ARCHIVED -  Transcript - Gatineau (Québec) - 2004-12-02

VARIOUS BROADCAST APPLICATIONS /

PLUSIEURS DEMANDES EN RADIODIFFUSION

HELD AT: TENUE À:

Best Western Cartier Best Western Cartier

Champlain A & B Room Pièce Champlain A et B

131 Laurier Avenue 131, rue Laurier

Gatineau, Quebec Gatineau (Québec)

December 2, 2004 Le 2 decembre 2004

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.

BEFORE / DEVANT:

Andrée Wylie Chairperson / Présidente

Andrée Noël Commissioner / Conseillère

Ronald Williams Commissioner / Conseillier

Joan Pennefather Commissioner / Conseillère

Stuart Langford Commissioner / Conseillier

ALSO PRESENT / AUSSI PRÉSENTS:

Pierre Lebel Secretary / Secrétaire

James Wilson Legal Counsel /

Valérie Dionne Conseillers juridiques

Steve Parker Hearing Manager /

Gérant de l'audience

HELD AT: TENUE À:

Conference Centre Centre de conférences

Outaouais Room Salle Outaouais

Portage IV Portage IV

140 Promenade du Portage 140, promenade du Portage

Gatineau, Quebec Gatineau (Québec)

December 2, 2004 Le 2 decembre 2004

PAGE / PARA

PHASE I

PRESENTATION BY / PRÉSENTATION PAR:

Astral Media Radio Inc. 224 / 1219

Global Communications Limited 303 / 1647

John Wright & Douglas Kirk (OBCI) 368 / 2146

CKMW Radio Ltd. (OBCI) 466 / 2661

Gatineau, Quebec / Gatineau (Québec)

--- Upon resuming on Thursday, December 2, 2004

at 0900 / L'audience reprend le jeudi

2 décembre 2004 à 0900

1210 LA PRÉSIDENTE : Bonjour à tous. Good morning and welcome to our hearing, and welcome back those who were here already. Nous vous souhaitons la bienvenue à notre audience ceux qui sont ici pour la première fois.

1211 Monsieur le Secrétaire, s'il vous plaît.

1212 Avant de débuter, je vous rappelle qu'il faut que vous fermiez tous les téléphones et les télé-avertisseurs quand vous êtes dans la salle d'audience parce que ça dérange et le panel et les conseillers.

1213 Monsieur le Secrétaire.

1214 THE SECRETARY: Thank you, Madam Chair.

1215 For the record, I would like to re-state that item number 5 on the agenda, the application by Radio Rideau Inc., the applicant has elected not to appear at the hearing, so that application will be considered as a non-appearing item by the Commission as it was filed by the applicant.

1216 So we will now hear item 6 on the agenda, which is an application by Astral Media Radio inc. for a licence to operate an English-language FM commercial radio programming undertaking in Ottawa. The new station would operate on frequency 98.5 MHz on channel 253B1 with an average effective radiated power of 5,713 watts.

1217 The applicant proposes to offer a music format called "Comfort Radio" that will predominantly feature a blending of soft AC and ballad-style musical selections along with a limited World Beat music component.

1218 M. Jacques Parisien will be introducing the panel. You have 20 minutes to make your presentation.

PRESNTATION / PRÉSENTATION

1219 M. PARISIEN: Good morning, Madam Chair, members of the Commission and the Commission staff.

1220 My name is Jacques Parisien. I am President of Astral Media Radio.

1221 Commissioners, we are pleased to appear before you today to present our proposal for a brand new radio concept to serve women aged 35-64 in Ottawa.

1222 Before we begin our presentation, I would like to introduce our panel.

1223 Starting in the front row is Charles Benoît, Vice-President, Programming at Astral Media Radio.

1224 Next to him is Mitsou Gélinas. A well-known Canadian artist and music producer, Mitsou has been a very popular Astral on-air personality for the past four years. She is also the editor of Quebec's number one women's magazine, "Clin d'oeil," and a new mother. Her extensive knowledge of women programming interests has helped us shape an innovative combination of music and spoken word content for our proposed radio station.

1225 Beside Mitsou, in the middle, is Luc Sabbatini, Executive Vice-President, Astral Media Radio. Luc is responsible for all our Quebec radio operations and will be in charge of Eve-FM in Ottawa should we be granted a licence.

1226 Next to him is Geneviève Moreau, Music Director at Astral Media Radio.

1227 At the end of the first row is Claude Laflamme, our Vice-President, Legal and Regulatory Affairs.

1228 Directly behind Claude, we are pleased to have Sheila Gervais, a community advocate who will chair our Local Advisory Board here in Ottawa.

1229 On my left is Anne McNamara, our Vice-President, Human Resources, and next to her is Jacques Dorion, President of Cara, a media-buying agency and research firm that developed our market analysis.

1230 I would also like to note the presence in the audience of Carmen Rodrigue, the General Manager of our two Gatineau stations, CIMF Rock Détente and Énergie 104.1.

1231 Commissioners, we have a substantial team with us today. They represent the expertise and resources that we bring to our plan for Ottawa from our Quebec operations.

1232 Astral Media Radio is a regional broadcaster. In Quebec, we own and operate Rock Détente, Énergie and Boom FM networks.

1233 Rock Détente, the number one network with Quebec women, is built on an in-depth understanding of female listening preferences.

1234 Énergie is number one with younger men.

1235 Boom, a new network targeting the baby boomer, was launched only 18 months ago and is already winning great ratings.

1236 We also have successful English-language stations in Nova Scotia and New Brunswick. All of our stations are known for being integral and relevant voices of the communities they serve.

1237 Astral Media Radio's mission is to take a fresh and vibrant approach to radio and we do that in two ways with this application.

1238 First, we have developed an original concept, "Comfort Radio," which is a fusion of music and lifestyle-oriented content designed exclusively for women. Eve FM draws on our passion for radio and our track record of innovation. It reflects our commitment to community involvement and our knowledge of female audiences.

1239 Second, Ottawa is an important step for Astral to become a truly national radio player and to bring diversity to the marketplace. We have the financial resources to expand successfully and the experience and imagination to provide a relevant, top-quality service to the English-speaking women in Ottawa.

1240 MR. BENOÎT: We are very excited about the very special concept that we have designed. Eve FM is lifestyle radio, not just another music format. It is a relaxing interlude for the busy women of Ottawa who are juggling demanding careers with their family and personal lives.

1241 We start by playing their favourite soft music and we enhance this ambience with programming based on wellness, home and community and leading a richer, simpler life. These are all dominant trends in women's leisure and information choices today.

1242 As Jacques said, the result is a unique fusion of music and content. It is created exclusively for women and it will sound completely different from anything else you can hear in Ottawa today.

1243 We developed this new approach by asking what do listeners really need in Ottawa. It is an educated, sophisticated market which is well served by all the popular mainstream radio formats and a number of specialty formats for men like Sports Radio and Classic Rock, but since listening hours for adults are still below the national and provincial average, we believe there is an opportunity for a specialty offering aimed at women.

1244 In developing this application, we considered many different formats and discarded those already being offered in whole or in part.

1245 Then we asked Synovate Research to test music styles not currently available in the market with eye appeal to women aged 35+. Soft adult music was the overwhelming favourite. About 75 per cent of female respondents like soft adult music and 65 per cent reported they would likely switch to listen.

1246 This music is a great fit with programming about slowing down and enjoying what is important in life. The demo you are about to hear will give you a sense of what Eve FM is all about.

--- Audio presentation / Présentation audio

1247 MS GÉLINAS: Eve FM will be the radio equivalent of magazines like "Real Simple," "Chatelaine," and "Oprah" and of specialty TV channels like HGTV, W and Canal Vie that have built their success with a lifestyle orientation. It is now time for radio to catch up and to go beyond Bye-bye Bob, Mojo and Jack.

1248 Let me tell you all about Eve.

1249 Eve FM will entertain and inform the music lover, career woman, romantic, household manager, mom, sister, friend and community partner in Ottawa's women ages 35-64. Our station will be calm but engaging, practical and supportive.

1250 We will have five regular features that are women into our morning, afternoon and weekend shows. They will reflect women's interests in key lifestyle trends: leading a healthier and less stressful life, focusing on home and family and on getting back to basics or what is important in life.

1251 Our womanhood feature topics will range from health and self-actualization to fashion and beauty from the perspective of the intelligent consumer seeking quality and simplicity.

1252 Family life will look at relationships and money management. This month, we might talk about what to get a teenager for Christmas, gifts for staying on budget with holiday shopping or how some families deal with Santa Claus in a non-Christian household.

1253 "Home Sweet Home" will explore interests from gardening and food advice to home fashion and book reviews.

1254 "Keep It Simple" will talk with experts about time-management and work-life balance.

1255 "Community Life" will be more than a community calendar, it will discover the good things that the area has to offer women and their families and how to get involved. We will interview local role models about their approach to life. We will learn from each other and bring women together.

1256 We also know the importance of trusted and relevant news to our audience and our commitment is to keep women informed and in the loop. We will be there every day, mornings, afternoons and weekends with top-quality, relevant and concise reporting.

1257 For those who love using the Internet to connect with each other, our Web site will be a virtual community, a meeting place for sharing experiences, good ideas and problem-solving. We will provide links to community services and groups, to chat rooms and to relevant Internet sites.

1258 We will have a job board, book, wine and movie reviews by experts and by our listeners, home and travel information, and follow-ups on our feature topics. Our Web site will nurture, support and enhance the Ottawa community as we listen and expand the possibilities.

1259 MS MOREAU: Our distinctive blend of calm, soft and light music will be unlike anything you hear on the radio in Ottawa-Gatineau. We will feature Canadian artists like Sarah McLachlan, Gordon Lightfoot, Gino Vannelli and Jan Arden, along with international artists like Norah Jones, the Bee Gees, Barbra Streisand, Phil Collins and Billy Joel.

1260 According to our research, the music we propose is 50 per cent more popular than Cool Jazz with the women of Ottawa. Most of this music is songs played by no other station in the city.

1261 We are also promising to broadcast 40 per cent Canadian content and 25 per cent of this will be new Canadian releases. That is one in every four Canadian selections we will play. It will include mellow new artists such as Jacksoul, Sarah Harmer, Shea and Audrey, favourite artists with new releases and re-releases of old favourites like K.D. Lang's new album.

1262 We are confident there is enough great new Canadian music in our proposed format to meet this commitment.

1263 We will have "World Beat" music on the weekend. Again, we will pick selections that match the mood of Eve FM, introducing our audience to new international music and Canadian artists like Taima.

1264 MS McNAMARA: Eve FM will reflect Ottawa's cultural diversity in its workforce and on air. We will implement Astral's successful employment and equity programs. We will take steps to bring a more diverse workforce to radio with annual scholarships for women, internships and a new training program for our managers on hiring.

1265 Our Local Advisory Board, chaired by Sheila Gervais, will help us to reflect Ottawa's diversity on air.

1266 Mrs. Gervais is well known for her work in the community. As a woman of east Asian descent, she brings to the table firsthand knowledge of diversity issues in addition to her record of participation in local issues. She has served on the Board of the CHEO Foundation and is currently in her second term as the Treasurer of Ottawa's United Way Campaign.

1267 MS GERVAIS: I am delighted to have been asked to chair Astral's Local Advisory Committee for Eve FM and I am delighted to be here in this capacity.

1268 As only one of many women who are active in the Ottawa community, I am excited about the prospect Eve FM offers to Ottawa's women's community as a new way for us to connect with each other, perhaps a new kind of meeting place.

1269 I do believe that women are gifted at finding common ground, at identifying ties that bind rather than differences that divide. Women working together can be a positive and powerful force in raising awareness of cultural and community issues and values.

1270 Many of us are at a stage in our life where we want to give back to our community and to help to make it a better place. I see the Advisory Board not only as a catalyst that will help Eve FM champion events, causes and issues that are important to local women but as part of an investment in a stronger and more caring community.

1271 I see the Advisory Board also as an important tool for providing feedback and suggestions, for reflecting the city's cultural diversity, in addition to advising on local events and talent-development funding. I hope that we can also provide a link to other community-based organizations with which we might share some common goals and objectives.

1272 The commitment Astral has shown to inclusiveness and celebrating diversity is backed by their actions in proposing this Board. I am proud to be a part of their team in Ottawa.

1273 MS MOREAU: Thank you, Sheila.

1274 Our Canadian Talent Development Program also has a strong Ottawa community focus with $700,000 in initiatives over seven years. We will contribute to talent development in the following ways.

1275 First, we will send $525,000 in cash to local music festivals and music initiatives. Our major focus will be sponsoring light music at local events. Winterlude, the Tulip Festival, Bluesfest, the Women's Voices Festival and other great events are all eligible for funding to hire Canadian musical artists.

1276 We will give FACTOR $105,000 over the seven-year licence term. Through our contribution, many talented Canadians will get a major boost for their music careers with support for recording and marketing.

1277 Third, we have designed scholarships worth $70,000 over the licence term at the Carleton University School of Journalism and the Algonquin College Radio Program to assist young women entering their second year.

1278 In addition to these qualifying CTD initiatives, we are committing $35,000 for local leadership workshops through Canadian Women in Communications and its National Capital Chapter. These workshops will offer valuable training for local women in media and can be webcast to all CWC members.

1279 Finally, we will contribute $35,000 for annual radio sessions at the Innoversity Creative Summits. Our goal is to provide a platform for sharing radio diversity success stories and for veteran broadcasters to advise the new generation of multicultural entrepreneurs and talent.

1280 MR. LAFLAMME: Astral has the commitment, the experience and the financial strength to deliver what we promise over the long term. There are many reasons why we believe Eve FM is the right service and we are the right applicant to deliver key benefits to Ottawa and to the broadcasting system.

1281 First, we will add to the diversity of radio offerings in Ottawa with a distinct new radio choice. We have created an innovative and integrated concept that combines lifestyle programming and soft adult music to meet the needs of an under-served audience, women ages 35-64.

1282 MR. SABBATINI: Second, we will be committed to reflecting the Ottawa community with 100 per cent local programming, relevant local information and an Advisory Board that will be an engine for community involvement and will reflect the area's cultural diversity.

1283 Third, we will significantly promote Canadian talents. We have promised 40 per cent Canadian content, 25 per cent of which will be new Canadian releases -- that is one out of every four Canadian songs we will play -- and we offer a comprehensive Canadian Talent Development package combined with two leadership programs designed to help women and visible minority reflection.

1284 Fourth, we have a realistic business plan that will allow us to contribute to greater competitive balance in Ottawa without causing undue harm to incumbent broadcasters.

1285 Finally, licensing Eve FM will contribute to greater competitive balance and diversity of news voices in the Ottawa English-language market.

1286 Members of the Commission, we believe that this proposal fulfils the needs of English-speaking women in Ottawa and that our application fully meets your licensing criteria and contributes to the objectives of the Broadcasting Act.

1287 Madam Chair, members of the Commission, we thank you for your time and attention. We are prepared to answer any questions you might have regarding our application.

1288 THE CHAIRPERSON: This morning, it is a bit of a first, we have more women on your panel than men. On the other hand, I hope you will convince us that your application is not Quebec women's view that Ontario women can't stand excitement but rather that they need calm.

1289 Commissioner Pennefather.

1290 COMMISSIONER PENNEFATHER: Thank you, Madam Chairman.

1291 Good morning, ladies and gentlemen. It is a little different to speak to you in English, and indeed, to carry on with what Madam Chair just said, thank you for starting the morning out with a bit of a relaxing mood setting.

1292 I hope that my questions won't change the mood too much but I do want to clarify some points throughout your application. In fact, your remarks this morning covered a number of the areas, so you will find that they will be touching back on your presentation at many points.

1293 The first area of questioning is the programming concept, which, as I understand it, is a mix of softer music, soft-her music, and lifestyle-oriented spoken word, and I take that from page 10 of your supplementary brief.

1294 But before I get to those two components to look at the music and then look at the lifestyle programming, the concept itself, the overall approach -- and you mention it again this morning in your presentation and you call it a specialty offering aimed at women -- on page 11 of your supplementary brief, you say: "theme-day parts that resemble specialty television more than the radio stations women in Ottawa-Gatineau are used to."

1295 Could you elaborate for us on what this specialty television theme-day parts means? How does that work? Now, there is a chart on the same page that gives us a sense of those themes and with hours. What does it really mean? In other words, what am I going to hear on the radio with that?

1296 MR. SABBATINI: Well, I will Charles Benoît, in a few minutes, give you more details on that.

1297 What we mean by our specialty offer is not only we will have the music that women want to hear, and more of that will be from nine to five, but we will have more concentration of content in the morning drive and the afternoon drive, 16 minutes of content in those two periods, and that is where you will find most of the topics of the women 35-64 in Ottawa, in Ontario, what they are looking for.

1298 Charles is going to give you a little bit more detail on that.

1299 MR. BENOÎT: Well, in fact, when we talked about the concept, we looked at what was very popular for a few years in Canada with all those formats with Dave, Bob, Jack and Mojo, and we said, well, how can we propose something unique aimed 100 per cent to women?

1300 And when we looked at our lifestyle content, we looked through our research that we did with Synovate and our extensive internal research and we developed the three strategic thrusts, which are home and family, wellness, simpler and richer life, and then we said, what kind of radio do we want to be.

1301 Then we said, Eve FM should be considered as women's best friend, a kind of oasis for them to feel good and relaxed and trying to keep them well-informed, play their familiar music and kind of creating a comforting mood.

1302 Maybe to give you the real spirit of Eve, I will ask Mitsu because Mitsu was a great help for us to develop this with her experience in women's magazines.

1303 MS GÉLINAS: Eve FM would like to be a tool to successfully live your life but mainly your day, and already that would be very helpful. It is all about soul, women's evolution and quality of life especially.

1304 Eve would like to offer fresh and light and helpful topics designed for women who are going back to basics, who refuse to be sold anything at any price and want to be elevated from the day-to-day blah-blah offered on radio and TV elsewhere.

1305 Eve's ladies would like to be entertained intelligently. So how will we do that?

1306 Well, on the weekdays, we will concentrate on news, local, international, weather and entertainment in our mornings and drive shows.

1307 Busy women want to be kept up-to-date and need news that is relevant to them. Interviews will seek out local women to comment on the top stories and our drive time will also feature morning briefs in "Home Sweet Home." We will put in the drive time the emphasis on the physical Eve in the morning. So it will be more about her body in the morning and more about her soul in the drive time.

1308 So morning, apart from the news, of course, will have a morning stretch for women who would like to meditate for a few minutes.

1309 Eve is healthy, also. We all know that women care about health, their own and that of others. So we will concentrate on health in the morning. On fashion; as well, on beauty.

1310 At night, we will talk about relationships. Ecology, as well, will be very, very important for Eve FM and her soul.

1311 COMMISSIONER PENNEFATHER: Okay. We are going to go back through all of this and try to be a little more specific, if I may.

1312 For example, what I have here in the supplementary brief on page 11 is from 3:00 p.m. to 7:00 p.m., Home Sweet Home as a theme, which means what in terms of the music and the spoken word? I will get back to the specific numbers. What I am just talking about now is the concept of from 3:00 to 7:00 it is Home Sweet Home. Is it what Mme. Gelinas was describing as the kind of feature programming that you will hear within that time frame?

1313 MR. BENOIT: Exactly. During that period we will be playing about seven songs. We will have about 16 minutes of spoken words. We will offer roughly about eight minutes per hour of services, which is news, traffic, weather, roughly. Within those 16 minutes of content we will be talking about those features, what she described.

1314 COMMISSIONER PENNEFATHER: Okay. Well, we will come back and describe the features more specifically.

1315 Let's go to the music specifically now. This morning you said that it will sound completely different from anything else you can hear in Ottawa. Frankly, I find that hard to understand because I certainly hear a lot of that music in Ottawa.

1316 That being said, let's ask the question this way. You are seeking to serve the same demographic group that would seem to fall under the music range description of some of the other applicants here. For example, I believe we are talking to Global about new easy listening; to Wright and Kirk about the famous "Triple S" format, which includes smooth jazz, AC, standards, and CKMW has music which would cover crooners, standards, ballads, love songs, contemporary hits. I assume as a competitor in this process you have reviewed these applications.

1317 Can you explain more specifically how your proposed format on the music side differs from these, all three of these, if they differ at all, and can you give us specific music examples to demonstrate that difference?

1318 MR. BENOIT: I think the expert will be Geneviève and I will let Geneviève explain to you the way we will differentiate ourselves.

1319 MS MOREAU: First of all, one of the things about Eve FM, the music and the spoken word content are a fusion. They are blended together. So that is one thing that is very important. We will be playing soft, relaxing music, but we also create a relaxing mood that blends with the spoken word concept. That is also the features in the topics. For the Canadian content it is 40 per cent and we are going to play -- one out of every four Canadian songs that we will play will be a new release. So that is very important for us to feature new Canadian artists and new releases also.

1320 We will be playing artists that don't get a lot of airplay in the Ottawa market, such as Gordon Lightfoot, Joni Mitchell, Anne Murray, Leonard Cohen, Barry Manilow, Barbra Streisand. All these artists don't get a lot of airplay.

1321 Also, we will say that more than half of the music of Eve FM will be exclusive to the market. We might share some of the same catalogues, but Eve will only be soft music, compared to maybe some more up tempo music that some other stations will be playing. Eve is only soft music.

1322 Also, the catalogue, like I said, we might share some of the same artists but we will be playing totally different songs from them.

1323 MR. SABBATINI: I would like to add that we have no jazz music, no instrumental music compared to some of the other applicants.

1324 COMMISSIONER PENNEFATHER: Your demonstration had your video had Buena Vista Social Club. I guess you are referring to the world beat music?

1325 MR. SABBATINI: Yes, exactly.

1326 COMMISSIONER PENNEFATHER: When you say "no" you are talking about the non-world beat music in Category 2.

1327 Here is another example to discuss this. Your format proposal, you are saying, will be viable in this market at this time, but the easy listening format was offered for years on CFMO in this market but abandoned in early 2000 in favour of alternative modern rock.

1328 Why do you maintain that this format will work in this market, because albeit you are trying to differentiate it, it is generally an easy listening, soft music format you are proposing. Why do you think it will work in this market?

1329 MR. SABBATINI: Well, I think we are very different from what CFMO used to offer. First, once again, there won't be any instrumental music. We won't be playing the same kind of artists; won't be playing Tony Bennett or Nana Mouskouri or Roger Whitaker.

1330 And once again, I think our fusion of spoken word aiming 100 per cent at women will make the difference.

1331 COMMISSIONER PENNEFATHER: Again ---

1332 MR. BENOIT: Mme. Pennefather, if I remember correctly, I guess CFMO had up to 80 per cent of their content instrumental music, which is a big, big difference from what we are offering here.

1333 COMMISSIONER PENNEFATHER: Magic 100, another comparison here. You have stated -- and we will get back to this later in terms of questions on impact -- that your station would affect largely, and perhaps at the top of the list Magic 100, because Magic 100 is the top station for women listeners in this market at this time.

1334 What would differentiate your proposed format from the one currently offered by Magic 100, CJMJ FM?

1335 MR. BENOIT: I think two things, and I will let Geneviève talk to you about there will be a big difference in terms of music, but also in terms of delivery.

1336 Magic is doing a great job but still the delivery on there is appealing -- yes, it is appealing to women. It is also appealing to men. The delivery is not as soft as we want Eve to sound like.

1337 In terms of music, if you look at their Top 20, I will let Geneviève explain you the difference.

1338 MS MOREAU: Well, we took a look at BDS for Majic for the beginning of November and we took a look at what Eve FM will be playing, the Top 20 songs they will be playing, and between the two stations we only share three songs that are identical. So that is a major difference when you are looking at the Top 20 BBF. We are talking about spins here.

1339 COMMISSIONER PENNEFATHER: Give me the examples, specifically.

1340 MS MOREAU: The examples are -- the three songs we would share would be Awake in A Dream, Calen Porter; Love Divine, Seal, and Answer in the Sky by Elton John. So that is only three songs compared to -- and those are every rotation.

1341 So Eve's catalogue will have sixties and seventies music and we are sharing that -- if you look at Eve, 38 per cent of Eve music will be sixties and seventies compared to 15 per cent for Magic, and 30 per cent of Eve's music is based on the last four years, compared to 55 per cent for Magic. So you can see the catalogue is totally different.

1342 One other difference that we have is that, like I said before, we feature some artists, Canadian and international artists that are not getting a lot of airplay, if you look at Gordon Lightfoot; Anne Murray. Anne Murray just came out with an album a couple of weeks ago and she is in the Top 100 of the sales in Canada and also in Ottawa. So if you look also at the sales in the market we see that there is a strong demand for the format and the music that Eve is offering.

1343 COMMISSIONER PENNEFATHER: I was just about to ask you that question regarding similar approaches in Canada and the United States.

1344 Again, in this market, it would appear from the BBMs that women -- the age group that you are focussing on; women, ages of 35 to 64; finally, a group in which I am involved -- again, this is a demographic that seems quite well served in this market.

1345 Can you explain again why comfort radio or, if you prefer, Eve FM, with its blend of soft AC and ballad style music and, as you say, less instrumental and with some world beat music, will offer a greater diversity for women in the market, since they seem to be well served already?

1346 MR. SABBATINI: Well, I will let Jacques Dorion tell you a little bit more about the extensive research we have done in the market, but when we looked first at the market we did a mapping of the market and we looked at where are the needs in the market. We definitely think there is a need in the women's area. There are stations like Magic who are getting a lot of women by default because there is no other offering in the market.

1347 I will let Jacques Dorion tell you a little bit more about it.

1348 MR. DORION: Good morning, Mme. Commissioner.

1349 If you look back at just about a year, we found that women 35 to 54 mostly tend to listen to a little bit less of radio in English Ottawa. It is true that Magic appeals for that age group, but like Luc said, it is probably by default. If you look at their spins on radio, they play one or two spins a week of music that Eve FM plans to play. So because they are the only player appealing to what I would say, a little more mature women group, they get the 35 to 54 by default. I think Eve FM goes beyond that, will target for a lady 45 years old.

1350 If you look at the mapping which has changed a bit with two changes in the formats since Astral has this application -- since the application was sent. The AC is younger than it used to be, CISS and Majic is still -- will still be younger than Eve FM. There is a demographic trend over time in the next three to five years. There will be more people in that age demo also. So looking into the future, this demo will be more important and advertisers will be seeking it more.

1351 COMMISSIONER PENNEFATHER: Yes, I looked at your study, and I see those shifts, but we are really trying to focus on a demographic and it is changing as such and somewhat -- if I have misunderstood you, I apologize -- somewhat the same play list but with different selections at different times and different packaging which would, in your view, change the attraction to women of that certain age group, if I understand.

1352 On the music, just before we leave that, I understand from your application, and reconfirmed in the deficiency letter of June the 30^th, that you commit to broadcasting 40 per cent Canadian content. Correct?

1353 I did not see in the application or in the deficiency response your commitment to 25 per cent new Canadian releases. Does this represent a new -- a proposal?

1354 MS MOREAU: Well, actually, I can say that when we filed -- it is only a sample. You only have a sample of a few hours of music programming. The music library for Eve FM will be around 2,000 songs. So the 25 per cent of new releases is part of that 40 per cent Canadian content, and I guess the sampling that we gave might not have featured new releases, but it is only a small sample because we will be playing music 24 hours a day, seven days a week. So obviously, it is a small sample.

1355 COMMISSIONER PENNEFATHER: Well, I will leave it to the lawyers to come back to you in terms of the process, but the commitment -- the 25 per cent, is it a commitment to the extent of a condition of licence?

1356 MS MOREAU: Absolutely.

1357 COMMISSIONER PENNEFATHER: How do you define "new"?

1358 MS MOREAU: A new release is a song that when it comes out we give it a six-month life -- well, we consider it new for a period of six months.

1359 COMMISSIONER PENNEFATHER: Okay. Let me move onto your spoken word.

1360 We will start with what is perhaps more typical of the radio questioning; namely, news and surveillance, and move onto your themed programming, as you have described it here this morning again. So we can clarify really again what -- how it all shakes down in the end beyond the overall approach of the theme, what it really means in terms of the amount of music and the amount of spoken word.

1361 In news, we note that you have agreed by condition of licence to broadcast at least 42 hours of local programming, but you indicate a majority of your programming will be local. I think this morning you said 100 per cent.

1362 MR. BENOIT: Exact.

1363 COMMISSIONER PENNEFATHER: For the record, would you please confirm how many hours of the programming aired per week would be local station produced, in view of your statement that you might run up to 10 hours in syndicated programming? So again, particularly since you mentioned the 100 per cent this morning, this also was discussed in the deficiency letter of June the 30^th. The syndicated programming would seem to not quite fit that picture. So can you explain about the syndicated programming, what it is, where it is scheduled and if it still exists in your proposal?

1364 MR. BENOIT: At first, our intention is to be really 100 per cent local, but we kept the door open that if a syndicated show would fit our format. So far, we didn't find any, but we never know what can happen in the future. But our first intention is to be really 100 per cent local.

1365 COMMISSIONER PENNEFATHER: What kind of syndicated programming would you be talking about?

1366 MR. BENOIT: As I said, so far we didn't find any that would fit our core audience. But you know, in seven years maybe something will come up and it will fit it. So far we are really planning to producing everything locally here in Ottawa.

1367 COMMISSIONER PENNEFATHER: Okay. I was --

1368 MR. BENOIT: If we had to open next week we would be 100 per cent local. We haven't found anything yet that fits the need of the listeners we are looking for.

1369 COMMISSIONER PENNEFATHER: I was just wondering about the 7:00 p.m. to midnight proposal, "Behind Closed Doors". So I need it defined a little bit more --

--- Laughter / Rires

1370 MR. BENOIT: I will let Mitsou to give you the --

1371 MS GÉLINAS: Are you interested?

1372 COMMISSIONER PENNEFATHER: No, it is all right.

1373 MS GÉLINAS: It will be a link between women's very stressful life with family, with husbands also, who can be very demanding sometimes, and work, and link from that to the bed sheets. Women very often don't have the time to think about themselves, so we want to be a tool for them with very soft music, very relaxing music. A few spoken words, but not that much in that bracket, in that bracket time. It will be like having a bath. It will be Eve's "bubble", as I should say.

1374 COMMISSIONER PENNEFATHER: Bubbles, you mean?

1375 MS GÉLINAS: M'hm.

--- Laughter / Rires

1376 MS GÉLINAS:  -- very interesting to --

1377 COMMISSIONER PENNEFATHER: My colleague to my left is making some remarks that I will pretend I am not seeing or hearing --

1378 THE CHAIRPERSON: Order, please.

1379 COMMISSIONER LANGFORD: No comment, Commissioner Pennefather.

--- Laughter / Rires

1380 MS GÉLINAS: There will be from 9:00 to 9:30 a very special time with nightly bath music to fill the tab, pour in some fabulous bath salts, light the candles and treat yourself to a relaxing interlude.

1381 COMMISSIONER PENNEFATHER: I was wondering when the candles would turn up. Not in Ontario.

--- Laughter / Rires

1382 MS GÉLINAS: If I may add, 34 per cent of Ottawa women think they are more stressed than elsewhere in Canada, so that might be helpful.

1383 COMMISSIONER PENNEFATHER: Do we look more stressed?

--- Laughter / Rires

1384 COMMISSIONER PENNEFATHER: All right. Let's get back -- let's keep on with the feature programming and we will move out of the Closed Door section and into Home Sweet Home. I just assume the grandmothers at the table will also have a place in your programming.

1385 COMMISSIONER LANGFORD: If they are young grandmothers they --

1386 COMMISSIONER PENNEFATHER: This is turning into the comedy --

--- Laughter / Rires

1387 COMMISSIONER PENNEFATHER: Okay. The features that you have been describing I think we have a good sense of it and, again, I am referring to the fact that what this proposal is about is the music and the spoken word, if I understand it.

1388 We talked about the weekly programming in terms of local, but now if we break it down in terms of the news and these features, if we look at the news you indicated approximately 12 hours of weekly programming will be devoted to spoken word, so a total of 12. Of that amount, four will be devoted to news and related surveillance. In your June 30^th deficiency letter you provided a newscast schedule and from the schedule we gather 91 minutes, or one-and-a half hours, devoted to news per se. This leaves us, I think, two hours and 30 minutes of related surveillance, which is usually your traffic, weather --

1389 MR. BENOIT: Actually, Mme. Pennefather, I think there was a mistake that happened when we filed our document. There were basically 12 hours of spoken word in which were 91 minutes of news and I will say about 120 minutes per week of surveillance.

1390 COMMISSIONER PENNEFATHER: One hundred and twenty (120) minutes per week surveillance. So two hours, 30 minutes, about?

1391 MR. BENOIT: Yes.

1392 COMMISSIONER PENNEFATHER: One-and-a- half hours --

1393 MR. BENOIT: To three hours.

1394 COMMISSIONER PENNEFATHER: Three hours surveillance.

1395 MR. BENOIT: M'hm.

1396 COMMISSIONER PENNEFATHER: Versus one-and-a-half hours news. Do you find this a little disproportionate?

1397 MR. LAFLAMME: Well, the news is due, in fact, all the weather reports that we are having all day and traffic. Essentially, our newscasts are going to be in the morning, from 6:00 to 10:00 in the morning, and during the drive home show which is from 3:00 to 7:00. In between, there will be only one newscast at noon.

1398 MS GÉLINAS: Just for the record, it is two hours surveillance and one-hour-and-a-half for news, so a total of three, thirty (3/30).

1399 COMMISSIONER PENNEFATHER: Okay. I had come up with one-and-a-half for news and two hours and 30 minutes surveillance, but what my point is that it would seem to be for a station which you are proposing keeps women informed, a balance in favour of traffic and weather as opposed to news. I was wondering what your rationale was for that.

1400 MR. BENOIT: Well, in fact, because we are concentrating our newscasts, as I said, in our morning and drive home show. That's one part, and we can for women not only by newscast but it would all be the content we are proposing.

1401 COMMISSIONER PENNEFATHER: Well, look at that then. So if we take -- exclude the four hours. We have discussed the news and surveillance. That is four hours total. This leaves eight hours for other spoken word at the 12. Could you tell us then how much of these eight hours is covered by the feature programs that you have described?

1402 MR. BENOIT: As I said earlier, and to give you an example, we will have about 60 minutes of spoken word per hour in the morning in the drive home. In the mid-days we will be running about two minutes of content per hour. During that period the music that is the key element there.

1403 COMMISSIONER PENNEFATHER: So if I get this right, then, during the day you have got your four hours -- or during the week you have got your four hours of news and surveillance. The balance of eight hours is made up of the spoken word content within the themed programming?

1404 MR. BENOIT: I am sorry?

1405 COMMISSIONER PENNEFATHER: The spoken word is -- the eight hours of the 12 is spoken word programming. That is the features?

1406 MR. BENOIT: Exactly, the feature content within our morning and drive home show.

1407 COMMISSIONER PENNEFATHER: And these are the themes that you have discussed. You mentioned them this morning too, as well, the various lifestyle programming?

1408 MS GÉLINAS: Yes, they are.

1409 COMMISSIONER PENNEFATHER: Those lifestyle programs, what length are they?

1410 MR. BENOIT: They are going to be blocks around three to four minutes each.

1411 COMMISSIONER PENNEFATHER: Three to four minutes each?

1412 MR. BENOIT: Yes.

1413 COMMISSIONER PENNEFATHER: What are they comprised of, interviews?

1414 MR. BENOIT: There will be interviews. There will be collaborators that will be -- maybe, Mitsou, you can -- but the regular collaborators that will be in the morning or in the drive.

1415 So Mitsou can give some examples of that.

1416 MS GÉLINAS: We will have different collaborators, a doctor on call, a naturopath, beauty editors from the magazines, from Canadian magazines. As well, fashion designers. We will have Dr. Linda Dodsbury also helping us, keeping track of work and family life balance. We will have a huge internet site as well.

1417 So our listeners will be really the third participants in this, because they will through internet, they will ask a lot of questions to our professionals.

1418 COMMISSIONER PENNEFATHER: Okay. Thank you. I am going to move on now to another area of questioning.

1419 We started our discussion this morning by reflecting on the fact that I was addressing you in English and this was obviously a proposal for English radio and, as such, we will be targeting Anglophone females both in Ottawa and the Outaouais, because if we look at the frequency and we know -- as you know, this is the Ottawa/Gatineau market.

1420 In developing your format and your business plan, was any consideration given to the possibility that the proposed format might appeal at some level to the Francophone tuning to the station? Let's call it cross-tuning on a fairly consistent basis. This is a bilingual market. Have you taken that into consideration in terms of your programming for music and in your business plans?

1421 MR. BENOIT: Of course, due to the market that might happen, but we really concentrate ourselves to the women of Ottawa, the English women of Ottawa.

1422 COMMISSIONER PENNEFATHER: Yes, I noticed the studies deal with English in terms of your analysis of the various share, reach, tuning, et cetera, and the study done by Synovate was also only the English component, as I read it. But the reality is that it is a market in which there is cross-tuning, in which there are a number of Francophone listeners to the English stations. Did you at any time consider this specifically in the planning for the station?

1423 MR. SABBATINI: Well, in a few seconds I will let Jacques Dorion give you a little bit more details about the market study we have done, but just to remind you that at Astral we believe a lot in research and we have extensive research that we do in the Gatineau market for the total market of Ottawa and English-speaking, French-speaking of Ottawa/Gatineau. We use research across Canada from CROP that works market-per-market, province-by-province. So apart from the study and the extensive study that we have done for this application only, we have a lot of research through other units from Astral. We have TV stations that are aiming at women and are in French markets or English markets. So there is a lot of stuff that we looked at when we decided to go on with this application.

1424 But most of the research was done through Synovate in this market, and not only in Ottawa, but in Gatineau. I will let Jacques Dorion tell you a little bit more about it.

1425 MR. DORION: Basically, the research was done among Anglophones only in this market, because if you look at the way the stations are distributed with the size of the market, there are less per capita English stations.

1426 On cross-tuning, it is a fact that in this market -- I will give you a macro average -- about 30-35 per cent of tuning hours from French come from English stations. That has been going on over the years and the number of stations in the market has not changed that distribution. It is an accepted fact, also, by the advertisers that Ottawa English is a more important market. It is an "A" market. That is why there is more money in it. There is more advertising dollars. Ottawa, all French, for many advertisers is a "B" market.

1427 Now, the cross-tuning will be more -- there will be more cross-tuning in the younger demos, probably because of the music. That's a phenomena that you would also see in Montreal.

1428 But these numbers have not changed over the years. It is mostly -- in the morning, for instance, you would see -- in the morning where our services are important and in the drive, there is less cross-tuning of Anglophone stations because French stations are more present in terms of programming, more local programming and features and so on.

1429 But this being said, this application is for English Ottawa and, you know, it provides to the Ottawa market more female audience than the existing stations, a little older than the existing stations, I'm talking more about magic, which describes itself this week on the busses about soft rock. I mean, we talked about ballads or we talked about soft music.

1430 So, in terms of music, like Geneviève said could be taken from the same catalog, but there is definitely in this market a need for an older demo appealing to the female audience more than the male and recognizing the fact that Ottawa English is a very... I shouldn't say sophisticated, well-educated market, well-developed in terms of main stream radio, but there will be in years to come also in other markets of Canada as we grow older, stations like this.

1431 COMMISSIONER PENNEFATHER: Thank you very much. I thought you would get back at some point to my comment about the play list. I didn't think you would let that flip by.

1432 But just on cross-tuning, if I may get back to that. In terms of the general discussion on this point, if I understand you then, you're saying that there is in this market being the bilingual market it is, cross-tuning historically.

1433 My question was from a general point of view, to what extent should cross-tuning be considered in an application for the Ottawa-Gatineau market. Is it, in your view, not as a point which deserves that much consideration or is it a point that deserves consideration from a business plan point of view?

1434 MR. SABBATINI: Ideally, it should be taken into account trying to, if you're pure about the radio format and you want your French listeners to tune in to French stations and English listeners to English stations, but over the years, what we have seen is that as you grow the number of stations in a given market, especially in a bilingual market, people do not change that much their habits.

1435 They still tune... that 30 per cent tuning hours to English stations has not changed over the years, even though Astral is what I callED a "professional broadcaster" and addresses the market. I guess they know the market in depth about French and English, about French.

1436 But this has not changed consumption and it has not changed advertiser patterns because advertisers know that there are two markets in this market, two advertising markets and they address it differently. They don't address... they don't... they address it differently. But, no, to your question, I don't think cross-tuning will change no matter what.

1437 COMMISSIONER PENNEFATHER: Thank you for that. While I have you, I'm going to ask you a couple more questions, just to make sure that I have the economic analysis and research cleared and come back to two more programming questions.

1438 But while we're on this, the impact on the markets, on page 44 of the study, I just want to be sure that we have understood that point. At the bottom of the page on page 44, table 11, where we're talking about the source to tuned hours for the proposed soft adult stations.

1439 The new radio listing hours, do I understand that this represents the proportion of the share that will be from new radio listeners?

1440 MR. SABBATINI: Yes, yes.

1441 COMMISSIONER PENNEFATHER: Okay. And do you have a sense of numbers in terms of beyond percentage, what that means in terms of numbers of listeners?

1442 MR. SABBATINI: The prediction for the market share is 5.7 per cent on adults 25-54, and we use this target group all the time because 80 per cent of the advertising dollars are based on adults 25-54. That's the core target group of advertisers.

1443 Five per cent of the 5.7, like .3 percent, .3 per cent will come from new radio listening hours, this format appealing to a core target group of women 35-64 will tune in maybe an extra hour or more during the week, you know.

1444 Second, .6 of that 10 per cent will come from out of market tuning, out of market could be two sources. One could be U.S. stations, limited, but still present in the market and French hours that are not counted by advertisers, you know, like .6 and 85 per cent, the core will come from existing stations.

1445 COMMISSIONER PENNEFATHER: That was clear, yes, the 85 per cent and if we move on to the 85 per cent hours tuned. But if we look at the impact on advertising and I move now to tables 14 and 15, which is pages 50 and 51, again in terms of advertising, we talk about 80 per cent will come from existing radio stations, 10 from convention television and five from dailies and weeklies.

1446 On the next page, you focus in a little more tightly on which of the radio stations and reference four stations, 78 per cent of the proposed revenue will come from four stations listed 1, 3, 4 and 5 on your chart. Obviously, when we're talking about advertising we're not talking about CVO, but we did talk about CVO in the hours tuned, if I understand.

1447 Could you just clarify for me if I have understood correctly, that the numbers, the impact on the revenue then on the right hand column is the amount of revenue that you expect as being from each of these stations specifically, those are the impacts there. Is that correct?

1448 MR. DORION: Yes. Correct. Two comments. One, I have seen in other applicants also that they would find new advertisers in the Ottawa market and I mean, we still believe that 80 percent of the monies will come from existing radio stations. I mean, this market is well-developed and no advertiser will add monies to his advertising budget because there is a new station in a given market. I mean, it's a recognized fact.

1449 On the existing stations, on the impact of the existing stations, we did a pro forma calculation of what the impact could be on the existing stations, based on their share of women 35-64. That's a pro forma calculation because, I mean, we suspect that the station with the more listeners in that demo, we have to... we have to be fair and think that they would tend to lose the most.

1450 But the new station will, well, I guess be on air in a year or two, so this amount could be waived off by growth in the market anyway.

1451 COMMISSIONER PENNEFATHER: Ah! Well, that was my next point. Considering these numbers and the impact on these stations specifically which target the same audience of women 35 to 64 and you note that what their share is currently and, therefore, the impact on revenues.

1452 Can you comment on the ability of these stations to withstand this kind of impact?

1453 MR. DORION: Well, I presume they would. I mean, if you look at ownership of these stations and most of these stations are owned by... eight of these stations are owned by major broadcasters across Canada. So, I mean, there are no newcomers in this market and the way the market is bought also, in many instances, as I'm not sure exactly about how this market is sold, but it is sometimes sold as a combo package, so where the advertiser buys more than one station of a given group.

1454 So, I would think that these groups would come up with strategic and very dynamic new proposals that would offset some of the losses.

1455 MR. LAFLAMME: And the growth, just because it's a very robust market in term of growth, if you look at the last few years, we're talking about an average of 8 to 9 per cent growth of radio business in the market.

1456 So, it's a very strong economic market for radio.

1457 COMMISSIONER PENNEFATHER: Thank you for that. I'll just go back now to a programming question in line with two subjects : Canadian talent development and diversity.

1458 Just on the Canadian talent development, it's just a clarification. I believe in your June 30th deficiency, you discussed the re-direction of the initiatives regarding Canadian women in communications and the university creative summits, two scholarships. Am I correct?

1459 MS GELINAS: Yes, you're correct.

1460 COMMISSIONER PENNEFATHER: Thank you. So, the Canadian talent development amount that is in your financial projections at $700,000.00 total by the end of year seven remains the same?

1461 MS GELINAS: Well, as we proposed this morning, we added another $70,000.00, so it should be reflected in our per cent.

1462 COMMISSIONER PENNEFATHER: The $70,000.00 you're adding is the Canadian women communications, but they are not the Canadian talent development initiatives as such.

1463 MS GELINAS: Yes, we agree with you, but we consider that those organizations are important and can play a very important role even if they are not eligible third parties. We would like to still honour our commitment with them because we have discussed with them before and so, we have got the privilege of having been granted that licence. We would like to still be funding those two.

1464 COMMISSIONER PENNEFATHER: So, in effect, though the $700,000.00 TTD is, as discussed up to this point, namely are the applications of the deficiency and the $70,000.00 originally within that $700,000.00 total is re-directed to the scholarship?

1465 MS GELINAS: Yes, it stays with the... so, it's over and above. Now, we are talking about $770,000.00.

1466 COMMISSIONER PENNEFATHER: But you understand the Commission would look at TTD at $700,000.00, not...

1467 MS GELINAS: It's understood.

1468 COMMISSIONER PENNEFATHER: ... that we are not supportive of those organizations, but I think that's important. On diversity, I've read the application and your comments again this morning on the Local Advisory Board and I think I got some further detail on how that work would function in your presentation this morning and in the June 30th deficiency, it's pretty well laid out.

1469 On the diversity side, in terms of music, you mentioned in your supplementary brief on page 18 that you would focus on the world beat music and this will add cultural diversity to Ottawa for Ottawa audiences. But in your deficiency letter of June 30th, you say probably in another context that this world beat music, which is category 3, will only be five per cent of the total music.

1470 In a sense then, in terms of looking at this as diversity and bringing new diverse artists to this community and perhaps your Local Advisory Board would comment on this to you going forward, why do you think that this is sufficient and do you have any other plans to approach diversity in music, other than five per cent in category 3?

1471 MS GELINAS : Well, the world beat music show that we're planning on doing is featured on the week-ends. It's three hours per night with a six-hour show basically and will feature international artists as well as Canadian artists such as Claude Mackenzie, we'll have Lasa Decela, Florent Volant, we will also have Intacto, Chloé Sainte-Marie, different artists like that.

1472 So that's, I guess, 5 per cent of the music programming for the entire station. If we want to go more than that, that's something that we will have to look at, but for now it's six hours per week.

1473 COMMISSIONER PENNEFATHER: But note I was asking it in terms of your overall approach to diversity and while we can talk about category 3 at 5 per cent, you have presented it in your supplementary brief as your approach to cultural diversity programming. So, my question was for the 95 per cent music programming how will you assure that some cultural diversity is brought to that programming, if any?

1474 MR. BENOIT: Well, just to go back. We will be featuring in the weekly programming, we will have features to promote that we're a comfort launch and just to go back to that six hour per week, we will start with that and we'll see what success we can have on it, but it's going to be a unique offer in the market. Nobody else does that.

1475 But we will be promoting our six hours by playing through our regular programmation different features to promote our show.

1476 MS GELINAS: And if I can add to that. We will seek the advice of the Advisory Board to make sure that the station will reflect Ottawa's cultural diversity in our programming.

1477 COMMISSIONER PENNEFATHER: Thank you. Synergy. In the June 30th deficiency letter on page 9, you state that Eve FM will operate as a stand-alone station and this is repeated in the supplementary brief. In the June deficiency letter you indicated that you don't expect any programming or operation of synergy between Eve FM and your two FM stations in Gatineau.

1478 What assurances can you give us that indeed comfort radio will enjoy editorial and programming independence from your two stations in Gatineau?

1479 MR. PARISIEN: This is going to be a stand-alone operation without no operational synergies either with our Gatineau stations or any of our other stations in Quebec or the Maritimes.

1480 The only synergies we could think of is on the Corporate Office, H.R. issues, legal issues, but that's all.

1481 Music directory is going to be unique and placed in this market, all the operations, technical staff, sales staff, general manager, everything is going to be local programming, everything is going to be stand-alone from Ottawa, with no intervention or synergies with other operations we have.

1482 COMMISSIONER PENNEFATHER: So, that news resources, the one full time and one part-time journalist for Eve FM will be dedicated solely to Eve FM or will there be sharing?

1483 MR. PARISIEN: Exactly, 100 per cent relief.

1484 COMMISSIONER PENNEFATHER: This brings me then to the last area of questioning which is in the overall picture for Astral in this bilingual markets. Let me begin by just stating what's the obvious in terms of Astral's position in the Gatineau market, it's very clear and in Quebec markets as a whole, the position of Astral through its various Rock Détente, Radio Énergie, BOOM-FM8, that you're a dominant player in the major markets in Quebec.

1485 And in Gatineau, and if we look at Gatineau, we're looking at Astral's position, 49 per cent listenership and 97 per cent of revenue.

1486 Now it is the case that we're talking about your application in the English market and we discussed earlier and one of the reasons I wanted to discuss the economics of the approach and the demand and the impact was to get a very clear picture, what can be confusing in terms of the Ottawa-Gatineau market.

1487 That being said, what I think I would like to discuss with you is if there should be any concerns on our part regarding the impact that Astral receiving a licence in this Ottawa-Gatineau market and when we look at the facts of cross-tuning, when we look at the facts of the reach of this particular frequency into the Gatineau market where Astral is dominant, you might want to consider or should we have any concerns regarding the dominant... this licence increasing the leverage of Astral in the Gatineau market in terms of this dominance of this market in Gatineau.

1488 Would you care to comment on that concern and if you, yourself, see any concerns that we should have in terms of the impact of granting you this licence in the Ottawa Gatineau market, which we agree would be focused on the Ottawa anglophone market, nevertheless, has a reach in this market?

1489 And in terms of advertising sales and in terms of any other impact with the Gatineau market, what is your comment on that effect on your existing dominance in the Gatineau market?

1490 MR. PARISIEN: Of course, we don't see any concerns. But let's start with the advertising dollars and I'm going to ask my friend Jacques Dorion to comment a little bit because of his expertise.

1491 We have tried for many years without success in our Gatineau stations to get some advertising dollars from the Ottawa market, we had no success at all from it.

1492 On the other hand, we have really problems getting national dollars from the advertisers in the Gatineau market because, like Jacques said earlier, most of the advertisers, national advertisers, use the Ottawa market and believe that by being present in the Ottawa English market, they cover the Gatineau market. So we have no access at all to most of the national dollars.

1493 You know, we see a lot of national campaigns that use Montreal, Three-Rivers, Sherbrooke. They go everywhere but once they get to Gatineau, they say no, we won't advertise there because we are covered from the Ottawa English market.

1494 Maybe, Jacques, you would comment a little bit and I will get back to the rest of the question.

1495 MR. DORION: Well, two things.

1496 One, it is true -- we also act as media buyer, by the way, in those markets for some of our clients and we did a little survey -- not a survey but we pulled out a list of 12 clients in our company, you know, the Ronas, the Danones of this world, ScotiaBank, IKEA, Sleeman beer, Adidas, and I would say that we are a micro-market in the sense that we represent how advertisers react.

1497 Twenty-five per cent of advertisers in this market, of our clients, do not advertise locally. They advertise on national TV or -- so they would not consider Ottawa English or Ottawa-Gatineau French as a market.

1498 One-third of them advertise in both French and English because they have retail outlets in both cities or both markets, shall I say: Rona, Belron, which is Standard Auto Glass, and IKEA.

1499 In two-thirds, the commonality is that English-speaking national and regional advertisers consider this market as being Ottawa, an A market where they spend most or all of their money, and they consider Ottawa-Gatineau or Gatineau as a B market and will very many times avoid this market and not invest in it.

1500 That is why -- the second point, that is why if you look at the advertising dollars, the radio advertising dollar per capita in this market, it is two to one English to French. If you look at the number of people in this market, we calculate it is like $61 versus $33. So advertisers spend twice as much dollars per capita to reach the English market, English-speaking market in this market versus the French, because French is also expensive, what is not being told.

1501 It is expensive partly because of cross-tuning but -- it is expensive but people like in television, the trend here is as people work more in this market, especially the women, they are not available during the day. So I mean it makes it an expensive proposal.

1502 So it is a market, very sane, but it is a market where advertisers do not mix their buys. They don't buy English to reach the French. Some believe they do but they don't do it as such and they don't buy the French to reach the English.

1503 COMMISSIONER PENNEFATHER: Okay.

1504 MR. DORION: We have the same phenomenon in Montreal. I mean CFCF TV is trying to sell us all the time the French viewers but we don't them on CF, we buy them on other stations.

1505 COMMISSIONER PENNEFATHER: Let me go back to ---

1506 MR. PARISIEN: Madam Pennefather, can I make a comment on your question?

1507 COMMISSIONER PENNEFATHER: Okay, but before you do, let me ask you to add to that comment.

1508 In your reply, you state the following -- in your reply to interventions:

"Astral's move into Ontario will add another strong radio competitor at the national level [and we have discussed that] and strengthen existing French-language operations as well." (As read)

1509 So I wondered when I read that what you meant by that.

1510 MR. PARISIEN: Okay.

1511 COMMISSIONER PENNEFATHER: So perhaps you could also respond to that.

1512 MR. PARISIEN: I will touch on that, my pleasure, but I wanted to chat with you on the expression "dominant." I really hope that we don't turn that out to be a handicap in terms of developing Astral Media and Astral Media Radio.

1513 I think that we are condemned to grow and we will grow and we will expand our radio properties as much as we can and I think our presence here in English Canada is a step in that direction.

1514 I also think that today you have to look at radio -- and I think everyone in this room, at least in the back room, would agree with me -- in terms of competing with the whole media industry. The radio market itself is growing normally in Canada, as you know, from recent numbers but our real potential is to go and get advertising dollars that are invested in television and newspapers and so on and so forth.

1515 Adding more franchises to our properties -- and it is the same thing for the other broadcasters in Canada -- just helps us be more efficient in switching advertising dollars from other media to radio and that is how radio will evolve and that is how radio will become more dynamic and more influential in the media decision process, with advertisers.

1516 So being a dominant player is not necessarily something ugly or bad. I think it is something that we have earned and we are forcing, obviously, to grow more. We are competing more and more with television, newspapers and all the other media and I think it is to the benefit of radio.

1517 So I just wanted to make that clear.

1518 COMMISSIONER PENNEFATHER: Mm-hmm.

1519 MR. SABBATINI: I would like to conclude on your question if we go back now to the Ottawa English market.

1520 First, we stated very clearly this is going to be a standalone operation without synergies with our Gatineau stations.

1521 Second, if you look at the profitability margin of this market, it is 50 per cent higher than the average Canadian markets. So this is a very robust market, a very strong market, and you have a couple of players here who have a cluster of four stations. So it is a strong market protected by a very strong broadcaster and if you look at our expectation of ratings and shares in the market, we are talking about 5-6 per cent.

1522 So it is a small player in this market, a standalone player, and we have a good content, a good concept. We are going to fight if we have the licence but still we are going to be a really small player in the Ottawa English market.

1523 COMMISSIONER PENNEFATHER: Yes. I think I was quite clear that I wasn't discussing the Ottawa English market, I was discussing the Gatineau market with this, and in fairness to you, that is where I think there would be any discussion, the Gatineau market.

1524 Again, we have an Ottawa-Gatineau market in terms of the BBM but, as well explained, they are treated in many cases separately, and therefore, I was looking at the fact of your presence in the French Gatineau market and what concern, if any, there should be in terms of the ability of an English-language licence to leverage more positioning for Astral in the Gatineau market.

1525 So that was the reason and the comment in the reply somewhat triggered my interest in this because you do say that it would strengthen your French-language operations. So I made an assumption that it would strengthen your position in the Gatineau market and you are saying no?

1526 MR. SABBATINI: No.

1527 COMMISSIONER PENNEFATHER: Those are my questions, Madam Chair.

1528 As you probably know from yesterday, there may be other questions, and at the end, you may have also your chance to make a final comment on why your proposal is best use of this particular spectrum.

1529 THE CHAIRPERSON: Commissioner Langford.

1530 COMMISSIONER LANGFORD: Thank you, Madam Chair.

1531 Well, we have had some fun here today but I have a serious question for you, and if you are not prepared for it because it comes -- and I suppose the pun is intended -- a little bit out of left field, you may want to address it more in reply or simply not address it at all.

1532 But as I listened today, as I watched the women on your television promotional film that you did, they seemed a very affluent lot, quite frankly. I am sure they have problems and they need their bubble bath but when I read on page 3, at the bottom of page 3 of your opening statement, you say:

"We have the financial resources to expand successfully and the experience and imagination to provide a relevant top-quality radio service to the English-speaking women of Ottawa." (As read)

1533 I really want to ask you -- put you on the spot a little bit -- relevant to which women, only the affluent women who you can deliver to your advertisers or will there be something here for the more marginalized women?

1534 There are a lot of women who don't look like those women in that picture here and they don't look like us up on this panel and they don't look like you on your panel because they have different problems, different challenges every day, and when I look at your proposed programming, I see that you have cut out a niche -- it is a different kind of niche. It is not just all the demo over 35 or all the demo between 12 and 25, it is a gender segment of a specific demo.

1535 I wonder if you have given this any thought. If you haven't and you want to think about it, that is fair, but if you have given it some thought, I wonder if you could give us some idea of where you feel your duty is to reach out to those who perhaps are not as big an interest to your advertisers but still are a very relevant segment of women of a certain age.

1536 MS GÉLINAS: Well, sir, I think you have understood women very well.

1537 COMMISSIONER LANGFORD: I am not sure my wife would agree, but anyway ---

1538 MS GÉLINAS: No. I think that we will talk to real women about real problems. You were talking about the aspect of their beauty, for example. Well, when we will talk about fashion, we will talk to real women with real bodies. I don't know if you know about the "O" magazine or "Real Simple" magazine. They are targeting exactly the same type of women, women who are real, who have real problems in life and who don't -- so yes.

1539 As an example, fashion. There is a huge new trend these days in the 1950s -- it is back to 1950s fashion. So we will ask our panellists -- because we will have panels, beauty panels, fashion panels. We will ask them: Is it a way to put women back to their places? You know, we are back to high heels, we are back to fur, we are back to very, very tight clothes. So we will survey those problems.

1540 You are talking about women of different -- de différents milieux. We will talk about new beauty products but also which ones work, which ones are worthy of spending your dollars. So we will cover different types of women and different types of budgets.

1541 MR. SABBATINI: Mr. Langford, I wish to ask Sheila to comment a little bit on this.

1542 COMMISSIONER LANGFORD: Maybe before you do, I am not really speaking so much about the tightness of the skirt or the height of the heel as much as maybe the bruised face of a woman who is in an abusive relationship --

1543 MS GÉLINAS: Mm-hmm. Yes.

1544 COMMISSIONER LANGFORD:  -- who has her own beauty needs, the woman who simply can't afford any of the products that any of your advertisers --

1545 MS GÉLINAS: Mm-hmm.

1546 COMMISSIONER LANGFORD:  -- are selling, though she must buy some.

1547 MS GÉLINAS: Yes.

1548 COMMISSIONER LANGFORD: I am talking about a social responsibility and it seems to me if you are going to say you are going to be relevant to women, I am wondering, without getting a violin out or quoting you the collected works of Karl Marx, where you feel your social responsibility is to these women who simply probably, for very good commercial reasons, are of little interest to your advertisers. I wonder what interest they are to you and what duty you feel to reach to them, beyond the question of whether fur is in or fur is out.

1549 MR. SABBATINI: A very good question!

1550 MS GERVAIS: Commissioner Langford, I would like to comment on that a little bit with respect to how we see the role of the Advisory Committee ultimately working with both the programmers and the managers at the station, because while we clearly will be hoping to advise with respect to talent development, particularly with respect to emerging talent from diverse communities, we also want to ensure that we are as representative as we can and that includes being as representative about bringing the concerns that women have, the concerns that women have broadly, exactly as you are saying, across the board.

1551 That is why one of the areas that we hope to advise on is with respect to the community organizations that we might support. That doesn't necessarily mean support financially -- it could in certain circumstances -- but certainly the types of causes, issues that we would like to see find their way into some of the editorial content on the station.

1552 I think by that kind of programming you automatically appeal to women. When I referred to a bit of a meeting place, I think ultimately very many women in the community may find a home there.

1553 One of the examples that I can give you from some of the work that I have been doing in the community is that the very large and increasing immigrant population in Ottawa, for example, does in a way fit the demographic because it is a highly educated demographic.

1554 In the Somalian community, for example, I can tell you that close to 80 per cent of that new Canadian population is actually women when we are talking about adults, primarily single women, but they also come from a highly educated background, and yet, they are in close to a 25 per cent unemployment rate -- category.

1555 So we understand that these are the types of areas that we would like to discuss with the programmers at the station in terms of areas that they will explore, because we understand that broadly-based women across the community share very many of those types of concerns. So we would hope to play a very active role in that regard.

1556 MR. SABBATINI: These are only a few examples and this is very important for us, and not only, again, on the programming side, not only on the choice of the topics, because we are not going to talk only about health and beauty and cream, we are going to talk about community involvement.

1557 Just to give you a little example of one of the ideas that came out from our brainstorming, there is a lot of mono-parental women in this market, like any other market --

1558 COMMISSIONER LANGFORD: A lot of what? I am sorry, I missed that.

1559 MR. SABBATINI:  -- mono-parental --

1560 COMMISSIONER LANGFORD: Right. Thank you, sir.

1561 MR. SABBATINI:  -- women, single parents with kids, who sometimes and very often struggle financially, and one idea we got is, let us say at this time of the year we could organize an event, an evening with -- you know, the Christmas period -- with gifts. It is only a few hours but it is a lot for those single families and their kids.

1562 So those are only a few examples we could do on-air, off-air, the interactivity with our Web site. It is not only beautiful women or young women, it is all the issues and women issues are ageless. So all that is very, very important for us.

1563 MR. DORION: Mr. Langford, what I would like to have is to nourish the spoken word. What we have done -- taken from a syndicated research called PMB -- that is the data bank we use in media selection in Canada, across Canada. We compared the Ottawa-Hull women aged 48 years old with the English-Canadian women and we also compared the French with the English in this market.

1564 Some of the differences are -- we all know that this market -- if we compare ourselves with the rest of Canada, this market is very, very more educated. If you work in this market, maybe people don't know but 60 per cent have more university degrees than any other market in Canada; they are employed full-time; there is twice as many managers, owners, professionals, executives among this age group in the women. They earn more money, their house is worth more dollars, they are more stressed, and compared with the French, they have written more often to a public official, they do more volunteer work, they do more, shall I say, physical activities, they do more fitness, they do more jogging, they do more swimming than the French and they entertain more at home.

1565 So it seems that we have pictured it maybe too rosy for you in terms of target group and you have related it to the advertisers, but within the spoken word, I presume there will be some attention being paid to all these activities and all what I would call this psychographic target group that exists in this market.

1566 COMMISSIONER LANGFORD: I don't disagree with you that the statistics are encouraging and that in the majority of these educated people there may be an interest in the very sorts of programs but there is what John Kenneth Galbraith called an under-class in every urban world and one doesn't have to walk very far in Ottawa-Hull to see examples.

1567 I am not asking you to put on a "Hair" shirt here and start to beat yourself in some kind of saintly fashion but at the same time it seems to me that you might feel the sort of duty, civic responsibility, that some of you have spoken about here quite interestingly and quite well, towards this more marginalized under-class of women who have problems that go well beyond anything that we face here at either one of these tables.

1568 As I say, I am not trying to put myself on a soapbox here but I was very curious to hear what sort of plans you might have, and Ms Gervais has spoken quite eloquently about some of them and I thank you for that.

1569 Those are my questions, Madam Chair.

1570 THE CHAIRPERSON: Commissioner Noël.

1571 COMMISSIONER NOËL: Just more of a constatation than a question. Isn't it true that violence towards women is not the privilege of under-class women? I think it is pervasive throughout the whole strata. If you have any comments on that.

1572 MS GERVAIS: Well, I must admit I am not an expert in violence against women but I think in terms of many of these types of issues that have a particular relevance to women, I think it is fair to say that they cross otherwise virtually all lines, including ethnicity, socioeconomic status and so on. So I think that that is a very fair comment.

1573 COMMISSIONER NOËL: I have no other questions.

1574 THE CHAIRPERSON: Counsel.

1575 MR. WILSON: Thank you, Madam Chair.

1576 If I could just circle back for a moment to your discussions with Commissioner Pennefather with respect to this commitment to 25 per cent new Canadian releases.

1577 First, I just want to clarify to confirm our understanding of your definition of new. If I understood your discussion with Commissioner Pennefather, your definition of new would encompass simply any new album released within sort of a six-month period.

1578 Let me give you an example. Suppose a new compilation of Frank Sinatra was released, would that constitute new under your definition of new, and if not, then maybe you could clarify for me how that is going to work?

1579 MS MOREAU: Well, for the Canadian content, if there is a re-release of a Canadian artist and they work that like a new song, if it is re-mastered or something like that, maybe it would -- it is always -- for us, a new release is zero to six months.

1580 So if there is a new compilation -- if someone comes out and does covers or something like that, you know, then -- you know, with K.D. Lang coming out with the album, so it brings back music that she hasn't done before, so it is considered for us a new release.

1581 MR. WILSON: Okay.

1582 And then just one final point and I just want to confirm again, following on your discussion with Commissioner Pennefather, I am correct then in my understanding that this commitment with respect to 25 per cent new releases was not set out in your original application nor in the deficiency response, that the first time this commitment has been raised with the Commission was this morning; correct?

1583 MS MOREAU: Yes, it is the first time. Yes.

1584 MR. WILSON: Then I would just note, given that this is a competitive process, that the Commission may then choose to consider your application based on as it was filed at the time of the deadline and may not choose to consider this new commitment.

1585 Those are my questions, Madam Chair.

1586 THE CHAIRPERSON: I happen to have with me your communique of October about the Énergie réseau having a ---

1587 M. BENOÎT : "Parti pour la gloire."

1588 LA PRÉSIDENTE : Pardon?

1589 M. BENOÎT : "Parti pour la gloire."

1590 LA PRÉSIDENTE : Une nouvelle émission, "La Relève."

1591 M. BENOÎT : Oui.

1592 THE CHAIRPERSON: So you are making a distinction between "La Relève" and new releases; correct? "La Relève" would be based more on --

1593 MR. BENOÎT: New talent.

1594 THE CHAIRPERSON:  -- artists who have not had a CD to their -- who have not produced a CD; right?

1595 MR. BENOÎT: Yes.

1596 THE CHAIRPERSON: Whereas new releases could be K.D. Lang, who is hardly "La Relève," right? You are making a distinction between the two?

1597 MR. BENOÎT: Well, in fact, we are going to have both. The show you are relating to, "Parti pour la gloire," some of the artists have their first CD but have never been aired on a radio and some of them don't even have released a CD yet.

1598 THE CHAIRPERSON: Yes, I see.

"Énergie invitera des artistes n'ayant encore aucun DC." (Tel que lu)

1599 So this new commitment that counsel discussed with you, is it in any way related to this other effort on the réseau Énergie of finally giving madame Drouin something to cheer about?

1600 MS MOREAU: Well, one of the things, naturally, when we are talking about new releases, we will take a really good look at new Canadian artists and the first album, the first efforts. So that will be something.

1601 And also when you look at certain artists in Quebec who maybe have a hard time in the rest of English Canada, so we also take a look at them and try to give them like a -- I don't know if you can say like a step board or somewhere, you know, to get featured and get air play.

1602 So new artists -- new Canadian talent is very important for us and it is part of the 25 per cent of new releases.

1603 THE CHAIRPERSON: So some new releases could be new artists, "La Relève," or it could be old artists with new releases?

1604 MS MOREAU: Yes, but we will make sure that the new artists, they get listened to, and if we can give them air play, we will, if they fit the format of Eve FM, which is soft, relaxing music.

1605 THE CHAIRPERSON: So the idea of new releases doesn't change the type of music that you will have on or the extent to which it is ---

1606 MS MOREAU: Well, Eve is soft music.

1607 THE CHAIRPERSON: I don't quite understand this commitment that the counsel talked about, what it does to the application or what it changes or what it adds to it.

1608 MR. SABBATINI: Well, it helps Canadian development -- to develop Canadian talent.

1609 That being said, maybe we could -- in that 25 per cent of Canadian content, we could have someone who never had a CD or someone who just came out with his first CD. That doesn't stop us from doing that. But that also includes someone who comes with a new song that was already done in the 70s or in the 80s. That is very large, but still, what it does is one out of every four Canadian songs we play are going to be new releases, not older than six months.

1610 THE CHAIRPERSON: Yes, but I make a distinction old songs redone by new artists --

1611 MS MOREAU: But that is only --

1612 THE CHAIRPERSON:  -- old artists doing new songs ---

1613 MR. SABBATINI: Yes, but that might be only 10 per cent of that 25 per cent. We don't know yet. It is tough to say today.

1614 MS MOREAU: We want to focus on new releases. Old songs that have been redone is only a small fraction. It happens like once every whatever, you know.

1615 So we are going to make sure that artists that don't get -- new artists that don't get a lot of air play in the market, and also with our on-air host, the fact that you are maybe going to do a launching, they are going to be close to the community and the music programming will be done here. So you are also close to the community. So that way, you know what is coming out and local artists and all that.

1616 THE CHAIRPERSON: Do you, Madame, consider yourself "La Relève"?

1617 MS GÉLINAS: Me? I don't think I am still "La Relève" but I have to say that it is very, very important for Canadian artists to have that kind of percentage, especially for artists that are doing pop adult. For younger artists, it is much easier to get air play with videos, with shows, with Internet. When you go into the pop adult, radio becomes the most important player.

1618 THE CHAIRPERSON: As long as we all understand there is a distinction between "La Relève", which is giving a leg up or a springboard or some help to newer artists who have more difficulty taking their place in radio than new albums, which can, as Mr. Sabbatini said, include the other but is not focused on "La Relève" --

1619 MR. PARISIEN: No.

1620 THE CHAIRPERSON:  -- simply focused on new albums of artists that have already made their name in the market.

1621 We have no other questions, so you have your three minutes to answer those we didn't ask.

1622 MR. PARISIEN: Madame Wylie, before I let Mr. Sabbatini wrap it up, I would like to leave you with a thought -- as a matter of fact, two thoughts. The first one is I hope you don't expand madame Drouin's jurisdiction over anglophone markets.

1623 THE CHAIRPERSON: Whose jurisdiction?

1624 MR. PARISIEN: Madame Drouin, Solange Drouin.

1625 THE CHAIRPERSON: To the anglophone market?

1626 MR. PARISIEN: Yes.

1627 So my thought is the following ---

1628 THE CHAIRPERSON: She may have a different view now that we have francophone companies in the English market.

1629 MR. PARISIEN: I never thought I would hear her name in this hearing.

1630 COMMISSIONER PENNEFATHER: We never thought we would hear yours in this market.

1631 MR. PARISIEN: Here is what I wanted to leave you with before I hand it over to Mr. Sabbatini.

1632 Ten years ago, you personally and some of your colleagues were sitting in a hearing and deciding whether you would expand television licences to a women only service, and out of that hearing -- I was there, I remember -- Canal Vie came to life and so did, in another situation, what was then The Women Network.

1633 I think you have a concept before you today where you are probably faced with the opportunity to give women a voice in the radio industry and I very respectfully submit that this is a unique opportunity to do that and it is a target group that is under-served.

1634 I think the concept that we have described to you this morning would address a lot of the issues that I have heard the panel express today, Mr. Langford, you Madame Wylie, madame Pennefather. So I think it is a fantastic opportunity for women in Ottawa and hopefully for women in general.

1635 Thank you.

1636 MR. SABBATINI: As you have seen this morning, we are very excited and enthusiastic about this concept and we do believe that Eve FM will benefit the Ottawa market for four reasons.

1637 First, it will add to the diversity of radio offerings. Again, I would like to emphasize that this is a fusion between good music, soft music, an oasis of comfort in terms of music, and important spoken word topics, content for the needs of women 35-64 in the market.

1638 Second, it will contribute to the musical diversity. It is 100 per cent local programming. There is an Advisory Board -- you have heard Sheila -- and this is going to be great for the market. The news content will be local. It is going to be relevant info for the women of Ottawa and we are going to be very involved in the community.

1639 Thirdly, it is going to significantly promote Canadian talent, 40 per cent Canadian content, but again, our 25 per cent, which is one out of four Canadian songs played, will either be "La Relève" or new releases from Canadian artists.

1640 And fourthly, Astral Media Radio has a proven track record in the radio business. We are passionate about this business and we have the means and the knowledge. This concept is great and we have a viable business plan to deliver what we are promising to you today.

1641 Thank you very much.

1642 THE CHAIRPERSON: Thank you. This completes the first part of the hearing for you. I am sure we will see you again. Thanks for your cooperation.

1643 We will now take a break until 11:15, at which time we will hear the Global application.

--- Upon recessing at 1100 / Suspension à 1100

--- Upon resuming at 1115 / Reprise à 1115

1644 THE CHAIRPERSON: Order, please. À l'ordre, s'il vous plaît. Mr. Secretary.

1645 THE SECRETARY: Thank you, madam Chair. Item 7 on the agenda is an application by Global Communications Limited for a licence to operate an English language FM commercial radio programming undertaking in Ottawa. The new station would operate on frequency 96,5 megahertz on channel 242P1 with an average effective radiated power of 3,600 watts.

1646 Madame Charlotte Bell will be introducing her colleagues. You have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

--- VIDEO PRESENTATION

1647 MS BELL: We are ready for your questions. We apologize for the sound, something went wrong.

1648 THE CHAIRPERSON: Thank you and welcome. I have a number of questions for you, at first related to the extent to which your proposal would be an addition to the diversity in the markets and so then we'll have a look at the music, the spoken words, et cetera and the format in general to understand how this would be adding diversity to the market, considering that we have a number of applications, we have 16 of them actually, who would be new additions to the Ottawa-Gatineau market.

1649 So, first, the format. We would like to understand better how different it is to what's available in the market, how different it is from what other... from the other proposals that are before... that are before us.

1650 You describe it as a new modern sound to music of the past in your supplementary brief. I was looking at pages 6 and 7:

"... and as the softest side of vocal music that would appeal to the 34 to 54 demographic, as a station with a calm, relaxing soft sound, more engaging than the elevating music of the easy-listening version that we have known up to date, therefore, made up of a distinctive blend of softer music, not currently available in the markets."

1651 So, how different do you see your proposal to first what's in the market and popular, especially CGMG with Magic 100 which has been focused on as appealing to this demography? How different would it be, your proposal?

1652 MS BELL: It's a good question, madam Chairperson. We looked at CGMG. CGMG is, as you've heard earlier this morning, a soft rock station and it does not include or if it does include any category 3 music, I think, they would be quite marginal. I am not aware that it includes any of it, so it's very very different.

1653 I would say that according to the play lists that we have developed for this format and what we know that they are airing, there might be a 20 per cent overlap of artists.

1654 We did also a BDF check, air play check for the community in Ottawa just to see in terms of who we had on our play lists and what other stations were playing, so it's very little overlap. Most of the artists we had, had either no air play at all, zero spins, because that's what they're counting.

1655 In a couple of cases, Johnny Mitchell had one spin, Van Morrison had four. The only two that were notable were Norah Jones and Josh Groben which is interesting, and they each had 28 spins.

1656 One of the big difference between a main stream AC station like CGMG and the station that we are proposing here is that the repeat factor is much lower on the new easy-listening format. It would probably... you would probably find it at 10 a week. On an AC station it's 25.

1657 So, I'm assuming, and I'm probably assuming correctly, that that was one selection for Norah Jones and one selection for Josh Groben that were aired by CGMG. So, having said all of that, I think there is quite a bit of difference between the two.

1658 In terms of the other applicants, if you would like me to answer that at this point, we have taken a look at the play lists that were filed and we appreciate the Commission asked all applicants to file play lists, made it easier for us to see what the differences and similarities were between the different proposals.

1659 In terms of the Astral proposal, we find that it's a little bit more of an AC main stream station for a couple of reasons. They are not planning to do instrumental music. There is a very low level of category 3 music and we looked at the artist list. They included artists there, I guess a few more main stream artists than we would have included in our play list, probably because they don't have a lot of category 3 music.

1660 And as I've said, they would have no instrumental music either. We would have 20 per cent.

Also, they're proposing to cater to women and I think their proposal is more niche programming than what we are proposing to do. So, in that case, there are quite a few differences between us and the Astral proposal.

1661 In terms of the triple S and CKMW, just quickly. CKMW is the closest proposal that you have in front of you, to the one that we have filed. According to their play lists, according to the amount of instrumental music and vocal that they're planning to do and in terms of the amount of category 3, I think they are very very similar.

1662 The triple S is also similar, but they filed a smaller play list, so it was a little bit difficult for us to tell, but I think that the difference there is that all of their category 3 music looks like it would be in the jazz genre, as opposed to us where we are going into spoken and other types of softer music.

1663 THE CHAIRPERSON: You mentioned vocal to instrumental. So yours is 80 to 20?

1664 MS BELL: That is correct.

1665 THE CHAIRPERSON: And is that what you consider to be the major difference between easy listening of the past?

1666 MS BELL: I would say that is definitely a major difference, yes.

1667 THE CHAIRPERSON: To remain diverse, would it be wise of us to ask you if there is a level of vocal instrumental that you would be prepared to live with?

1668 MS BELL: Well, we are prepared to live with it. It depends if you are talking about a condition of licence. Is that what you are referring to?

1669 THE CHAIRPERSON: Well, if you make the vocal to instrumental a main characteristic of what distinguishes your proposal from others or what is in the market at the moment, wouldn't it be legitimate to perhaps consider requiring that it remains new listening and doesn't get old over time -- the old easy listening?

1670 MS BELL: That it would -- that whatever would revert -

1671 THE CHAIRPERSON: Well, if you --

1672 MS BELL:  -- back to the old easy listening format?

1673 THE CHAIRPERSON: Because you have made it an important characteristic between easy listening as we know it, and the new easy listening which would be more vocal to the extent of 80/20.

1674 I think I heard you say that, or did I, that the Astral proposal that we just heard had less instrumental music than your proposal. Is that correct?

1675 MS BELL: I think they have none.

1676 THE CHAIRPERSON: None.

1677 So would you not consider it legitimate for us to wonder whether we could demand that you stay with that proportion of vocal to instrumental?

1678 MS BELL: I think it's --

1679 THE CHAIRPERSON: Not in relation to what is in the market at the moment, like AC, for example, which is very popular. I would expect -- would you see that station as having more or less instrumental than what you propose --

1680 MS BELL: I don't think they have any instrumental. I don't think they have any.

1681 THE CHAIRPERSON: It is all vocal?

1682 MS BELL: M'hm.

1683 THE CHAIRPERSON: So that is not what will distinguish it, your proposal from CJMJ's format?

1684 MS BELL: No.

1685 THE CHAIRPERSON: No.

1686 MS BELL: Part of what distinguishes it is that we do have some instrumental. We have some -- 20 per cent Category 3 music also, which distinguishes it also.

1687 THE CHAIRPERSON: That is a clear distinction and one that you, I think, have accepted would be a condition of licence, the Category 3 proportion?

1688 MS BELL: We have accepted the Canadian content related to the category.

1689 THE CHAIRPERSON: The Canadian content?

1690 MS BELL: Yes.

1691 THE CHAIRPERSON: You wouldn't accept that the Category 3 -- what happens is easy listening, new listening, the number of spins, all of that, it is very difficult for us to distinguish are we adding something to the market or are we not, because then people tell us, "Well, it is different because it will be more vocal. It is different because it will be Category 3, but I am not sure I am going to stick with that", is what I am talking about.

1692 What we end up with at the end of the day is back to almost regulating format, or else adding stations that will compete in the market or have an impact in the market by actually offering something that is not very different from what is available.

1693 MS BELL: This station is going to be very different from what is available and we are certainly committed to it, and we are certainly committed to stay within the format.

1694 The only problem we have is not our commitment to stay within the format. It is that we have no control in terms of what others will do in the marketplace and that they can do freely because Commission policy does not regulate formats. So within a year of being in this format, another station could completely change its station format and compete head to head with us, and if we had no ability to adjust ourselves because of that we would be the only ones and we would be the only ones at a competitive disadvantage in the marketplace.

1695 THE CHAIRPERSON: So let me rephrase my question then.

1696 You say you are proposing a format. You intend to stick with it. With regard to what is in the market at the moment, especially CJMJ, tell us again what it is that will be different, having discussed that requiring of vocal to instrumental is not something that you are prepared to accept, nor that you do Category 3.

1697 So if you were sitting here what is it that you think you would like to hear from your team as to whether this will bring diversity to the market?

1698 MS BELL: Well, as we have explained, the format is markedly different from what you get on CJMJ. What I am trying to understand is, are you asking me to make a commitment or to agree to a condition of licence that would tie us --

1699 THE CHAIRPERSON: No, no.

1700 MS BELL: Okay.

1701 THE CHAIRPERSON: We are trying to understand better to what extent this new easy listening format does bring diversity to the market and will continue to bring diversity to the market. Because it is not just commercial impact or financial impact on existing players, but we are also mandated to try to see that the listener gets something different, and to understand just how different that is, which has to be more than just adding the word "new" in front of easy listening, since we have easy listening, is simply my -- because you are not prepared to say, "Well, we will -- what it is that distinguishes it -- we are not prepared to accept commitments.

1702 I understand that the policy is now that formats can be changed, but at least we want to know what are the characteristics of what you are proposing in a competitive circumstance that would lead us to believe that this is the one to licence because the listeners will get something that they don't get now.

1703 MS BELL: Well, I will begin and then maybe I can pass it over to Mr. Oakes who did the format survey.

1704 But as part of his research; actually on page 13, he provided a chart that gave you very distinct differences between old easy listening, new easy listening and mainstream adult contemporary. As you would see if you go through the chart, there are a number of clear differences between the two formats. The first one, obviously, is --

1705 THE CHAIRPERSON: To instrumental?

1706 MS BELL: Yes.

1707 THE CHAIRPERSON: The very one you are not prepared to make commitments about.

1708 MS BELL: We are committed to it, but I am not prepared to commit as a condition of licence at this time.

1709 In terms of the music tempo, adult contemporary stations have a variety of different music styles and the tempo is not necessarily soft and melodic at all. It will be mixed in with a variety of other music styles that would disrupt the softer flow. In terms of the number of times selections are repeated in a week, usually on average it is 25, and in terms of a new easy listening it would be around 10.

1710 There is more current music on mainstream adult contemporary, the ratio being 40 to 60, whereas new easy listening the ratio is 20 to 80.

1711 We will be doing specialty music. They don't provide any specialty music.

1712 Our Canadian content is higher.

1713 The other main characteristic is the size of the play list because of the repeat factor. The size of the play list would be around 1,500 for new easy listening and most AC stations are around 800. So again, there are a number of variables there that are very different.

1714 THE CHAIRPERSON: And I guess your video was aimed at giving us a reflection of the fact that you will not share songs to a large extent with existing. Is that how I read this?

1715 MS BELL: Yes.

1716 THE CHAIRPERSON: The line that says "sharing with new easy listening, sharing songs"? In other words --

1717 MS BELL: It is about 20 per cent.

1718 THE CHAIRPERSON:  -- there will only be 20 per cent of overlap between the songs or --

1719 MS BELL: That's right.

1720 MS CHAIRPERSON:  -- even maybe the cuts in albums, I suppose, and CDs which --

1721 MS BELL: Absolutely. The other thing is the new easy listening format is more album-driven, whereas on an AC station it is more hit-driven. Our hit ratio would probably find itself between 35 and 40 per cent, as opposed to a higher percentage which you will find on most AC stations.

1722 So again, there are a number of variables.

1723 THE CHAIRPERSON: Now, we also have before us two jazz proposals, something that your company is familiar with, one in French and one in English, and there is competition, obviously, for the market and for a few frequencies. How different would it be -- now, you will have 30 per cent Category 3 music. How much of that do you expect would be smooth jazz or would be jazz, because I think somewhere you said it would include world beat, jazz, folk --

1724 MS BELL: Folk.

1725 THE CHAIRPERSON: How much would be jazz and to what extent would there be overlap there with these proposals where, obviously, to the extent that their specialty formats they have to do 70 per cent jazz, but the other 30 per cent could be a category to music and it could in fact be the type of music that we have heard this morning; correct?

1726 MS BELL: M'hm.

1727 THE CHAIRPERSON: Conversely, you could have -- all your Category 3 music could be jazz. Then how different would these proposals be from yours?

1728 MS BELL: I would say 10 to 15 per cent would be jazz.

1729 THE CHAIRPERSON: Of the Category 3?

1730 MS BELL: No, of the -- I'm sorry, no, no. We are doing 20 per cent Category 3. Now, I am getting confused.

1731 THE CHAIRPERSON: Well, I am talking about 34 jazz --

1732 MS BELL: That's right.

1733 THE CHAIRPERSON:  -- specialized music.

1734 MS BELL: I think a little more than a third of our Category 3 music would be jazz. It would be a little bit more than folk and world beat, yes. Because we consider jazz --

1735 THE CHAIRPERSON: When you say Category 3 it includes 34, which is another definition of --

1736 MS BELL: Jazz.

1737 THE CHAIRPERSON:  -- jazz. So then what is your comment about the extent to which these proposals are different from yours?

1738 MS BELL: The jazz proposals, I think they would be quite a bit different from ours. We have a jazz station in Winnipeg and I think there is a small amount of overlap in terms of the play list, but this station, the new easy listening format, has more of a mainstream feel to it, far more Category 2 music. So I mean, I think the sound of the jazz station and this type of format would be quite different, even though it would have a jazz element.

1739 We did look at jazz. We tested jazz in the market and the demand we found for jazz was not significant enough to make a station viable in this marketplace.

1740 THE CHAIRPERSON: Some of you -- well, Mr. Jones, you are in Kitchener with "The Beat"?

1741 MR. JONES: Yes.

1742 THE CHAIRPERSON: What is The Beat?

1743 MR. JONES: The Beat is a rhythmic CHR radio station totally different to what we are proposing here today.

1744 THE CHAIRPERSON: And different, obviously, from the Winnipeg station.

1745 MR. JONES: Very much so.

1746 THE CHAIRPERSON: And would I see a difference from the proposal in Halifax? I wasn't in Halifax. What did you tell the panel in Halifax about what the new listing format would be, the same thing as this one?

1747 MS BELL: Yes, we did. It is the same thing, except we added an element of Celtic music in Halifax to reflect the local --

1748 THE CHAIRPERSON: Now, help me. Is that Category 3 music?

1749 MS BELL: I believe it would fall under Category 3.

1750 THE CHAIRPERSON: Do you recall what your Category 3 --

1751 MS BELL: Commitment?

1752 THE CHAIRPERSON:  -- commitment was in Halifax?

1753 MS BELL: The same thing.

1754 THE CHAIRPERSON: The same thing as here?

1755 MS BELL: Yes.

1756 THE CHAIRPERSON: So --

1757 MS BELL: It is the same model, Madam Chair.

1758 THE CHAIRPERSON: Yes. I don't know if any of you are -- how familiar you are with the Winnipeg station. So you say it is very different from the Winnipeg station.

1759 MS BELL: It would have to be because the Winnipeg station is 70 per cent Category 34.

1760 THE CHAIRPERSON: And what do you do with the other 30 per cent, do you know?

1761 MS BELL: The other 30 per cent, I think some if it would overlap with the Category 2 music on this play list, yes. Not all.

1762 THE CHAIRPERSON: If someone were to listen to your proposal and to what they hear in Winnipeg, how different would it be?

1763 MS BELL: Night and day, I would think, yes.

1764 THE CHAIRPERSON: And colder in Winnipeg?

--- Laughter / Rires

1765 MS BELL: And colder in Winnipeg. We should have called that one "The Chill".

1766 THE CHAIRPERSON: And how different is this proposal from CBC-2, for example?

1767 MS BELL: CBC-2 does some jazz programming. It is specialty programming. I think it is very different from CBC-2, very different.

1768 THE CHAIRPERSON: I realized as we were looking at it that Oakes did some format research for you, but have you looked at any similar formats in the United States?

1769 MS BELL: Actually, I think Mr. --

1770 THE CHAIRPERSON: Contemporary or new easy listening?

1771 MS BELL: I think Mr. Oakes is acquainted with a couple of stations. I will ask him to answer that question.

1772 MR. OAKES: Thank you, Charlotte.

1773 Yes, I have. Since Halifax I have been busy on the internet finding out what formats the United States are coming up with and if they are roughly similar to this. Over the last year there has been more stations in major markets that are going this way. Some are calling themselves "light AC". Others are a different format called "adult standards", Frank

Sinatra, Tony Bennett, et cetera. There are a few stations without question that are close to what we are going to do. One of them is in St. Louis and it debuted about eight months ago. They have only had one book, one rating, WRDA FM 104.1 -- it calls itself "Red FM".

1774 We probably share from listening to it and seeing what they have -- we probably share 80 per cent of the artists and their presentation would be a little different from us. It is very lean and mean and very little talk. In America that would probably be the closest one. The second closest one is one in Miami, WLYF FM 101.5, and we might share 50 per cent of what they play.

1775 THE CHAIRPERSON: I was more interested in how well they are doing and once they are operational in the market just how different they are.

1776 You have a licence to have this new listening, easy listening formats since last Friday, or authority in any way to launch one in Halifax. I guess your view would be that that doesn't exist in Canada at the moment?

1777 MS BELL: Not exactly --

1778 THE CHAIRPERSON: Good answer.

1779 MS BELL:  -- this format.

1780 THE CHAIRPERSON: Because it is going to be diverse. At least, in this market we don't have one. But it is interesting how you talk about these stations as new listening and they are called soft AC. It just shows my point that it is difficult to really get a fix on just how different they are except by looking at the play list, probably.

1781 So how different are they, those that are already in the market, because we don't have one to compare here, I guess?

1782 MR. OAKES: Well, the St. Louis station is very similar to us. It has got a --

1783 THE CHAIRPERSON: No, no, I mean how different from what has been known before. We are being told this is a new beast and we are trying to get a fix on how new is it. Obviously, you convinced the panel to some extent about something in Halifax, but in this area, how different is it from what we have already?

1784 So I am asking you, are you aware of how different these stations are from what has been known before? What makes them -- what characterizes them as a different format in the ones that exist in this?

1785 MR. OAKES: Well, Charlotte has covered most of it with Majic 100.

1786 THE CHAIRPERSON: So these are the --

1787 MR. OAKES: That's the closest one. Other than Majic 100 there is nothing in this market that is even remotely close to this.

1788 THE CHAIRPERSON: Now that you have the same format proposal licenced in Halifax, will there be some sharing of any programming production?

1789 MS BELL: We don't plan on doing a lot of program sharing. There might be an opportunity to have a one-hour program featuring new Canadian artists in this music genre where we would have perhaps local artists from Halifax and Ottawa, if we had the licence, and they would have exposure to both markets.

1790 These stations are going to be local and so there will not be a whole lot of program sharing. It cannot be more than one program a week, if that.

1791 THE CHAIRPERSON: You mean one program per week, per day?

1792 MS BELL: Per week.

1793 THE CHAIRPERSON: Per week. Where it wouldn't really matter where it was produced from?

1794 MS BELL: That's correct.

1795 THE CHAIRPERSON: Because it would not be of a local nature.

1796 MS BELL: That's correct.

1797 THE CHAIRPERSON: I have already tried to see to what extent the vocal as opposed to instrumental is important. Even in the Oakes research, I guess, it is described as dominantly vocal, so 80 --20 would be soft. It is not edgy music, but definitely vocal, and you have already told me you are not prepared to accept a condition of licence that would limit you to 80.

1798 The Canadian content, however, would be a condition of licence for you, in Category 2, and 30 per cent in Category 3.

1799 We have already discussed, then, the Category 3 music would be complementary to this file. So I suspect that in 34 it would be more of the more quiet type of jazz?

1800 MS BELL: That's correct.

1801 THE CHAIRPERSON: Because we have blues, soft contemporary, jazz, jazz funk and funk. So it would be more the softer side?

1802 MS BELL: That is correct.

1803 THE CHAIRPERSON: Of 34.

1804 MS BELL: And including some instrumental.

1805 THE CHAIRPERSON: In Winnipeg you cover, I suppose, a greater range of jazz music.

1806 MS BELL: Because it is 70 per cent of the schedule so, yes, a very broad range.

1807 THE CHAIRPERSON: So you would cover most of the 34 type.

1808 In the Category 2 music, is there a music style that is easy to recognize that would be the mainstay of the proposal? For example, in the Oakes research at page 18 we have music styles there defined -- at page 18 of the Oakes research. What would you consider the mainstay style of your particular proposal? It is called easy listening music, but in the primary music styles does the proposal -- would you have an emphasis, let's say, on soft pop as opposed to --

1809 MS BELL: I think the emphasis would be on soft pop and probably re-recorded standards by more contemporary artists. I think that would be the bulk of the play list and, certainly, the play lists that we provided as a sample.

1810 THE CHAIRPERSON: Now, in this research this was to try to -- these are the nine styles that you tested in your research?

1811 MS BELL: Mr. Oakes --

1812 THE CHAIRPERSON: On page 18 there.

1813 MS BELL: Yes.

1814 THE CHAIRPERSON: This table is the nine styles that were the most -- these are the percentages of the interests of the people you tested?

1815 MR. OAKES: Right.

1816 THE CHAIRPERSON: After exposing them to greater styles?

1817 MR. OAKES: Twenty-three (23) styles I tested.

1818 THE CHAIRPERSON: Yes, and you can see the primary styles. The percentage is not greatly different, I guess?

1819 MR. OAKES: Right, but those four styles would make up the bulk of the sound.

1820 THE CHAIRPERSON: Now, in the spoken word, which is going to be, I gather from your response to the question 5 in the deficiency letter, response letter, that it will be 89/11 per cent, so 11 per cent of spoken word programming.

1821 MS BELL: That's correct.

1822 THE CHAIRPERSON: Is it your view that the Gatineau, the Ottawa/Gatineau market, 35 to 54, is under served with regard to spoken word?

1823 MS BELL: We are actually catering to the 35 to 64.

1824 THE CHAIRPERSON: Sixty-four (64), excuse me.

1825 MS BELL: Okay. Are they under served in terms of spoken word, I wouldn't -- I would not say that. In fact, I would say that in the Ottawa markets, two of the top stations are actually talk radio, which is CBO and CFRA. So I would not say that they are under served.

1826 I think that you have to, as a music-based service -- and I think when people go to our station, they are going to go primarily to hear music. At the end of the day, I think they also want, and we found that in our survey -- they want news and they want surveillance information because they don't want to have to -- if they want to know the weather or if there is an accident at the corner of Bank and Slater, or if the Portage Bridge is blocked, they don't want to necessarily have to change stations. So you include an amount of spoken word on your station to provide enough surveillance and news headline information so they don't have to go back and forth.

1827 THE CHAIRPERSON: Now, in your supplementary brief, at page 10, you have identified what you see as -- and what Mr. Oakes, I guess, saw -- as in the spoken word what this demographic and those who would be listeners to the new easy listening format would want. Part of it was, as you say, surveillance, weather, et cetera, but also local area entertainment information seemed to be of some importance. Am I correct?

1828 MS BELL: That's correct, yes.

1829 THE CHAIRPERSON: Is what this demographic interested in -- that is interested in the new easy listening, is it a question of substance or of style, the type of new -- of spoken word content?

1830 MS BELL: Actually, Madam Chair, I don't think that we tested whether it was substance or style. I really do believe that when you ask people, and I think that is what Mr. Oakes did, is simply ask them if they wanted -- if news and information programming was important to them on a music station, if weather or traffic and that sort of information was important, and they said overwhelmingly "yes".

1831 Obviously, the presentation style of this information would be different on an easy listening station than it would be on a rock station. Your announcers would be approaching the material with a different tone so the sound would be different.

1832 THE CHAIRPERSON: Yes.

1833 MS BELL: And the tone would be different.

1834 THE CHAIRPERSON: Yes. I see in your supplementary brief, for example, at page 7, that you do say that the style of the spoken word will be different because you want a consistency of approach and you want to reflect a calm, relaxing sound. So now I quote:

1835 "The style of the spoken word

programming must also be soft and relaxing so that it blends seamlessly with the softer music styles."

1836 So that is style. What about substance, news, et cetera? Some of it will not -- somebody suggested yesterday that they could help do news differently with a smile, which was -- gave me a smile that you would do that on radio, but what -- the style is clear. What will it do with substance?

1837 MS BELL: I am going to ask --

1838 THE CHAIRPERSON: Will it have an impact on what you choose to cover to report, to talk about?

1839 MS BELL: I am going to ask David Jones to answer that question.

1840 MR. JONES: I think the best way to characterize that is we would approach it that if it matters to somebody who is 35 to 64 in this market, that is certainly something that we would cover. It wouldn't necessarily get into a jazz style or something along those lines. It would be important to 35 to 64 year olds.

1841 THE CHAIRPERSON: Though, you will have news that is the type of news that one expects anywhere else?

1842 MR. JONES: I would not characterize it that way because, as Charlotte mentioned, if there are a couple of -- and there are two talk news stations in the market. So they would obviously get into things that were more in-depth and possibly different from what we would cover. We would cover news so that our audience would be informed as they are being entertained with the music that we play on the station so that they don't feel they have to go somewhere else to get that information.

1843 THE CHAIRPERSON: Are there then special challenges in fitting the spoken word content in that type of format?

1844 MS BELL: I don't anticipate that there are any special challenges at all, no.

1845 THE CHAIRPERSON: So you will report the bad news as well as the good news?

1846 MS BELL: Absolutely. Always, with a smile.

1847 THE CHAIRPERSON: Because they may not be calm, relaxing or soft.

1848 So the spoken word content, information, et cetera, if it is bad weather you can't smile and say it is good weather.

1849 MS BELL: No.

1850 THE CHAIRPERSON: And the source of information you don't anticipate --

1851 MS BELL: Madam Chair --

1852 THE CHAIRPERSON:  -- will be that different in that portion.

1853 Now, I suppose there will be spoken word content introducing music as well?

1854 MS BELL: That's correct.

1855 THE CHAIRPERSON: And that's where both the style and the content will be -- of the spoken word will be different?

1856 MS BELL: And this is a more mature audience and, as you heard this morning, you are looking at the Ottawa market where there is a high level of people with university educations who have certain expectations. You have to tailor your information programming to the marketplace that you are in and their expectations and the age demographic. That's exactly what we are going to do here.

1857 THE CHAIRPERSON: Interestingly, I know that when one discusses the CBC or SRC there is always the question of the appeal of having no commercials for some listeners, but to what extent those of you who are in radio, to what extent do you see the success of the CBC in this market, certainly, and in French in particular, to what extent it is because it is a more thoughtful, less strident approach, that they are successful? I think CBC-1, Radio One, is very successful in Toronto as well.

1858 MS BELL: It is extremely --

1859 THE CHAIRPERSON: Mr. Oakes, are you nodding because you are surprised?

1860 MR. OAKES: Not at all. I listen to it. I have listened to it for quite awhile. It is extremely popular because it is, one, non-commercial; two, is one of the best at disseminating information. It has talk shows during the day. It has expert opinion and it is a very well-programmed station. Its rating -- it is the top station in the market.

1861 THE CHAIRPERSON: You can say as much at CBC-2, which would be more comparable; right, more music and less spoken word?

1862 MR. OAKES: Yes. The music is drastically different from what we would be doing, but classical music generally doesn't get large shares.

1863 THE CHAIRPERSON: No, and they would have, of course, some programs that would be more strident or the more edgy jazz, et cetera, which you won't have on your --

1864 MR. OAKES: Correct.

1865 THE CHAIRPERSON: So you would consider CBC-2 very different from the format?

1866 MR. OAKES: Very different.

1867 THE CHAIRPERSON: But the approach of being less strident would be more similar or more thoughtful?

1868 MR. OAKES: More mature, yes.

1869 THE CHAIRPERSON: To CBC-1.

1870 Now, in local programming in your application -- I am looking at 7.6 -- which gives us 42 hours because that is required if you are going to get advertising, what do you see will be local programming? You told me a while ago you may have an hour with Halifax, but apart from that will all the programming blocks be produced here in your studio?

1871 MS BELL: I would say that almost 100 per cent, except for perhaps a few hours of syndicated programming that may be added. I would say there would never be more than maybe six or eight hours a week.

1872 MR. JONES: I think it would be safe to characterize that we would share some programming with our newly-licenced station in Halifax because it is so similar. To what extent we do that we would have to obviously figure that out, but a couple of hours a week wouldn't be unrealistic, as we could potentially do with our jazz station in Winnipeg. We could share potentially an hour of week of jazz with our jazz station in Winnipeg. Obviously, that would be local in the market that it is produced, but it would not be in the other markets that would use it.

1873 THE CHAIRPERSON: And when you say "syndicated programming" what are you referring to?

1874 MS BELL: I am referring to other programs that might fit our format that we could purchase ads in the schedule, not that we have anything planned at this time. But as the format develops and is emerging in the States, there might be other programs that are of interest to our audience.

1875 THE CHAIRPERSON: That are already pre-organized?

1876 MS BELL: That's correct. But I think that this would represent a very small proportion. That's usually evening-type programming.

1877 THE CHAIRPERSON: But during the broadcast day before midnight?

1878 MS BELL: That's correct.

1879 THE CHAIRPERSON: Yes. To what extent does the Canadian content requirement put a bit of a cold shower on getting program blocks?

1880 MR. JONES: Big time cold shower, which is why I say it might be more advantageous for us to develop things within the new Halifax station and the Ottawa station, if it is licenced, and potentially the jazz station. When Charlotte says syndication, there is nothing that would preclude us from possibly syndicating from within and, again, sharing that material with the other markets.

1881 THE CHAIRPERSON: Otherwise, you have to make up for the lack of possible -- lack of Canadian content in the rest of the programming block.

1882 We have asked you, of course, about editorial independence, and you did mention this morning at page 8 that you will benefit from news-gathering possibilities as well as cross-promotional resources, but that your proposal would have a dedicated news department including a news director responsible for decisions. You were asked this question before, so you made some comments in the first question -- the answer to the first question of our deficiency letter.

1883 You mention there at answer 1(b) that:

1884 "The national news gathering

1885 provided by CanWest will be a

1886 resource..."

et cetera.

1887 So it will be only national that -- national news that will use the news-gathering facilities of other CanWest properties?

1888 MS BELL: I will ask David Jones to answer that.

1889 THE CHAIRPERSON: Because the Ottawa Citizen covers local news as well. Are you going to limit it to national news?

1890 MR. JONES: What we are contemplating is CanWest News Service, which is somewhat of an equivalent to BN, which other radio stations have used, broadcast news, which streams news and information. We would utilize the CanWest News Service to focus on national items, but we would certainly do local news and focus locally on the news wherever possible. In that respect, we would have a separate news staff at The Chill.

1891 THE CHAIRPERSON: I have heard you before and I have read you again about the difference between news gathering and news production, so to speak -- I think that's the way you put it -- and my question is, will the local news-gathering facilities of other CanWest properties, which in this market includes the newspaper mostly, also be shared?

1892 MS BELL: Each asset will have its own separate news gathering. Will they ever collaborate and work together? Yes, they would.

1893 Frankly, other outlets in this market collaborate with the Citizen and other local newspapers and other sources in terms of getting their news gathering. So it would be ridiculous for us not to use the source that others also go to in the marketplace.

1894 THE CHAIRPERSON: What will the newsroom of your proposal look like if you were licenced? How big would it be? How complete would it?

1895 MS BELL: It would be one news director and four reporters and journalists.

1896 THE CHAIRPERSON: And you would actually have a newsroom, an actual physical newsroom?

1897 MS BELL: David, would you like to --

1898 MR. JONES: I think the short answer is yes, we would have a separate newsroom, news director and reporters, yes.

1899 THE CHAIRPERSON: So then at the answer to question 3, you commit that you will have separate and independent news management and presentation structures for radio and print operations in this market?

1900 MS BELL: That is correct.

1901 THE CHAIRPERSON: And you also accepted in that same answer to have a condition of licence related to editorial independence similar to the one that was imposed in Winnipeg.

1902 Can I take it that if we took that condition of licence and changed the word "television" for "newspaper," that is the type of condition of licence you would be expecting to have as a condition of licence?

1903 MS BELL: Yes, it would be.

1904 THE CHAIRPERSON: Exactly the same, okay.

1905 CTD, there are a few things we would like some more details on. The $30,000 per year which is allocated to support the Ottawa International Jazz Festival, Cisco System Bluesfest and the Blues in Schools Outreach Program, what type of arrangements or agreements would you undertake to allocate this money in that fashion? Because we don't have very many details about that one, the way we have about others of your proposals.

1906 MS BELL: Mm-hmm. We have had discussions with all of those organizations and what they have agreed to is to use those funds and what we have asked for is that that money be used to showcase Canadian artists for the two festivals.

1907 In terms of the Blues in Schools, we would, obviously, want them to use the money to prepare materials for that program or cover travel costs or the cost of running that program. So that is a little bit different.

1908 Have we signed agreements or anything? No, we haven't. We have simply had preliminary discussions with all of those groups at this time.

1909 THE CHAIRPERSON: And you are not in a position to actually tell us more in detail, as you have, for example, for some other of your proposals, how the cash will be allocated, for exactly what?

1910 MS BELL: I don't have breakdowns for all of those. If the Commission wishes us ---

1911 THE CHAIRPERSON: Can you provide that?

1912 MS BELL: We could do that.

1913 THE CHAIRPERSON: Counsel can speak to you as to how to do that --

1914 MS BELL: All right.

1915 THE CHAIRPERSON:  -- because you have given us, for other Canadian talent development projects, more --

1916 MS BELL: Detail.

1917 THE CHAIRPERSON:  -- detailed allocation of the funds and in what fashion.

1918 MS BELL: No problem.

1919 THE CHAIRPERSON: I understand that you can't have signed agreements until you know whether you are putting this forward, but how do you see it, because it gives us a better idea of how it is done.

1920 Now, if any portion of this particular proposal were deemed not to be eligible, would you accept to redirect the funds to support another CTD application?

1921 MS BELL: We would, absolutely. We would either redirect to StarmakerFund because we know that is accepted or FACTOR.

1922 THE CHAIRPERSON: And in the meantime, it may be found to be satisfactory --

1923 MS BELL: That is correct.

1924 THE CHAIRPERSON:  -- once we have more details.

1925 Now, I have discussed a little bit the diversity, et cetera, with you as to how we can actually determine -- the other question that the Commission gets into, of course, is the impact on the market that the proposal at this time would have and the extent to which it may be wise or not. In some cases, of course, it is to your advantage if you are the one who has a station that will suddenly get some competition.

1926 You have projected that 50 per cent of your ad revenues would be generated from existing local radio stations; correct?

1927 MS BELL: I am going to ask Ken Johnson to answer those questions.

1928 MR. JOHNSON: Yes, we have. Fifty per cent of our potential revenue would come from existing radio stations.

1929 THE CHAIRPERSON: Now, in the Oakes research project at page 14, Mr. Oakes, am I to understand from that that what you tried to do there was to project where the 4 per cent share projected in year one would come from? Is that correct? By delineating the stations where this 50 per cent proportion -- in this case, we are not talking money, we are talking hours tuned, but is that how I am to understand that?

1930 MR. OAKES: Yes.

1931 THE CHAIRPERSON: That, for example, 25 per cent of your expected share would be garnered from CJMJ? Is that how I am to read this?

1932 MR. OAKES: In doing my projections here -- or my calculations here, I was just looking at hours tuned, okay. So what I did was I ---

1933 THE CHAIRPERSON: But isn't the aim eventually to say where your 4 per cent -- how your 4 per cent will be garnered?

1934 MR. OAKES: Right.

1935 THE CHAIRPERSON: Yes, okay.

1936 MR. OAKES: Okay. But these are -- there are two ways you can look at the hours tuned to new station: one, hours tuned created that aren't currently there --

1937 THE CHAIRPERSON: Yes.

1938 MR. OAKES:  -- and secondly, taking --

1939 THE CHAIRPERSON: Yes.

1940 MR. OAKES:  -- listening from other stations.

1941 THE CHAIRPERSON: Yes.

1942 MR. OAKES: Those percentages relate to taking from other stations but it is of the hours tuned from the other stations, not the new hours tuned. So if we are looking at 4 per cent share ---

1943 THE CHAIRPERSON: Yes. But let me ask you more simply, is the 272 in the third column total for hours tuned -- does this mean that 2.72 per cent of the share that will be ---

1944 MR. OAKES: Of the 4 per cent, yes.

1945 THE CHAIRPERSON: Of the 4 per cent.

1946 MR. OAKES: Right.

1947 THE CHAIRPERSON: And it will be taking .68 from CJMJ, et cetera, down as you go?

1948 MR. OAKES: Correct.

1949 THE CHAIRPERSON: Correct, okay.

1950 So why is there nothing from CIHT, the new dance station?

1951 MR. OAKES: They are currently not listening to it. If they are, they are in another category and it is around 1 per cent. The same thing with the tuning to the French stations, is tuning was so low I didn't put it in.

1952 THE CHAIRPERSON: Yes, that was my next question. We talked to everybody about the cross-tuning phenomenon and I don't see, even though we know that there is a fair amount of cross-tuning ---

1953 MR. OAKES: Well, not with this audience.

1954 THE CHAIRPERSON: Not with this audience?

1955 MR. OAKES: No. They are approximately ---

1956 THE CHAIRPERSON: No one who listens to CIMF, for example ---

1957 MR. OAKES: Some do but it is under 5 per cent, total listening to Hull-Gatineau stations.

1958 THE CHAIRPERSON: CIMF?

1959 MR. OAKES: Once again, yes. Now, that is the AC station? Yes.

1960 THE CHAIRPERSON: Yes.

1961 MR. OAKES: But it is small. It is under 5 per cent.

1962 THE CHAIRPERSON: So you wouldn't see this station as taking any, not even a very small proportion of its tuning from the French stations in similar format?

1963 MR. OAKES: Correct, I don't see very much at all.

1964 THE CHAIRPERSON: And of course, what is your correlation between the 50 per cent revenues from existing stations and the 2.72 per cent of the 4 per cent share you project? How do you go about correlating the share into revenues?

1965 MR. OAKES: Ken Johnson, I think, can answer this better than I.

1966 MR. JOHNSON: Madam Chair, it is not a direct correlation. Certainly, we expect that of the revenues we would be taking from existing stations, most of them would come from CJMJ and CFRA. I think what we have to do is stand back and look at the real impact.

1967 We are looking at a $60 million market with a growth rate over the last five years of about 7 and a half per cent. In our calculations, and we were conservative, we would take about -- 50 per cent of our first year's revenue would be about $900,000. If you even take half of that or a quarter of that from each of the stations, I think the real dollars effect on those stations would be minimal. Also, the growth of the market would pretty much make all of the existing stations in the market whole inside of the first year.

1968 So again, yes, there is going to be some impact but I think it is going to be minimal to the existing stations in a real dollar term.

1969 THE CHAIRPERSON: You have given us an estimate of how much of your revenues would come from new listening. How much of the hours tuned would come from new listeners to radio? Have you calculated that, Mr. Oakes?

1970 MR. OAKES: You mean new listeners, people that have never listened to radio before in this market?

1971 THE CHAIRPERSON: Mm-hmm.

1972 MR. OAKES: There is so few of them, it is under 5 per cent that currently don't listen at all.

1973 THE CHAIRPERSON: It is not relevant?

1974 MR. OAKES: No.

1975 THE CHAIRPERSON: Now, how possible would it be to -- I am not asking you to make one but how would one go about taking your page 14, Mr. Oakes, and your colleague, and tell us exactly from which stations the revenues will come from? So 50 per cent of your first year revenues are a million, are they not, or more -- almost two million, right, first year revenues projected?

1976 So now, you are quite ready to tell us that 2.72 per cent of the 4 per cent will come from these stations and that 50 per cent of the revenues will come from existing stations but that there is not necessarily a correlation between the two, but what would it look like if we tried to see where the 50 per cent of the $1.9 million -- which is a million dollars -- who would it be taken from?

1977 MR. OAKES: Well, I think it would come from the stations that we impact with hours tuned and Majic 100 would have the largest ---

1978 THE CHAIRPERSON: But you told me earlier that it is not correlated necessarily ---

1979 MR. OAKES: I am sorry ---

1980 THE CHAIRPERSON: Well, the hours tuned and the revenues --

1981 MR. OAKES: Right.

1982 THE CHAIRPERSON:  -- that flow with it is not necessarily an easy correlation. Could I transcribe it by taking the .68 and say that is the station from which X amount of dollars will come of the million?

1983 MR. OAKES: Okay. Mr. Johnson will handle this.

1984 THE CHAIRPERSON: There is a disconnect between share and revenues, obviously.

1985 MR. JOHNSON: There is a whole lot of market impact in terms of competitiveness, in terms of how stations sell their inventory, but I guess to give you a bit of a sample here, if 25 per cent of our share is going to come from CJMJ and we have $900,000 that we expect to come from existing stations, they would represent about $225,000 of that.

1986 THE CHAIRPERSON: Twenty-five per cent?

1987 MR. JOHNSON: Yes.

1988 THE CHAIRPERSON: And are you prepared to get me closer to 50? We now have 25 per cent.

1989 MR. JOHNSON: We have CFRA at 21 per cent. So again, they would be in around the $200-225,000 range, if you assume ---

1990 THE CHAIRPERSON: So it is an approximate correlation --

1991 MR. JOHNSON: Absolutely, yes.

1992 THE CHAIRPERSON:  -- it is not a real correlation.

1993 MR. JOHNSON: Absolutely, yes.

1994 THE CHAIRPERSON: Okay. Because you often hear, no, no, there is no correlation.

1995 Now, at 5.5 of your application, under financials, you have a -- in answer to question 5.5 -- do you follow me -- you have questions about financial operations and you are projecting there a 7 per cent share of the market in years six and seven, right?

1996 MS BELL: That is Katherine Browne.

1997 MS BROWNE: Yes, that is correct.

1998 THE CHAIRPERSON: And I think, Mr. Oakes, at pages 7 and 9 of your study, you say that it could be as much as 9 per cent at maturity, correct?

1999 MR. OAKES: Correct.

2000 THE CHAIRPERSON: Why is it 7 instead at maturity?

2001 MS BROWNE: Well, Mr. Oakes' research is coming up with the maximum potential that can be achieved in the marketplace with this format. Obviously, in developing our business plan, especially for the first licence term, we would want to inject a certain amount of conservatism in the numbers to ensure that we could achieve a certain financial matrix, and therefore, it is our estimation that we can get to about 7 per cent in the licence term.

2002 But obviously, at some point, the maximum potential could be achieved but we didn't want to build that into the business plan within the first licence term.

2003 THE CHAIRPERSON: So more a question of being conservative.

2004 To what extent does that affect -- of course, what we were talking about, the correlation of the revenues was for year one, which was a 4 per cent share. So how it develops over seven years is something that you chose to be more conservative about.

2005 Now, we talked about cross-tuning and a possible effect on the French stations in the market, which is, of course, of interest to the Commission. For those of you who are familiar with Ottawa, I mean there is not a heck of a difference between the two in terms of coverage. You know, there is just a bridge in between and a very high percentage of bilingual people, especially when you are talking about an English station. We all know -- everybody has the numbers -- that the tuning of francophones to English stations is fairly high. It seems to be going down slightly but it is still close to 30.

2006 When I look at 5.2 under your marketing in the application and then we look at the 3 mV per metre contour and the .5, I mean it definitely straddles both markets, right? And the population that is there, it is a million, in the .5 contour is the entire population of the Greater Ottawa-Gatineau.

2007 I am really curious, Mr. Oakes, why on your page 14 there is no effect shown on French-language stations that would have some similar music to the one proposed.

2008 MR. OAKES: Well, when I isolated this audience, I was curious to see what the tuning was to stations in Hull-Gatineau, and the tuning by this group to Hull-Gatineau stations is dramatically below the market average for Ottawa. And I just did Ottawa, so I couldn't do the reverse. I couldn't find out people in Hull-Gatineau, whether they would listen to the station because I didn't survey that area.

2009 THE CHAIRPERSON: Yes, I see that you only surveyed Ontario --

2010 MR. OAKES: Right.

2011 THE CHAIRPERSON:  -- to find out what the interest was. What kind of picture does that give us of impact on the market if you didn't check what would happen with this new listening format, what the effect would be on the francophones in Ottawa? There are lots of them too. Did you survey any francophones in Ottawa?

2012 MR. OAKES: Yes.

2013 THE CHAIRPERSON: Yes.

2014 MR. OAKES: And they are in this ---

2015 THE CHAIRPERSON: But not over the bridge?

2016 MR. OAKES: Right. But if you look over the bridge, there is only one station that comes even remotely close to the format that we are doing and it is an adult contemporary station.

2017 THE CHAIRPERSON: Yes, but it could well be that there would be a lot of people interested in you, listening, who are not satisfied at the moment and listen maybe to their second best and would now be listeners to the new station.

2018 MS BELL: We do anticipate that there will be some listenership from the Gatineau area, of course. We considered this question before asking Mr. Oakes to do the research and, in fact, we considered very carefully should we be surveying residents in Gatineau.

2019 The problem is if we had done that, we would have had to remove them from the results in order to build the business plan because it would have skewed the results. They are sold separately and the purpose of the research for us is to help us in terms of estimating who we are going to reach and how we are going to build a business plan. So even if we had done it, we would have had to remove them.

2020 But of course, we expect that there will be people from the Gatineau area listening to the station, as Ottawa people listen to Gatineau stations, and there are so many people living on both sides who work -- who either live in Ottawa and work in Gatineau or vice-versa that there is always going to be cross-tuning in this market.

2021 THE CHAIRPERSON: Why would it have skewed the results? We heard someone mention how air time is sold in this area -- I would like to hear some more -- but why would it have skewed the results?

2022 Is it not of interest to an advertiser to know that the francophone -- we have 3 BBMs in this market, don't we? BBM measures the total listening, the francophone listening and the anglophone listening; isn't that correct?

2023 MS BELL: I will ask Ken Johnson to answer that.

2024 THE CHAIRPERSON: And also when you sell air time in this market, what would you put forward to the potential advertiser?

2025 MR. JOHNSON: The reason we didn't include it is because the advertisers treat the English market and the French market as two totally distinct markets with different strategies, different creative, different budgets. One budget does not affect the other.

2026 In actual fact, I think the previous applicants said that they have been trying to sell their Gatineau station in English Ottawa and have no success. It is because clients treat them as totally two different markets.

2027 So although there will be some listeners from Gatineau, it will not affect the budgets financially whatsoever because we will not get any credit from an advertiser for the Gatineau audience.

2028 THE CHAIRPERSON: Is that cast in stone, that if you start a new format that you can't sell the idea that francophones are listening to it too and --

2029 MS BELL: Yes, we have been struggling with that in Montreal also.

2030 THE CHAIRPERSON:  -- you can't factor it in?

2031 MR. JOHNSON: I have been selling in the business for 25 years, and in Montreal as well, the exact same issue sits there. I absolutely have been trying for 25 years and it is in stone, it won't change. Clients treat the markets totally separate.

2032 THE CHAIRPERSON: No matter how new the format is?

2033 MR. JOHNSON: If it is a different market, it is a different language.

2034 THE CHAIRPERSON: You expect to have a positive PBIT by year three and to reach $3.5 million in revenues at that time and $5 million by year seven.

2035 Now, since there is a disconnect, you say, between -- well, it doesn't seem to be that severe -- between share and revenues, to what extent are the revenues dependent on achieving the shares over time?

2036 MS BROWNE: I guess I am not 100 per cent sure what you are asking. Basically, the revenues that we have projected are entirely dependent on the share that we have projected.

2037 THE CHAIRPERSON: Okay.

2038 MS BROWNE: Yes.

2039 THE CHAIRPERSON: That is how you calculate it?

2040 MS BROWNE: Yes.

2041 THE CHAIRPERSON: And your view with impact is to say well, you expect the market to grow from what everybody accepts is $56 million in '03 -- or is that '04? Your year one would be '05 and you expect -- $60 million is what you project in your supplementary brief. Remind me, was $56 million the '03 or '04 numbers for the market?

2042 MS BROWNE: $56.7 for the market was 2003.

2043 THE CHAIRPERSON: $56.7?

2044 MS BROWNE: Yes.

2045 THE CHAIRPERSON: And do you have any idea how '04 is developing?

2046 MS BROWNE: No, we don't have any --

2047 THE CHAIRPERSON: No?

2048 MS BROWNE:  -- intelligence on that at the moment.

2049 THE CHAIRPERSON: But you expect -- you are projecting $60 million by year one?

2050 MS BROWNE: That is correct, yes.

2051 THE CHAIRPERSON: And how is that arrived at?

2052 MS BROWNE: Basically, we took the $56.7 and grew it 4 per cent per year up to the first year of our application.

2053 THE CHAIRPERSON: And so you are saying then that of the $4 million growth that you expect if you were licensed, your projected $2 million in year one could be accommodated just by the growth?

2054 MS BROWNE: Yes, based on ---

2055 THE CHAIRPERSON: Only half of the growth would be enough to accommodate the $2 million without having an undue impact on other stations or as an argument for saying that there won't be undue impact?

2056 MS BROWNE: I think what Ken was referring to was that the growth in the marketplace in the first year that we would be operating would be enough to make the current incumbents whole by the end of the first year of our operation.

2057 THE CHAIRPERSON: Yes, and that is $2 million and the growth is 4, so that half of the growth would be enough to accommodate you, and you use that as an argument for saying there won't be significant impact on the other stations?

2058 MS BROWNE: Just to clarify, the growth between year one and year two in the market we have projected at $2 million.

2059 THE CHAIRPERSON: But between now and when you launch --

2060 MS BROWNE: That is 4, yes.

2061 THE CHAIRPERSON:  -- the market will have grown by $4 million?

2062 MS BROWNE: Yes.

2063 THE CHAIRPERSON: And then your projections are the growth -- what you are saying is not the fact that the market is growing, it is the growth between year one and year two you are talking about?

2064 MS BROWNE: Yes, because, in fairness, when we enter the market in year one, the current incumbents would have already benefitted from the $4 million growth between 2003 and 2005.

2065 THE CHAIRPERSON: And then if I relate that to your page 14, Mr. Oakes, it means that a station like CJMJ would have made more money anyway, so the amount you are taking from them is not going to be very dramatic?

2066 MS BROWNE: That is correct.

2067 MR. OAKES: Yes.

2068 THE CHAIRPERSON: Mr. Oakes.

2069 MR. OAKES: Correct.

2070 THE CHAIRPERSON: Okay.

2071 MS BELL: Plus they did not intervene in this process. So if they felt they were going to be significantly impacted, they might have said something or we would have expected them to.

2072 THE CHAIRPERSON: Okay.

2073 Now, where we are talking about the ability of this market to accommodate you and your plans without having an undue impact on the others' performance, have you thought about whether the Commission would do a Halifax and give a number of licences and what that would do?

2074 MS BELL: We have considered that you might do that. Are you asking us which ones we can live with?

2075 THE CHAIRPERSON: What is your view about how you could be accommodated if we decided to give more licences --

2076 MS BELL: I think ---

2077 THE CHAIRPERSON:  -- than just saying yes to your proposal?

2078 MS BELL: Well, we would thank you for saying yes to our proposal but we could also -- I think we could ---

2079 THE CHAIRPERSON: What about the others?

2080 MS BELL: That is right. I think we could live with another English-language proposal that is targeting another demographic ---

2081 THE CHAIRPERSON: Just demographic or format, because demographic is pretty broad.

2082 MS BELL: It is broad but I think if ---

2083 THE CHAIRPERSON: You are not concerned about format?

2084 MS BELL: We are concerned about the format but I think all of the similar formats are targeting the 35+.

2085 THE CHAIRPERSON: So you would eliminate that demographic --

2086 MS BELL: That is right.

2087 THE CHAIRPERSON:  -- which I was wrong about, which goes up to 64?

2088 MS BELL: That is correct.

2089 THE CHAIRPERSON: Your underlying assumptions, which are in your application at 4.4, under financial, I was curious to see that it has as one potential problem future technological change. What you were doing there is saying that your projections may be changed because of some potential unknown future events and one of them is future technological change.

2090 I also see that the second bullet is regulatory approval of additional new entrants in the Canadian broadcasting marketplace, and then the next bullet is future technological change.

2091 What was intended by that?

2092 MS BROWNE: There isn't anything specific that we are anticipating but essentially, you know, we put forward in an application process seven years of financial projections and within a seven-year time frame it is hard to anticipate the types of changes that might happen technologically which could impact for the better or for the worse these financial projections. It is basically a general statement. Again, we weren't thinking of anything specifically.

2093 THE CHAIRPERSON: Okay, so I can take it that the second bullet is what we discussed earlier, additional new entrants in this market, and you would see a problem if there was another proposal that had as its target demographics the same as yours.

2094 Now, would you add male -- female-male to the 35-64 as well as a problem?

2095 MS BELL: I think that anyone who is targeting the 35-64, in fact, this format skews quite well to females. I think our ratio would be 60-40 on the female side. So it would still -- it would be competitive.

2096 THE CHAIRPERSON: That is what you have.

2097 Are you prepared to go further as to exactly which proposals you would find it difficult to live with if we were to license more than one?

2098 MS BELL: All right, if I must. I think that we would consider the Astral proposal, the Triple S proposal and the CKMW/The Jewel proposals to be directly competitive, even though there are differences, and that it would be problematic for us if you ---

2099 THE CHAIRPERSON: And not the Smooth Jazz proposals?

2100 MS BELL: The Smooth Jazz proposal ---

2101 THE CHAIRPERSON: You see, this is usually -- you start by asking how diverse will you be --

2102 MS BELL: That is right.

2103 THE CHAIRPERSON:  -- and whoa, it is not easy to get answers, but when you say who could you live with, it gets a little bit more -- a little more narrower.

2104 So those three then. What else?

2105 MS BELL: Those three.

2106 And the Smooth Jazz, if it remains a speciality licence and remains a smooth jazz service, then we would not have a problem with that one.

2107 THE CHAIRPERSON: No. Well, we certainly -- since they will have conditions of licence, we will certainly expect them to ---

2108 MS BELL: That is correct.

2109 THE CHAIRPERSON: Okay, because it does narrow -- after all this discussion --

2110 MS BELL: Mm-hmm.

2111 THE CHAIRPERSON:  -- you say well, who can you live with and still make your $2 million, we get answers more quickly.

2112 Now technically, you have -- oh, remind me. Have you told us -- yes, you have a second choice of frequency because there are many -- because 96.3 and 5 are, of course, mutually exclusive. There are many competitors on either of these frequencies.

2113 We will ask you in a few minutes -- some of my colleagues may have questions -- to tell us why this frequency, either of them, should be granted for your proposal. This is your last chance at the end of this process to tell us why it would be in the public interest to give the frequency to this proposal.

2114 In the meantime, Commissioner Langford has questions.

2115 COMMISSIONER LANGFORD: Thank you, Madam Chair.

2116 A very picky question but since we have done the list with the Chair, I just thought I would throw in the Christian application, which format-wise, of course, is very different but does target your demographic exactly. What is your reaction to that one?

2117 MS BELL: My understanding is that that station is not a music-based station, that there is a small percentage of the programming ---

2118 COMMISSIONER LANGFORD: About 22 per cent music, they told us, quite unlike your music but still targeting the older demographic; 78 per cent then spoken word but still very clearly targeting -- only because you used the word "demographics."

2119 MS BELL: Absolutely.

2120 COMMISSIONER LANGFORD: It was very clearly targeted at that demographic.

2121 MS BELL: I appreciate the question and thank you for the opportunity to clarify that. We would not have a problem with that.

2122 COMMISSIONER LANGFORD: Thank you, that is my only question.

2123 THE CHAIRPERSON: Counsel.

2124 MR. WILSON: Thank you, Madam Chair.

2125 Just to circle back to your discussion with the Chair with respect to the breakdown on this $30,000 per year and just if we can pin down the timing by which you would be able to file something with us on that.

2126 Would you be able to file that breakdown by the beginning of the reply stage, Phase 4?

2127 MS BELL: Oh, absolutely. Yes.

2128 MR. WILSON: Those are my questions, Madam Chair.

2129 THE CHAIRPERSON: Now, there is your three minutes.

2130 MS BELL: It is a shame -- maybe not.

2131 COMMISSIONER LANGFORD: And you can't show us the video again. It is too long.

2132 MS BELL: Well, we apologize for that.

2133 Why us? I guess I would take you back to the licensing criteria and talk a little bit about how we fulfil the licensing criteria.

2134 We have put together an innovative proposal for this market in a format that is not available in this market.

2135 We have a sound business plan that is conservative but it is sound, cash-flow positive in year three.

2136 This is a new exhibition window for Canadian artists that are rarely heard on commercial radio, and from what we have gathered in the research that we have done, there is very little of the music that we are proposing to air that is actually being heard here.

2137 I think our CTD commitments are quite important and extensive and they also tie into the local community, with more than 75 per cent of those dollars being spent here to help nurture and promote artists. So I think that the nature of the Canadian talent development package is also something that is very important for the Commission to consider.

2138 Beyond that, we were just talking a moment ago about new technologies and how that might impact us, and I go back to the hearing that you held just a month ago looking at subscription radio and satellite radio and a variety of new technologies to bring this into Canada.

2139 This type of new service is going to have eventually an impact on conventional mainstream radio and I believe that -- I think it is important for the Commission to have strong radio players and media companies that are able to compete because we are constantly being bombarded by new technologies that are coming either from other countries or within Canada, that are fragmenting audiences and advertising revenues, and I think that strong players are something that need to be taken into account.

2140 We thank you very much for your attention and we look forward to seeing you in the next phases.

2141 THE CHAIRPERSON: Thank you for your cooperation. That ends the first phase for you and we will see you again.

2142 We will adjourn until 2:30. Alors, nous reprendrons à 14 h 30.

--- Upon recessing at 1300 / Suspension à 1300

--- Upon resuming at 1430 / Reprise à 1430

2143 THE CHAIRPERSON: À l'ordre, s'il vous plait. Order, please. Mr. Secretary, please.

2144 THE SECRETARY: Thank you, Madam Chair. Item 8 on the agenda is an application by John Wright & Douglas Kirk, on behalf of a corporation to be incorporated for a licence to operate an English-language FM commercial radio programming undertaking in Ottawa. The new station would operate on frequency 96.5 MHz, on channel 243A, with an effective radiated power of 700 watts. The applicant is proposing to operate a Triple S music format featuring a blend of smooth jazz, soft AC and standards.

2145 Mr. John Wright will be introducing the panel. You have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

2146 MR. WRIGHT: Thank you. Madam Chair, Commissioners, I am John Wright, I am a licence holder for K-Rock 105.7 in Kingston and I will be the President of this new company.

2147 Before we begin our presentation, I would like to introduce the rest of the panel. Behind me on my right is Wayne Stacey. Wayne is our technical advisor and one of Canada's best known and most respected broadcast engineers. Beside Wayne is Douglas Kirk. Doug is a majority shareholder and President of the Wave 94.7 in Hamilton and Durham Radio in Oshawa. Doug is a committed radio broadcaster and Chairman of Smooth 96.5.

2148 Beside Doug is Carol Welsman. Carol is an award-winning Canadian contemporary jazz pianist, vocalist, performer and songwriter. Sandy Singers joins us by video. Sandy is a member of the Kingston Talent Development Board, Manager of the Kingston Food Bank by day and a musician by night. Beside Carol is Nura, a Canadian contemporary vocalist. Beside Nura is Kellylee Evans, a Canadian contemporary vocalist and recent performer at the CAB.

2149 On my right is Andrew Forsyth. Andrew is with Bond & Associates, Canada's foremost radio consultants. Andrew has 10 years of being a program consultant to private radio stations across Canada. Ken Rockburn will be joining us on video. Ken is a well-known Ottawa broadcaster, he has 15 years experience with CHEZ, he was five years as host of Ottawa CBC's All in a Day and it achieved the highest rated drive show position on any CBC radio station in Canada. Ken is Host Producer of Talk Politics on CPAC, he is a communicator, he is commentator, he is a champion of the arts and we are very proud that he is going to be our morning show host on Smooth 96.5.

2150 On my far left is Brenda Tirrell. Brenda started radio at CHOM in Montreal, continued at CFR in Calgary, she has been with many community organizations here in Ottawa, and she will be the community relations director at Smooth 96.5. To my left is Ross Tirrell. Ross joined the radio business at CHOM in Montreal, he spent quite a number of years as Vice-President of Sales for Rawlco Communications, he was recently Station Manager at CKBY in Ottawa, and Ottawa Sales Manager for the Rogers Group of Companies. He is a Director, a shareholder, he will be Vice-President and General Manager of Smooth 96.5.

2151 We will begin our presentation now. Smooth 96.5 is the name for our proposed broadcast undertaking to serve Ottawa-Gatineau. We believe approval of our application will significantly increase the choice and diversity for local listeners. Smooth 96.5 will be very different from any of the current stations in Ottawa and will target the underserved 45 plus listener. Smooth 96.5 is designed as a lifestyle radio station. It will combine our Triple S music format with news and information built around our five foundations of interest.

2152 This is a new independent radio company, but our shareholders have years of experiences, owners and operators of radio stations. We are also the only English-language FM music applicant with local ownership management. Our presentation will address the financial health of the Ottawa-Gatineau market, the impact of our proposed new radio station on existing stations in the market, our programming and Canadian talent development initiatives and the diversity we bring to the market as applicants.

2153 MR. TIRRELL: We believe that Ottawa- Gatineau has the necessary social and economic infrastructure to support a new radio station. It is the fourth largest urban area in Canada and ranks fifth in the world for research and development. Ottawa boasts average household income levels 20 per cent above the national average and 28 per cent of the population hold university degrees, well ahead of the national average of 17 per cent.

2154 Let us look at how our application might impact existing stations. First, are we likely to take away any significant audience numbers from existing stations? Secondly, what effect will we have on the financial health of the current operators?

2155 This chart shows the core demos for the English-language FM stations currently serving Ottawa. Core demo is defined as the demo or a group of demos that make-up 50 per cent or more of a station's hours tuned. None of the existing FM stations in Ottawa have a core demo similar to what we will target or a format similar to the Triple S format on Smooth 96.5. Smooth 96.5 is targeting Ottawa listeners 45 to 64 and will have minimal impact on existing stations. Please note that we have included CKBY which, although currently licensed to serve Smiths Falls, covers the Ottawa market and has done so for many years.

2156 This next chart shows the financial health of the Ottawa radio industry. It details Ottawa radio profit before interest and taxes over the past five years, which has grown by an average of 29.9 per cent annually for that period of time. For the year ending August 31, 2003 Ottawa profit before interest and tax margin was 27.2 per cent, while the national average was 19.3 per cent. The annual dollar growth of radio advertising in Ottawa-Gatineau is well over double the projected first year revenues for Smooth 96.5.

2157 We conclude, Smooth 96.5 will have no significant financial impact on existing radio stations. In summary, Smooth 96.5 will cause no significant audience erosion to existing stations and the Ottawa radio market is robust enough to allow revenue growth on these stations while absorbing the launch of Smooth 96.5.

2158 MR. FORSYTH: This chart maps the profile of each of the Ottawa Anglo FM stations by age and gender appeal. The 12 to 54 year old Ottawa FM radio listener has many choices, but the majority of these stations serve 25 to 45 year olds. Stations centre their appeal to this core. The younger segment, 12 to 25, is well covered by three stations catering to the Rock, Pop and Top 40 tastes of that group. The older generation, 45 plus, has no one station targeting their needs. The obvious hole in the market is 45 plus, the older boomer generation.

2159 To investigate this underserved market, John and Doug commissioned Hendershot Research of Hamilton to test four different formats with adults 36 to 64. Smooth Jazz, Soft AC, Standards and the hybrid Triple S format combining those three formats. The goal was to determine a unique format to serve listeners 45 to 64. Soft AC had very strong appeal to 45 to 54, but its strongest appeal was 35 to 44, younger than desired and basically a direct competitor to Magic 100.

2160 John and Doug then developed a hybrid format, the Smooth Jazz, Soft AC, Standards or Triple S format. This combines songs from artists that the three styles tested, Smooth Jazz artists like Diana Krall, Dave Koz and Gino Vannelli with Soft AC artists like Sarah McLaughlin and Jessie Cooke along with Standards from Neil Diamond, Barbara Streisand and Frank Sinatra. These styles were then tested as the Triple S format with the target 45 to 64 year old group. Twenty-three and a half per cent indicated they would make this their favourite station, about 15 per cent more than Soft AC.

2161 Typical hours of music show a blend of the three genres of the Triple S format, Smooth Jazz, Soft AC and Standards. The mix is smooth, soft and we think very hip, plus it is designed 40 per cent Canadian content. Here is an example of an hour:

2162 This midday hour showsa mix of soft AC artists like Seal and Alicia Keys, standards from artists like Al Martino and The Carpenters, and smooth jazz from Chris Bodie, Bryant Hughes and Boz Skaggs.

2163 A balanced flow with appeal 45-64, familiar soft favorites from the 60s and 70s, as well as complementary styles from contemporary artists, adding to diversity, with little duplication of music found of existing stations.

2164 Smooth 96.5 will be a unique radio station for Ottawa/Gatineau, both musically, and through spoken word, originating from the commitment to local news and the lifestyle design of the Smooth 96.5 "Triple S" format.

2165 MR. TIRRELL: As a long time Ottawa resident, and someone connected with the industry, I am aware that spoken word content is very to the Ottawa community. That is why it is important in our plans to build a lifestyle radio station combining information from our 5 foundations of interest in conjunction with our unique "Triple S" music format.

2166 Our newscasts will seek out, feature and follow stories from one of our foundations of information. Our reporters will have a regular beat, encompassing contacts from each of our five chosen interest areas. Longer-form features will evolve from the original stories. Guests, primarily from one of our foundations of interest will join Ken regularly on the morning show.

2167 We will have information packages every thirty minutes in morning drive, again at noon, and at the top of the hour through afternoon drive.

2168 Special two-minute foundations of interest features will be scheduled hourly, from 10 a.m. to noon and from 1 p.m. to 4.

2169 MR. FORSYTH: These foundations of interest will be topical, tied to the day's news. Need-to-know as well as Good-to-know information, information that will impact 45-64 year-olds.

2170 For example, the morning newscast might have a clip form a local doctor commenting on a newly developed treatment for stroke victims, cross-promoting a background discussion which will follow in the morning show and be capsulized and aired during the midday program, important lifestyle information delivered intelligently from a rolodex of local experts from fields as diverse as law to art appreciation, from contributors who are regular on the radio station.

2171 MR. TIRRELL: Ken Rockburn will speak on video about his morning show and his personal connection with Smooth 96.5 and our community of listeners.

2172 MR. ROCKBURN: What John Wright, Doug Kirk and Ross Tirrell have done here makes me very excited because it brings together all the elements of radio that I have loved from my entire career: Good music, of course, a connection to the community -- and when I say a connection to the community, I mean a real connection, not that sort of photo-op, advertiser-driven connection that many radio stations have to their community, I mean a real connection -- and also smart talk.

2173 When I say smart talk, I don't mean smart-aleck talk, I think that is far too often the currency in radio stations, not just in Canada, but also across North America these days. I mean intelligent talk, when I say that, talk that addresses the serious and the not-so-serious issues that are of concern to your listeners, and that's what we're going to do with Smooth 96.5, we're going to address those issues around the lifestyle areas that John, Doug and Ross have identified for you here today.

2174 My Morning show on Smooth 96.5, for example, will be just that; it will be an amiable, palatable mix of all of those things: Up-to-the-minute local news, good tunes, information, all wrapped around those 5 lifestyle areas.

2175 So, for example, over the course of my morning show, you might hear a conversation with an author or two, or a musician or two. We'll look at politics and health, all of those issues that play an important part in the lives of the audience that we are hoping to appeal to.

2176 This is what I believe radio should be, not ghettoized talk, not ghettoized music, we don't live our lives that way; radio should reflect our lives.

2177 Our plan is to make Smooth 96.5 an indespensible part of the lives of our listeners, to be as much them as they are us, and that is, of course, Ottawans, we are all Ottawans. Finally, I have to say that it is my belief that a locally-owned, independant, community-based radio station like this one is the only kind of radio station that can respond to its audience in any real way.

2178 The audience that Smooth 96.5 is appealing to is also, from my experience, an audience that has been largely ignored in the Ottawa market, and I think this radio station will go a long way to correcting that oversight.

2179 For all of these reasons, that's why I'm in.

2180 MS TIRRELL: Good afternoon.

2181 My position at the new Smooth 96.5 will be tat of the community relations director. I am going to be drawing on my past experiences in radio, working with non-profit organizations, as well as my 15 years on school counsels.

2182 These experiences will help me with my responsibilities, which will include the Canadian Development Program, our PSA bank of 1,500 commercials, as well as establishing and growing our website and our special events. These events will revolve around our lifestyle foundations, which include food and wine, music and entertainment, travel, personal health and personal finances. This is what will make us an adult lifestyle station, connected to our 45-64 listener community.

2183 In addition, I will be working with non-profit organizations, as well as our local musicians, and our showcase of talent arranged under the three headings of, "The Next Diva", "The Torch Singer" and "The Jazz Singer".

2184 MR. WRIGHT: There is a business side of radio and then, of course, there is a fun side of radio. Where we get our biggest kick is uncovering, supporting and developing Canadian talent. If our application is approved, we will commit to 40 per cent Canadian content on-air, and we will spend $525,000 on direct expenditures over the 7-year term of the licence.

2185 Doug and Mary Kirk have an amazing track record at The Wave in Hamilton, they have become friends with more Canadian artists than most station management people have met in their careers. They not only play these artists at the station, do interviews, promote and finance their concerts, they also sell their CDs, providing exposure and marketing for many artists that don't have a distribution deal with a record label.

2186 Last year, K-Rock won the CAB Gold Ribbon for Canadian Talent Development. We were competing with stations many times our size, some with Canadian talent development budgets more than 10 times our size. We believe the commitment of station ownership and staff, plus the involvement of our Canadian talent development boards, have been a big multiplier effect on the cash expenditures.

2187 Of course, it's always easy for us to say we're dedicated and we're passionate about Canadian talent development, but then sometimes we're not the best judge of ourselves, so receiving a gold ribbon is confirmation to us that our efforts are truly above the rest.

2188 Artists, also, are a great judge of the sincerity and commitment of broadcasters in their own musical genre. We would like you to hear their words:

2189 First, Sandy Singers:

2190 MR. SINGERS: I almost hate to admit it, but I can go as far back as probably 15 years in knowing John. He was really instrumental in developing a sample CD -- in those days, I think it was a record, actually, but it could have been a CD -- spotlighting foundations of rock. It was really the only project of its kind, and it was so valuable because so many local artists at that time were given the opportunity to record and to be put onto a compilation that would represent music to the industry.

2191 John went away for a while and then had come back, about 4 years ago, in to the community to develop this new radio station. And in his absence, nothing happened. In his absence, there was no real radio station involvement in the musical community, and I think that Ottawa will benefit a great deal from this new partnership, this new development of a station there.

2192 MR. WRIGHT: Carol.

2193 MS WELSMAN: I am a pianist and jazz singer, as John mentioned earlier. I am also the owner of my own record label, and I have 5 CD in the Canadian market, three or which are owned by me -- my first three -- and I have relied solely on airplay for promotion and for exposure because of the fact that, though I have investors in my record label, we don't have promotional budgets anything like what the major labels would offer, and in the jazz world, we know that it is very small.

2194 Doug and Mary Kirk have been so supportive of my career, to the point of, even today, I tolf them I have on Celine Dion's new album, and they're actually playing the song and promoting the fact that I wrote it. So I must that I have received unprecedented exposure of my music in Canada thanks to Doug and Mary, so I am very very pleased to be part of the panel.

2195 MR. WRIGHT: Nura?

2196 NURA: Madame Chair, first of all, I'd like to say, I don't think I've ever been more nervous. I could do a concert better than this!

--- Laughter / Rires

2197 THE CHAIRPERSON: I assure you, we will not try to sing.

--- Laughter / Rires

2198 NURA: I would like to say that people at Wave, this stationis a station that feels like home, and they have been incredibly supportive of Canadian talent, which we sorely need in this country. They've promoted concerts, they've gotten involved with the community, they get very involved with the artists, they raise the awareness of Canadian to such an extent that I can safely say I don't think I would have a face as an artist in this country if it was not for these people.

2199 I strongly support their appeal.

2200 MR.WRIGHT: Thank you, Nura.

2201 Kellylee?

2202 MS EVANS: Thanks.

2203 As an Ottawa-based artist, I'm really excited about this application for Smooth 96.5. I personally would love a station that could provide opportunities for local artists like myself to actually have their music heard on the radio.

2204 Besides the CBC and college radio, I can't really think of a single station in Ottawa that would play my style of music, which has more of a smooth jazz sound.

2205 I've heard great things about Doug in Hamilton and John in Kingston and the work that they've done to support local and emerging artists. I know, in Hamilton, that Doug not only plays their music but he also sells their CDs in the station lobby, and that, in Kingston, John airs local musicians weekly.

2206 I'm realy excited about their mandate to provide airplay to Ottawa's emerging artists, I'm really excited about their mandate to promote local shows and performances, and I'm really excited about their mandate to provide grass-roots support in the form of talent development.

2207 These efforts are tangible and very much needed. The possibility of being mentored by a major label artist like Sarah McLachlan wold life-changing for local artists. Hearing our music between established artists like Céline Dion or Diana Krall would give our music intsant credibility.

2208 I, for one, am willing to support an application by a team of individuals who have shown in their life's work a strong desire to develop Canadian talent. This is an ethic our industry desparately needs, and Ottawa artists desparately need Smooth 96.5, and sincerely hope that this application is a success and smooth 96.5 becomes a reality.

2209 MR. KIRK: I'd like to talk for a moment about local ownership and diversity.

2210 Smooth 96.5 is about introducing an independant voice to Ottawa/Gatineau. Our application is the only English commercial application which is independant and has a component of local ownership. Ross Tirrell, a long time Ottawa resident and experienced broadcaster, will be a significant shareholder as well as the Vice-president and General Manager of the station.

2211 We believe we're exactly the type of new operators the Commission had in mind when it established the new commercial radio policy. We're independant, experienced, committed and local-market oriented.

2212 Regarding the market, there are currently 14 commercial radio stations licenced to serve Ottawa/Gatineau: 9 English, 4 French and 1 multilingual. Of the 9 English stations, 7 are owned by Rogers and CHUM, and the 2 others are owned by large groups, Newcap and Standard. Three of the 4 French stations are owned by Astral Media. There are also 2 stations licenced to Smith's Falls owned by Rogers which target the Ottawa Market.

2213 We currently have no interests in this market, either in radio or television broadcasting or local or national newspaper publishing or cable TV.

2214 Clearly, our application will provide Ottawa/Gatineau with an interesting, independant, locally mangaged new voice in radio.

2215 John?

2216 MR. WRIGHT: In summary, we believe our application to establish Smooth 96.5 will have the following benefits:

2217 We will be providing a new and distinctive programming choice to the underserved listeners 45+. We will offer these listeners a substatial amount of community-responsive news and information programming, built around our 5 foundations of interest.

2218 We are a new independant radio company to Ottawa, made up of experienced radio broadcasters.

2219 We operate operate successful stand-alone stations in Hamilton and Kingston, both competing with the big chains. This will provide new diversity of ownership to media in Ottawa.

2220 Our application features local ownership and management, making our decision making quick and responsive to the community.

2221 Smooth 96.5 will have no significant impact on existing stations, and;

2222 Finally, our application will over-deliver on Canadian talent development. Smooth 96.5 will take the same approach the Doug has done in Hamilton, that I have done in Kingston: Find the up-and-coming artists, play their music, support them when they perform, combined with 40 per cent Canadian content as a condition of licence, and expenditures of $525,000 over the term of the licence.

2223 For all these reasons, we believe licencing Smooth 96.5 is in the public interest.

2224 Thank you very much, and we'll be pleased to answer your questions.

2225 THE CHAIRPERSON: Thank you, Mr. Wright and your colleagues.

2226 Commissioner Williams, please.

2227 COMMISSIONER WILLIAMS: Good afternoon, Mr. Kirk, Mr. Wright and Smooth 96.5 panelists.

2228 I have a quick question in the area of control of the company and how that is structured, then I'll move into another whole series of questions, similar to what the other panels had.

2229 In our analysis, we note that the licensee will be controlled by the board, and John wright will have the deciding vote on the board. So, with Mr. Wright having 45 per cent of the shares, you would still have control of the entity, and how is that achieved?

2230 MR. WRIGHT: It's really a tie-breaking vote, so --

2231 COMMISSIONER WILLIAMS: How do you tie, though, is what I'm trying to figure out.

2232 MR. WRIGHT: I'm sorry, I'm not understanding --

2233 COMMISSIONER WILLIAMS: Well I see a 45 and 45 can -- or if there's 3 board members...

2234 How would you achieve a tie, is what I'm trying to find out, where that vote would be needed.

2235 MR. WRIGHT: I suppose that depends on the quorum at the meeting. I think I have, as I recall, 2 members of the board, Doug has 2 members on the board, and Ross has 1 member on the board.

2236 So if, at a meeting, there happened --

2237 COMMISSIONER WILLIAMS: Where there was an even number, you would have the ability to conduct business.

2238 MR. WRIGHT: Exactly, Correct.

2239 COMMISSIONER WILLIAMS: Okay. I understand. Thank you.

2240 In your supplementary brief, Appedix 1A, page 11 of your application, you describe your proposed "Triple S" -- and I'll probably direct all my questions through you, Mr. Wright, then you can redirect them to whomever you deem is appropriate.

2241 Your "Triple S" format is Smooth, Soft AC, Standards. You go on to state that your hybrid "Triple S" music format will offer Ottawa/Gatineau's 45+ adult listeners:

"... a unique and distinctive blend of smooth jazz, soft AC and standards."

2242 As you are aware, 3 other applicants are appearing at this hearing offering a somewhat similar music format proposal, designed to serve a similar demographic. As well, 2 applicants are proposing to serve the market's adult listeners with speciality FM smooth jazz formats.

2243 In reviewing you sample lists, and the music descriptions your hve provided in your brief, it appears that your "Triple S" format is based extensively on the New Easy Listening/Adult Standards-style format, recently developed in the U.S. and actively programmed in many U.S. markets.

2244 To assist us in the examination of your format proposal, would you object to our viewing your "Triple S" format as essentially a New Easy Listening/Adult Standards-style format? And if this is not acceptable, perhaps you could explain how your "Triple S" format differs from the New Easy Listening/Adult Standards-style format.

2245 It's a long question.

2246 MR. WRIGHT: It's a good one.

2247 I guess I'm not familiar with what an Easy Listening/Standards format would indicate, in terms of musical content that might be different from ours.

2248 We actually developed this, our particular format, on our own. We were unaware that there was another format around that was dealing with standards and with soft AC and with smooth jazz.

2249 We realize some of the other applicants do have mixtures, but I don't believe they cover that same mixture, so ours was developed through our research and if the other label, if the Easy Listening/Standards label applies to what we are doing, we would certainly be comfortable with it.

2250 COMMISSIONER WILLIAMS: Okay, that is good, thank you.

2251 Your proposed "Triple S" format would serve Ottawa-Gatineau's 45+ adult listeners, a group you have identified as being currently under-served by local radio. Other applications are before the panel proposing to provide similar formats to serve the same general audience group.

2252 Could you please explain how your format proposal differs, if at all, from the other similar format proposals that have been before us, or are about to be before us, from Global, CKMW and Astral?

2253 MR. WRIGHT: I am going to ask Andrew if he would comment in a moment.

2254 I think one of the big differences would be, first of all, our format is designed to speak to the 45+ target group as opposed to the 35+ target group, and that is a significant difference. There are a number of stations in the community whose prime target is 35-44, and as soon as our prime target is changed from 45 to 35, then we are now competing with existing stations in the market.

2255 So when we did our initial research, we found that the soft AC component of our music mix was definitely making us -- if we had gone with soft AC, we would have been a 35-54 radio station. So that is when we did the mixing of the three gendres to age our station and to avoid a conflict with Majic and the other stations that are targeted 35-44.

2256 I will ask Andrew to just expand on that a bit.

2257 MR. FORSYTH: The key difference certainly between this application and the other applications from Astral, Global and CKMW -- and again, we thank the Commission for requesting that each one of the applicants file a music list. It gave us an opportunity to be able to compare and go, have we got apples and apples and apples, or apples and oranges, or apples, oranges and some lemons, but what we have we got here?

2258 We looked at these and said, well, one of these appears to be to us, from our perspective, in a very limited look at their proposed play list, closer to a soft AC, which is where we did not want -- or John and Doug and Ross did not want to go. So one of the applicants, we feel, is closer to a soft AC, and John has already the issue with soft AC as the major component of format.

2259 The other formats proposed by Global and CKMW are closer to an extent to the "Triple S" format. However, certainly the Global application doesn't necessarily contain the same diversity, we feel, that this radio station is offering, and again, this is done just by sampling their play list. And the CKMW list also is a much more universal list and not perhaps as focused as what we would be looking at this radio station.

2260 This radio station comes from the core elements. The three core elements, again, are -- certainly, soft AC is a component, smooth jazz is a component and standards are a component, but there are also elements that will fall into that that come from areas such as Celtic music and from folk-based music, et cetera.

2261 So I think there are some components in this that certainly differentiate it musically from the other applications in front of you.

2262 COMMISSIONER WILLIAMS: Okay, thank you, Mr. Forsyth.

2263 Two applicants, 591991 B.C. Ltd. and Radio 1540 Limited, are proposing specialty FM smooth jazz formats, both proposed to serve an adult audience 24-54, which will overlap to a degree with your format's target audience and its core audience of 45+ adults. I also see you have confirmed that 25 per cent of your overall "Triple S" music mix would consist of Category 3 music drawn from sub-categories 34, Jazz and Blues, and 33, World. As well, both smooth jazz applicants have set out conditions of licence, a 70 per cent Category 3 minimum that could see them program up to 30 per cent Category 2 music.

2264 Based on their music list submissions, it would appear that Category 2 music both smooth jazz applicants would offer is similar to the soft AC standards type of Category 2 vocal music you would offer. This would appear to indicate a potential for upwards of, say, 55 per cent duplication in music programming between your "Triple S" format and the smooth jazz proposals.

2265 From your perspective and a listener's perspective, how would your proposed format and music mix differ from the two smooth jazz proposals?

2266 MR. WRIGHT: Again, I will ask Andrew to comment in a moment, but certainly, the biggest single difference is that we will be playing -- 25 per cent of our content will be from Category 3 and a smooth jazz station has 70 per cent minimum of their content from Category 3. So that is the biggest single difference between the two.

2267 Also, it might be important to mention at this point that there was a comment this morning that said that our 25 per cent, our Category 3 music was all going to be smooth jazz, and that was not a correct statement. Smooth jazz is certainly going to be a big component of our Category 3 but it is not all our Category 3. We will still be playing elements from other musical gendres in Category 3, but that would be the big difference.

2268 Andrew.

2269 MR. FORSYTH: I think John has given you a very good précis of it. When you get into the detail, rather obviously, the major difference is going to be that they will be playing 70 per cent Category 3 smooth jazz, and as John has already indicated to you, what this plan is looking at, the Category 3 component will have smooth jazz in it but there will be components of Celtic, of world beat, of folk music, et cetera in that package. So that will make a big difference.

2270 COMMISSIONER WILLIAMS: CJMJ FM and CHLX FM, Couleur FM and Majic 100 currently offer adult-oriented music formats -- and I understand you touched a bit on this on an earlier response -- targeting a similar audience as your "Triple S" format.

2271 In your opinion, how would your format specifically differ from these existing market stations in terms of competing for listeners?

2272 MR. WRIGHT: Majic is a much younger skewed radio station than we will be. They are a soft AC radio station. I believe they are calling themselves soft rock right now. They are very definitely a high repetition, mass market radio station. Their prime core target group is 35-44.

2273 Our target group is 45+. Our core, our sort of bingo target that we are going to serve is 45-64. So we are skewing ourselves much older than Majic and, again, we have a whole component of smooth jazz, we have a component of folk and Celtic, so we are playing musical selections that are very, very different than Majic.

2274 I would let Andrew, please, comment on the some of the musical selections that make us very different.

2275 I think the major difference between Majic and Smooth is going to be the fact that, as John has said, Majic is a soft AC, a smooth rock radio station. This radio station will not be chart-driven. They are driven by the chart. They would repeat their current material approximately 25 times a week. Repetition on this particular radio station would probably be in the order of 10-14 times a week. So the repeat factor would be a lot smaller.

2276 Not only would the repeat factor be smaller but, of course, the universe of music played would be larger. Typically, a soft AC would play from a list of approximately 600 songs, 600-800 songs. This station is proposing to play from a list of approximately 1,500 songs.

2277 So there are some very key differences to the texture and what components will make up the station. Smooth will be playing some instrumental material. I doubt that Majic is playing any instrumentals. They may play the occasional but they certainly don't play it as part of their regular menu of material. Certainly, Category 3 material, they are not playing any of that.

2278 We have looked at their play lists through BDS and basically have been able to look at them and say, well, the crossover between the two radio stations would probably be in the area -- week to week, it may vary but it would be between 10-20 per cent duplication as far as musical selections.

2279 COMMISSIONER WILLIAMS: Okay. Thanks again, Mr. Forsyth.

2280 Mr. Wright, in view of the number of music format choices currently available in the Ottawa-Gatineau market, why, in your opinion, do you consider your target audience to be under-served in the market?

2281 MR. WRIGHT: I don't know if the chart is available, if we can bring that back up, but when we look at all the existing radio stations in the market, if you look at their core demo, not one of them starts at 45. There is a good reason, of course, for this. Usually these reasons centre around money and the big advertising dollars are all centred within an 18-54 demo. So if you have a choice, that is where you would like to be and there is a good concentration of radio stations in that area now.

2282 So we looked at where there was a not a concentration, where there was an under-served market, and we discovered that the under-served market started at 45. The adults 45+ didn't have any radio station directed at them. So that is where we chose to start our research into what they needed.

2283 Andrew, any further comment? No? Thank you.

2284 COMMISSIONER WILLIAMS: Okay.

2285 Why do you believe your "Triple S" format would provide adults 45+ with the greatest degree of programming diversity and why does it represent the best choice of format to serve this audience?

2286 MR. WRIGHT: We looked at the needs and wants of 45+ with our research through Hendershot. It is very different than what is being offered on any other radio station in the market but the "Triple S" format is only part of that diversity too.

2287 Of course, spoken word represents a very large part of our difference as well, where we are going to be providing Ottawa -- we are going to build a community of interest around these five foundations.

2288 So we are different and we are diverse because of our music and we are also different and diverse because of our spoken word content.

2289 MR. FORSYTH: If I may just add to that point on spoken word content, Ottawa is well served by CBC and by CFRA. There are news talk radio stations that do provide services, spoken word services to 45+.

2290 We are talking about a music-based radio station that is going to be serving the 45+ audience but the spoken word on it will be tailored to the music and it will work with the music, talking about lifestyle issues that appeal to people whom the music addresses.

2291 It is a very important issue when you look at what is available on morning radio, in particular in this marketplace. I think Ken sort of touched on it in his video piece but what he was talking about was information and discourse in morning shows that is really targeted to an adult audience, and that is something that this radio station intends to bring to the marketplace.

2292 COMMISSIONER WILLIAMS: Thank you.

2293 Maybe going a little further along the spoken word path, first, based on your market research, what are the expectations and needs of the 45+ age group audience and how do these needs and expectations differ from the majority of active adult listeners in the market that seem satisfied with the level and quality of spoken word programming provided by the incumbents?

2294 MR. WRIGHT: That is a good question. We found that the 45+ market is under-served in Ottawa. So they may be listening to certain areas by default but they are not totally happy with their current choices.

2295 So we feel it is an under-served group of listeners and when we designed the format to serve this under-served group, we designed it for 45-64 year olds, for people that are, we hope, near to retire and maybe retired, and our spoken word content is designed around those interests.

2296 We are trying to build a lifestyle radio station with a community of interests and with the music that matches with that lifestyle.

2297 Andrew may have a further comment.

2298 MR. FORSYTH: It is probably easier to speak in terms of examples and I gave you one in the presentation relative to having a local doctor comment on actually a University of Calgary funded research project which has discovered that ultrasound is a very good tool in healing individuals who have suffered from stroke.

2299 We take that type of story -- and that would certainly be of interest, I think, to anybody who is 45+ -- and get some, again, local input on it so that there is some local direction, and that would be not necessarily a talk-show type of information piece but an interview backgrounding piece that would at least direct people to be able to go to other places to get information, whether it was a local medical Web site or the Canadian Heart and Stroke Foundation Web site, et cetera, et cetera. So there is that type of information.

2300 There would be information, as an example, on the financial side, rather than just this is how you invest your money. It is not necessarily going to that type of thing as much as just commenting on where the money is going. If you have an RSP and your RSP has Nortel in it, what do you do with the current status of Nortel? Well, there are class action suits taking place. How do you get involved?

2301 Those types of things are of direct interest to people and those are the types of things that, frankly, aren't necessarily being discussed in great detail at the CBC. It may be a news story but there is no real local follow-up on it and their mandate is not necessarily local, it is national. And the other commercial stations, it may not be necessarily something they would pick up on.

2302 So it is that type of talk, it is that type of spoken word that ties into a very active audience that has, as I say ---

2303 COMMISSIONER WILLIAMS: Are there special or unique challenges that your organization will face in trying to meet the spoken word and information programming expectations of your audience?

2304 MR. WRIGHT: I think we are always faced with challenges to be as good as we can be in the areas that we have chosen to cover. We think we have a very good plan in making sure that we are addressing our community of interest.

2305 We have assigned out one of the foundations of interest to each one of our on-air staff and our news people, so that it might seem like a huge task to create this spoken word on a daily basis but when we take the big amount that we have to do and we break it down so that each staff member, on-air staff member has one feature that they have to do daily, so each one is following one of our pillars or foundations of interest and they gather the information on that particular foundation of interest.

2306 So we are taking what starts out as a pretty daunting challenge and we break it down to small pieces and we have been able to design our station to accommodate that and we feel it is very important.

2307 COMMISSIONER WILLIAMS: In your supplementary brief, you provided us with information on how news packages would be scheduled throughout the broadcast week.

2308 Would these news packages contain both news and related surveillance material, for example, weather and sports information, and how many hours per broadcast week do you plan to devote to these news packages?

2309 MR. WRIGHT: Andrew.

2310 MR. FORSYTH: There will be a total of five hours of newscasts on the schedule.

2311 COMMISSIONER WILLIAMS: Thank you.

2312 You have stressed that your proposed station would distinguish itself from other players in the market by providing intensely local community-responsive news and information programming.

2313 Could you provide us with more information on, for example, the size of your newsroom and types of resources you will make available to your news staff so they can meet your stated objective to provide listeners with intensely local community-responsive news and information programming?

2314 MR. WRIGHT: Yes. We have a news staff of three for the station. Of course Ken Rockburn, our morning show host, is also a supplement to that whole news area. Ken's background is in news. He will be working with the three news reporters and readers.

2315 As I say, we have been able to look at our commitments and look at: (a) the news gathering that we need to do; and (b) the spoken word content in our foundations of interest.

2316 We have divided that up so that we can handle that quite readily with the staff that we have assembled.

2317 COMMISSIONER WILLIAMS: In your supplementary brief you also indicate you provide your listeners with relevant lifestyle information in the areas of travel, personal finances, food, wine, music, entertainment and health and that this information will be provided on air, on your web site through the staging of live events.

2318 Could you elaborate on your plans to provide this lifestyle information to your listeners? For example, how many on air hours per week would you devote to this type of lifestyle information programming and how would this programming be scheduled? Can you maybe elaborate a bit on your proposed live events initiatives.

2319 MR. WRIGHT: I will just talk for a moment and then ask Andrew to fill in on the on air part.

2320 We are doing a lifestyle radio station. We are building the music to suit a 45 to 65 year old core group. We are building the foundations of interest to appeal to the 45 to 64 age group.

2321 We will be doing a series of special events during the year. Those special events would come under Brenda's direction, our community relations director, and she would organize and put on the special events to support these foundations of interest. It could be a food and wine show. It could be a talk by a local person who understand personal finance, that we arrange and we invite our listeners to both on the air, through our database and on our web site. It is a way of linking with our listeners, linking with our community and making sure we are in sync with their needs and their wants, not only their musical needs and wants, but their information needs and wants for their lifestyle. That is why we call it a lifestyle format.

2322 On the on air gathering and treatment of that information, Andrew can comment on how we have organized ourselves to be able to do that.

2323 MR. FORSYTH: I will try and give you the nitty-gritty number thing and then fill it in, put some flesh on it.

2324 The nitty-gritty number thing is two hours a week. It would be two hours a week of programming, spoken word programming, devoted to these foundations of finance, health, music and entertainment, food and wine and travel. The structure will be set up this way.

2325 Each one of those elements will have a two minute capsule inserted into the daytime programming. It will be two minutes on finance, two minutes on health, et cetera, et cetera, broadcast across the day.

2326 Each one of those elements will also be incorporated in the newscast, more from a here is a news item, here is a current item, this is what the headline is on it, stay tuned, we will have more for you on that in 15 minutes or 45 minutes or in the next show. So over the course of the day these topics really become a major part of the spoken word content, not just the two hours that we are talking about in the, if you like, actual foreground piece, the mosaic piece that contains it, but in some of the preparation work around the shows and also in the newscasts. It is really a real part of the texture of the radio station.

2327 COMMISSIONER WILLIAMS: On average, over the broadcast week, how much time would be devoted to music programming and the spoken word programming excluding the commercial content. Just a percentage breakdown would be adequate for this response.

2328 MR. WRIGHT: Our spoken word content is 12 per cent of our week. I am not sure I have the math for the remaining --

2329 COMMISSIONER WILLIAMS: The 88 --

2330 MR. WRIGHT: Yes, 88 per cent is music and commercials. Commercials would be -- we are projecting three minutes an hour in our first year, 18 hours a day, da, da, da, da, da. Basically, it is 12 per cent spoken word content. The remainder would be in commercials, three minutes an hour of commercials and the remainder in music.

2331 COMMISSIONER WILLIAMS: Okay. Thank you.

2332 In a response to earlier questioning, you have identified a number of spoken word general programming expectations that you feel are necessary to incorporate into your programming in order to successfully program to your target audience. These elements include intense local news, information and lifestyle, spoken word programming.

2333 I note your projected programming expenses range between $438,000 in year one rising to $596,000 in year seven.

2334 The annual projected programming expenses filed by Astral, Global and CKMW, the other three new easy listening adult standards applicants are, in each case, double your projected year expenses. I would like to understand this apparent discrepancy between your programming estimates and the estimates filed by the other applicants.

2335 Why do you feel that your projected annual programming expenditures are sufficient to provide your target audience with the level and quality of relevant spoken word programming and music programming necessary to be successful and be -- if licensed, I note that you would be a standalone in the market. Are there certain programming synergies that you plan to utilize which would help you keep annual programming expenses in line with your estimate?

2336 MR. WRIGHT: First of all, the total dollar expenditure. We looked at our program plan, we looked at our product design, how we wanted to design our radio station, the spoken word content we wanted to be able to provide, and we looked at what number of staff members we would be able to do that with. We have provided for that in our programming budget.

2337 This is a station that is going to start off with a two-share of listening in Ottawa, so it is designed, the business plan is designed to be an affordable business plan. We know what the financial realities are and we have designed the radio station to accommodate those realities. It is a 45-plus target group. It is a target group that is underserved, but one of the reasons it is underserved is it is very difficult to get advertising dollars to support a 45-plus radio station.

2338 First of all, there are some financial realities. Secondly, we have designed the product to do what we need to do and we have been able to do it within our budget. We don't think we are missing anything in there. We have the number of bodies we need to do. We have them assigned. We have looked at each one of the tasks. We have looked at the news commitment, how we have to staff to do our news commitment. We have looked at our spoken word commitment, how we will accommodate and handle the spoken word commitment. We are confident that we have provided the right resources to do the job.

2339 It is not like we haven't done it before. Doug has done it in Hamilton in a standalone situation, and I have done it in Kingston in a standalone situation. We believe we know how we can hire and utilize staff to accomplish what we need to do.

2340 COMMISSIONER WILLIAMS: The last part of my question was: are there certain programming synergies that you plan to utilize that would help you keep these expenses in line with your estimates?

2341 MR. WRIGHT: I'm sorry, I missed that part. I apologize.

2342 COMMISSIONER WILLIAMS: That's okay. Not a problem.

2343 MR. WRIGHT: No. We have planned this to be a standalone. All the staff for Smooth 96.5 will be at Smooth 96.5. It will be independent and a standalone.

2344 COMMISSIONER WILLIAMS: I read with interest your commitment to provide upwards of 12.5 hours of free commercial time annually for use by local non-profit organizations. You mention as well that you will seek to establish a close connection to the community by working with local charitable organizations as well as sponsoring and covering community events.

2345 Could you provide us with a little more detail regarding your proposed commitments in this area. For example, how would community non-profit groups be made aware of the 12.5 hours of free commercial time that you would provide and would there be a certain criteria that a group would need to meet in order to access this air time?

2346 MR. WRIGHT: We believe very strongly that the path to our success is paved with a strong, strong community involvement role. We need to be out there. We need to be involved in every area that 45 to 64 year olds are exposed to. A great direction to do that is to get involved in non-profit organizations, help them achieve their goals and their needs.

2347 So Brenda will be given the bank. She will have the bank.

2348 Brenda, can you spend the bank?

2349 MS TIRRELL: I can spend the bank.

2350 MR. WRIGHT: Her responsibility will be to contact community organizations, to contact non-profit organizations, to let them know that our radio station is new and we are here and we are ready to help. That is going to be the first message. We are new, we are here, we are ready to help, and that we have time that we have put aside to help them solve their problems and their community needs.

2351 I hope we get to the point very quickly where we have more people that have come forward saying we want to use your help than we have time available. That will be a sure sign that we are on the right path to success.

2352 I don't know if I have answered that whole question.

2353 COMMISSIONER WILLIAMS: You have given a full and complete answer. Thank you.

2354 I would like to talk a bit about your CD recording and distribution package for concert contest winners. It is just a question on the $5,000 budgeted to record and manufacture 1,000 CDs for each of the three winners that will come out of your annual Next Diva, Jazz Singer and Torch Singer Concert Series.

2355 What is the actual budget for the recording portion of the prize and the budget for the manufacturing portion of the prize?

2356 I will give you some time on that.

2357 What type and quality of recording are you hoping to produce for each contest winner on a dollars to be determined budget? Are we looking at a studio recording, a broadcast quality recording, a three-song demo style recording or a full production 10 or 11-track recording?

2358 You have also indicated the CD would be distributed. Could you please discuss your distribution.

2359 There are about three questions wrapped in there, as is our way. If you need further clarification, I would be more than pleased to provide it.

2360 MR. WRIGHT: I think it was two years ago or three years ago, two years ago, we paid for the production of a CD put together by a non-profit group that was actually a high school radio station in Kingston. They were producing a CD that had 10 cuts on it. We paid for that production for them. That is where I got those numbers from. We were able to buy 1,000 CDs for $5,000 I think was the --

2361 COMMISSIONER WILLIAMS: No. That was the full production 10-track recording.

2362 MR. WRIGHT: Ten tracks on the CD. Correct. Correct.

2363 COMMISSIONER WILLIAMS: Was it a studio recording or broadcast quality?

2364 MR. WRIGHT: It was a studio recording. The studio we made arrangements for. Quite frankly, we did an exchange of time for the studio so that there was no cash involvement in the studio. Some of the things we put down are in kind and some of the items are cash items.

2365 COMMISSIONER WILLIAMS: So the quality of the CD was of what level? What quality level was it?

2366 MR. WRIGHT: It was airable. It was airable quality, yes.

2367 COMMISSIONER WILLIAMS: Okay. So it was good quality then.

2368 MR. WRIGHT: Yes, good quality.

2369 COMMISSIONER WILLIAMS: I will record that as good quality.

2370 MR. WRIGHT: Yes, good quality. It was good quality.

2371 COMMISSIONER WILLIAMS: Arable ground is good ground. Right?

2372 MR. WRIGHT: Yes. In fact, McClement, do you remember him? He is a major record producer. He actually came down and he happened to have gone to that high school when he was growing up and now Doug McClement is one of the major producers around. He actually came down and donated his time to do the production side. When all of these efforts -- that is why I say there are lots of multipliers in Canadian talent development. If you have the will, if you have the station that wants to use its resources to make things happen and wants to get exposure for artists like we have today, there are lots of ways to do it and to multiply the effect of the cash that you might have and to do it within an affordable budget.

2373 COMMISSIONER WILLIAMS: Ms Evans, I believe you performed at the CAB a couple of days ago and I had the pleasure of listening to you, along with 700 others I guess that were there.

2374 MS EVANS: Thanks.

2375 COMMISSIONER WILLIAMS: Have you produced a CD?

2376 MS EVANS: Yes, I did.

2377 COMMISSIONER WILLIAMS: Is your CD played by the stations that either of these gentlemen now own?

2378 MS EVANS: Not yet, but it also hasn't been -- it hasn't been fully released yet. I produced it and I have used it to get some attention out of a U.S. label. They have asked me to just kind of hold off on sending it out to all the stations because they would like to release it in a certain time frame and get all the budget behind it to get it out there.

2379 I truly believe that there are a few cuts that might be good enough for the station. I have copies if anybody wants to listen.

2380 MR. WRIGHT: Kellylee, how did you pay for it?

2381 MS EVANS: A line of credit. I took out a line of credit.

2382 COMMISSIONER WILLIAMS: A line of credit.

2383 Mr. Wright, would music such as she performs be something that would form part of your offering on your new station?

2384 MR. WRIGHT: Yes, it would.

2385 MR. FORSYTH: In fact, if I may just add to that point. One of the features that the radio station would have is a program called Showcase which would run in the evenings at eight o'clock. It would be a venue for local, new emerging talent again from a wide spectrum.

2386 It isn't necessarily just smooth jazz or just soft AC or new emerging standards, if there is such a thing. It would come from a cross-section of musical styles. That is the venue where artists would be able to come in who don't have a recording contract, who are at a stage where they feel that they are strong enough to do public performance and need that leg up to get going.

2387 One of the issues that we hear from artists, certainly like Kellylee, they have the ability, they look like they could move forward, but some of the hurdles that are put in front of them for some of the other incentive programs that are there, whether it is a radio station contest, talent contest, or it is the Canadian idol, or it is even a Factor type of situation, they don't necessarily have the prerequisites to be able to meet that and move forward from there. That is one of the things this radio station is trying to do is give them that leg up.

2388 It is something that KROC in Kingston has done very successfully with one of their local talent winners that went on to the Canadian Music Week and got a gig. This comes from a radio station that is in the 27th largest market in Canada. It is pretty impressive and Doug does this all the time in Hamilton. Again, it is getting young talent, emerging talent, into the radio station, getting that music on the radio and letting them move forth.

2389 MR. WRIGHT: Carol would like to make a quick comment if she could.

2390 MS TIRRELL: I am old talent or getting to be. I'm not 20 years old any more, I'm 26. I wanted to say that one of the things that is very important to me is, I am actually -- four of my five CDs have received JUNO nominations in the contemporary jazz category, which then moved into vocal Jazz as a category, which they developed as a result of Diana Krall's success here.

2391 One of the things that I find extremely important is I am played on the traditional jazz stations in Canada, but where I really believe in Doug and Mary and this whole format is that they believe in good music and they don't have the blinkers on when it comes to style. I am one of the few artists that has actually crossed over on to smooth jazz in the format on The Wave 94.7 and have received all this air play and even have a piece of my video that appears in their television commercial, which has given me a much broader exposure because of that.

2392 It is because of their belief in not creating too many boundaries and believing in good music, be it Kellylee's or Nura's, that it doesn't matter if it comes from a more traditional jazz background, if it is a beautiful song they will play it. That is a great help.

2393 COMMISSIONER WILLIAMS: Thank you.

2394 You have accepted to operate under conditions of licence that would see the station broadcast a minimum of 40 per cent Canadian content in Category 2 music and broadcast a minimum of 40 per cent Canadian content Category 2 music between 6:00 a.m. and 6:00 p.m. Monday to Friday.

2395 Are we correct to assume then that your intention is to broadcast a weekly minimum of 10 per cent Canadian content in Category 3 music as indicated in your July 15 deficiency response where you suggested 25 per cent of the station's overall music programming would consist of Category 3 special interest music. However, your application at that time was mute on the level of Category 3 Canadian content you proposed to broadcast the licence.

2396 The question in that is: are we to assume that your intention is to broadcast a weekly minimum of 10 per cent Canadian content in Category 3 music?

2397 MR. WRIGHT: No.

2398 COMMISSIONER WILLIAMS: What is your intention?

2399 MR. WRIGHT: The deficiencies letter did not address Category 3 music at all. When we said, and we have said all along, we will do 40 per cent Canadian content, we meant 40 per cent Canadian content. Our commitment was to 40 per cent Canadian content.

2400 COMMISSIONER WILLIAMS: So your commitment to Category 3 Canadian content is 40 per cent.

2401 MR. WRIGHT: Correct.

2402 COMMISSIONER WILLIAMS: Thank you.

2403 You have indicated that your principal language of broadcast will be English. As a point of interest, I note that in the fall of 2003, BBM data showed that Majic 100 ranked number five in tuning amongst francophone listeners.

2404 In developing your format business plan, was any consideration given to the possibility that your proposed new easy listening format might appeal to and attract some level of francophone tuning into the station, let's call it cross-tuning, on a fairly consistent basis in view of the bilingual nature of the Ottawa-Gatineau market? If yes, what were the conditions and how were they reflected in your programming or business plan?

2405 MR. WRIGHT: That's a really good question.

2406 There are a few things that are -- you know, when we look at the radio business, there are some things that seem very obvious at the beginning and they aren't when they are examined.

2407 As an example, when we generally look at radio stations' audiences, we would think that, you know, the bigger the audience -- if you have a huge audience outside of your central area, you should be able to do better than a station that doesn't. Yet, when it comes to getting advertising dollars, you find that the advertisers won't pay any money for an audience outside your central area.

2408 It is very much the same thing in Ottawa. We expect and will have, we think, quite a crossover of audience. We think francophones will like our radio station. We think that they will listen to our radio station, but we won't get any revenue support from that. The buying community buys the French market and the buying community buys the English market. They don't cross over.

2409 We can certainly have Ross comment further if you want to talk about the advertising side of it. So when we designed our product, we designed our product for the English market knowing that we will get francophone support, but it was designed for the English market because that is where our advertising support is going to come from.

2410 COMMISSIONER WILLIAMS: I would be pleased to hear Ross' take on the advertising side.

2411 MR. TIRRELL: Thank you.

2412 Much as we heard this morning from Astral, they had an experiment where they tried to I think solicit advertising revenue from the Ottawa side. When I was with Majic 100 a number of years back we tried the same approach with the same results.

2413 Historically, the way the market is set up, certainly the national advertisers that buy into the market from advertising agencies outside the market, they look at either Ottawa anglo or Ottawa franco. They look at it as very separate entities. In fact, even the advertising agencies, the breweries and the fast food chains have a Quebec agency and they have an Ontario agency. So it is a very separate situation.

2414 The local advertisers, in the experience I have had in the years I have been here, I would say about 98 per cent would focus on where they operate. So if they are on the Ottawa side they would focus on the Ottawa market. There has been historically a couple of people that will sort of try to cross the divide, if you will, and seek -- you know, advertise into either the Quebec side or into the Ottawa side. It is very, very divided.

2415 I guess about two years ago or three years ago, the Radio Marketing Bureau, who track the revenues in tram, were convinced that they needed to actually separate the markets out because it had become quite an issue for the broadcast community to see all these numbers jumbled together. Now the numbers actually show a separate revenue for the Ottawa English and Ottawa French. There is definitely a line down the middle.

2416 To John's point, cross-tuning will exist as per your example on Majic. CIMF has a lot of tuners on the Ottawa side. I have been in the market for 15 years, we have never had great success in garnering any revenue as a result of that tuning. In fact, the agencies actually discount it. That is why they use the anglo book as opposed to the Ottawa central numbers.

2417 COMMISSIONER WILLIAMS: So that would apply to all stations I guess in your opinion then. No one has been able to take advantage of this bilingual marketplace in that manner?

2418 MR. TIRRELL: Not in my experience and I have worked for -- I ran the Rocco stations here and then I ran the Rogers stations here, so that is a fair number of them. We had very little success.

2419 There was one client, Villa Toyota, who would continually advertise into this market from Hull. We hired francophones and sent them over. They just didn't have any great success, much like Astral found going the other way. I think it is the way it has been thus far, that's for sure.

2420 COMMISSIONER WILLIAMS: So there may be an opportunity down the road there then.

2421 MR. TIRRELL: There is always hope in the sales area.

2422 COMMISSIONER WILLIAMS: We should probably not give very much weight to the cross-tuning potential of any of the applicant's business plans then based on your previous answer.

2423 I will ask you, in assessing which market proposal represents the best use of frequency in the market, should the cross-tuning potential be a factor in that?

2424 MR. WRIGHT: I would like to have Doug Kirk comment on that.

2425 MR. KIRK: I just want to clarify your question.

2426 COMMISSIONER WILLIAMS: Given that there may be some opportunity for cross-tuning, should we consider which format proposal would present the best use of frequency in the market to take advantage of cross-tuning opportunities?

2427 MR. KIRK: If I understand the question, you are asking is there a format that could work and maybe in the future --

2428 COMMISSIONER WILLIAMS: Works on both sides.

2429 MR. KIRK: -- would work on both sides and would that be --

2430 COMMISSIONER WILLIAMS: You would be able to put forward the argument that being one of the reasons why it is the best use of frequency.

2431 MR. KIRK: I think our view of it, and certainly Ross and John could comment further, but I think our view of it so far is that the formats have not worked. Clearly, from a sales point of view, it has not worked either. There hasn't been a station that we are aware of that even with some cross-tuning has been able to effectively use that cross-tuning and make it work from a financial point of view.

2432 I think you have to look at them in the communities that they are primarily designed to serve, look at the revenue potential available in those communities. Our view here is that the anglo market is operating in the range of 44 million to 45 million. That is the base to look at on the new anglo proposals. Similarly, there is about a 10 to 12 million francophone market.

2433 COMMISSIONER WILLIAMS: So any weight we were going to put on the cross-tuning thing should be I guess allocated towards the business opportunity as opposed to a listening format presentation to an underserved market. Say the Gatineau market wanted this easy listening "Triple S" type format, should much weight be given to that or should we concentrate purely on the business opportunity side?

2434 MR. KIRK: I think it is the business opportunity.

2435 In the historical experience, there has not been an effective commercialization of the cross-tuning between markets.

2436 COMMISSIONER WILLIAMS: I guess I'm hearing your answer as very little weight should be given to that.

2437 MR. KIRK: Right. I don't think you could say, this format could be accepted and there could be tuning in the francophone market. Some of that music could be very popular in the market, but there has been no reason that we can see to have that tuning become a commercial -- contribute to the commercialization of the radio station.

2438 John, do you want to comment further on that?

2439 MR. WRIGHT: (Off microphone...)

2440 COMMISSIONER WILLIAMS: You are fine with that.

2441 MR. KIRK: Always ask the quarterback.

2442 COMMISSIONER WILLIAMS: Would you be able to provide an estimate of the proportion of the audience? You have proposed a "Triple S" format station that would be comprised of new listeners to conventional radio. Would you attract new listeners with this format?

2443 MR. WRIGHT: Not really. I think at last look, 95 per cent of Canadians listen to radio, 95 per cent of adults listen to radio. I think what we will do is we will increase tuning from light listeners. I think there are a lot of light tuners that are 45 to 64. They may not have the product that they want now and by providing them with a product that they like, that they feel part of, that -- as I say, it is a lifestyle radio station designed to appeal to their musical tastes but also to their informational tastes. I think by doing that, we can increase hours tuned from those listeners.

2444 COMMISSIONER WILLIAMS: In your letter to the Commission dated July 15th, 2004, you estimated that none of the advertising revenues of your proposed station would be garnered from existing radio stations. Where is the money coming from? How do you arrive at this estimate?

2445 MR. WRIGHT: Show me the money.

2446 When we made that statement, it was based on the fact that we looked at the growth in the market and we said the growth in the market is much higher than our first year revenue projections. So when we look at a first year revenue projection of 900,000 and we look at the -- by the way, we feel it is important that the English station base their shares on the English dollar expenditures because as we have just talked about, there isn't a cross-pollination. We are basing ours on the $45 million English revenues, not the $56 million.

2447 When we look at that, the growth on that, the historical growth on those dollars is two or three times greater than our first year revenues. Therefore, what we are saying is we are not taking revenues away, we are not taking it from existing broadcasters. We may be taking some of their growth, but we are not taking anything away from them. So the market can absorb us and the existing broadcasters could still have growth.

2448 We are not tapping the same budgets that they are tapping, I will have Ross make a comment on that in a moment, but a 45 plus target group is -- we are not going to get the agency business. We are not going to get any of the advertising agency business that drives most of these stations that are in the market. We are an older target group. We have to develop new budgets.

2449 Ross might comment on that part of it.

2450 MR. TIRRELL: Thanks, John.

2451 The conversations I have had with a number of the advertisers in the marketplace, there are two areas where we will be able to generate revenue. The first, as John has indicated, is just overall growth in the marketplace.

2452 The second I think will probably come from newspaper. Many of the people I have spoken to, whether it be a car dealer, Belisle, who sells Chevrolet and Cadillac or the BMW dealer or the Jaguar dealer or the furniture people and people that own jewellery stores that I know, they view the 45-64 year old market as a portion of their target. It is generally a relatively profitable portion of their target, but it is currently still a relatively small portion of their target.

2453 It is difficult to reach that target exclusively in the current mainstream media. Most of the radio stations have very broad targets and they are successful reaching those broad targets and so their rate structure is very high. So if you wanted to use Majic 100, as an example, a leading station, to reach a small segment of their audience, it is not cost beneficial to you. So they tended to use newspaper because they have said to me they felt there hasn't been any efficient way to reach this group on radio.

2454 Our business plan calls for a very effective and efficient, translated, relatively low cost, way to reach this segment of the population and so I think we will see some growth there. A number of the advertisers who gave me letters of support indicated they would put some money against that group that they weren't currently investing in radio. Therefore, although they are radio advertisers, their radio budgets will grow probably at the expense of print, which is where they have been using it.

2455 COMMISSIONER WILLIAMS: This 45-plus segment, you state it is a small portion of the target. How large and how fast is this demographic growing? Do you have any feel for that?

2456 MR. WRIGHT: When we are saying the smallness, I think we were referring to the amount of advertising dollars available for that.

2457 COMMISSIONER WILLIAMS: Of this target number?

2458 MR. WRIGHT: Yes.

2459 Certainly, the demographic is growing. You know, that's the bulge. The bulge is going through and we are hopeful that in years to come we may convince advertising agencies that they should be redirecting or redeciding their target groups. There has certainly been lots of discussions over the last couple of years as to whether the traditional 18 to 49 and 25 to 54 target groups are still relevant or should we be going for a 35-64 or a 45-64?

2460 But to date, nothing has happened on that. To date, anything past 54 is not part of what the advertisers are paying for. That is where we say it is small. It is a small amount of money that we are chasing in a 45-plus target group.

2461 COMMISSIONER WILLIAMS: In lifestyle programming, have you given thought to home and gardening advice and that type of programming as these baby-boomers become bloomers, so to speak?

2462 MR. WRIGHT: It would certainly be one of our sales targets. A very big growing market for 45 plus and it would be something we would consider, but certainly a big part of our sales thrust would be identifying those targets.

2463 COMMISSIONER WILLIAMS: Your research consultant study indicates that your proposed station would garner an 11 per cent tuning share amongst the 45-64 in the Ottawa-Gatineau market. How did you determine that you would garner an 11 per cent tuning share and what would an 11 per cent tuning share amongst the 45 to 64 year old Gatineau market represent in terms of 12-plus tuning?

2464 MR. WRIGHT: Our research did show an 11 share. We translated that in our first year to a six share of 45 to 64. That would translate into a three share of 12 plus.

2465 Also, I think we all realize it, as advertisers say, as we get older we get set in our ways. We are tougher to change, so a new youth market station can come on the air and seem to -- bingo, they get an audience immediately, whereas a station that is targeting 45 plus, it takes some time to get that audience, so the potential is eleven share. It is going to take a long time to build it and get people to change their habits and change from what they are comfortable with now and get to that maximum potential.

2466 COMMISSIONER WILLIAMS: That is even though, as you have stated earlier, that they are currently being underserved or they are going to places that aren't the best places to be simply because the place where they want to be isn't on area?

2467 MR. WRIGHT: Yes. We have older demo groups where formats have changed and sometimes they just left it on their radio because it is a habit of theirs to be on that station. You know? We like to think that radio is the most important thing in the world and that when we do something it can be instantly known and instantly recognized.

2468 We like to think that radio is the most important thing in the world and that when we do something it can be instantly known and instantly recognized. But there is lots of competition for people's time and it is a difficult thing to break into an older market.

2469 COMMISSIONER WILLIAMS: Yes. But once you have broken in, they sound like they are fairly loyal.

2470 MR. WRIGHT: Yes. Yes.

2471 COMMISSIONER WILLIAMS: The fall 2003 BBM survey results reveal that jazz stations garner between 1 and 2.8 per cent of 12-plus shares and you have just answered yours would translate into a three share. So I guess we could assume that the format that you are proposing for this marketplace would attract comparable tuning to other Canadian cities.

2472 MR. WRIGHT: Yes. We are not going to be a smooth jazz station or a jazz station. That is one of the reasons, they are in about a one, a one and one-five, one-eight share, and they are just not -- we looked at the Ottawa market for that and said it is not economically viable to do that format.

2473 Our "Triple S" format is designed to have much broader appeal than a smooth jazz or a jazz station.

2474 COMMISSIONER WILLIAMS: Thank you, Mr. Wright.

2475 I guess what I would like to know now is, as you know, the frequency 96.5 is competitive and technically mutually exclusive with five other applications at this hearing. I would like your views on what in your view are the compelling reasons to grant you the requested frequency and in what ways does your proposal constitute the best use of the frequency spectrum.

2476 MR. WRIGHT: Oh, we should turn my mic on too.

2477 COMMISSIONER WILLIAMS: Somebody is turning mine on and off as well so I hope it is all being recorded appropriately.

2478 MR. WRIGHT: We feel we have identified the underserved area. We have looked at all the other stations in the market. Andrew's chart very clearly shows that this big ball at the top is sitting up there all by itself, so we feel and we spent a lot of time and energy making sure that we were not just being another Majic or another station servicing the 35 to 44 target group. We are 45 to 64, 45 plus.

2479 We think that that is the underserved area. That would be a reason why we think it would be the best use of the frequency.

2480 COMMISSIONER WILLIAMS: Okay. I am just about at the end of my questions.

2481 We asked other applicants in the event that we were to licence more than one of these applications who they could easiest live with and who they would rather not live with and who they could live without. Perhaps if I can get your views on that scenario as well in the event that we licence more than one.

2482 MR. WRIGHT: We would be comfortable with tourist information.

2483 COMMISSIONER WILLIAMS: You are sure. On both of them or one of them?

2484 MR. WRIGHT: Both. We would be comfortable -- I mean, we would rather not any more, but we would be comfortable with any youth market station, but uncomfortable with any other station targeting the older adult market.

2485 COMMISSIONER WILLIAMS: Okay. Thank you very much, Mr. Wright. I'm going to turn you back into the care of our Chair. She will redirect any further questions that may be required of your panel.

2486 Thank you.

2487 THE CHAIRPERSON: Commissioner Langford.

2488 COMMISSIONER LANGFORD: Thank you, Madam Chair.

2489 I have a couple of questions. Before I do though, I should say, Mr. Tirrell, you know, you still have a chance to get out of here. I'm warning you that when Mr. Wright came before us in Kingston four or five years ago he had actually more hair than you do at this time. He was a captain of his own little navy, he was a happy guy, taking people out in boats on Lake Ontario, and here he stands before you a shadow of the man we had before us four years ago.

--- Laughter / Rires

2490 COMMISSIONER LANGFORD: The first question I have is actually for Mr. Forsyth. I'm going way, way back to the very beginning, I'm sorry, but you made a statement I just simply didn't quite understand because I don't think I have your sophistication in this.

2491 In comparing your playlist to CKMW's playlist, you used the term that theirs is much more universal than hours. I guess I just actually don't understand what that means and how you would describe that in words of one syllable for people like me to try and understand what the difference is between the two playlists.

2492 MR. FORSYTH: First, Commissioner, I have never doubted your insight or ability on anything.

2493 COMMISSIONER LANGFORD: Wait for the decisions. Amazing. You may change your tune.

2494 MR. FORSYTH: When I say universal, and again I will qualify my comment on the fact that we were in the same boat, not John's boat, the same boat as everybody else. Commission staff asked us to supply music lists and we supplied music lists that we felt captured the essence of what this radio station would be, which frankly, you know, is difficult to do even in a four or five hour sample, but it gives you a gist of where it is going.

2495 So my comment on their list is also based on the fact that it was a short list, but the short list -- and then when I say universal, what I meant by that was, it went to further extremes, and I don't mean extremes of harshness or sound, just either from a point of view of era or genre of music or style, I think they went much broader than frankly I think anybody else had applied for.

2496 That was my comment, sir.

2497 COMMISSIONER LANGFORD: All right. That is helpful. Thank you very much.

2498 Just one last issue. I'm not quite sure whether it is a question or just a reflection. I think it was you, Mr. Wright, very, very early on, maybe even in your opening statement you spoke about having a rolodex of local experts. That was the term you used and I guess what you mean by that is a list of experts that you would bring in on your spoken word programming. I wonder whether you have given any thought to ensuring that these experts won't sound all the same, that people will hear women experts and people who obviously come from different cultural backgrounds so they may not be able to identify them, and that your list, your rolodex of experts will reflect Canada as we are getting to know it.

2499 MR. WRIGHT: I will turn this over to Andrew because I would like to take credit for that comment because I think -- you know, a roladex of people, I mean, it has a great sound to it, but it was Andrew's comment.

2500 MR. FORSYTH: I think when we look at the term experts in their field and it is radio, you know, it is very difficult to tell where the people come from, but your point is well taken and that is, you know, it should certainly be the radio stations prerogative to make sure that the diversity that is around us is reflected on the radio and therefore the points of views.

2501 I am not going to get to the specific point you are trying to get to, but let me give you an example.

2502 If we were talking about the financial world, rather than having a financial expert from a financial firm, I would certainly recommend to Ross that he would look at probably going to each one of the major investment firm banks, maybe not the CIBC this week but later it might be okay, go to each one of the banks, go to each one of the major investment firms and basically come back with at least a handful, when I say handful, you know, five to 10 individuals that they could call at any given time and not always going back to the same person. So hopefully within that group we would start to get some diversity.

2503 If you did that with the medical community and if you did that with the home care group, and if you did that with the gardening group, if you did that with all of those sectors, I think the net result would be you would get some good cross-section of the local community.

2504 MR. WRIGHT: We also are, as you are aware, very fortunate that Ken Rockburn is going to be spearheading our whole sort of foray into the foundations of interest. Ken does not have a roladex, he has now a palm pilot. He has the vast number of Ottawa contacts and very diverse contacts. I think your points are well taken and we will revisit that and make sure that we are providing diversity in those areas.

2505 COMMISSIONER LANGFORD: Thank you very much. Those are my questions, Madam Chair.

2506 THE CHAIRPERSON: Commissioner Pennefather.

2507 COMMISSIONER PENNEFATHER: Thank you, Madam Chairman.

2508 Just to follow-up on that, if I can turn to the community relations director, in fact, I will speak to the women on the panel.

2509 On the matter that Commissioner Langford raised, do you have specific plans in view for community relations in terms of the culturally diverse community and how you intend to go about that to ensure that you are dealing with the various cultures of that community?

2510 MR. WRIGHT: Do you have some --

2511 MS TIRRELL: Do you mean specifically with the new artists in music.

2512 COMMISSIONER PENNEFATHER: No. I took upon it that you are a community relations director.

2513 MS TIRRELL: Correct.

2514 COMMISSIONER PENNEFATHER: I was looking at your description of generally where you are going with that and I was wondering if in fact either to support your Canadian talent development program or your relations to non-profit organizations you had any specific plans or any way you were going to do that which would involve the different cultural groups in the community.

2515 MS TIRRELL: Being out in the community, dealing with the different groups, organizations, musicians, we will certainly be looking at all of them, you know, whoever is out there. We will be trying to welcome everybody into our community.

2516 COMMISSIONER PENNEFATHER: Okay. Let me ask the musicians, ladies, at the back.

2517 I was struck, Ms Welsman, about what you said about your total reliance on air play. I can't resist asking you or your fellow artists to comment on air play in this day and age and going forward. What I am thinking of is obviously the Internet and the challenge to you as artists in terms of selling of CDs versus the availability of your music on the Internet to a broad audience.

2518 Do you have any comment on air play in today's day and age in going forward for artists? Is it as important?

2519 MS WELSMAN: Oh, I think so. If I may start. Just from being a record label owner and experiencing the lack of budgets for, as I said before, for promotion and marketing. I think it is very important, the marketing aspect is important. The Internet is also very important for Internet sales. From my web site we garner a lot of sales around the world, so it is extremely important for me. There are also 30 second sound bytes of all my material on the site, so people in Japan go, people all over can hear bits of the music.

2520 But I think one of the problems I face, still to this day, with my own CDs that my company owns, is that I don't have the marketing dollars. If I came up with a marketing campaign to direct people to the web site or to direct or to be able to produce an infomercial and get it on TV with budgets that I have, I would have even more exposure along with the radio stations like Smooth FM that promote.

2521 I think there are so many areas that you have to target, but until I have that possibility, and we are working on it, I do rely on the CBC and Jazz FM in Toronto and The Wave 94.7 for the bulk of my exposure.

2522 COMMISSIONER PENNEFATHER: It is the promotion component you see as positive in terms of the technology called the Internet at this point in time.

2523 MS WELSMAN: Sure.

2524 COMMISSIONER PENNEFATHER: Any other comments on technology and your futures in music?

2525 MS NURA: Absolutely. Ditto on what Carol just said. But also I would like to stress that we have dealt, especially in Canada, with a catch-22 scenario. Radio not only supports the ability to sell our product, but it also supports just the awareness of music, period, on a much more personal level.

2526 That in combination with what you are asking about, the expansion of technology and how it effects art, or the exposure to art, is incredibly fast and incredibly, not to use the word too often, universal. We are dealing with a scenario now where the music is getting out there so quickly that we don't even -- we find it hard to track it.

2527 The positive thing about radio is it can be tracked. There is a more personal support not just with the air play. That does enable Canadian artists to be exposed and to sell CDs and not have to go necessarily south of the border, so to speak, but bring people out to situations like concerts, allow the young generations also to feel that there is a light at the end of the tunnel when they do create music and they know it can be exposed.

2528 COMMISSIONER PENNEFATHER: Thanks.

2529 MS EVANS: If you don't mind, I just wanted to speak to that as well. I think one of the really important things about this application by this particular group of individuals is the personalized care and the attention that they give to the artist and the desire to actually have air play for local artists.

2530 If I can give a scenario. In January, I had the great fortune of being involved in Hot 89's Urban Star Quest. That is something that was put on with Canadian Music Week. I was chosen as a semi-finalist and got the chance to perform with some of the other artists that were chosen.

2531 I would say that of the -- I think it was about four of us or five of us of that group, only one of the artists really could have had a chance of getting their music played on Hot 89. Afterwards, I gave my CD in and, you know, the programmer said, gosh, man, if you were having a concert we would want to be there, we really love your CD, it is really great, but you know we can't play your music on air because they are focused on hits and they are focused on music that is instantly recognizable.

2532 That is the thing. How does a young artist get their music to be instantly recognizable if we can't ever get it played on the air.

2533 That is the other thing. I mean, when you go to these conferences, one of the things that the record execs stress is that you need to have this big visibility in your local region. But again, how are people in the local region ever supposed to hear our music if none of the radio stations will play it.

2534 So to have a station with owners that are committed to having local musicians' music played on air is extremely important just to grow our career so that we can leave this pond and get our music heard internationally.

2535 COMMISSIONER PENNEFATHER: Thank you very much, Kellylee and congratulations on your performance the other evening.

2536 MS EVANS: Thanks.

2537 COMMISSIONER PENNEFATHER: Thank you, Madam Chair.

2538 THE CHAIRPERSON: Commissioner Noël.

2539 COMMISSIONER NOËL: Maybe just an additional question to what Mr. Williams asked you last.

2540 If we were to licence your station and another applicant, you said that you would be happy with the two tourist applications. Have you considered or given any thought to if we were to licence one of the French applicants and would that have some sort of effect on your business plan given that in a musical format there could be some cross-listening.

2541 MR. WRIGHT: I presume you mean the Smooth Jazz applicant.

2542 COMMISSIONER NOËL: I didn't say which one, but you can tell me which one you don't want.

2543 MR. WRIGHT: Again, it would be uncomfortable to have other new licencees competing for a similar demographic group. We have stated ours is 45 plus and our core is 45 to 64. It would be uncomfortable if there were other applicants in there. Certainly, English would make it impossible.

2544 French, yes, we would have some -- as we have talked about today, we would have that probably sharing of audience, but it is more palatable because the advertising dollars don't cross.

2545 COMMISSIONER NOËL: Thank you.

2546 THE CHAIRPERSON: When you say the demographic 45 plus, so you wouldn't have a problem living with the 35 plus?

2547 MR. WRIGHT: Yes, we would.

2548 THE CHAIRPERSON: You would as well.

2549 MR. WRIGHT: Yes.

2550 THE CHAIRPERSON: So not just 45 plus but 35 plus.

2551 MR. WRIGHT: No. Thirty-five plus.

2552 THE CHAIRPERSON: And it would include 45 plus of which I think we have another one.

2553 There is something else I would like to pursue a bit with you. Commissioner Williams raised your programming expenses, which are quite low. We have to understand how this is going to work.

2554 I am aware that the revenues you expect are lower as well than the stations that he raised, Jewel, Astral and Global, who are also in a similar easy listening zone at least. Would you agree with me that the 45 to 64 plus audience is more likely to be fairly sophisticated and demanding in the spoken word programming?

2555 MR. WRIGHT: It could be a good assumption.

2556 THE CHAIRPERSON: That you are more thoughtful and demanding now than you used to be when you had more hair.

--- Laughter / Rires

2557 THE CHAIRPERSON: You have seen like everybody else the statistics for Ottawa, the Ottawa-Gatineau, which is higher education, more educated women. Those statistics you have seen like everybody else.

2558 MR. WRIGHT: Yes.

2559 THE CHAIRPERSON: So one would expect that the spoken word programming for your core audience would have to be well researched, well done and that is what raises for me anyway the concern about the programming expenses. Am I correct that you told Commissioner Williams you would do 12 per cent spoken word?

2560 MR. WRIGHT: Correct.

2561 THE CHAIRPERSON: And the 88 per cent would be the music and the commercials. So 12 per cent per week of 126 broadcast hours would be about 15 hours of spoken word. Is that about correct?

2562 MR. WRIGHT: That's correct.

2563 THE CHAIRPERSON: You have already spoken about five hours of news and that too, news and information and so on, would have to be well done obviously with the usual components, surveillance, well, weather is the weather, et cetera. It leaves us with 10 hours of spoken word programming. You have talked about your foundations I think is what you called them: lifestyle, travel, personal, et cetera.

2564 MR. WRIGHT: Yes.

2565 THE CHAIRPERSON: So 10 hours of spoken word left per week, you said two hours of lifestyle, so there is eight hours left. Have you looked at the other applications and compared -- like, if I take your projections, your Canadian talent development is not included in your programming expenses.

2566 MR. WRIGHT: Correct.

2567 THE CHAIRPERSON: So even the numbers that Commissioner Williams may have raised are lower really than that because most of the other applicants separated out their CTD component, so in a ballpark way Global's expenses, Astral's expenses, CKMW The Jewel's expenses, they are twice, three times, as much as four times as much. In the case of Global it is 11 per cent spoken word programming. In the case of Astral it is 12 hours. It is even less than you project.

2568 How are you going to manage that so that your station is appealing? It has to be researched. It has to be programmed. I know Mr. Rockburn is a very efficient person, but what is going to be your staff component to manage to do this with these sums?

2569 In fact, year one and year seven are very low programming expenses. How did you calculate that? What is going to be the number of people doing this spoken word programming?

2570 MR. WRIGHT: We will have five people that will be involved in that process. It will be spearheaded by Ken who is certainly very capable and very well spoken and I think can --

2571 THE CHAIRPERSON: Are you including your entire staff there, sales as well?

2572 MR. WRIGHT: No. No. I think the salespeople we will keep on the road and get them to bring the money in if we can.

2573 We have three people in news. We have Ken doing mornings. We have a drive home person. We have an evening person. We have purposely put our evening person in live so that we can do our showcase of Canadian talent that comes up every night at eight o'clock and we want to be able to feature that live. We would even hope that if there are musicians that we are featuring on a particular night they can do sort of a live on-the-air interview type program for our showcase of Canadian talent at eight o'clock.

2574 We have those bodies and, as I said before, we have looked at the task that we have provided for them and we have divided that task up and we feel that -- this is how we have built our station.

2575 This is going to be a lifestyle radio station. We also have to build it within our means and within what we think is the potential of serving that 45 plus target group. It is going to be very difficult to generate revenues with that target group. It is not in what is called the money demos. None of the agency business will come to that target group. It is going to be strictly local money that we are going to get in that target group initially. The agencies will not buy it.

2576 So (a) we have to design our product for the economic reality; and (b) we have designed our product and we have the people and we can do the job we said we want to do.

2577 THE CHAIRPERSON: Basically, what you are telling me is you start with the revenues that you think are possible and then you go from there to how much you are going to spend on programming the station.

2578 MR. WRIGHT: We do two things. We look at the product that we want to do. We look at the revenues that are available and we look at the potential.

2579 We did the same thing when we started KROC in Kingston. We looked at what we thought the potential was, where we thought we could go. Now I can tell you that in the case of KROC in Kingston, if I looked at our projections that we came to the Commission with -- no, I don't want to do that.

2580 Our programming expenses in year three, we are now about, as it turns out, 50 per cent higher than that. Our revenues have driven that. We have been a very, very successful station. We have started by doing the right things. The right things have generated more income. We have then turned that income back into more programming and that is how it has gone.

2581 But our product design to start with and our targets to start with were identified and they were affordable and they were done. Now we have gotten very much bigger and we have put our resources back into programming to help us grow.

2582 THE CHAIRPERSON: What is your target audience and your format in Kingston.

2583 MR. WRIGHT: Our target audience in Kingston is 25 to 44.

2584 THE CHAIRPERSON: And the format?

2585 MR. WRIGHT: Rock. Rock. KROC.

2586 THE CHAIRPERSON: This "Triple S" is not something you have to be held to. Right?

2587 MR. WRIGHT: Pardon me?

2588 THE CHAIRPERSON: The way your proposal is put forward, you will have condition of licence related to the Canadian content.

2589 MR. WRIGHT: Correct.

2590 THE CHAIRPERSON: There will be nothing to hold you to either this format or the demographic that you are looking at. You see our concern of course is when we look at the expenses and at the target and the plan and we are looking at diversity and impact in the market, things have to look like they are possible and the programming expenses are definitely much lower than the other applicants.

2591 What is the programming compared to administration in terms of salaries and so on? You see, if you look at your expenses, the programming expenses area, in year one once you take out the CTD because it is included is $363,390 and then $488,000 and more for administration.

2592 What do you put in administration, in that line?

2593 MR. WRIGHT: Just one moment.

2594 THE CHAIRPERSON: What I am focusing on is whether your programming expenses, as did Commissioner Williams, will be sufficient for us to think that you can program to this core and make it with this aim, because we are looking at, as you are, in getting some diversity in the market and being able to do what you plan to. We are trying to understand here why you think you can do as much spoken word programming with so much less money than the other applicants in the same area, one of which is actually in the 45 to 64 target. I mean, we will hear them and we will see what they have to say.

2595 But if you look at your projections, your administration expenses are much higher, well, quite a bit higher, than your programming expenses once I take out the Canadian talent development expenses. I am wondering if maybe those expenses are high.

2596 Who prepared these and who is in what line of expenses?

2597 MR. WRIGHT: Who is in what line.

2598 THE CHAIRPERSON: When we are concerned about spoken word, we are concerned about how many people will be devoted to it and how many resources will be used. You are not following me, are you?

2599 MR. WRIGHT: I am. I think I am.

2600 THE CHAIRPERSON: I think your administration expenses are generally high. I am wondering if you divvied up your resources, your human resources differently from some other -- I am trying to take away the concern that your expenses for programming are low, very low, compared to applicants looking at a similar target.

2601 For example, if I take Global whose programming expenses are more than twice yours, their administration expenses are very similar. Why? What is in that line?

2602 MR. WRIGHT: One of the issues, and I will have --

2603 THE CHAIRPERSON: Would you like to have some time to look at that and get back to us in reply, you know, what is in your programming expenses and in your administration expenses in terms of manpower or womanpower, et cetera?

2604 MR. WRIGHT: In programming, as I said, in terms of on air people we have three news people. We have a morning person, we have an afternoon drive person, we have an evening person, we have two part-time people on the weekends. So that is our complement. That is our line-up.

2605 THE CHAIRPERSON: When you say on air, are these people who also do the research and prepare these capsules and these 10 hours of spoken --

2606 MR. WRIGHT: Correct. Yes, they do.

2607 THE CHAIRPERSON: Then they are not just on air. They do the back work as well.

2608 MR. WRIGHT: They multi-task, yes.

2609 THE CHAIRPERSON: Okay.

2610 MR. WRIGHT: You know, in markets that we are working in when we are standalones and have to be efficient, most of our people are multi-tasking, they are doing many different things. We have grown KROC on that basis and have been very, very successful doing it. We have people doing multiple things.

2611 THE CHAIRPERSON: Yes. I was trying to also say that the experience you have had in Kingston is different, isn't it? It is a different demographic that may expect a different type of spoken word programming.

2612 MR. WRIGHT: Yes.

2613 THE CHAIRPERSON: It is a smaller city. You know what the statistics are about Ottawa-Gatineau, that to appeal to that demographic you are going to have to have the resources to produce, I suppose, interesting spoken word programming. Anyway, we have looked at it.

2614 MR. WRIGHT: Okay.

2615 THE CHAIRPERSON: Do you have anything else --

2616 MR. WRIGHT: I would like to have Doug have a comment on it in a moment.

2617 But, as I say, we did the product design. We have the people. We divided up the tasks. Each one of these positions has a spoken word responsibility and they have to do that spoken word responsibility. We have looked at it and we feel that it is a very manageable situation.

2618 Doug operates in Hamilton, which is an older format and it is in a larger city, so I might have Doug comment on that from a Hamilton point of view.

2619 MR. KIRK: Thank you. We do not have the same intensity of spoken word commitment in the Hamilton situation, but I wanted to talk about an example of what we do, which is relevant to this situation. As John said, we have looked at the requirements and the tasks that have to be done and these feature programs through the day and those have been assigned and can be done.

2620 A situation that we have in Hamilton is one of our on air DJs does a feature on wine. It is developed, it is sponsored. He does the research and goes out and interviews people, brings them in and does that feature as an adjunct, as part of his day-to-day responsibilities. It is something he really enjoys. It is, as we say, a foundation of interest that he has and does this feature on the radio station on an ongoing basis.

2621 That is the type of programming where you can get high quality comment and information brought to the radio station as John says as part of a multi-task description of one of the employees who does a full-time air shift as well. That is broadly how the process would work.

2622 THE CHAIRPERSON: Mr. Kirk, I know historical figures are not to be disclosed in public so you answer this as you wish. If I were to go back to the office and look at your programming expenses in Hamilton, what would I find as a ballpark figure compared to these? You may choose not to answer at all if you wish, but I can go and look.

2623 MR. KIRK: You know, I know you can go and look and I would probably have to go and look too. I don't have the numbers that we have provided to you five years ago --

2624 THE CHAIRPERSON: Okay. That's fine.

2625 MR. KIRK:  -- but certainly the direct programming expenses in Hamilton would be lower because we have fewer people. We have allocated more people here, additional people in news. Ken Rockburn's role in the station is a more focused role on developing the type of features and programming and interviews and that type of interest programming, that is what he is good at. People in Ottawa have known him for years here and it is focusing on that. So there are more resources.

2626 The direct expenses would be higher in this situation.

2627 I just want to add one other comment. When you say relatively our administration expenses might be higher, we have allocated all the general management and sales management expenses to administration. I don't know if others have split the general manager's job partly to programming and part to administration. I haven't looked at that in detail. I don't know.

2628 THE CHAIRPERSON: Not everybody does it the same, but you have a different line for sales and administration is $488,000 and some. If I take out CTD from expenses in year one I end up with $363,000 and some.

2629 We are just trying to make sure it is not accounting slight of hand, the projections, but efficiency. You have made your point.

2630 MR. WRIGHT: Yes. We are very confident that we can do it.

2631 MR. KIRK: If I could just add to that, Madam Chairman.

2632 We didn't start with a revenue number. As John said, we decided from a bottom-up approach what was required to put the programming on the radio station and designed the programming plan with the people that we needed to do what we had in mind. So it is very much that, not that we had X-dollars and had to divvy it up and that is all we could come up with.

2633 It is very definitely the positions are designed, the programming will be produced, we want you to know that and we have experience in the market in hiring people and that is how we costed it out. I don't know what assumptions the other applicants have made, the deep level assumptions and what kind of salaries they have targeted.

2634 Certainly from John's experience and my experience, we think the job can be done with the money that we have allocated to it.

2635 THE CHAIRPERSON: After this exercise you may lose some of your panels to the competing applicants.

2636 MR. KIRK: We could start a consulting business maybe.

2637 MR. WRIGHT: Yes.

2638 THE CHAIRPERSON: Show them how to do it.

2639 You have your usual three minutes now to get your enthusiasm back up.

2640 MR. KIRK: We never lost our enthusiasm.

2641 THE CHAIRPERSON: Like I have lost mine.

2642 MR. WRIGHT: Thank you, Madam Chair.

2643 Yesterday, Madam Chair, you had shared with all the applicants the criteria for evaluating our applications. We believe our application best meets these criteria you have set out.

2644 For diversity of voices, our application brings together a brand new ownership group, one with experienced broadcasters who know how to build a business plan and who have operated standalone stations in competitive markets. The new company is also the only applicant with significant local ownership.

2645 We bring diversity of voices to Ottawa-Gatineau. None of our shareholders have any interest in any other Ottawa media outlet. We are truly a new voice. The potential impact of Smooth 96.5 on existing stations is very minimal.

2646 We have shown that there is a large underserved group of listeners 45 plus with the core being 45 to 64. Existing stations in the market are not planned or designed to satisfy this group. Smooth 96.5 is designed to serve this particular underserved group and will not be going head to head with any other local radio station.

2647 Ottawa-Gatineau has the ability to support a new radio station. This is a very buoyant radio market, quite able to absorb our proposed new station. Our first year revenue projections are substantially less than the average annual growth of radio revenues in the market. We have the financial resources needed to launch, nurture and sustain Smooth 96.5.

2648 We will make Smooth 96.5 a lifestyle radio station designed for our core listeners age 45 to 64. We will do this by combining our "Triple S" music format with our five foundations of interest. On air, on our web site, at our special events and through our database marketing.

2649 Our spoken word content will be spearheaded by Ken Rockburn, a well-known Ottawa broadcaster, champion of the arts and soon to be morning host on Smooth 96.5.

2650 Canadian talent development, what we call the fun side of the radio business. We will play 40 per cent Canadian content. We will spend $525,000 in direct local expenditures.

2651 Beyond that, we will play the music and promote the concerts of new up and coming Ottawa talent. Today we have heard how important that is from Sandy, Nura, Kellylee and Carol. We feel our application best captures the intent of the criteria you have shared with us. We believe it is in the public interest to approve Smooth 96.5.

2652 We thank you very much for your very insightful questions and for listening to our presentation.

2653 Thank you very much.

2654 THE CHAIRPERSON: Thank you very much to you, ladies and gentlemen, and for your cooperation. We will see you, some of you, at the next phase probably.

2655 MR. WRIGHT: Yes. Thank you.

2656 THE CHAIRPERSON: Thank you. Have a good evening.

2657 We will take a 15-minute break, after which we will hear the presentation by CKMW and proceed with the questioning in the morning. We will be back in 15 minutes.

--- Upon recessing at 1645 / suspension à 1645

--- Upon resuming at 1700 / reprise à 1700

2658 THE CHAIRPERSON: À l'ordre, s'il vous plait. Order, please. Mr. Secretary, please.

2659 THE SECRETARY: Thank you, Madam Chair. Item 9 on the agenda is an application by CKMW Radio Ltd., on behalf of a corporation to be incorporated for a licence to operate an English-language FM commercial radio programming undertaking in Ottawa. The new station would operate on frequency 88.5 MHz on channel 203B with an average effective radiated of power of 2,961 watts.

2660 Mr. Bill Evanov will be introducing the panel. You have 20 minutes to make your presentation.

PRESENTATION / PRESENTATION

2661 MR. EVANOV: Before we begin, I would first like to express our appreciation to the Commission for your confidence and trust in awarding us the Halifax frequency. The new station we will launch this coming June and the young people of Halifax will have a radio station to be very proud of.

2662 Before we actually begin our presentation, I would like to carryon and say, Madame Président and Members of the Commission, my name is Bill Evanov, President of CKMW Radio and the Evanov Radio Group. My team is, to my left, Carmela Laurignano, Vice-President, Group Manager, and a shareholder in this application. On my right is Ky Joseph, our Vice-President of Sales and a shareholder in this application. To Ky's right is Larry Leblanc, Bureau Chief Billboard Magazine Canada. Behind me on my far left is Mike Kilbride, our Vice-President of Finance. Next to Mike is Gary Gamble, Program Director, and then Debra McLaughlin, President of Strategic Inc., and Natasha Marchewka, our Music Director. We would like to begin -- Oh, I am sorry, at the side table from my right, to your left, is Brian Sawyer, Broadcast Engineer Consultant, to his right is Stuart Robertson, our Legal Counsel, and Paul Evanov, Vice-President of Programming for our radio group.

2663 We are an independent broadcaster successfully operating three stations in the competitive Toronto CMA: CIAO-AM, an ethnic radio station; CIDC-FM, dance/CHR format; and CKDX-FM known as Foxy 88.5, which programs a format created by us, blending adult standards, pop classics and light AC vocals with instrumental music. This is the format we are proposing for Ottawa.

2664 When we purchased CKDX three years ago we did a thorough examination of the formats in the market and discovered that there was a real gap in service to the 45 to 64 year old population. After a complete review of available formats and consumer preferences, we concluded there was a real appetite for several categories of music including vocal and instrumental not readily found on radio, and that they could be blended into a format that we call easy listening.

2665 In designing the play list, we took to heart Frank Sinatra's advice to Tony Bennett on how to have longevity with a music career and it was repeated again about a week ago on Larry King Live when Tony Bennett was interviewed and he once again repeated the quote, and I quote:

"Only sing great songs and don't only sing through a small single narrow demographic."

2666 In response, we play only great songs and we play a variety of music genres counter to the claims of other applicants, and particularly the false one, that instrumental music is electronic valium or elevator music. It is in fact uplifting and foreground. Proof of this exists within our own service. Foxy increased its audience sevenfold from a 0.2 share to a 1.5 share in the Toronto CMA in a year and a half. It may not sound like much, but it is major considering that the signal cannot reach 84 per cent of that market.

2667 We have compiled an extensive library of vocal and instrumental music and provide airplay to Canadian artists that is not available to them anywhere else on radio in Canada. Foxy has pioneered and implemented a successful format. The proposal for The Jewel adjusts and tailors this format to the needs of Ottawa. We are firm in our belief that Ottawa will enthusiastically welcome the format we pioneered, so much so that our company is here to make major commitments and investments in CTD, in programming and in local hands-on management. The Jewel will attract adult listeners in the core 45 to 64 age demo with a blend of several genres of music that are far richer and deeper than the sounds one associates with easy listening.

2668 The Jewel will program 65 per cent vocal and 35 per cent instrumental. This format draws music that is thought of as enduring or classic. The sound of The Jewel will come from a broad blend of music styles that include pop classics, adult standards and light AC, but also will include light classical, jazz based, folk roots based and multilingual music. Songs are selected by their sound, not their hit status.

2669 MS MARCHEWKA: A demand for the music we propose is evident from the popularity of newly recorded adult standards and easy to listen to selections by such artists as Rod Stewart, Norah Jones, Josh Groban, Michael Bubl, Ann Murray and Amy Sky. It has renewed the popularity of classic performers such as Frank Sinatra, Tony Bennett and Dina Washington.

2670 This musical trend clearly shows a huge demand for the softer side of popular vocal musical styles with lyrics and melodies that listeners can connect with no matter what the era. We will include pop recordings from over the past 50 years while keeping current with new artists or new selections that fit well with our format. Examples of standards that The Jewel will play are Fly Me to the Moon, I Left My Heart in San Francisco, Beyond the Sea and What a Wonderful World.

2671 We will also include pop favourites, vocal or instrumental renditions of pop classics or the originals themselves, including Ryan Malcolm's Just the Way You Are, Elton John's Your Song and Marc Jordan's Marina Del Ray. We will have selections by Billy Joel, Clay Aiken and Whitney Houston.

2672 Some examples of the light adult contemporary selections are Brian Adams Inside Out, Matt Dusk's Precious Years and Rita MacNeil's Blue Roses, Leanne Rimes' I Need You, Tony Braxton's Spanish Guitar and Phil Collins' Can't Stop Loving You.

2673 What separates The Jewel from the traditional easy listening format is that we will go deeper into the repertoires of artists showcasing a broader scope of their work. We will play music from the likes of Sarah McLaughlin, Celine Dion, Jan Arden, Mark Anthony, Eva Cassidy and Van Morrison. As well as playing their familiar songs, we will play their uncharted selections. We will also include duets and groups such as KD Lang and Tony Bennett, the Bee Gees, Fleetwood Mac and the Ennis Sisters.

2674 Show tunes and film soundtracks will be blended in the format and include the Phantom of the Opera, Mamma Mia and Breakfast at Tiffany's. We will also include international repertoire performed by Nana Mouskouri, Julio Iglesias, Andrea Bocelli, Nelly Furtado, Lara Fabian and Lhasa De Sela.

2675 Contemporary recording artists are actively creating music in the instrumental style. We will feature Pablo's Love You Forever, Jacques Duguay's My Way, Lorena McKennitt's Greensleeves, Liona Boyd's A Time for Us and Richard Abel's Plaisir d'Amour. We will blend the compelling sounds of these instrumentals throughout the broadcast day and then, in the evening, we will become completely instrumental.

2676 The choices of music on The Jewel are unlike any other in the marketplace. The mix will include songs or artists that may be considered a crossover into pop from several genres including light classical performers like Sarah Brightman, traditional jazz artists like Ella Fitzgerald, smooth jazz performers like Diana Krall, R&B's Oleta Adams and country artists like Shania Twain.

2677 Ours is what we call the wow factor. Wow, I haven't heard this song in a long time. Wow, I love that song but I have never heard that version of it. Our play list will be immensely engaging because of the appeal of either the song or the artist. Despite the range of formats in Ottawa, the majority of the music played on The Jewel will be unique and unduplicated on existing services, yet most selections will be familiar to listeners.

2678 Our proposal is to provide 40 per cent Canadian content throughout the broadcast day, which includes a Canadian Spotlight program that will run on Saturday afternoon and repeat on Sunday morning. The focus would not be limited to only a single style of music. Works in all genres of music, including jazz, smooth jazz, instrumental, traditional folk and roots, as well as standards and soft AC, would find their way into this feature. If it is Canadian and melodic, The Jewel's Canadian Spotlight will give it a showcase.

2679 Following Canadian Spotlight will be a two hour folk and roots program. There are many locally produced artists and several fall into this category of music. These are artists who are known as local talent in the Valley and Ottawa proper but rarely, if ever, are heard on radio. Our folk and roots show will feature their storytelling through song. Rarely heard artists include guitarists such as Alex Houton and Ian Tamblyn and singer/songwriters Lynn Miles, Kathleen Edwards and Susie Vinnik, all of whom have built music careers in the Ottawa area.

2680 MR. GAMBLE: Our spoken word component will also reflect a mature contemporary listener that will make-up The Jewel audience. News was described by respondents in the demand survey we conducted as being one of the key programming elements, so we will feature 13 traditional newscasts each Monday through Friday. Local news was described as being of greatest importance in the research and that will be a major component of The Jewel's spoken word.

2681 Fifty per cent of all news content will be of local nature. Because news and information are not strictly headline driven, we have created several features that will run throughout the week and provide the Ottawa-Gatineau listeners with updates on matters and subjects that are important to them. Twice a day, Monday through Friday, we will summarize the day in business through our business reports. Health watch, an important issue for the 40 plus demo, will cut through the often confusing reports on health matters and at a two minute feature at noon, Monday through Friday, address new studies and provide tips on staying in prime health.

2682 Several times daily throughout the week The Jewel will update its active listeners on ski, marine or golf conditions. Since our core audience has moved beyond the young family stage and will be finding more time for leisurely pursuits in life The Jewel will keep them abreast of conditions that affect their outdoor activities. Similarly, the community calendar feature and the theatre and arts reports will keep our listeners up-to-date on cultural happenings in the Ottawa-Gatineau area. Twice weekly our book of the week feature will expand our listeners' knowledge of new releases with an emphasis on Canadian authors. We will produce reviews as well as invite listeners to make suggestions on books to be reviewed.

2683 MS JOSEPH: The characteristics of the Ottawa market make it an ideal environment for a format such as The Jewel. The city is mature, culturally rich, well educated and outperforming many major markets in economic indicators such as personal income and retail sales. Our consumer demand study showed that 61 per cent of the 25 plus population would probably or definitely listen. The research also reveals that the core demographic is adults 45 to 64, slightly over half the audience is female, almost half completed some or all of a university program, is ethnically diverse and the average household income is higher than the average for the city.

2684 All of this information specific to The Jewel's audience was shared with advertisers through a study that was conducted to determine the advertising revenue potential of this service. Similar to our experiences with Foxy in Toronto, we found that advertisers as well a consumers were very interested in the proposal. We were told that for the most part the only hope of advertisers being able to reach this audience was through print or flyers. We have received statements of interest from several categories of advertisers such as jewellers, car dealers, furniture stores and travel agencies.

2685 The conclusions of the study were that a radio service reaching the affluent and older market would be supported by the advertising community and that, specifically, the proposal for The Jewel was viable.

2686 In terms of affecting incumbents, we concluded on the basis of the demand study and our advertising investigations that the impact of The Jewel will be spread over several existing services. The repatriation of monies back to radio from other media and the creation of new sources of revenues will have the net effect of increasing the overall market sales volumes.

2687 MS LAURIGNANO: With each application we present to the Commission we give our investment in Canadian talent development careful consideration, appraising all options from two perspectives. Does it have meaningful impact? And, will we be able to give the initiatives additional support through promotion within our format? We are very pleased to state that we have accomplished both of these objectives again with The Jewel application.

2688 We are proposing 12 separate initiatives that range from funding Canadian performers at existing festivals like Festival franco-ontarien and the Tulip Festival, to creating our own events at local venues such as the Annual Capital Concert. We have proposed to give industry associations like Factor and Musique Action annual amounts as well as helping fund l'Alliance Radio-Communautaire, an association based here in Ottawa, dedicated to making French community radio across Canada a success.

2689 We will promote two CD initiatives, one instrumental and one vocal, both aimed at giving emerging Canadian artists additional exposure and opportunities. The Jewel in partnership with Montreal-based DEP Records will undertake to produce and market these two CDs.

2690 Finally, we want to ensure that success of the format and, in particular, the range of music produced by Canadian artists performing in the instrumental genres is more broadly accessible. To accomplish this, we are proposing to create a catalogue of Canadian instrumental artists. This catalogue will be an online summary of Canadian artists and their recorded works. The availability of this catalogue will be the first step in enabling the music, film, television and advertising industries to access and program instrumental music where ideal and assist them to source Canadian choices. The catalogue will be in the public domain, available through the internet and will be independently organized and administered.

2691 Funding by The Jewel will be used to seed and run the initiative. It is a large and necessary initiative that we feel will give an under-recognized group of performers a critically important promotional tool and support. The benefits of this endeavour will extend well beyond the licence term of The Jewel and we think it will provide exposure that cannot be replicated by any other measure.

2692 The contribution of these 12 initiatives to the broadcast system is $4 million over the course of a seven year licence. In the case of all our initiatives, we have made special efforts to ensure that it is the artist who directly benefits. In addition to the funding, due to the compatibility of the initiatives with that format and audience, The Jewel will provide invaluable on-air promotional support through our spoken word community calendar and events listing and website. Our commitment to Canadian development is extensive and thorough.

2693 MS JOSPEH: In summary, The Jewel is a format that builds on the easy listening style to broaden its appeal and expand its listenability. This means The Jewel will appeal to a larger portion of the market and will be appreciated and enjoyed by a core 45 to 64 year old. Our commitment to instrumental music is a first in the market and is unparalleled in Canada. We currently integrate instrumentals in Foxy and we will program at least 35 per cent on The Jewel.

2694 The support and development of instrumental artists is a cornerstone of our CTD package and will make a meaningful difference in the awareness they can generate and the way in which they are perceived. The format for The Jewel was thoroughly tested and the results concluded that there was a strong demand across cultures for our blend of easy listening.

2695 Finally, we are a successful radio operator with specific direct experience in developing and maintaining unique formats and will be a new and welcomed voice in this market.

2696 MR. EVANOV: We have made a major commitment to instrumental music in this application. This music is alive and yet nowhere is it embraced by radio. How can we ignore what has existed for centuries?

2697 How can we deny future generations the opportunity to hear instrumental music? This may be the only chance this music has for exposure on radio.

2698 Since the music we are proposing is not heard in the market, we have brought it here to you in Ottawa, compliments of Richard Abel.

2699 MR. ABEL: I hope, first of all, that you will pardon me for my poor English, because I didn't bring my candelabra, but I am so happy that instrumental music doesn't have any language barrier. I am about to play for you a song that I recorded with the Prague Philharmonic.

--- Musical Presentation

2700 COMMISSIONER WILLIAMS: Mr. Evanov, I just have to say that your song and dance continues to raise the bar for radio station applicants.

2701 THE CHAIRPERSON: Mr. Evanov, we will wait until tomorrow morning to ask if you can afford these people.

2702 MR. EVANOV: Thank you very much.

2703 THE CHAIRPERSON: Thank you very much, and thank you very much for the entertainment, it is not often that it happens other than in a video.

2704 We will resume then with the questioning tomorrow morning at 09:00. Nous reprendrons at 09h00 demain matin. Merci beaucoup et bonne soiree. Have a good evening.

--- Whereupon the hearing adjourned at 1728, to resume

on Friday, December 3, 2004 at 0900 / L'audience

est ajournée à 1728, pour reprendre le vendredi 3

decembre 2004 à 0900

suite / more

Date modified:

2004-12-02