our demographic is decidedly older for the most part -- judging from those who approach us in public and who support us prayerfully and financially. They are those, might I suggest, who have a little snow on the roof.

2743 Our music tends toward the mellow and soft side. And let me say that most of our music we play, close to 90 per cent, is home-grown Canadian.

2744 If given the opportunity to broadcast twenty-four hours a day, seven days a week, it is our intention to appeal to a broader demographic, from children old enough to talk to the most senior folks of our community -- mind you, at different stages throughout the broadcast week.

2745 As our application shows, we have a desire to appeal to a wide range of musical tastes and styles and provide information that will attract that same range of age groups through children's programs, talk shows, interview segments, phone-in broadcasts and news.

2746 Madam Chairperson and Members of the Commission, we do have facilities right now that can be converted into office space and studios.

2747 As you heard earlier, we have official approval from the City of Kitchener to erect a transmitter atop City Hall.

2748 We have the support of a number of local churches. And we have signed agreements with a handful of program groups and advertisers who already endorse our commitment to broadcast.

2749 We know there are musical artists in Ontario and other parts of Canada who will stand to benefit from the added exposure they would receive. Rachel Wallace-Oberle, Bruce Johnston and I all have a proven broadcasting track record in our community, as well as in other regions of southern Ontario.

2750 Madam Chairperson and Members of the Commission, we thank you for hearing us today, and we would appreciate any consideration you are able to give to our application.

1420

2751 THE CHAIRPERSON: Thank you very much for your presentation, Mr. Johnston, Ms Wallace-Oberle and Mr. MacDonald.

2752 I will be asking you a few questions about your application and your presentation today.

2753 The questions will cover programming, your training and supervising of volunteers, your Canadian Talent Development proposal, your business plan and finally some technical questions related to frequency.

2754 Let's begin with programming.

2755 When I ask you the questions, just to note, I will be referring to your application and to the deficiency letter of May 21st and a couple of comments you made this afternoon.

2756 If we look at your proposal in terms of local programming, as I understand it, your proposal is 70 per cent music, 30 per cent spoken word in the application. Part of that spoken word programming we may assume could be news, weather and sports, but it is not entirely clear from the application how this is going to be done.

2757 As you know, while local programming no longer requires a specific commitment with respect to the amount of news and information programming by an FM licensee, it remains an expectation that FM licensees will nonetheless schedule news and information programming at levels sufficient to meet the needs of the community.

2758 You have placed a lot of emphasis this afternoon on your connection with this community.

2759 I believe you talked to us about local programming in the deficiency letter of May 21st, in questions 4(b), (c), (d) and (e).

2760 In that letter you say that due to budgetary constraints, the station will not offer "regular news weather and sports until the station is in its sixth year of operation".

2761 Considering what I have said previously about the importance in local programming of news and information, can you tell us what you mean by regular news sports and weather, what you consider that to be. And why do you feel that your proposal is sufficient to meet the needs of the Kitchener community when this regular news, weather and sports would only be available in year six of your licence?

2762 MR. JOHNSTON: Maybe I could answer that question initially, Madam Chairperson.

2763 What we intend to do is not have the typical kind of news, weather and sports packages that we are accustomed to hearing on secular stations that bring in news not just from the local area but also on the international and national scene, as well. We would not subscribe immediately to that kind of a service where we could provide that kind of coverage.

2764 However, having said that, I believe that we would have opportunity to talk about some of the issues of our local community, especially those things that might not be captured on a secular media, matters pertaining to the churches within the area, the religious community -- and not necessarily the Christian community either. It may involve the Islamic community, the Jewish community, whatever the case might be.

2765 It is our hope that through the volunteer component, we will have people who would be prepared to go out into the community and do interviews with various individuals who are key people in those areas, to talk about some of the things that are occurring.

2766 For example, if a church decides to have some kind of a fund-raising event, not necessarily to raise money for the church but maybe for some cause like Cystic Fibrosis research, that may be an opportunity to send somebody out to cover that.

2767 That is not necessarily the kind of story that would be carried on the secular media. It might be but not necessarily.

2768 This would be an opportunity for us to plug in directly with the churches to be able to capture some of that interest.

2769 I think that in terms of sports we can also tap into the local community by inviting the local sporting organizations to give us information by telephone: sports scores and other information that would be interesting -- and not necessarily even in the religious vein, but nonetheless would help us to tap into the community.

2770 So I see these things initially.

2771 I was struck by what Commissioner Langford talked about this morning about going slowly. We don't want to bite off more than we can chew. We can run up a tremendous expenditure by getting into something that is major right away, so we are kind of buying a little time, if you like.

2772 THE CHAIRPERSON: Thank you for that. Let me just make sure we have understood it, then.

2773 I am looking at the grid you submitted with your application. There is a section from 6:00 a.m. to 8:00 called "Sonrise: Music, News, Weather and Breezy Chat".

2774 So when we see the term "news" there, is it more the information programming you were describing, or could we call it more regular, as you call it, news of the day? What exactly is that news?

2775 MR. JOHNSTON: It wouldn't be so much the news of the day. It probably would be something more specific, at least initially.

2776 Again, as time goes on, that news could incorporate some other things as well, which would be the news of the day: local happenings and national, international occurrences.

2777 THE CHAIRPERSON: The way you describe your information, if I can use that term, possibly having people out interviewing on issues -- and we will come back to that in another way -- if I am looking at this grid, where would that information about the community and community happening, apart from 6:00 to 8:00 a.m., turn up?

2778 I frankly don't see it. I understand these grids are often a little general. Could you give us an idea where such information would be available to the public?

2779 I am trying to get a sense, from the point of view that this is an application in a commercial environment and an application in a competitive environment -- a licensee, as I said, has to have a look at the responsibility you have for providing local information and news, as far as possible.

2780 Could you tell us where we would see it in the programming?

2781 MR. JOHNSTON: Yes, Madam Chairperson.

2782 I think you would see that probably incorporated and kind of sprinkled through the time frame between 6:00 and 8:00. So it wouldn't necessarily be designated as a five-minute time when this kind of information would be supplied but perhaps would be incorporated into the total program frame from 6:00 to 8:00 as the disc jockey, or whoever the host is, might deem to feel that that is the time to do it.

2783 If you were looking later in the day, the Cruise Control at 10 o'clock and then the Home Stretch at 3:00, we would sprinkle that kind of information into those periods of time.

2784 As for the rest of the day, I would think it would have to be up to the individual volunteers. I might add again that most of what happens after 6 o'clock will be volunteer.

2785 They, in turn, may want to bring in some information about what is happening in the local Christian community. They would do that at their prerogative and at their own time during the program framework that they have set up for them.

2786 THE CHAIRPERSON: Thank you. I would like to get back to that when we talk a little bit more about the programming.

2787 I see on the grid Sunday Sound of Faith at 9:00 to 10:00 still there. Is that the same hour that you currently have on air?

2788 MR. JOHNSTON: That is correct, Madam Chairperson.

2789 We have had some preliminary discussions with CKWR where we broadcast now. We are talking in terms of maybe simulcasting that period of time and doing some other things that we are still exploring.

2790 THE CHAIRPERSON: You made the point, both in the application and today, about your group having had this hour for the last four and a half years, if I am not mistaken.

2791 MR. JOHNSTON: That is correct.

2792 THE CHAIRPERSON: It would help the Panel to get a sense of what that hour sounds like. What do we hear on that hour?

2793 In light of my questions on the mix of music and spoken word, in that hour what would we hear?

2794 MR. JOHNSTON: Since I am the producer of the program, I guess I can answer that question too.

2795 What we do is we start off our program with an introduction. The three of us co-host it, as you heard earlier, and each of us in turn introduces our particular part of what we might be doing during the course of that program.

2796 Then we go into some music. Following the first music package, we have a piece called Heartbeat, which is approximately a two-to-three minute devotional, something with a challenge to it. Pastor Marlene Delicart, who is part of our team, does that.

2797 Then we go into some more music.

2798 During the initial patter time, we spend that time devoting our attention to church events that are occurring in the area. We receive a number of these over a period of time, and some we are able to broadcast because we don't have that many, especially during the summer. At other times, we try to incorporate as many of these as we can.

2799 I happen to be the one who puts these things together, but we all take turns reading these things.

2800 Then we go into another series of musical packages.

2801 All of these things are interspersed with our commercial breaks. We have several sponsors who actually pay us the time so that we, in turn, can pay CKWR for the time that we have.

2802 Rachel does a devotional about 30 minutes into the program. Again, that is a three-minute piece. It is a challenging piece, as well, but it kind of reflects the overall theme of our program.

2803 We may talk, as we did last Sunday, about God's will. Rachel was introducing something about God's will.

2804 So we try to make the whole hour fit a theme, and that includes the music. The music, I would have to say, is 90 per cent Canadian.

2805 Again going back to our presentation at the beginning, we have 200 CDs here which have been given to us over the last four years to play. That is all Canadian.

2806 THE CHAIRPERSON: I was wondering, for the record, what the milk crates are back there. So that's what they are.

2807 MR. JOHNSTON: I think that roughly sums up the program for us.

2808 It is kind of a soft sell, yet the theme, our Christian messages, is certainly evident.

2809 MR. MacDONALD: Could I add, too, that we often bring in guests for live interviews in studio, and we give them anywhere from 10 to 15 minutes of time to talk about whatever they might be involved with, whether it be a mission or their music ministry.

2810 We have actually had groups come in. The Unashamed Quartet have been in on a couple of occasions to talk about what they are doing over the next few months. Then they have done some live a cappella singing in studio.

2811 So it is quite a variety that we get on the program from people who come in and talk about some mission work they might be doing overseas to artists who come in and talk about how their career has been furthered by getting exposure on the air.

1435

2812 THE CHAIRPERSON: Thank you. That is very helpful and gives us a sense of your approach, which is now going to expand from one hour, one day a week, to seven days a week, 24 hours a day.

2813 So you can guess where we are going to go with this.

2814 MR. MacDONALD: That's the challenge that we are prepared to meet; that's correct.

2815 THE CHAIRPERSON: One of the issues -- and let's stay with the spoken word programming. Now we are looking at the full schedule that you have proposed to us and your approach.

2816 You have said in your application that virtually all of our programming would be classified as religious. Now I am referring to the Religious Programming Policy 1993-78, with which I am sure you are familiar.

2817 In fact, you discuss the matter of balanced programming in your application and deficiency response.

2818 This is the area I would like to cover now and get further clarification from you.

2819 In your application and deficiency response, just as you just described your hour, you mentioned phone-ins, interviews and studio discussions.

2820 As you know, the notion of balance, as found in the religious policy, seeks to ensure that a reasonably consistent listener will be exposed to a spectrum of differing views on issues of public concern within a reasonable period of time. And there are various mechanisms to do this. In fact, they include phone-ins, interviews, searching out different views, et cetera.

2821 In your application, and I think perhaps I can infer from what you have just described in your programming on Sunday currently, you do talk about open line talk shows.

2822 In your proposed schedule I see Night Waves from midnight to 6:00 a.m. But apart from that, since we don't regulate that component of the day, could you tell us what other kinds of programs in your proposed schedule might play a role in the provision of balance and identify them for us.

2823 MR. MacDONALD: We have been negotiating and talking to at length the Canadian Islamic Congress -- the President of that organization lives in Waterloo; he is a professor at one of the universities here -- about perhaps coming in and doing an hour or two a week on a regular basis and bringing the Islamic perspective to the community.

2824 Just a couple of days ago I was speaking with Zelda Young, who does a program on CHIN in Toronto an hour a day, and she does another hour and a half on Sundays. She has expressed a great deal of interest in bringing that program to our station to give Christians an opportunity to hear the Jewish side of things.

2825 She is with the Canadian Jewish Congress.

2826 In addition to those two faith groups, we also plan on having phone-in components during the program day, as opposed to just the overnight period. We think that we should be able to meet the balance requirement quite readily if we are able to come to some agreement with the two aforementioned groups, plus the phone-in shows.

2827 Of course you never know who is going to phone in on a topic of any given importance on any given day. They might be talking about the sniper issue, or whatever, and you are going to get all kinds of different issues on that.

2828 So we anticipate having that through the broadcast day as well as overnight. That is the way we have been approaching it to this point.

2829 THE CHAIRPERSON: If we could put this into a little clearer framework, the 30 per cent spoken word of your broadcast day, shall we say, what proportion of that would be what we call balanced programming?

2830 MR. MacDONALD: My understanding is that we would, under the requirement of the Broadcasting Act, be six or seven hours a week. So we are aiming for a minimal of that amount to be other faith programming, so to speak.

2831 THE CHAIRPERSON: Six or seven hours. That was my next question.

2832 When will they be scheduled?

2833 MR. JOHNSTON: Madam Chairperson, I think the plan would be to probably schedule these groups after 6 o'clock in the evening along with the other volunteer groups that are involved in the programming schedule, the ones that we have noted there.

2834 There are a number of TBAs, as you can see, from the schedule that we provided for you, and I would see that some of these other faith groups could probably fit into those areas.

2835 THE CHAIRPERSON: If it is in that component, other groups may have their spot but, as well, let's take a show -- Countryside, Pat Murphy, as they are listed here, Phone-In, Roman Delicart. There's the phone-in show there.

2836 This would be open line programming available for viewers to call and express their opinions. This is, let's assume, part of the balanced programming.

2837 What measures have you put in place or will you put in place to assure that in fact there will be over the course of the week a balance of views brought forward?

2838 You did note that there are volunteers preparing this programming. What mechanisms do you have in place to assure us that there will be either differing views sought out -- because, as you say, you are not quite sure what is going to happen in an open-line show -- that those differing views will be sought out within the open line programming?

2839 MR. MacDONALD: I suppose that one would have to take whatever hot topic happens to be on any given day. You are bound to get every different viewpoint on that from different faith groups and people phoning in, just like the existing talk shows that we hear on the News Talk Radio 570 every day. There is a wide spectrum of people that phone in when topics are introduced. So there is no guarantee that on a given day the people listening would not be 90 per cent Christian.

2840 I would think that if the topic were interesting enough and if people got angry enough about a certain thing, they would want to make their viewpoints know.

2841 With phone-in shows you never know. That is why we are also bringing in the other two faith groups, the Jewish Congress and the Islamic Group, to try and increase the number of hours per week that they would have access to the airwaves to bring their viewpoints forth in their own programs.

2842 We think with all three of those components, we would easily be able to reach the requirement for balance.

2843 MR. JOHNSTON: Madam Chairperson, perhaps I could add to that.

2844 I think whenever there is the phone-in component -- and we have talked about this to some length -- that we want a measure of tolerance on the part of those who are conducting the programs, those who are hosting the programs. So when somebody does have a different perspective on something, they are not going to be shot down simply because they are not a Christian, if they should declare that they are not a Christian, for example.

2845 For example, the issue of the terrorist activity around the world which has been such a hot topic over the last 13 months, this is an issue that obviously has played out in many forums, and there are many differing views on what should be done, how it should be confronted, and so on.

2846 These are issues that perhaps could be dealt with through some of these phone-in issue programs.

2847 THE CHAIRPERSON: Thank you for that.

2848 If, for example, there are complaints regarding the content of balanced programming, or if despite all best efforts a particular topic has raised considerable discussion and there are some complaints about the nature of the input you have or the way it was handled, would you have a regulatory review committee to assess these complaints and to handle them?

2849 MR. MacDONALD: We haven't actually set that up as yet. But I think that would be an excellent idea. We meet regularly as a committee to discuss any upcoming issues that might come up with the station, and we will be certainly more than willing to look upon that as something that a separate committee could be set up to deal with that problem alone.

2850 Since we haven't really had any complaints in the last four and a half years on the one hour that we do have, that is not an issue that we have had to address as yet.

2851 THE CHAIRPERSON: I respect that. That is why I raise the point that we in going from the one hour to the full schedule there are some areas that we felt very important to discuss with you. This is one of them.

2852 MR. MacDONALD: We appreciate that.

2853 THE CHAIRPERSON: One of the points that you raise that is part of your approach is the use of volunteers.

2854 If I am correct, in your application and deficiency responses we come to approximately 55 volunteers, if not more. Some of your hosts could even bring in other volunteers, as needed, if I have understood the application.

2855 Could you describe to us the mechanisms you will have in place to train these volunteers in terms of the regulatory demands that come pursuant to having a licence, and particularly in relation to balanced programming?

2856 What training mechanisms will you have?

2857 MR. JOHNSTON: Madam Chair, perhaps I can answer that question.

2858 Within the last three months we as a committee made a decision on that matter. We have determined that if we are granted the licence within two months of having been granted that licence, we would bring volunteers together.

2859 Mind you, we have already been working with volunteers, not just our core group but others who are involved in the picture who have indicated an interest in becoming involved with us.

2860 I have a file here, which is about that thick, of people who have given us résumés or sent us letter, e-mails and faxes indicating that they are interested in becoming involved with us as volunteers, helping out in various capacities.

2861 I would see this meeting as the preliminary to perhaps a lot of other things occurring with the volunteers.

2862 We have a vision. We have a statement of faith, and things of that nature. Certainly we would not want to have anyone who is a volunteer who is going to embarrass us, who is going to cause any problems that would jeopardize our licence in any way.

2863 At the same time, we are prepared to take on volunteers across the board. We were even talking about if somebody from the Jewish faith, for example, wanted to be a volunteer, would we allow them to be a volunteer? I said sure, and I know the others said sure, let's do that.

2864 If they come along and they are willing to follow certain policies and procedures with regard to the operations of the station, why not? We can learn from each other.

2865 THE CHAIRPERSON: In your deficiency letter to question 12(b), regarding this point you mention an individual or preferably a small committee that would be involved.

2866 Is that what you plan to do, have a small committee for training purposes?

2867 MR. JOHNSTON: Yes, that's right. I would head up that committee myself.

2868 We would gather together probably half a dozen people who could monitor the situation.

2869 When you are dealing with volunteers, you also have to realize that, like any other programming, people have to be there to do the programs. This is one of the things we would want to stimulate.

2870 When people are getting paid to do something, it is much easier to say okay, you are getting paid to do the job and you will show up for the job. When you are dealing with volunteers, sometimes it is a little more relaxed. People can say I am a volunteer today, but next month I am on holidays and somebody else is going to have to take over.

2871 We are going to say to these volunteers: If you are going on vacation or if you should happen to be sick, you need to have a contingency plan in place so that it is not going to come back to me or the committee to try to fill that void.

2872 Volunteers are very important, and this is where we feel we can involve the local community in so many different arenas: in the area of music, in the area of operations, and even in some of the planning for the future.

2873 THE CHAIRPERSON: The committee and yourself would train volunteers prior to joining the station, as you have just described.

2874 On a going forward basis, would there be internal guidelines and mechanisms to ensure that in fact regulatory obligations and responsibilities regarding open line programming will be met at all times?

2875 MR. JOHNSTON: Absolutely, Madam Chairperson. We haven't worked out all the details yet, but certainly that would be part of our plan.

2876 THE CHAIRPERSON: Thank you.

2877 We will go on to Canadian Talent Development and the CDs sitting behind you there. I don't propose we play them all at the moment.

2878 You stated in your application that you will participate in the CAB's Canadian development plan. As a medium-to-large market station, your required contribution to eligible third parties would be $5,000 per year over the course of the licence term.

2879 In its plan the CAB expressed agreement with the Commission's definition of eligible third parties, which includes FACTOR, Musique action, national and provincial music organizations, performing arts groups, schools and scholarship recipients.

2880 In your May 21st deficiency response in paragraph 13 you stated that a third party acting as "an agent" for Sound of Faith Broadcasting would distribute these funds, this $5,000, in order to subsidize individuals or groups wishing to record a CD.

2881 However, based on the Commission's definition of eligible third party, this agent would not qualify as an eligible third party.

2882 In light of this, could you specify an eligible organization or group for which the funds would be allocated?

2883 MR. JOHNSTON: When you are doing something like this, when you are talking money you want to make sure that that money is going to go to the cause for which it was designed.

2884 We, for example, might work through a bible college like Emmanuel Bible College, which is situated in Kitchener. If there is a group or an individual that, for example, wants to do some recording, we may ask EBC if they would be prepared to act as that agent for us to make sure that that money is expended the way it was designed and that we are going to get exactly what we intend to get.

2885 So the money will be not just given over to the individual who wants to do this, but there will be some assurances that the money will be spent and that we will get a product as a result of it.

2886 THE CHAIRPERSON: Thank you. I see that you recognize the spirit of the question.

2887 I think what would help clarify things -- and I understand now what you meant by agent to some extent. I think it would be very helpful if you could provide us with a list of those kinds of organizations which you foresee could be the vehicle, shall I call it, through which the funding would end up in the hands of artists.

2888 This, of course, is the intention of Canadian Talent Development. And the reason for eligible third parties being described and listed carefully is to assist in that assurance.

2889 Perhaps you might want to get back to us on that.

2890 MR. JOHNSTON: Madam Chairperson, we could do that.

2891 THE CHAIRPERSON: Cultural diversity.

2892 As you know, in the commercial radio policy the Commission encourages broadcasters to reflect the cultural diversity of Canada in their programming and employment practices, especially with respect to news, music and promotion of Canadian artists.

2893 What measures would you take to incorporate and reflect the reality of Canada's cultural, ethnic, racial and aboriginal diversity in the following areas: employment practices, news, music and promotion of Canadian artists?

2894 MR. MacDONALD: As far as the employment practices go, we don't expect to have too many employees. Right now in our volunteer core group of 11, we have six female and five male. So we have covered that one.

2895 When you are working with volunteers, we have had volunteer meetings in the past and we have had people from almost every ethnic background imaginable coming to these volunteer meetings and wanting to participate with us.

2896 So we don't feel that would be a problem in terms of hiring practices when it comes down to the actual fact of having to hire paid staff over and above the volunteers that we might be working with.

2897 Any other things, Bruce?

2898 MR. JOHNSTON: No. We haven't dealt specifically with the aboriginal aspect of things. We certainly have dealt with these other issues that Dave has alluded to.

2899 We are prepared to get people on board with us as volunteers.

2900 I even had an individual recently, who is a member of the visible minority, inquiring about employment with us. I have given that individual some incentive to give us further information and let's sit down and talk and see where we go from there.

2901 So we are open to that, very much so.

2902 THE CHAIRPERSON: I guess I would have thought you would have been. I think in your application you say 8 per cent of your programming will be ethnic programming, and that might include a Spanish phone-in show. So I thought perhaps you might want to have someone who could speak Spanish on the phone.

2903 MR. JOHNSTON: As a matter of fact, we have already had some commitments from a Spanish-speaking person. For example, if you look at the schedule, on the Wednesday at 6 o'clock we have a phone-in program with Roman Delicart. He is fluently bilingual in Spanish and English.

2904 We anticipate that there would be the Spanish component there.

2905 There is a large Portuguese community, as well, in Kitchener-Waterloo, and we would hope to plug them in here at some point.

2906 We have a Korean group that is interested in doing something and a Ukrainian group. Even though they are smaller components of the total population, we certainly want to include them in there.

2907 The Gum Troupe(ph) hour that you can see at 6 o'clock on Tuesday involves the Lascos. They are of Ukrainian background, and they will have a children's program, albeit it probably in English, but nonetheless they will follow with a Ukrainian moment which will allow them to address the Ukrainian community in their language.

2908 THE CHAIRPERSON: Thank you.

2909 Let's move to your business plan now.

2910 I note today in your presentation on revenue outlook you say:

"We are confident that there are sufficient advertising dollars in our community of Kitchener-Waterloo to sustain all but a handful of programs without resorting to on-air appeals for other funds..."

2911 Currently, your programming is supported by Canadian advertising dollars.

2912 You repeat these comments later in other sections. I have to say that in going through your financial projections, I have some questions.

2913 Looking at the proposal you have, starting with audience share, I think you say in your deficiency response that you predict your estimated audience share of 12-plus tuning to be 3 per cent in Year One, rising to 7 per cent in year seven.

2914 If we compare that projection to that obtained by other religious format stations across the country, we are looking closer to a 1 per cent share of 12-plus tuning.

2915 If you look at your estimates that you supplied in your deficiency response in question 15 -- and I think you referred to them this afternoon in terms of what you get in terms of a listing share currently translates into your optimistic predictions.

2916 Can you tell us a little more on what you base your predictions for that share?

2917 MR. MacDONALD: We were not privy to the figures from some of the other stations in Canada, but we have looked at what the American model has been. Even though they have over 2200 stations we find that in many of the American markets they get between 4 and 6 per cent with no problem at all. They have a very competitive marketplace in terms of the number of Christian broadcasters.

2918 We are coming into this totally new. There has never been a religious or Christian station in Kitchener-Waterloo. There has been a limited number of Christian broadcasts on a community station, but this is a totally new thing. So it is very difficult to make predictions.

2919 We don't have models to go on from Country format or from Rock format or from other markets as much. Even the Christian stations that have been licensed in Canada, they are all fairly recently licensed.

2920 There is no long-term picture to look at, so we based it on the model that we have seen happen in the U.S. and a bit of educated guesswork, really.

1455

2921 THE CHAIRPERSON: Have you been here in the last couple of days? You know we have been discussing quite extensively the particularities of this market and particularly out of market tuning and the level of that out of market tuning and the challenge that that presents.

2922 Do you feel that you are being realistic in terms of the audience share you propose that you can get, considering this environment?

2923 MR. MacDONALD: The only out of market tuning available for people who want to listen to the kind of programming that we are going to offer is the station in Buffalo, which comes in here very weakly. Sometimes you can get it in your car in certain parts of town.

2924 That station is at 99.5, and there are three other applicants right now applying for 99.5. So that particular station is not going to be a factor in the marketplace should one of those licences get granted.

2925 So we would then be the only religious station in this area that would offer the kind of programming that 77 per cent of people who claim to have church affiliation in Kitchener would be inclined to turn to.

2926 So that is why we are maybe a little optimistic with the market share possibilities.

2927 THE CHAIRPERSON: Did you do a demand study to demonstrate in fact that the population you are referring to would become audience for your station?

2928 MR. MacDONALD: No, we didn't actually do any in-depth studies. We have just based it on the experience of the response we have had to the show that we have had on the air for only one hour a week and generating, at times, 10 per cent of the audience listening at any given time on that Sunday morning; that we are beating some of the other established stations in that time slot.

2929 Again, it was an educated guess because there is no real model to work with.

2930 Most of the stations that have been licensed for broadcast with Canadian and Christian stations, most of them have been music boxes. We propose to be 70:30 music and spoken word.

2931 So we are taking a totally different outlook than a lot of the stations have.

2932 I realize there have been other ones recently. We haven't followed each and every one of them. I know the first few stations that went on the air, that were called Christian stations, were simply playing all music and no spoken word.

2933 So it is sort of uncharted waters for us, so to speak.

2934 THE CHAIRPERSON: On the matter of advertising revenues -- and I referred you to your comments this afternoon -- in your supplementary brief you estimate $164,000 local advertising revenue in Year One, rising to $1.149 million in year seven.

2935 Why do you feel this is a realistic objective or estimation, particularly rising to $1.149 million in year seven? On what do you base this and why do you feel it is a realistic estimate?

2936 MR. MacDONALD: Again, we don't really have a model to work with. So we just took some figures and did some creative calculating and figured that we should be able to sell so many minutes per hour by year seven. We have been selling four minutes per hour on Sunday morning. If we were to continue with that, at that rate we would be doing very, very well indeed.

2937 Again, it is more of a projection based on mathematics than anything else and the fact that we are the only player in the market and that there is a large Christian component to this community.

2938 We may be a little over-enthusiastic, a little over-aggressive in those numbers. But we had to take a stab at it. That is the approach we took, just by so many minutes of sales per day, building at a reasonable rate over the seven-year period.

2939 THE CHAIRPERSON: Based on your hour program on Sunday.

2940 MR. MacDONALD: Based on that and based on the fact that we really didn't have anyone else to look to to compare it with, because there is nobody else doing our format.

2941 THE CHAIRPERSON: In your application you estimate that 40 per cent of the advertising revenue that is generated by your proposed service would come from new advertisers.

2942 Do you expect that the advertising revenue generated by your proposal would come largely from non-traditional radio advertisers?

2943 MR. MacDONALD: Do you mean from people who normally would not advertise on radio?

2944 THE CHAIRPERSON: Yes.

2945 MR. MacDONALD: Yes, I would think there would be a large component coming from that. One of our regular advertisers who has already committed to being with us when we go on the air fulltime, I don't believe has ever done any other broadcast advertising in the area. He runs a Christian book store. So his is very much a target audience.

2946 There are many other businesses in this community that are run by Christians. They have a little telephone directory that is called The Shepherd's Guide, and these people will advertise in that. It is kind of like a small Yellow Pages for Christian businesses.

2947 There are lots of different types of businesses represented in The Shepherd's Guide.

2948 Many of those would also be found in other advertising media, but many of them would not be. We think that there is an opportunity for these people to address an audience they haven't had an opportunity to address before.

2949 We will be largely looking at a Christian audience. We understand that.

2950 If you go to a Christian businessman and give him the opportunity of speaking to that vast audience of Christians in the community, we think that they will respond very favourably, because the Christian segment is a far larger segment than any other demographic you might choose, whether it be 12-to-24 or 19-to-34, whatever. The Christians cross over the whole gamut, all age groups.

2951 So we think there is a really large opportunity here for us.

2952 THE CHAIRPERSON: Of the 40 per cent new advertising revenue coming from new sources, can you give us a sense of how much of that 40 per cent would be from non-traditional radio advertisers, the newcomers to radio?

2953 MR. MacDONALD: I don't quite understand.

2954 THE CHAIRPERSON: Forty per cent of your advertising revenues would be from new advertisers. Some of those would be non-traditional radio advertisers new to radio per se.

2955 Is there a percentage you can give us of the 40 per cent?

2956 MR. MacDONALD: That is very speculative. I really don't know that I could go out on that limb.

2957 MR. JOHNSTON: Madam Chairperson, perhaps I could help to answer that question a little bit.

2958 Again going back to the Sunday morning program, I would say that probably half of the advertisers there are non-traditional radio advertisers.

2959 They advertise on our program but on no other program. That is because they have come to us and asked us if we would advertise their product or their service.

2960 Again, based on some measure of experience, I would anticipate that there would be some others who would come forward too if we were granted a licence to do that. I know there have been some who have talked to me informally about the possibility some day of advertising on the station should we be granted the licence.

2961 THE CHAIRPERSON: Thank you.

2962 If we look at your financial operations in Section 3.1 of your application, your proposed financial operations, and if we look at a comparison of the operating and profit margins of all the applicants at the hearing, it reveals that your proposal is one of the most profitable.

2963 The difference between your proposal and the others is shown in the projected expense levels. So I would like to look at those expense items with you to get a better sense of the methodology you used to prepare those expense estimates.

2964 I am looking at, for example, the technical expenses.

2965 If we go to Year 5, could you explain that number to us, where you get it and why it is so low?

2966 It is comparatively low in terms of the technical requirements for the type of licence you are applying for. We are wondering where you got that number and if you can tell us why it is so low.

2967 MR. MacDONALD: Part of the reason that our technical expenses, and certainly all through the operating expenses are lower is that a lot of the things we have been acquiring over the past few years have been donated to us.

2968 We already have three McCurdy consoles that have been used in other facilities, including CKWR and the Conestoga College. They are still very serviceable but a little older. And as they upgraded, they donated that equipment to us. That means eliminating a lot of start-up expense for us, a lot of technical expense.

2969 We anticipate having an engineer on a contract basis to service our equipment rather than having a fulltime paid engineer.

2970 The transmitter site that we have at Kitchener City Hall is at no cost to us.

2971 Our office and studio space is being offered to us at no cost to us, because we are a ministry. So people are donating these things to us.

2972 That is probably the main reason that these expenses are so low.

2973 THE CHAIRPERSON: In this afternoon's presentation you mentioned that artists would have available to them facilities, low production costs and facilities.

2974 What kind of facilities are you talking about there? Is it full studio?

2975 MR. MacDONALD: We have a number of people in the Christian community that we have been working with over the years, have had them on our program on Sunday morning. They work with local musicians and have their own studios, in-house studios, and produce CDs.

2976 So we would be able to have working arrangements with people like that who would be able to do these projects for these artists at very, very low cost.

2977 We were actually talking with one of them yesterday. We ran into him at lunch hour. He has a fine studio in Cambridge, and that is what he does with it. He uses it to promote Christian artists.

2978 He is an artist himself. He is part of a band. They had about 60 dates this past summer, mostly in the U.S. Here is a guy who lives in Cambridge but goes to the U.S. to play because he can't get an audience here for his music until we get some Christian radio on the air. He is a guy who could help produce these CDs. He has a full studio in his basement.

2979 So we expect to enter into arrangements with people like that at very low cost to us but certainly at a great advantage to the artist.

2980 THE CHAIRPERSON: Thank you for that.

2981 Canadian talent finding its way to the United States is not a new phenomenon. We are very proud of them, but we would like them to stay here, wouldn't we.

2982 MR. MacDONALD: And they would like to stay here, I'm sure, and save the travelling costs and all the things involved in that.

2983 THE CHAIRPERSON: Indeed. On your programming expenses, if we look at year six, it would appear up to that point a rather average increase in expenses. We did discuss earlier the possibility of news, weather and sports turning up in year six, but I don't see any change in the programming expenses there.

2984 Is there any comment on that point?

2985 MR. JOHNSTON: Madam Chairperson, year six was the year that was chosen. We may very well decide to do something before year six. I don't want to carve in stone saying that year six is the year that we are going to do it.

2986 Obviously these are our best guess projections that we have. As time goes on, particularly over the first couple of years of the experience of having a licence, should you grant it to us, we will learn a lot in terms of our expenses.

2987 We are blazing new territory in a sense, and I am sure you can appreciate that. We would obviously have to revise some of these figures. Some of the figures may go up, and some may go down too. Maybe we are being too ambitious in some cases and maybe not ambitious enough in others.

2988 THE CHAIRPERSON: Thank you.

2989 We will move to a question on the frequency. As you know, we ask applicants to tell us why they would make the best use of the frequency in question when there is a competitive situation.

2990 In this case you are applying for 94.3 at 50 watts. CKMW Radio Limited is applying for 93.9, but the two frequencies bear a second adjacent relationship to each other and therefore cannot co-exist in the same market.

2991 Therefore, your use of FM frequency 94.3 is competitive and technically mutually exclusive with another application.

2992 Under this scenario, we seek your views on helping us to decide which applicant proposes the best use of the requested frequency.

2993 What, in your view, are the compelling reasons to grant you the requested frequency?

2994 MR. MacDONALD: Our broadcast engineer who appeared here on the last panel, Mr. Macaulay, went through the frequency spectrum at length to try and find something that would work for us.

2995 He mentioned the 91.5 application at 5 watts that had been put forth before and turned down by Global Television. That was our application, and they turned it down even though we were only going to be 5 watts. I am not sure why they thought we would interfere with them. But that is okay, because an FM station in Brantford also turned us down. So that didn't work.

2996 You have heard from other applicants, I think, that this is an extremely crowded spectrum.

2997 As a matter of fact, I purchased a little FM transmitter to use with one of these little MP-3 players in my car, and it said: Tune your car radio to an unused frequency and then you can match it up with the little tuner on this thing.

2998 I could not find a frequency on my car radio where I was getting a totally quiet sound. I was getting some kind of broadcast signal from every frequency on the spectrum in my car radio. A lot of them were very weak and from out of market, to be sure, but nonetheless it is a very crowded spectrum here.

2999 Mr. Macaulay, one of the most respected engineers in Canada, was the one who determined for us that 94.3 was about the only one at this point in time that would work. We were aware of this possibility with the second adjacent frequency with the other applicant.

3000 We discussed that at length with the people at Industry Canada, as well, and they advised us that if we went ahead with this and the other application were granted, we would be in a position of being unprotected and would have to find something else.

3001 So we went into that with our eyes wide open and decided that we would wait and see how everything fell into place before we went on a wild goose chase for another frequency that we may or may not need.

3002 We are hoping that 94.3 will be the one that is granted. If it is the other applicant that is given the licence to broadcast, then we will have to go back and we would be prepared to do it at that time.

3003 But because we are a volunteer group, a non-profit group, and not flush with a lot of extra cash, we thought we would wait and see how it all turned out before we went and spent that extra money to do more engineering.

3004 So it is at the request of Mr. Macaulay that we chose that frequency.

3005 THE CHAIRPERSON: Thank you very much. Those are my questions.

3006 I think Commissioner Cram has a question for you.

3007 COMMISSIONER CRAM: Thank you. It is really quite brief.

3008 Mr. MacDonald, when you started you said you were a committee, but in fact Sound of Faith Broadcasting Inc. is a corporation?

3009 MR. MacDONALD: There is a corporation, Sound of Faith Broadcasting, yes. And we are the local Kitchener-Waterloo committee, operating independently and trying to get this particular station, Faith-FM on the air.

3010 The Commission has already heard an application from Grace FM in London. They are also under the corporate umbrella of Sound of Faith Broadcasting but also operating independently in London.

3011 You may have received an application from Woodstock for a station to broadcast there, as well, again operating as an independent committee in Woodstock but under the corporate umbrella of Sound of Faith Broadcasting.

3012 So yes, while we are a part of that corporation and I am on the board of directors of that corporation and the corporation meets regularly in Woodstock, we have regular meetings here in Kitchener as a separate group. We are operating independently within the overall corporate umbrella.

3013 COMMISSIONER CRAM: So who would own the licence if it were awarded?

3014 MR. MacDONALD: I guess the licence, then, would be owned by the corporation.

3015 COMMISSIONER CRAM: I am assuming, also, that the corporation has the charitable tax number.

3016 MR. MacDONALD: That is correct.

3017 COMMISSIONER CRAM: And that all the donations are in fact given to it and the donations go through it.

3018 MR. MacDONALD: With respect to the donations, we actually independently keep our own bank accounts and run them independently. But all of that is put into the financial statements of the corporation at the end of the year.

3019 COMMISSIONER CRAM: Yes. Revenue Canada would like to know that it is one company, I am sure.

3020 MR. MacDONALD: Yes, it is.

1515

3021 COMMISSIONER CRAM: Thank you so much. I really enjoyed the newsletter.

3022 MR. MacDONALD: Thank you.

3023 COMMISSIONER CRAM: Your committee consists of the five of you, including Mrs. Delicart and Ms Higgins. Is that the --

3024 MR. MacDONALD: Actually, those five are the ones that do the Sunday Sound of Faith program and are the core of the committee with our others, as well.

3025 Bruce has probably the whole list. He is the guy who e-mails them all the time. Not all of them show up at our meetings, but those five, plus we have a part-time secretary who attends. She is paid and she comes to the meetings.

3026 We have a couple of other people involved in technical things who come to our meetings. We have a Webmaster who does our Web site. He comes as often as he can to the meetings and is considered to be part of the committee.

3027 The core group is the five of us, yes.

3028 COMMISSIONER CRAM: At the end of the day, if this licence were granted who would make the decisions about programming, about balance?

3029 Who would be the guiding arm of the licence here?

3030 MR. MacDONALD: The five committee members.

3031 COMMISSIONER CRAM: The five that we have here.

3032 MR. MacDONALD: Bruce, would you like to address that?

3033 MR. JOHNSTON: Actually, probably the extended group, as we were talking about before, the eleven, would have the decision-making platform in terms of the policies and procedures and so forth, and how we would administer all of this.

3034 The five of us being the core group, we exercise a bit more authority perhaps than some of the others do, but nonetheless we incorporate them to have input and to be part of the decision-making process.

3035 COMMISSIONER CRAM: You plan on making profit. And I am assuming, because the corporation has the charitable registration, that it is a non-profit organization.

3036 Where would the profits go?

3037 MR. MacDONALD: We see ourselves as a ministry, and our vision is to take the profits and re-invest them in Canadian talent.

3038 As we talked about earlier today, there are certain ways that we have to do that, through other organizations. We can't just give it to the artists as a donation.

3039 That is our ministry, to advance Canadian Christian talent. So that is where we want to put the bulk of our profits.

3040 COMMISSIONER CRAM: Thank you.

3041 Thank you, Madam Chair.

3042 THE CHAIRPERSON: Thank you.

3043 Counsel?

3044 MR. WILSON: I just have one question.

3045 In your discussion of Canadian Talent Development with the Chair, you mentioned that you could file a list of eligible third party organizations.

3046 Will you be able to file that list by the end of the hearing?

3047 MR. JOHNSTON: Madam Chairperson, through you to counsel, I am not sure that we can do it by the end of the hearing, but certainly within the very near future.

3048 THE CHAIRPERSON: Could you give us a possible timeline to that, just because we would have to make sure that information was public.

3049 A couple of weeks?

3050 MR. JOHNSTON: I was going to say if you would give us one month. Would that be all right?

3051 Thank you.

3052 THE CHAIRPERSON: Are there any other questions, counsel?

3053 MR. WILSON: No, Madam Chair.

3054 THE CHAIRPERSON: Thank you.

3055 Thank you very much, all five -- or eleven.

3056 MR. JOHNSTON: Thank you very much.

3057 MR. MacDONALD: I should acknowledge Ms Kim Higgins as the operator of our computer. She also is our music librarian and responsible for supplying us with our milk cartons full of CDs today.

3058 Marlene Delicart sitting beside her is the fifth member of our committee. She is here for moral support.

3059 THE CHAIRPERSON: Thank you very much to all of you. We will now take a 15-minute break.

3060 It is 3:15. We will be back at 3:30 with Trust Communications Inc.'s presentation.

--- Upon recessing at 1515 / Suspension à 1515

--- Upon resuming at 1530 / Reprise à 1530

3061 THE CHAIRPERSON: Order, please.

3062 Mr. Secretary, please.

3063 MR. LEBEL: Thank you, Madam Chair.

3064 We will now hear Item 7 on the agenda, which is an application by Trust Communications Ministries for a licence to operate an English-language commercial Specialty FM radio station in Kitchener.

3065 The new station would operate on frequency 99.5 MHz (channel 258A) with an effective radiated power of 379 watts.

3066 The applicant is proposing a Christian music service (specialty format) with at least 95 per cent of the weekly total music drawn from subcategory 35 (non-classic religious).

3067 Mr. Davy will introduce his colleagues.

3068 You have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

3069 MR. DAVY: Thank you.

3070 Good afternoon, Madam Chair, Commission and Commission staff.

3071 My name is Ben Davy. I was part of the original Advisory Committee for Christian Radio in Barrie, and now I am the Assistant Program Director at LIFE 100.3, owned by Trust Communications Ministries.

3072 In 1999 the Commission awarded CJLF a licence for the Christian format, and LIFE 100.3 was our first entry into radio broadcasting. Today, however, is our first time at a formal hearing. Trust Communications Ministries is a registered charity with the Canada Customs Revenue Agency and is regarded as "listener-supported".

3073 Before we present our opening statement, I would like to introduce you to our radio panel.

3074 On my far right is Janice Baird. Janice is the office manager, and she oversees the finances of the company. She is also married to our station manager, Scott Jackson.

3075 Next to Janice, in the middle, is Scott Jackson. Scott is our radio visionary and founder. He has worked in radio broadcasting for 24 years with CHUM Group, Moffat Communications, the Pelmorex Radio Network and Christian Radio WAY-FM in Nashville, among others.

3076 Scott is the station manager and program director of LIFE 100.3.

3077 Behind me and to my right is Kim Lucas. Kim is the local Kitchener-Waterloo representative and chair for the Advisory Committee for Christian Radio in KW.

3078 She presently is an advertising representative with the Elmira Independent.

3079 Beside Kim is our engineer consultant, Pierre LaBarre, who is joining us for Phase 1.

3080 We are here to present to the Commission our application for a new FM service at 99.5 FM in Kitchener. The format is contemporary Christian. Our Christian music format will target persons 25-to-44 during the day, with an adult/pop format and play music that targets a youthful 12-to-24 audience after school and into the evening.

3081 I will now ask Scott Jackson to give you an overview of our application.

3082 MR. JACKSON: Our application for Christian Radio in Kitchener is largely based on the success of LIFE 100.3 in Barrie.

3083 We ask ourselves: Is Christian radio a successful format? And how do we know?

3084 Our research comes to us, first of all, from LIFE 100.3. Up until this fall, BBM ratings were beyond our budgetary means. So without ratings numbers we found more creative ways to measure our success.

3085 The first way to measure is through listener response.

3086 Example: In our first year we approached Snow Valley ski hill for advertising dollars. They were unsure of our listener base, so to convince them of the loyalty to our radio station we offered Snow Valley a promotion. Snow Valley said if you can bring 50 people to our ski hill on a Monday night, we will be impressed.

3087 Well, we hit the air and after selling 600 tickets, Snow Valley told us to stop selling tickets. And they bought a small advertising package.

3088 We measure success by listener reaction. Every week we are inundated with heartfelt letters from listeners about how our radio station has encouraged them on dreary days and that the music we play has touched their hearts.

3089 After three years, thousands of letters are on file. This is typical of most Christian stations. You see, Christian listeners are loyal to the format.

3090 We also measure success in terms of advertising. While LIFE 100.3 is listener supported, a third of our income comes from commercial advertising.

3091 Our Condition of Licence for advertising limits us to air six minutes per hour in morning and afternoon and four minutes throughout the rest of the day. We reached our maximum for a full month three times.

3092 Commercial advertisers of ministry based information believe in us.

3093 Most importantly our listeners believe in us. Every March we air our fundraising Sharathon. We ask our listeners to support us with monthly donations. Sharathons on LIFE 100.3 have exceeded goals three times. It is a testimony to the loyalty of our listeners when they put their money where their heart is. Not many stations can tell that story.

3094 We may not have BBM ratings, but we know Christian Radio is important to listeners.

3095 We are so encouraged by the success in Barrie that we wish to take our product and customize it and localize it for KW.

3096 I will ask Ben Davy to talk about the healthy state of the Christian music industry.

3097 MR. DAVY: Thank you, Scott.

3098 Music sales in Christian radio are at an all-time high. According to R&R trade magazine, secular music sales dropped last year by 11 per cent. Some say that is due to online downloading. Others say September 11th discouraged retail sales. However, Christian music sales are up 9 per cent in that same period.

3099 The Commission requires a 10 per cent level of Canadian music in our weekly scheduling. As a measure of good faith, Trust Communications Ministries committed over the regulation. We accept a 12 per cent level as a condition of licence for KW.

3100 This level may seem small to our competitors who are committed to 35 per cent or more, but the Christian music industry in Canada is still in its infancy.

3101 The Commission has only approved the Christian format since 1993, and less than 20 fulltime stations are on the air now.

3102 Looking for good Canadian music has become something of a quest. We recommend our best Cancon to other Christian radio stations in Canada to help each other expand our music libraries.

3103 Fortunately, Kitchener resident Andrew Horrocks is a worldclass producer of Christian music, and we are thrilled to have him sit on our Advisory Committee.

3104 Andrew is a former member of the Christian recording act 100 Days and now operates A.M.E. Recording Studios in Kitchener and has produced high-quality albums for many Christian artists. We appreciate the music he makes and hope to partner with Andrew often.

3105 Remember there is no national Canadian chart for Christian music. There is no Canadian record company to promote music. It is up to us to find the material and spread the word.

3106 The Christian music industry and the Christian radio industry have a long way to go, but with stations like LIFE 100.3 and our friends in other cities we are making wonderful progress.

3107 Scott.

3108 MR. JACKSON: Thanks, Ben.

3109 I will call upon Kim Lucas, the chair for our KW Advisory Committee, to give us some local background research.

3110 MS LUCAS: Before submitting our application for Christian Radio KW, we formed an advisory committee of about ten people. These people offered local insight, Christian music contacts, business contacts and made suggestions so that Christian Radio KW would represent our city.

3111 We then hired a Wilfred Laurier University student to conduct market research and give us information about the market.

3112 According to the Region of Waterloo Planning Department study, July 2001, the population in KW has grown from 399,000 in 1991 to 466,000 this year, and that number will grow to 493,000 by 2006.

3113 The Business Development office in Kitchener reports that this year 2400 new people moved to KW, and the Canadian Mortgage and Housing Corporation forecasts 5,500 new homes being built in 2003.

3114 CMHC says employment is expected to increase by 4.2 per cent in 2003.

3115 Lastly, employment in Waterloo Region grew 3.2 per cent in 1998 and 5.1 per cent in 1999.

3116 Two hundred and twenty-nine churches are in Kitchener-Waterloo, another 82 in Guelph and 91 in Cambridge.

3117 In the 1991 Census, we found that in the Kitchener CMA, with a population of 353,000, the largest religious group is Protestant, over 178,000; and in addition, 117,000 are Catholic.

3118 In fact, the KW area is known somewhat as a Bible belt.

3119 There are 300 students attending Emmanuel Bible College. Other Christian schools include Great Lakes Bible College in Waterloo, Waterloo Lutheran Seminary at WLU, St. Jerome's University, St. Paul's United College, Renison College, Conrad Grebel University College and Heritage Baptist College and Seminary in Cambridge.

3120 The public school population in KW is growing and projected at 10 to 35 per cent by 2003, according to The Record. Clearly, the KW economy is healthy and growing strong. It will support Christian radio.

3121 In the KW area there are five Christian book stores, and this is where Christian music fans buy their music. Christian book stores are a natural advertiser.

3122 Concert promoters from Canada and the U.S. are bringing shows to Ontario more and more often. Last year superstar acts such as the Newsboys, Delirious, Michael W. Smith and Steven Curtis Chapman played in Toronto, only an hour away for KW music fans.

3123 Kingdom Bound is a four-day Christian music festival that is held on the grounds of Six Flags Darien Lake in New York every summer. Last year 17,000 Canadians attended. The concert promoter has agreed to include Christian Radio KW in his advertising buy.

3124 Our city is craving a Christian Radio station that is fulltime and that broadcasts loud and clear, with the full power signal strength to saturate KW without signal shadows and pockets.

3125 Ben.

3126 MR. DAVY: What seems to surprise new listeners of Christian radio is how much it sounds like secular stations -- with news, contests, even traffic. With Skywards traffic, we will know the road conditions on Conestoga Parkway, Highway 8 and the 401.

3127 Our news commitment will begin with a top hour and bottom hour cast every morning. It's everyday news that would include local stories like the Grand River Regional Cancer Centre, expansion at the KW Auditorium and international stories that affect our lives, such as the war against Iraq.

3128 We will include the score of the Kitchener Rangers game and talk about the Raptor's practice at RIM Park. Christian Radio KW will offer listeners a new editorial voice without a sensationalist script.

3129 We are offering a minimum of 75 minutes of news each week, with expansion to afternoons and weekends after Year One.

3130 Additional spoken word information comes from interviews: interviews from local and national musicians, committee members from the Out of the Cold program or the Food Bank of Waterloo Region, interviews from pastors, teenagers reporting on missions trips from Third World countries, and interviews from local VIPs.

3131 Two locally produced features are The Good News Patrol, a positive news story, and Music Notes, an interview feature with artists. These two features run 45 minutes each week.

3132 Adding this up, we are estimating our spoken word commitment at 8.9 hours each week, or 7.1 per cent.

3133 Scott.

3134 MR. JACKSON: Christian programming is noticeably absent from KW.

3135 Right now the signal from Buffalo's Christian Radio WDCX drifts into Kitchener. The signal is not strong, but there are listeners who enjoy the music programming. However, WDCX does nothing to support the local listeners: no local concerts, no local mentions, no local appearances by their DJs, and almost no Canadian content.

3136 If the Commission awards 99.5 to any of the other applicants, other than Trust Communications Ministries, the Christian format will be gone forever. There will be no full power radio station dedicated to a 24-hour Christian music format.

3137 In a population of 466,000, where over 75 per cent of the people considered themselves either Protestant or Catholic, there is a need for this format.

3138 Kim.

3139 MS LUCAS: Our Committee research shows us that KW listeners are tired of the repetitive Top 40 music that is duplicated over and over on AC and CHR stations. Christian radio is only available from WDCX on the 99.5 frequency.

3140 Christian Radio is unlike secular formats. It is what we call a lifestyle format. The majority of our listeners attend a Christian church on a regular basis. They believe in family values and programming that is not embarrassing or offensive.

3141 While their lives are not perfect, they hunger for entertainment that exalts integrity, honesty, peace and wholesomeness. In a world that seems to be spinning out of control, Christian radio often provides the security and encouragement listeners need.

3142 MR. DAVY: Thank you, Kim.

3143 I will ask Janice Baird to comment on the financial assistance Trust Communications has offered to third parties.

3144 MS BAIRD: Thanks, Ben.

3145 Where many Christian radio stations across Canada are working on very small, break-even budgets, LIFE 100.3 is in the very fortunate position of a positive cash flow from happy advertisers and loyal listeners. We do not take this blessing lightly.

3146 It is our corporate policy to offer assistance, both financially and in experience.

3147 Twice now we have supported young radio broadcasters by paying their part-time salaries at Christian radio Spirit-FM in Lethbridge and Xtreme 101 in Moncton. Those are one-year commitments.

3148 Our station manager Scott Jackson has a strong programming background and, at the expense of our company, we have sent Scott to coach, train and consult managers and DJs at other Christian stations in Ontario, the Maritimes and in Alberta. He teaches them how to organize on-air Sharathons, how to build morning shows and how to create music rotations.

3149 One station sends Scott their airchecks every year, and Scott offers them detailed reviews of their DJs and programming at no charge.

3150 Scott also volunteers as a guest speaker to radio broadcasting courses.

3151 We have offered $1,000 scholarships to two radio programs at community colleges and, in one case, discovered one of our fulltime announcers through the course.

3152 As the Commission has licensed new Christian radio stations over the last few years, Trust Communications Ministries has provided seed money -- that is, cash donations to virtually ever Christian station in the country with donations totalling $27,830.

3153 We donated seed money to the local Barrie group Steadfast to send them to Nashville for Gospel Music Week last year.

3154 We have donated what we call "rescue money" to two different high school concert promoters because their shows lost money. And these are beyond our CTD expenditures.

3155 We do all these things because we want to improve the quality of Christian music and Christian radio. Consider it, if you like, a "pay it forward" concept.

3156 Our charity status and our policy to support the industry extends to Christian Radio KW.

3157 Scott.

3158 MR. JACKSON: We believe in developing radio personalities and will make that known to the students and instructors at the local radio courses at Conestoga College.

3159 Our company is so community based that in Barrie at LIFE 100.3 we attended 150 events last year. That is two to eight events each week. The same plan applies to Christian Radio KW.

3160 MS LUCAS: These events are not necessarily church-based activities. Local Christian listeners in Kitchener will want to know about the "Wonders of Winter" at Waterloo Park, the Elmira Maple Syrup Festival, the Waterloo Busker Carnival, the Cambridge Fall Fair and the KW Multicultural Festival.

3161 KW has many "Christian" events that will be supported by our station.

3162 "Worship Together" is an annual Christian music convention with international musicians that took place on the U of W campus; 5,000 people attended last year.

3163 "The Project" is a Christian showcase for young bands, created by Kris Stinson from Kitchener. Kris is a strong believer in Christian hard core and alternative music. We have agreed in principle to partner with The Project, promote the bands, interview them, play their music and emcee their shows. It's a logical promotion of KW artists.

3164 Pastor Brandon Malo has a very unique, one-of-a-kind church. It's called The Embassy on the U of W campus. The reason it is unique is because this church service plays loud music, youth style. Church goers wear jeans, t-shirts, wild haircuts and come to be with God. They will, no doubt, enjoy our evening programming.

3165 Our DJs will attend these events and file cut-ins back to the radio station. Radio is about relating to the community and that must be done at a local level.

3166 Ben.

3167 MR. DAVY: One of the things I really appreciate about my boss Scott Jackson is that he believes in training talent. We do regular airchecks, and he coaches us and challenges us to be better.

3168 Scott has sent me to Nashville for training at Gospel Music Week and to Atlanta where I attended programming seminars with Brad Burkhart and Mike McVay.

3169 Other staff members have attended Canadian Music Week in Toronto. Our production manager has been sent for training and mentoring at mainstream radio stations. All of us have been motivated by what we learned.

3170 Our KW staff will receive the same training. If Christian radio is to improve and compete, training is essential, and I am proud that Trust Communications Ministries believes in that.

3171 Janice.

3172 MS BAIRD: One of the secrets to our success is that we set revenue budgets that are under-estimated so that we will, hopefully, over-achieve.

3173 Our financial projections for Christian Radio KW are based on the three-year history of LIFE 100.3.

3174 Here is our financial status.

3175 As a listener-supported radio station, we earned $300,000 in 2002 from church donations and listener support. The Kitchener-Waterloo market is three times the size of Barrie. We are projecting a conservative amount of $199,500 in listener pledges and church donations in Year One and hoping to over-achieve.

3176 In terms of advertising revenue, Barrie's first year produced $162,500 in advertising dollars -- 95 per cent of that being Christian businesses and churches. In our fiscal year that just ended August 31st, our advertising revenue grew to $347,729.

3177 The CRTC provided us with KW market revenue information. Local Time sales are $11.9 million.

3178 Our projected advertising revenue in Year One is only $160,000. It is truly conservative, and we hope to over-achieve quickly. Until we do, we represent 1.3 per cent of the total advertising pie. And most of that revenue is from Christian ministries.

3179 We have tried to be good stewards of our revenue. Other than a monthly vehicle payment, Trust Communications Ministries is not in debt and has no loans. Everything is paid for.

3180 Regardless of whether we break even or over-achieve, our budget is conservative and highly realistic. There is plenty of room to grow, but we are playing it safe.

3181 Scott.

3182 MR. JACKSON: As a fan of Christian music, I would like to thank the Commission for your decision to recognize the Christian radio format.

3183 There are over 1,600 radio stations with the Christian format in the U.S. Some are talk stations, some are AC, others are southern gospel and the one I worked for at WAY-FM is Top 40.

3184 As Canadians travel south on family vacations, all they need to do is push "scan" on the car radio and land on Christian radio. In many cities there are two or three Christian stations to choose from, and variety is good.

3185 Now we have Christian radio in Canada. Compared to the 1,600 in the states, there are less than 20 in Canada. Even considering the population difference, we are still just beginning.

3186 When I worked in Nashville, I realized how big the Christian music industry is. Canada is totally unaware that there are Christian record labels like Forefront, Sparrow and Tooth and Nail. There are managers and agents and publicists. There are huge music festivals -- like Woodstock but without the drugs.

3187 There are big scale performance bands like dc Talk and the Newsboys with multimillion dollar tours.

3188 There are Christian radio consultants like Brad Burkhart and radio trade publications like Christian Radio Weekly.

3189 There are radio networks like WAY-FM and KLOVE.

3190 In Houston is KSBJ, a major market listener-supported station that brings in millions of dollars a year in donations and employs two dozen fulltime people.

3191 Every April the Gospel Music Association puts on a convention in Nashville for people involved in radio and music. GMA is "the place" where the Christian music industry converges for a week of training and music showcases.

3192 And let's not forget the annual Dove Awards -- Christian music's answer to the Grammy's, where we salute the best of pop, rock, rap, alternative and inspirational songs and artists every year.

3193 At a recent Trust Communications Ministries focus group of adults, one woman commented that because of LIFE 100.3 she realized that the Newsboys were not just a garage band who made a demo CD at their church but were actually superstars, with agents and managers and a big record deal that competes with secular artists.

3194 Canada barely scratches the surface of this incredible industry, but we are getting there. Every time the CRTC licenses another Christian radio station, our industry grows. More Canadian artists have a chance to be heard. There are more promoters, more concerts, more radio people hired and more Christian businesses. Our Canadian talent grows and our economy is strengthened.

3195 I love Christian radio. I love the wholesome environment at LIFE 100.3. But most of all, I love the music.

3196 We have a slogan on our radio station and on billboards in town that says: "You may think it's about religion but really it's about life" -- LIFE 100.3.

3197 Like Kim said earlier, our music touches people's lives. It's uplifting. It helps people consider their position in life and the type of person they hope to become. It's about integrity and family values. It's about changing the world, one person at a time, one city at a time, through one station at a time.

3198 I can't imagine living in a city without Christian radio. Something would be missing.

3199 Kitchener-Waterloo is a city like many others. It is a city without Christian radio. Trust Communications Ministries has a great track record in Barrie.

3200 I am asking the Commission to let us develop a new station for Kitchener listeners who are asking us to play their music.

3201 Ben.

3202 MR. DAVY: As you can hear, our panel are not only broadcasters but they are passionate fans for the development of Christian radio in Canada. I believe people with passion can achieve great things. We need more passionate people in radio -- Christian or otherwise.

3203 We thank the Commission for hearing our application, and we welcome your questions on any of the areas of our application.

3204 THE CHAIRPERSON: Thank you very much, everyone.

3205 Commissioner Langford, please.

3206 COMMISSIONER LANGFORD: I must warn you that we are passionate regulators here. So passionate regulators meet passionate applicants, and sometimes we get emotional. We will try to keep it under control for you, and you do the same for us.

3207 You have answered a lot of my questions in your opening remarks as to time, just nailing down how long news casts will be. Some of what we ask you is a little bit drudge like, but in the end what we have to be sure we know is what this final product will look like and more precisely what it will sound like.

3208 Some of your minute counts and some of the information you gave us, Janice, particularly with minute counts on The Good News Patrol, 45 minutes, and Music Note, that really helps me. I will come back to them anyway to try to break them down and see what they are going to contain.

3209 But I was able to strike a few questions off as you were talking, and that was very helpful.

3210 I want to start with the programming. I want to make sure that we understand what people will hear if this application is successful and you go to air in Kitchener-Waterloo. I guess a lot of it is music, but maybe you could help me through just how much of it is music and how much of it is spoken word.

3211 Do you have a breakdown that will help us?

3212 MR. JACKSON: It is primarily a music-based radio station. We want to play the hits, the Christian hits. I will ask Ben to comment on spoken word.

3213 MR. DAVY: Thanks, Scott.

3214 Like Scott said, our sole focus is Christian music. We will be a Christian music-based station. I will break down the spoken word for you.

3215 COMMISSIONER LANGFORD: Wait. Don't jump to it yet. Let me make sure I understand that as well.

3216 Is Christian music as you play it all distinct music, or is some of what we might hear on adult contemporary rock stations qualify because of content?

3217 Is there crossover, in other words?

3218 MR. DAVY: The crossover would be very limited. We have broken it down as 95 per cent of our music we estimate will be from Category 35, which is non-classic religious.

3219 We are estimating that pretty much 95 per cent or more, probably all of our music, will fall into that 35 category.

3220 The 5 per cent of Category 21 is kind of a breathing room just in case some music does cross over. But we expect that will be very limited, if any.

3221 COMMISSIONER LANGFORD: How does it get to cross over? Does it cross over because, for some reason, it picks up what I might call a Christian theme? Or does it cross over just because it's popular but it's also not threatening, not nasty, whatever adjective you want to use?

3222 What makes a crossover possible?

3223 MR. JACKSON: Two things come to mind. One would be movie soundtracks where Christian artists have been signed to perform in a movie the theme song or background music.

3224 Sixpence None the Richer, for example, was originally a Christian band. Their music was played in a couple of movies and then it turned up on secular stations.

3225 The other reason would be that the record companies also have a mainstream record deal and have released the records to mainstream radio.

3226 COMMISSIONER LANGFORD: Let's go back, speaking of movies. I guess the biggest movie hit I can think of in the last ten years would have been Céline Dion's Titantic theme song.

3227 Would that be played -- how long ago was that? Ten years ago, five years ago? I can't remember.

3228 Time flies when you are having fun, and we are fun-filled passionate regulators.

3229 MR. JACKSON: The boat went down. It doesn't matter.

3230 COMMISSIONER LANGFORD: When the boat went down, would that have qualified? Would you have played that piece of music?

3231 MR. JACKSON: That particular song, no.

3232 COMMISSIONER LANGFORD: Can you give me any idea why? It would help me to know.

3233 MR. JACKSON: It was not released to the Christian market. There are Christian record labels that release their songs to the Christian market, just as there are secular labels from Warner Brothers and MCA that release music to AC and CHR secular stations.

3234 We receive our product from the Christian labels. We follow Christian charts to find out what's hot and what's not.

3235 COMMISSIONER LANGFORD: Would you agree there is nothing -- we are not talking rap when we are talking Céline Dion here. It was fairly popular.

3236 Let me put it this way: Would you have been surprised to hear people who are faithful listeners to your station flipping over to another station to hear that song when it was at the top of the charts?

3237 MR. JACKSON: We know that there is cross-tuning from station to station. So I guess that's possible, although I don't like Céline Dion. But I am sure the listeners would cross-tune possibly if they wanted to hear that.

3238 We find that our listeners are really loyal to our format. It is much like a country loyal listener, even more so. They are passionate about this format, because it represents a lifestyle to them. They cling to the format.

3239 They hear encouraging lyrics that give them hope, and that's why they tune to our music. They know our music is positive, is wholesome and is based on family values.

3240 COMMISSIONER LANGFORD: So it is content, at least, that distinguishes it.

3241 In other words, it is positive attributes rather than not being negative. Is that a way to put it?

3242 MR. JACKSON: Exactly.

3243 COMMISSIONER LANGFORD: Your station, before we get on to spoken word, would have approximately how much of its content -- if I listened to it 24 hours a day, how much music would I hear on a percentage basis, or hours, or however you like?

3244 Give me some idea of the amount of music as opposed to spoken word.

3245 MR. JACKSON: I could give you a record count.

3246 Our morning show would have between six and eight records an hour, just like a mainstream station.

3247 Throughout the rest of the day we are probably playing 13 records an hour during the day and maybe 15 or 16 at night, because they are shorter and they are faster and we can play more.

3248 It is very music intensive.

3249 COMMISSIONER LANGFORD: Are there some shows that have no music at all? Let's use your Barrie station as an example.

3250 MR. JACKSON: Music program?

3251 COMMISSIONER LANGFORD: Do you have any half-hour shows, hour shows, that have no music at all, that are spoken word?

3252 MR. JACKSON: Yes, we do that as well, on a limited basis. We want to keep it music intensive so that we are different from -- I guess that is just the focus of our organization, to say music intensive, which would be AC during the day and CHR at night.

3253 MS BAIRD: We do have church services on Sunday. That would be a half-hour block programming from a church.

3254 COMMISSIONER LANGFORD: That's right. You are proposing three, if my recollection is correct, on this current application to be church services.

3255 MS BAIRD: That's right.

3256 COMMISSIONER LANGFORD: We will get to that in a moment.

3257 Tell me, then, about the spoken word and then maybe we will from there get a better sense of what is left for music.

3258 How long is a song? I don't know. How high is high? I have trouble with six to eight cuts, or 12 to 13 cuts, because I just don't know how long they are.

3259 Anyway, I am starting to get a picture. Let's go to spoken word, and maybe we can go back and do a little more music.

3260 MR. DAVY: All right; thank you.

3261 We have totalled up our spoken word, minutes, and we calculate it to amount to 8.9 hours of spoken word per week, which would factor out to be 7.1 per cent spoken word content.

3262 There are five areas that we have broken that down into. I will just touch on each of them briefly: news, DJ spoken word, traffic, on location and features.

3263 First of all, we will talk about news.

3264 Our news would be very similar to the news you would hear on secular stations. It would be a new editorial voice. We have no affiliation with any other media outlet in KW. So we feel that would be a positive thing that we are bringing to the market.

3265 Our news would be far less sensationalist, is how we describe it, as opposed to other newscasts that you would hear.

3266 We have noticed that a lot of news out there, especially in the secular media, is very sensationalist in the sense that the way it is presented and delivered can be very demoralizing and depressing. We would still share those stories, but they would be presented in a way that would be less sensationalist, if you will.

3267 COMMISSIONER LANGFORD: I don't want to sound cynical, but if you are shooting 12 or 13 people in Maryland, it is pretty hard to put a happy spin on that. How would you cover a story like that?

3268 MR. DAVY: We would certainly present a story and the facts and details but without getting into all of the gore. There were some stories that we are finding on a lot of news outlets that are very graphic, very detailed in the way that they present these stories. We wouldn't really deliver them in that same light that you would hear and see on other media outlets. We would still certainly share the details and the facts.

3269 COMMISSIONER LANGFORD: All right. Carry on.

3270 MR. DAVY: Our morning news would be 15 minutes per day. We have a three-minute newscast at the top of the hour and two minutes at the bottom of the hour.

3271 So from 6:00 to 9:00 a.m., that would be 15 minutes of news, Monday to Friday. Multiply that by five days and that would be 75 minutes of news in the morning.

3272 We are also proposing a three-minute newscast at noon, Monday to Friday. So that would be an additional 15 minutes of news there.

3273 As far as DJ spoken word --

3274 COMMISSIONER LANGFORD: I hate to interrupt, but rather than going back and forth.

3275 MR. DAVY: That's fine.

3276 COMMISSIONER LANGFORD: After a year you are going to move to weekends, as well. What will that look like?

3277 MR. DAVY: We will look at doing afternoons, first of all, and perhaps weekends as well. We would look at that after the first year.

3278 COMMISSIONER LANGFORD: How many people would be dedicated to your news gathering organization, your news group?

3279 MR. DAVY: At this time we would just plan on one morning news announcer. There could be a split shift, as well, so they could do the morning news and then come back and do the news at 12 noon.

3280 COMMISSIONER LANGFORD: Who writes it for the announcer? Who collects it?

3281 MR. DAVY: They would write it for themselves. They would be the news announcer and director.

3282 COMMISSIONER LANGFORD: Is this rip and read? They are not going out in a car looking for news. We are pulling this off the wire?

3283 MR. DAVY: They would write their own stories. We are doing that at CJLF in Barrie right now, as well.

3284 MR. JACKSON: If I could add to that, the way we are handling it right now in Barrie is our news director Christie Burton has made a lot of contacts in the community, going to City Hall and council meetings. She has made so many contacts that they are e-mailing her and faxing her in news stories as well.

3285 She does cover some stories during the week. She is a fulltime person in Barrie. So she is making a lot of contacts.

3286 We are also receiving police reports, school board council meeting reports, and various faxes. That gives us a large percentage of local news.

3287 We would also use the Internet to obtain national stories and international stories.

1605

3288 COMMISSIONER LANGFORD: Does this woman actually read the content as well, or does she prepare it and your disc jockey or your announcer reads it?

3289 MR. JACKSON: She writes and reads it, yes.

3290 COMMISSIONER LANGFORD: Have you run into any problems? It is hard to check, isn't it? If people are sending you faxes and sending you e-mails, do you just accept them? How do you check that?

3291 MR. JACKSON: I guess if there is any uncertainty, she would phone them back. This is her sole purpose in the morning. She is part of the morning show with Ben, and her fulltime commitment is to do news.

3292 She is not being a DJ on the morning show. She is just there for news purposes.

3293 COMMISSIONER LANGFORD: She can check it out and check other sources, and things like that.

3294 MR. JACKSON: And does.

3295 COMMISSIONER LANGFORD: Good. If I can add an editorial comment, good.

3296 Moving right along, what else do we have?

3297 MR. DAVY: Our next source of spoken word is DJ spoken word, which would include jock talk. As far as DJ ad libs, we have broken that down into 42 minutes per day, to sort of categorize that a little more clearly for you.

3298 We are looking at 4 minutes of DJ ad lib per hour in the morning from 6:00 to 9:00 a.m. There are four talk breaks per hour, each of them one minute in length. That is from 6:00 to 9:00 a.m.

3299 There are two talk breaks per hour from 9:00 a.m. until midnight.

3300 Those would be the periods of the day that we would have DJs on the air: from 6:00 a.m. until midnight.

3301 So 42 minutes per day, Monday through Saturday. That multiplies out to 252 words of spoken word per week, multiplying that by six.

3302 We are also planning --

3303 COMMISSIONER LANGFORD: That is 252 minutes.

3304 MR. DAVY: Two hundred and fifty-two minutes.

3305 COMMISSIONER LANGFORD: You said 252 words.

3306 MR. DAVY: I'm sorry.

3307 COMMISSIONER LANGFORD: I know somewhere somebody is going to have to type this out. And the question will come down. So we might as well settle it now.

3308 It is 252 minutes.

3309 MR. DAVY: Minutes per week; that is correct.

3310 COMMISSIONER LANGFORD: Great.

3311 MR. DAVY: We are also planning on weather updates as well, 20 seconds in length, approximately. We would run 18 of those a day. Again, that would be from 6:00 a.m. until midnight, 18 hours, one per hour, Monday through Friday. That multiplies out to 45 minutes of spoken word per week.

3312 Public service announcements, 20 seconds each. Similar to weather, 18 per day, one per hour from 6:00 a.m. until midnight, Monday through Saturday. So that multiplies out to 36 minutes of spoken word per week.

3313 Morning show interviews, those could be people in the community, local youth pastors, Christian recording artists, et cetera. We estimate probably two of those per week. They would be about six minutes in length. So that would multiply to 12 minutes of spoken word in the morning per week.

3314 And one interview at night would be six minutes, as well. So six minutes there per week.

3315 Any questions on DJ ad lib at all?

3316 COMMISSIONER LANGFORD: The DJ patter, the DJ four minutes an hour of -- I can't remember how you characterized it. You had a nice term for it.

3317 MR. DAVY: Prep or jock talk we call it.

3318 COMMISSIONER LANGFORD: That is just commenting on the music usually? Is that the usual thing? Or the group or the weather outside, or how about those Blue Jays? What sort of thing is it?

3319 MR. DAVY: Any topical information at all. That would cover a wide variety of things, as you mentioned.

3320 It could be something to do with the artist or the song that was just played. It could be sports. It could be something from that announcer's personal life, maybe an experience or just something funny that happened to them on the weekend. It could be an e-mail that was sent to them from a listener. It could be a number of things.

3321 COMMISSIONER LANGFORD: It's what in commercial radio might be called happy talk, just keeping things moving along, keeping the records spinning.

3322 MR. DAVY: Sure.

3323 COMMISSIONER LANGFORD: The interviews are with different pastors? I gather we are drawing on your Barrie experience in transporting this here. Is that accurate?

3324 MR. DAVY: Sure.

3325 COMMISSIONER LANGFORD: Are they almost always a local pastor, a local vicar of some sort?

3326 MR. DAVY: No.

3327 COMMISSIONER LANGFORD: What kind of other interviews would you do? Would you do artists as well?

3328 MR. DAVY: Absolutely, Christian recording artists, both local and otherwise. If there was a concert coming up in our area that week, we would certainly try to get the artist on the air to encourage people to come out to the show.

3329 This morning we did an interview with a fellow from Samaritan's Purse, which is an organization that is encouraging people to fill up shoe boxes with gifts, small things to take to children in Third World countries, kids that wouldn't be able to have a Christmas present.

3330 COMMISSIONER LANGFORD: Yes. They have come by my kids' schools.

3331 MR. DAVY: We had him on for a five or six-minute interview this morning.

3332 It could be anything that we think would be relevant and informative to our listeners.

3333 COMMISSIONER LANGFORD: Are these minutes general or are they iron clad? If you happen to get somebody really great on, you can go a little longer? You could drop a song?

3334 MR. DAVY: Sometimes, yes.

3335 COMMISSIONER LANGFORD: That's fine. There is some flexibility there for you.

3336 MR. DAVY: Yes.

3337 COMMISSIONER LANGFORD: That's good to know.

3338 I have done a little bit of looking at the Barrie nature of programming, which I gather was licensed to be almost precisely like this, the same sort of format, and yet on your Web site you talk about programs like Dobson's Family Minute -- I'm sorry, I don't live in Barrie so I haven't heard it -- Focus on the Family. And there are a number of others.

3339 What are these programs and where do they fit into this music, news and a few interviews format?

3340 MR. JACKSON: The Barrie station is a different format from the KW application. In our KW application it is very music intensive, because we also knew there was another applicant who was doing much more spoken word than us.

3341 So hoping that there would be room for two different stations on the airwaves, we try to go very music based. For that reason, it would be different than the Barrie one. But the music would be the same as the Barrie one, being AC during the day and CHR at night.

3342 COMMISSIONER LANGFORD: You are not going to be replaying these programs on this station, were you to be successful here.

3343 MR. JACKSON: At this point, it is our believe that Faith FM is covering the spoken word. If there is only one station that is licensed, then we would like to consider that and also to consider the Religious Broadcasting Act, which 1993-78.

3344 COMMISSIONER LANGFORD: Let's talk about that. Assume that we do one and it's you. How do you deal with the demands for balance set out in the Act and the decision you just quoted on your Barrie station? How do you reach out to other religious communities and try to get the kind of balance that we demand?

3345 MR. JACKSON: We do interview shows on the morning show, as we talked about in one of the other applications, where phone-in shows are considered to be balanced. So in the morning show we have had a number of phone-in shows where listeners can call in and talk about whatever the hot topic might be.

3346 There was an example, a situation where a Catholic school student was banned from bringing his gay friend to the prom, and the court ruled against it. We took calls from listeners, and we were asking for their viewpoint: How did they feel about that?

3347 Another example that recently came up is when the federal court ruled that child pornography was considered artistic, and we invited listeners to call in and express their opinions.

3348 Whoever called in -- we had a call screener, of course, to make sure that we had eloquent speaking people on the radio. But that would be an example.

3349 One other one that I can cite for you now is the day after September 11th we invited listeners to call in and talk about how they felt. September 11th was largely a religious statement, as we know, with the terrorist attacks. So people were able to express how they felt in that case.

3350 Then one year later, as many secular stations did, we invited listeners to call back and give reflection on how it has changed their lives a year later.

3351 Still related to balance, our newscasts are not Christian based but they cover the hot topics of the day, regardless of religious affiliation.

3352 We are aware that the Commission wants balance on public concerns and that religion is one of those public concerns. We do our best to honour that balance in Barrie.

3353 The format is a little bit different for KW, but we still want to remain open to that if the need is there. If listeners are interested in that, then we want to serve them.

3354 COMMISSIONER LANGFORD: I know we are here to talk about Kitchener, but as the Barrie example may get transposed here, depending on how the licensing equation works out, what I think I am hearing you say is that for some reasons -- September 11th being a horrific and memorable one -- you reach out and attempt to have people contact you with your views.

3355 You screen them for eloquence, and that's perfectly understandable. We don't want Mr. Ernst Zundel in his particularly ineloquent way stating his views.

3356 What about screening them for balance? How do you ensure that you perhaps get some Muslim members of the community who feel perhaps threatened, who feel completely like they may be victimized for something they had absolutely no control over?

3357 MR. JACKSON: I think the statement that you just made would be made on the air. That certainly was part of the September 12th discussion. We invite people to call with that point of view.

3358 We can't control them. We can't make them phone. We can only work with what we have. But as we are screening the calls, we also ask them what their topic is, so that it is just not repeated. It isn't just for eloquence of speech. It is also so we get a variety of questions, and we are not talking about the same thing.

3359 COMMISSIONER LANGFORD: Do you feel you have a further duty, or perhaps as your station grows you will have a further duty to reach out and to actually become proactive in looking for other points of view?

3360 MR. JACKSON: Are you speaking of KW?

3361 COMMISSIONER LANGFORD: Let's talk about KW. Let's assume that you are licensed here in Kitchener-Waterloo, you alone as a Christian broadcaster are licensed, no one else. So the opportunity arises where you may want to get into the type of shows you are getting into in Barrie. You don't feel, as you said, that you have to be more music oriented because the other faith station would be more spoken word oriented. You can bring the full meal deal, as you say, to your listeners.

3362 What would you then feel the onus is on you from the regulations requiring balance? How would you feel that you would have to conduct yourself? I would be interested to get your opinion.

3363 Put it bluntly: What do you think your duty is, as a religious broadcaster, to reach out to other religious elements of your community?

3364 MR. DAVY: Since we are a Christian- based music format, we don't really anticipate that there will be many people from non-Christian based religions that will approach us with regard to many of our programming opportunities.

3365 We feel it is unlikely that our listeners, who will be Christian-based listeners, will be interested in that type of programming. It would be similar to a country music station crossing format. We are a Christian, and we will be a Christian-based format with Christian music listeners.

3366 We anticipate that that is what the demand will be for our programming.

3367 COMMISSIONER LANGFORD: I think you would agree with me that CRTC Public Notice 1993-78 is a particular public notice applying precisely to religious broadcasting. It does not require all broadcasters to become homogenous. We do not require country stations to play rock and roll. We do not require rock and roll stations to play CHR, and on down the line.

3368 But we do require religious broadcasters to present as much as possible -- not an equally balanced view but at least a balanced view.

3369 I see, Scott, that you are shaking your head. You brought this particular public notice up, so you are clearly familiar with it.

3370 MR. JACKSON: Yes, I have recently read it.

3371 I understand that the word is opportunity. As you have said, it is not necessarily in time but it is in opportunity.

3372 COMMISSIONER LANGFORD: Right. I think there is also a duty, wouldn't you agree, to reach out and not wait for people to come to the door; but in fact for you to go out into the community seeking them?

3373 If I can think of the parable of the marriage feast, I think you have to go out to the crossroads and look for the members of the community. You don't necessarily wait for them to come to you.

3374 MR. JACKSON: Well, for KW we are looking at being a music-based radio station. So we are not looking for religious talk. We are not applying for a religious licence; we are applying for a music licence, a Category 3 licence.

3375 COMMISSIONER LANGFORD: That is quite correct. But you said to me, I believe -- and correct me if I am wrong -- that were you the sole religious broadcaster licensed in this area, there may be something of a transition; that the sort of programming that you now play on your Barrie station might find time on this station.

3376 Isn't that correct?

3377 MR. JACKSON: That would be for future consideration. The application that we have submitted, though, is just based on music. That would require us to go back to our board of directors and come up with an alternate plan. That would be a change of plan.

3378 COMMISSIONER LANGFORD: I think it is very important for us to know, though, even at this early stage, that if that kind of programming is a possibility and if, to take the Barrie example, it is going on now in Barrie, it is clear to you that we would require -- and I use that word advisedly -- you to take a proactive role.

3379 I am not trying to lecture you here. I just want to make sure you understand. I am not in the lecturing business. But I am passionate about regulating.

3380 I want to be sure that we are all clear.

3381 The last thing that this body wants in the whole world is for somehow to deceive an applicant, even if it is by omission rather than by commission.

3382 We don't want you to go away thinking: Gosh, we told them if we won this thing and we were the only ones that we might move to that type of voice programming that we are now doing in Barrie. They never mentioned anything about balance, and they were happy.

3383 I want you to realize, I want you to understand, out of fairness, that we do have the very regulatory vehicle that you mentioned; that it calls for balance and that balance puts an onus on you to reach out into the community.

3384 It isn't enough to say: Our door was open and nobody walked through it; no Jews, no Muslims, no fill-in-the-blank. The only people who walked through were Christians, so they are the only people we put on the air.

3385 That is not enough if my reading of this is correct. And if it is wrong, we have a very fine legal counsel in the person of James Wilson over there who will bring me up very smartly.

3386 That is my reading of it. I see, for the record, that Mr. Wilson is nodding in the affirmative, which always makes my heart sing.

3387 Are you with me on that? Do you see what I am saying?

3388 MR. JACKSON: Yes. You are asking for a proactive approach to provide balance.

3389 COMMISSIONER LANGFORD: I'm not asking. I'm telling you.

3390 MR. JACKSON: I got your message.

3391 COMMISSIONER LANGFORD: "Them's the rules", as they say.

3392 MR. JACKSON: Do you want me to sign off on it now?

3393 COMMISSIONER LANGFORD: No. But you may have to. Those really are the regulations.

3394 To give you a sense of it, it's not that we are trying to get you to put water in your wine. It's that frequencies are scarce. As you and every other applicant has said here today, frequencies are as rare as hen's teeth here. We are not going have enough to give everybody.

3395 That means the people who are lucky enough to have that piece of public property have to share it a little bit in certain circumstances. And you are one of the circumstances. Ethnic broadcasting is another one of the circumstances. We can think of other examples.

3396 There endeth the lecture, and I am sorry to go on for so long about it. I think it is very important that if your station were to go in that direction, you would be under no misapprehension as to what the rules are.

3397 We will get back to what you are really proposing now and to what this application is. I apologize if I have gone on too long, but as I say, we don't want anyone leaving here thinking that we have misled them in any way.

3398 Getting back to the 45 minutes of The Good News Patrol and Music Notes, can you tell me a little bit about those, please.

1625

3399 MR. DAVY: Sure. The Good News Patrol will run as a part of, the ending of our news package. It will be basically a good news story. It could be spiritual or otherwise, something that is positive and encouraging. Usually it is local. It is something that is happening in our area. But it could be something of national or international interest.

3400 Our news announcer would put that together and present that every morning at the end of the newscast.

3401 That is a 30-second feature that would run six times per morning.

3402 Music Notes highlights Christian music, and it would be an artist or a band that we would feature. At our Barrie station right now we have a musicologist who researches Christian artists, puts that feature together and produces it for us.

3403 So that would be a spotlight on a Christian artist or a band. We run that five times per day, and they are 60 seconds in length.

3404 COMMISSIONER LANGFORD: Thank you for that.

3405 I think the only other aspect of your programming is the church service element on Sunday. Is that correct?

3406 MR. JACKSON: I am just running through the program schedule in my head.

3407 Do you mean as far as features would be concerned?

3408 COMMISSIONER LANGFORD: What I have here is: music; news; DJ talk -- jock talk, as you call it; weather and a bit of traffic, perhaps; public service announcements; interviews, both morning and evening.

3409 Did I say music? Obviously music is a major part.

3410 And then is the only other element the church services on Sunday?

3411 MR. JACKSON: So far, yes. I am just thinking, we would be willing to run -- and we do run in Barrie -- an all-request hour every night for teenagers to call in and request and do dedications, and so on.

3412 I don't think that is in the application, but that would be a secondary feature that we would pick up.

3413 On the weekends we are looking at three 30-minute church services for Sunday morning. They would be locally produced local services.

3414 COMMISSIONER LANGFORD: For those I understand you choose three from different churches around the community?

3415 MR. JACKSON: That's right.

3416 COMMISSIONER LANGFORD: From hundreds of churches in the Yellow Pages? That's an incredible number, isn't it.

3417 MR. JACKSON: Yes.

3418 COMMISSIONER LANGFORD: How is that done? How is that choice made?

3419 MR. JACKSON: Back in Barrie I attended a Barrie ministerial meetings where the ministers got together, dozens and dozens, and we would make them an offer and let them know that we are looking for proposals for Sunday morning programming and ask them to submit something of what they would like to do.

3420 One of the programs that we are currently running is -- I'm sorry, I guess that one is deleted.

3421 We would like to have a hymns show, which is a more traditional music. One pastor wanted to be the host of a hymns program. Another one does an interview show where he interviews people in his church or visitors to the community.

3422 Those are two examples of what we could possibly run.

3423 It sort of depends on the talent that is out there, the skill that the pastor has. Sometimes one of the fellows is a former radio guy, so he brings an interview aspect to his show.

3424 COMMISSIONER LANGFORD: So it is the same three every week?

3425 MR. JACKSON: Yes. The proposal, you mean?

3426 COMMISSIONER LANGFORD: Yes.

3427 MR. JACKSON: Yes, it would be because we are looking at hopefully a 52-week contract so that we can count on them each week.

3428 COMMISSIONER LANGFORD: You sell the time.

3429 MR. JACKSON: We sell the time.

3430 COMMISSIONER LANGFORD: I see. Is that normal?

3431 MR. JACKSON: Yes, it is.

3432 COMMISSIONER LANGFORD: As I say, this is a recently new world to me. So I am trying to learn as well.

3433 You make a deal. This is what you call the paid programming in your supplementary brief.

3434 MR. JACKSON: Yes, that's right.

3435 COMMISSIONER LANGFORD: I was wondering how that worked.

3436 I have a couple more on programming, one tiny one.

3437 Janice, I think it was you who used this term. I read it in your supplementary brief. I didn't believe it when I read it, and then you used it.

3438 It seemed like one of the great oxymorons of all time: hard core Christian music.

3439 What is that?

3440 MS BAIRD: It's very loud. I can't even stomach it. It's just really geared to 16-to-18 year old guys. It's pumping it out hard.

3441 COMMISSIONER LANGFORD: It's music though; right?

3442 MS BAIRD: Yes, it is.

3443 COMMISSIONER LANGFORD: I just note that in your supplementary brief -- and I'm afraid I can't give you a page reference. It is actually the second-last page.

3444 It happens to come in the opening line of a sentence dedicated largely to book stores. My knowledge of "hard core" in book stores -- although I have only read about it and seen it in movies -- is that it is quite a different thing, thank you very much.

3445 So I did look up pretty sharply when I saw that. It's music. Fine.

3446 My last question, moving right along. I don't quite understand what your Advisory Committee will do if your station is going to be made up of the kind of programming you have just spelled out.

3447 Maybe you could help me with that. I wouldn't mind a little idea of how it would be made up.

3448 Even before we get that, what would they do?

3449 MS LUCAS: Our local Advisory Committee will be in place through the first year of operation here in Kitchener. At that point it will cease to exist on a formal level. But we will hope that the volunteers that have been involved with it will continue on participating in things like focus groups, volunteering to help out at Sharathons, which is a major fund-raising event.

3450 But in a formal as it is in place right now, it will only be in effect for that first year of operation.

3451 COMMISSIONER LANGFORD: We tend to think of them as being very, very useful in the type of role of finding balance; that people would have an advisory committee which would have representative members of the community on it.

3452 So you might have Jewish people, Muslim people, as well as Christian people on your advisory committee so that when you are reaching out for balance, when you are being proactive, as I was talking about, these are the people who would help you.

3453 But of course, if you are just choosing music off charts and you are doing news, there is no need, is there? I can't see a need.

3454 MS LUCAS: The purpose of our local advisory group that we have formed at this point was to connect the Barrie group with the local KW listening audience and to get a sense of what this area wanted out of a Christian music format.

3455 It connected us with business contacts, church contacts, ministry organizations and helped us prepare our application in the forms of petitions and surveys and letters of positive intervention.

3456 That is the role that we played in that area.

3457 COMMISSIONER LANGFORD: Thank you for that.

3458 Now that I know what you are going to do, the next questions won't take very long, with one possible exception; that we may dabble in the dreaded 1993-78 public notice again when we get to the revenue side of it.

3459 Other than that, I think we can move quickly through it.

3460 I want to take you to your Canadian Talent Development offering of $5,000 per year.

3461 The first question I would ask -- and we are a greedy bunch when it comes to Canadian Talent Development. I am not asking you to raise it now, because you have made your application and that's your application. It would be quite wrong for me to ask you.

3462 In light of what you said, Janice, in the opening remarks about how successful you are and how you are now in fact instigating your own schemes for handing out money and bringing talent along and bringing disc jockeys along, and what not, why didn't you make it higher?

3463 I am not asking you to make it higher. In fact, I don't want you to make it higher. I just wonder why you didn't.

3464 MS BAIRD: I think I mentioned when I was speaking that we tend to set our budgets fairly low, realistic but maybe on the low side so that we over-achieve. We do not want to set our budgets high and then come in under and blow the budget and run out of money. We want to be successful.

3465 We feel that by staying at the $5,000, we know we can achieve that. If we go over it, that's great.

3466 In the last three years at Barrie we have gone over. We committed $3,000 there and we have gone over every year. So we are certainly prepared and hoping that we can do that. But we just wanted to set the minimum so that we would hopefully over-achieve.

3467 COMMISSIONER LANGFORD: It is very responsible of you. But it is a competitive process, and it must have been tempting in light of the success in Barrie to go a bit higher and see whether that wouldn't give you an edge.

3468 MS BAIRD: We like to go by our budgets. We have been successful in doing that, and that's how we feel we are going to be successful here as well; by setting our budgets and sticking to them.

3469 MR. JACKSON: Perhaps I could add to that.

3470 A number of the fundings that we have passed out in the last three years have been beyond the CTD, but they were not broadcast. We were not looking for public awareness of what we have done. We have just done it quietly because we felt it was the right thing to do. That's our policy.

3471 It extends even beyond the CTD, where we have given out funding to Christian radio station.

3472 COMMISSIONER LANGFORD: You said that, and that is what made me ask the question. It is obvious that you are going beyond, considerably beyond, I would say.

3473 Let's get to what you are doing. I want to touch on a few minor points.

3474 You have set aside $3,000 for concert promotions. It's not a huge amount of money, but still it's $3,000. What does it buy? How many concerts do you get? Or do you just get one?

3475 I am just not sure what you plan to do with the $3,000 beyond using it for concert promotion.

3476 MR. JACKSON: These were youth concerts, again using Barrie as a model. Not that it is a copycat situation, but using it as a model, we did two youth concerts a year. That is where the $3,000 was spent.

3477 Actually, we spent a lot more than that, but that is where it would be spent, is on youth concerts: on the artists and on promotion of the artists.

3478 COMMISSIONER LANGFORD: How do you ensure that the money actually goes to the artist?

3479 MR. JACKSON: My wife writes the cheque.

3480 COMMISSIONER LANGFORD: That would do it.

3481 Using your Barrie example, all payments go through third parties, then, in some way?

3482 MR. JACKSON: Yes.

3483 COMMISSIONER LANGFORD: You speak generally of underwriting touring bands. Could you flesh that out a little bit?

3484 I know what a touring band is, but what I don't know is exactly how you plan to underwrite them; how that would work and how often you might do it.

3485 MR. JACKSON: We have gotten to know a lot of Christian musicians, local musicians, regional musicians, and we have supported them when they have been in need for things. We have been there for them financially.

3486 This is not a touring example, and it has not happened in Barrie yet, but we are interested in touring examples. The band Steadfast was going to Gospel Music Week in Nashville for training and upgrading and hoping to get a showcase. So we paid their hotel bill so they wouldn't have to sleep in their van.

3487 COMMISSIONER LANGFORD: So that is how you are doing it. It is kind of an ad hoc thing, where you can help.

3488 MR. JACKSON: That's right, where there is a need, we are capitalizing on it.

3489 COMMISSIONER LANGFORD: There seems to be a need here, and I am going to help it: "James, a message from the Chair: suggest you move smartly, young man."

3490 All right. Moving right along, as we say -- and I am beginning to sound a bit parrot like; I will try to find another line.

3491 Audience share, revenues, the whole picture of how you are going to do, to put it colloquially, you are very optimistic there. From hearing the enthusiasm in your voice about how things have gone in Barrie, perhaps with very good reason. However, Kitchener-Waterloo isn't Barrie.

3492 I want to ask you generally -- let's start with market share. What makes you think in a market like this, where there is so much to choose from, that you are going to have such a healthy market share, some varying between 6 per cent in Year One and 9 per cent in Year Seven?

3493 That's a good swack of share. On what do you base that?

3494 MR. JACKSON: I forgot to turn on the microphone. Radio people forgetting to turn on the microphone is scary.

3495 COMMISSIONER LANGFORD: Yes. Unfortunately, I never forget.

3496 MR. JACKSON: I guess our market share is based on a couple of different things. Earlier today we heard that in the United States the market share is sometimes low, but also in the United States they have two, three, four or five Christian radio stations to choose from, and that would slice up the pie.

3497 They also have much larger markets and more listeners in those markets.

3498 We sort of looked at the performance in KW. We looked at BBM research from a year ago and tried to speculate where we would end up.

3499 CKGL-AM had a 7.5 cum. rating and CKWR, the community station, had a 2.2 rating. We believe that our cum. ranking would be somewhere between those two stations.

3500 CKGL had a weekly central cum. of 32,000; CKWR had 18,000. So we projected between the two, at 20,000 and that is what we put in our application.

3501 Our 6:00 to 10:00 a.m. average core hour projection of 2,000 is based on a similar methodology. CKGL has 7,300 and CKWR has 3,100 in the full coverage area. We couldn't obtain central coverage data, to we estimated that our average core hour would be 2,000 in morning drive.

3502 Based on the BBM diaries in Barrie, our competitors in Barrie have told us that there were many, many diary comments about our station, surprisingly so, and that included the name of our station and the name of our morning show. Their guess was a 5 per cent market share in Barrie.

3503 We also know from KW that there is WDCX, that signal that drifts into the market, and there is a loyalty to that radio station. So we are hoping we would pick up their listeners by taking the 99.5 frequency.

3504 So all that put together is how we came up with the 5 per cent.

3505 COMMISSIONER LANGFORD: So it isn't starry eyed and passionate optimism. You really did have a method of calculating and you think it is realistic.

3506 MR. JACKSON: I am hoping that we will over-achieve. I am hoping it will be over 5 per cent.

3507 We did increase it I think for Years 6 and 7.

3508 I'm sorry, Year 1 is 6 per cent, not 5 per cent.

3509 COMMISSIONER LANGFORD: That's right.

3510 MR. JACKSON: Year 2 is 7 per cent. And it could well be beyond that, because when the new radio station signs on there is always a novelty factor. We are hoping that we will be fortunate in that area, as well.

1640

3511 COMMISSIONER LANGFORD: It is a heavily fragmented market, though. And we wish you well, if you are successful in this process. We like all our licensees to do well here.

3512 Perhaps you have to set high goals for yourselves.

3513 Revenues are equally high, and this seems to me to be kind of a very untested market for those kinds of revenues. My concerns are similar to the concerns voiced by the Chair with the earlier applicant.

3514 It's not that I am saying you can't do it, but I find, as I read through your application and supplementary brief, if I can use this word, there is a certain amount of faith in this, isn't there?

3515 MR. JACKSON: Yes.

3516 COMMISSIONER LANGFORD: You may be getting help from other sources, and I just can't quantify that.

3517 You speak of colleges advertising. You speak of book stores. But I don't have a sense -- have you spoken to the Carpenter Book Store? Have you spoken to the colleges?

3518 Do you have a real sense of what the dollar value of this belief is that you can bring them in as advertisers?

3519 MR. JACKSON: That's a two-part question.

3520 Yes, we have spoken to them; but no, we don't have an amount from them.

3521 I could quote for you Barrie levels of advertising, if you would like to know.

3522 COMMISSIONER LANGFORD: I think that might help, if you have similar situations.

3523 It's not that I am questioning it in the sense of questioning your veracity. It is simply that I have nothing to do by in this area. It is a very, very new format. It is brand new to this market. It is brand new to these advertisers.

3524 I walked by the Carpenter Book Store today. It is there. It is a lovely book store, there is no doubt.

3525 But what it's advertising budget is, I have no idea.

3526 Perhaps you could help us with some Barrie figures.

3527 MR. JACKSON: Sure. In Barrie we have a book store named Treasure House. They spend over $11,000 a year.

3528 In Orillia there is another book store, and they spend over $11,000, which I think is very aggressive for a city the size of Orillia. But they have renewed every year, and every year they have increased. They are generating traffic, and they are thrilled with the station.

3529 Those two advertisers are two of our biggest fans.

3530 COMMISSIONER LANGFORD: Do you have anything similar for colleges, any religious schools that are advertising?

3531 MR. JACKSON: Yes, we have a number. In fact, Emmanuel Bible College here in KW advertises in Barrie. We have colleges all across the country, from B.C., Saskatchewan, Alberta all on the air this month advertising, looking for students to take courses out west.

3532 COMMISSIONER LANGFORD: Is it a kind of seasonal thing; that they advertise during application time? Is it this year the grade 13 students, and next year it will be grade 12, are putting in their applications now and will be until February and March?

3533 Is that the time they advertise, or do they advertise all year long?

3534 MR. JACKSON: Pretty much all year long. They are on the air for night courses or for student registration.

3535 COMMISSIONER LANGFORD: Thank you for that.

3536 The donation side of it, how does that work? You have the Sharathon, and we can get to that in a moment. I guess that is a little bit like TV Ontario or PBS doing their annual join-up and send us some money. Let's get to that in a moment.

3537 How about the regular donors? How does that work? How do you encourage regular donors to donate?

3538 MS BAIRD: As we said, we are a lifestyle format and people are very loyal, and they do put their money where their heart is. We have people that send in monthly cheques. Sometimes they send them in 12 at a time. They postdate them for an entire year.

3539 We get about $1,000 a week off the street, unsolicited donations. We also have two part-time fundraisers that do go into churches or other events and ask for donations; tell them that we need new equipment, or whatever, and ask if they can help in any way.

3540 So we have those as well as our Sharathon.

3541 COMMISSIONER LANGFORD: Before we get to the Sharathon, in a church, from my experience, they pass the basket. It is pretty clear what you are supposed to put in there, and it isn't your lunch wrappings.

3542 You make no solicitation whatsoever? Money simply arrives at the door?

3543 MS BAIRD: No, that is a different animal.

3544 The donations that I was speaking of, this $1,000 a week we get, that isn't solicited other than we do say on the air in our legal ID that we are listener supported. People hear that and say okay, I need to support them. That's what they need. They need my help.

3545 But we do go into churches and speak, promote the station. We set up our booth with a banner, something like that. Very often the pastor will pick up a love offering on our behalf. In other words, they pass the plate twice. They pass it for their church congregation, and then they pass it for us.

3546 COMMISSIONER LANGFORD: That's off station grounds, and that one is clear.

3547 The $1,000 a week comes simply because once a day you use the words "listener supported".

3548 MS BAIRD: Once an hour.

3549 COMMISSIONER LANGFORD: Once an hour; I apologize.

3550 Once an hour you give you call letters and your mission statement and indicate that you are listener supported, and that's it.

3551 MS BAIRD: Yes. We are a registered charity, and they know they get a tax receipt as well. That obviously helps them to make that decision.

3552 We don't go door to door. We don't do mail-outs. They just love us. What can I say.

3553 COMMISSIONER LANGFORD: I wonder if we could try this on Treasury Board. We are using the wrong techniques. We go on our knees and grovel for more money and never get it. Maybe we should just say we are taxpayer supported and see if anything happens. That is a new approach, very subtle.

3554 And that's it. That is the money. There are the churches, the church visitations, and the donations, regular donations just from saying you are listener supported, church offerings.

3555 That brings us to fundraising and the Sharathon. I am just looking at your breakdown here.

3556 How does the fundraising work?

3557 MS BAIRD: The fundraising is done by the fundraisers. They get connected through -- we have a couple of CDs that we can look up businesses or -- I'm not sure what they are called.

3558 Like the Trillium Group. I am not sure what that is, but they give donations to various charities, grants throughout the country. We go to them and tell them our needs. That is one way.

3559 The other way is if someone has donated to our Sharathon two years ago and they haven't donated for two years, the fundraiser may go to these people and say: We notice you haven't been giving. So we don't consider them a Sharathon donator, because they didn't give at Sharathon this year. They would go and say: Is there something we have done wrong, something that you would like us to improve, or is it just that you have had financial difficulties, or something like that? And get these people back.

3560 That would maybe be included in that $1,000 or above that.

3561 COMMISSIONER LANGFORD: That's not done on the radio. That is a one-on-one that one of your volunteers or advisory group does for you.

3562 MS BAIRD: Right.

3563 COMMISSIONER LANGFORD: That brings us to the Sharathon, then. How does that work? How will it work here, I suppose is a better way to phrase it, although I am sure you are going to draw on the Barrie experience.

3564 MR. JACKSON: Do you just want me to explain the overall concept of Sharathons?

3565 COMMISSIONER LANGFORD: Yes. How it works. How you let people know that you would appreciate their help.

3566 MR. JACKSON: Sharathon is a two-day, once a year fundraising campaign, as you have said, sort of like TVO. We try to build a lot of interesting promotional programming elements into it to avoid it sounding like a "Begathon".

3567 So we have testimonies from pastors, endorsements from pastors. All year long whenever we do an interview with an artist, we will record the artist giving an endorsement of the radio station. When our DJs go out on location, we would take a mini disc along and get endorsements from listeners.

3568 Then every March we package that up so that during the two days of Sharathon, as the announcers are on the air asking for support we can also plug in these different interesting testimonials, which make it an interesting Sharathon.

3569 The money we receive comes, as Janice said, sometimes by cheque. It could be 12 postdated cheques. It could be one per month.

3570 We also have an auto withdrawal program where it automatically comes out of their bank account, and that is the most successful. We also do Visa.

3571 The auto withdrawal is really helpful to us, because we know we can count on the money. It will always be there.

3572 There are two categories during Sharathon: the monthly category, which we have just highlighted. And then there is the one-time category.

3573 The monthly category is presenting the need of the radio station, and it pays a portion of our bills.

3574 The one-time category, if you choose to donate to the one-time, that is for a special project. If we need to buy a new computer for the newsroom, or if we want to buy bumper stickers, that would come out of our special projects one-time category.

3575 Listeners choose. They can choose monthly or they can choose the one-time, or they can choose both.

3576 COMMISSIONER LANGFORD: It's a little like putting a new roof on the church. You have a special fund for that and then you have the kind of keep the church going and keep the pastor fed normal donations.

3577 During the two days while you are having these endorsements, does the music continue as well? Or is it really an intense fundraising and mostly spoken word?

3578 MR. JACKSON: It's pretty intense: long days, few songs. The more music we play, the less the phone rings. So you have to be constantly on the air telling a story, reminding the listeners of the value of Christian radio and why it is important in their lives; taking phone calls.

3579 They call and tell us how much they love the radio station, and that encourages other people to call.

3580 We would probably play four records an hour during Sharathon.

3581 COMMISSIONER LANGFORD: If I call in, am I heard on the radio, or are some heard on the radio? Or is the call a private thing?

3582 MR. JACKSON: It could be either way. Once the listener has called and made a donation, we would say: "Would you like to go on the radio?"

3583 When our volunteers are taking a pledge, a lot of the time listeners want to tell their story. It is a radio person who answered the phone and they want to tell their story. The volunteer will say: "I have somebody interesting on line 2", and we will put them on the air.

3584 COMMISSIONER LANGFORD: Do you train your volunteers? Are they aware of the code of ethics that is in the same Public Notice 1993-78? So they know they are not to pressure people and that sort of thing?

3585 MR. JACKSON: The volunteers are not aware of 1993-78. They are simply trained to answer the phone and take pledges.

3586 We know through that policy, though, that we cannot, nor do we want to, go on the air and give them a threatening feeling like if you don't support us, we will go off the air.

3587 First of all, we know that is against the Commission's wishes. Second, it would sound horrible on the radio if they thought they were supporting something that might sink.

3588 We always put a positive spin on everything; not that a program will go off if you don't support it, but we can do more things if you do support us. And they have caught that vision.

3589 COMMISSIONER LANGFORD: And there are no divine consequences: your crop will fail if you don't give or anything like that.

3590 MR. JACKSON: Is that a question?

3591 COMMISSIONER LANGFORD: Everything is a question.

3592 MR. JACKSON: Talk to me after.

3593 COMMISSIONER LANGFORD: I would rather you told me now.

3594 There isn't anything like that. You don't hold yourself out as representing any dire consequences in any way if people are not supportive.

3595 MR. JACKSON: Of course not.

3596 COMMISSIONER LANGFORD: That's good. That is the right answer. Thank you.

3597 A few clean-up questions -- not little, but in the sense of you have had notice of this.

3598 We have asked all applicants to give us some sense of a cultural diversity plan and how they will work to meet the requirements of cultural diversity reflecting the demographics of your community that you will be in.

3599 Can you give us some idea of how you want to respond to that question?

3600 MS BAIRD: Sure. You listed four different topics: employment practices, new, music and promotion of Canadian artists. I will briefly talk about each one.

3601 In terms of employment, our policy is simple: the best person gets the job. In the past we have hired an African-Canadian, and we have had a part-time Aboriginal employee, and Aboriginal volunteer, and four of our eleven fulltime staff are women currently. Two of those women are in management, and three of our women are on the air.

3602 In news we cover all major stories, regardless of culture or race.

3603 Women is one of the minority groups identified, and 50 per cent of our music features women bands or singers.

3604 Finally, we are eager to find Canadian music that fits the sound of our station. We have received minimal recordings from minority groups: the Vaqua(ph) Cat, Marlene O'Neill, Miranda Stone and Cheryl Stacey are the most prominent performers from the female minority group. We have hired four of those five artists for performances and regularly play their music.

3605 Out of Eden and Michael Taite are probably the best known black artists that we play.

3606 COMMISSIONER LANGFORD: Before we give you a chance to hit a final home run with why you are the best, you do mention in your application, or perhaps it is in the supplementary brief -- I think it might be in the supplementary -- that there is a second choice of frequency.

3607 I don't think you mentioned what that second choice is and why it is your second choice. Perhaps you could tell me, if you do know it now, or is it just a general statement that you would take something else?

3608 I am unclear on it.

3609 MR. JACKSON: Thank you for asking. We asked our engineering consultant to come in from Montreal, anticipating that you might ask that question. So I am going to ask Pierre if he would advise you.

3610 COMMISSIONER LANGFORD: Good to know you bought that train ticket for a reason.

3611 MR. LABARRE: I drove the whole way.

3612 COMMISSIONER LANGFORD: So did I. A horrible road, isn't it.

3613 MR. LABARRE: Channel 229 is our second choice. That is 93.7, I believe.

3614 I can elaborate on it, if you want.

3615 COMMISSIONER LANGFORD: I would be more interested in why it is your second choice. As an engineer, I guess you are the man to tell us.

3616 MR. LABARRE: I don't know. It may be because I fell in love with 99.5 at first because the amount of interference that we are getting from the Buffalo station on 99.5 is expected to be less than the overall interference we would be getting on 229, on 93.7.

3617 They both have the same capability. I could elaborate on the capability.

3618 When I was in the hospital in February, writing this brief --

3619 COMMISSIONER LANGFORD: You weren't on any strange stimulants at the time, were you?

3620 MR. LABARRE: Unfortunately. I was faced with the then Industry Canada rules. So a second adjacent protection was more stringent than it is today, since June.

3621 On 99.5 we maximized the power toward Kitchener-Waterloo from our proposed site, and it is limited in that direction by CKFM -- or it was, I should say, limited by CKFM. Now we could go to four times that amount of power.

3622 Ironically, the CKFM limitation was the most stringent of all the limitations. In fact, we could maintain the same pattern and enhance the coverage such that the power could be four-fold that of that presented.

3623 My client is willing to go along with that, if the Commission were to issue a licence hoping to optimize the use of the frequency.

1700

3624 COMMISSIONER LANGFORD: We are speaking of 99.5 now.

3625 MR. LABARRE: Okay. Ironically, the same thing happens with the other one.

3626 In that case it is also toward Toronto, but it is toward CBL. But the same situation applies. It can go up four-fold, as well. It could be operated at the same power as 99.5.

3627 COMMISSIONER LANGFORD: Are they both acceptable? Is that what you are saying?

3628 MR. LABARRE: Yes.

3629 COMMISSIONER LANGFORD: Thank you for that.

3630 Let's deal in the final question -- and this is your chance to hit your last home run. You are not alone. There are many suitors lined up. I guess 99.5 is the modern equivalent of Penelope at her loom, and Odysseus is still out there with Calypso wiling away the hours, and the suitors are lined up. And you are one of them.

3631 Before he gets home with the bow and arrow and puts the coyatis(ph) to all of you -- and this is really going to send you high school students back to those English books that you only read the Coles Notes on -- tell me why you should be the one that Penelope chooses.

3632 Why should you have 99.5 rather than the other applicants?

3633 MR. JACKSON: Our company has an excellent track record in Barrie. We are not in debt. We have over-achieved our own goals every year for three years.

3634 We have a petition of 1,635 names and over 250 intervention letters of positive support.

3635 Advertisers such as Christian concert promoters, youth groups, church ministries, Christian book stores and bible colleges do not advertise on secular radio. It is not their audience, and the rates are unaffordable. Our advertising clients will be new radio advertisers.

3636 The closest Christian radio station is spillover from WDCX in Buffalo. They are primarily a talk station. They are not youth oriented. They are not music driven. And they share no interest in Kitchener-Waterloo or Canadian content.

3637 The adverse tuning by listeners to other stations will be minimal. Without local Christian radio, Christian music fans are listening to CDs and tapes. In this case, when listeners discover Christian radio, they will be increasing the total hours of radio tuning in the market.

3638 If 99.5 is awarded to us, former WDCS listeners will appreciate that that frequency is still providing Christian music.

3639 We are passionate about our format, and we have put our money where our hearts are by giving away thousands of dollars as donations to every fulltime Christian radio station in the country.

3640 We coach, train and motivate other Christian stations in Canada by going on location, at our own expense, to help them.

3641 The use of the 99.5 signal will be best used with a full power Christian format. Our engineering study by Pierre Labarre shows that our signal will cover KW from the CBC tower, and the new Industry Canada rules will allow us to make even better use of both 99.5 and the alternate frequency 93.7.

3642 Finally, there is no Christian radio in KW. There is none. There are many forms of Top 40 and AC and Rhythmic, and many of them share the same artists. We would be pleased to share the airwaves with one of the CHR applicants and one of the Country applicants.

3643 However, the market doesn't have a full variety of music formats until it has Christian radio.

3644 Thank you, Commission.

3645 COMMISSIONER LANGFORD: Those are my questions. Thank you.

3646 THE CHAIRPERSON: Thank you, Commissioner Langford.

3647 Commissioner Cram has a question.

3648 COMMISSIONER CRAM: I have a few.

3649 I want to start off, Mr. Davy, with your discussion about unsensational coverage of the news.

3650 If the unsensational terminology for what is happening in Iraq right now is a war, what is the sensational terminology?

3651 MR. DAVY: I think it all has to do with the way the story is presented.

3652 COMMISSIONER CRAM: There is not a war.

3653 MR. DAVY: I'm sorry?

3654 COMMISSIONER CRAM: There is not a war in Iraq.

3655 MR. DAVY: Correct.

3656 COMMISSIONER CRAM: I would have said using a war as a terminology of current affairs right now in Iraq is sensational in and of itself.

3657 MR. DAVY: To describe it as a war that is happening right now?

3658 COMMISSIONER CRAM: Yes; to describe the situation as a war.

3659 MR. DAVY: Okay. Perhaps that was not an accurate way of describing the current situation over there.

3660 COMMISSIONER CRAM: Yes.

3661 MR. DAVY: It was simply an example.

3662 COMMISSIONER CRAM: I just wanted to bring that up, because that sort of rankled me the second I saw it. I thought do you really mean it when you say you speak in an unspectacular way about issues. To me, that would be very jangling if I heard there was a war in Iraq.

3663 MR. DAVY: Right. We would certainly present the story as the situation is unfolding. Perhaps political tension would have been a more accurate way to word that.

3664 COMMISSIONER CRAM: Yes. This Good News and Music Notes, would it be common programming with Barrie, or would it be original to KW?

3665 MR. DAVY: I'm not really sure if we have made a decision on that yet.

3666 The local news person in Kitchener would do The Good News Patrol, certainly.

3667 Music Notes, I don't know if we have reached a decision whether or not that would be the same one that would run in Barrie. I would imagine it would be done locally by a Kitchener person.

3668 COMMISSIONER CRAM: The biggest issue I found in this whole application was how you defined Christian music.

3669 It seems to me what I heard, Mr. Jackson, is that it is Christian if the labels and the lists from the States say it is Christian.

3670 Is that what I am hearing from you?

3671 MR. JACKSON: The Christian labels have a statement of faith. So when they are signing artists, the artists are agreeing to the artist statement of faith. That's how they are signed.

3672 COMMISSIONER CRAM: So there is no definition in Canada. It is based on the labels themselves and how they define themselves, and then you define yourself based on how they define themselves.

3673 MR. JACKSON: Yes, pretty much. They have developed a system down there. We are still in our infancy, so we don't have a system in place.

3674 When it comes to Canadian content we read the liner notes and that kind of gives us a statement of faith of the artist. They tell us where their thoughts are, where they are spiritually.

3675 We can also assume by the lyrics whether or not it is a Christian song.

3676 COMMISSIONER CRAM: Then at the end of the day you define if it is Christian?

3677 MR. JACKSON: I think pretty much the artists do. They submit their music to us, because they know that our format is Christian music.

3678 COMMISSIONER CRAM: All right.

3679 I heard you when you were talking about in excess of CTD contributions, and it sounded to me like you were assisting other broadcasters.

3680 Yet at the same time you are saying to us that Christian musicians are poorly done by in Canada because there is no recognition.

3681 Why wouldn't you be putting more money into assisting musicians? If you are making more money, why wouldn't you be supporting your genre?

3682 MR. JACKSON: There are many different ways that we can assist. We are assisting Christian musicians, and we have given some examples there.

3683 COMMISSIONER CRAM: Hotel rooms. I heard that, yes.

3684 MR. JACKSON: For example, by doing additional concerts that are beyond the CTD.

3685 We send our money to other Christian radio stations to help them get going, and that also helps the Christian music industry, because they have more tools, or more resources or more expertise.

3686 We also send some of our money very quietly -- we don't broadcast and tell people where we send the money to. But I will give you one example. Hopefully, this will be a good example.

3687 There was a situation where somebody didn't have a winter jacket, and that news got back to us. So we bought them a winter coat. We do things like that all the time, but we don't look for recognition because that's our policy.

3688 We take the extra money that we have, and we are trying to bless various groups of people, whether they be musicians or Christian radio stations or just people who have been burned out of their home and they have no place to stay.

3689 MS BAIRD: If I could add to that, in general I think the public tends to give themselves to one or two charities. I can think of an example off the top of my head.

3690 Let's say they give to the SPCA and maybe their local hospital, and that's what they do year in, year out. We tend to give where there is a need.

3691 We definitely give to Canadian talent, partly because we have to and partly because we want to see the growth of that. But we give to other things, because we want to be where the community is at.

3692 COMMISSIONER CRAM: Thank you.

3693 THE CHAIRPERSON: Thank you, Commissioner Cram.

3694 In the spirit of Commissioner Cram's question, subcategory 35 does contain contemporary Christian music. The spirit of the question obviously was to get some definition of how you choose it, how you define it, what we are hearing.

3695 Counsel, do you have a question?

3696 MR. WILSON: Yes, I have one question, Madam Chair.

3697 In your discussion with Commissioner Langford, I believe he drew your attention to the Guidelines on Ethics for Religious Programming that are set out in Section 4 of Public Notice 1993-78 regarding tolerance, integrity, social responsibility and solicitation of funds.

3698 Do you have any comment on the possibility of the Commission imposing a condition of licence to adhere to those guidelines?

3699 MR. JACKSON: No. That would be fine.

3700 MR. WILSON: That was my question, Madam Chair.

3701 THE CHAIRPERSON: Thank you very much, counsel.

3702 Thank you very much for your presentation and response to our questions.

3703 That concludes our business for today, Mr. Secretary?

3704 MR. LEBEL: It does, Madam Chair.

3705 THE CHAIRPERSON: We will adjourn and we will be back here at 8:30 tomorrow morning to hear the presentation by Edward F. Bauman & Rae Roe.

3706 Thank you.

3707 COMMISSIONER LANGFORD: The passion continues.

3708 COMMISSIONER CRAM: Yes.

3709 THE CHAIRPERSON: Thank you very much.

--- Whereupon the hearing adjourned at 1710, to resume

on Wednesday, October 30, 2002 at 0830 / L'audience

est ajournée à 1710, pour reprendre le mercredi

30 octobre 2002 à 0830

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