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Please note that the Official Languages Act requires that government publications be available in both official languages.

In order to meet some of the requirements under this Act, the Commission's transcripts will therefore be bilingual as to their covers, the listing of CRTC members and staff attending the hearings, and the table of contents.

However, the aforementioned publication is the recorded verbatim transcript and, as such, is transcribed in either of the official languages, depending on the language spoken by the participant at the hearing.


























Various Broadcast Applications/

Plusiers demandes en radiodiffusion













HELD AT:                              TENUE À:


Westin Edmonton Hotel                 l'Hôtel Westin Edmonton

10135 100th Street                    10135, 100e rue

Edmonton, Alberta                     Edmonton (Alberta)


June 22, 2006                         Le 22 juin 2006








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



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.







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.

               Canadian Radio‑television and

               Telecommunications Commission


            Conseil de la radiodiffusion et des

               télécommunications canadiennes



                 Transcript / Transcription






Various Broadcast Applications/

Plusiers demandes en radiodiffusion









Michel Arpin                      Chairperson / Président

Barbara Cram                      Commissioner / Conseillère

Rita Cugini                       Commissioner / Conseillère

Ronald Williams                   Commissioner / Conseiller

Stuart Langford                   Commissioner / Conseiller







Chantal Boulet                    Secretary / Secrétaire

Joe Aguiar                        Hearing Manager /

Gérant de l'audience

Anne-Marie Murphy/                Legal Counsel /

Shari Fisher                      Conseillères juridiques






HELD AT:                          TENUE À:


Westin Edmonton Hotel             l'Hôtel Westin Edmonton

10135 100th Street                10135, 100e rue

Edmonton, Alberta                 Edmonton (Alberta)


June 22, 2006                     Le 22 juin 2006






                                                 PAGE / PARA



PHASE I (Cont.)






Harvard Broadcasting Inc.                        1028 / 6201


King's Kids Promotions Outreach Ministries Inc.  1082 / 6572


Newcap Inc.                                      1161 / 7004


Radio CJVR Ltd.                                  1200 / 7187


Touch Canada Broadcasting Inc.                   1264 / 7533










Aboriginal People's Television Network           1351 / 8355










Touch Canada Broadcasting Inc.                   1364 / 8431


Radio CJVR Ltd.                                  1364 / 8438


Newcap Inc.                                      1365 / 8445


King's Kids Promotions Outreach Ministries Inc.  1366 / 8453


Harvard Broadcasting Inc.                        1367 / 8462


Vista Radio Ltd.                                 1369 / 8475


1182743 Alberta Ltd.                             1370 / 8484

               Edmonton, Alberta / Edmonton (Alberta)

‑‑‑ Upon resuming on Thursday, June 22, 2006

    at 0830 / L'audience reprend le jeudi

    22 juin 2006 à 0830

6195             THE CHAIRPERSON:  Order, please.  Good morning, everybody.

6196             We will now start with the following item.  Madam Secretary.

6197             THE SECRETARY:  Thank you, Mr. Chairman.

6198             Good morning, everyone.  We will now proceed with Item 15 on the Agenda, which is an application by Harvard Broadcasting Inc. for a licence to operate an English‑language FM commercial radio programming undertaking in Fort McMurray.

6199             The new station would operate on frequency 103.7 MHz, channel 279B, with an effective radiated power of 20,000 watts, non‑directional antenna/antenna height of 54 metres.  Appearing for the applicant is Mr. Paul Hill who will introduce his colleagues.  You will then have 20 minutes for your presentation.

6200             Please go ahead.


6201             MR. COWIE:  Good morning, Mr. Chairman and Members of the Commission.  My name is Bruce Cowie, and I Am the Vice President of Harvard Broadcasting.  I am pleased to be here today to present our application for MIX 103.7, a new Adult Contemporary FM station targeting the 18 to 54 year old demographic in the fastest growing city in Canada, Fort McMurray.

6202             Before beginning our presentation, I would like to introduce the members of our panel.

6203             Seated on my right, is Michael Olstrom, Harvard's Station Group Manager.  Seated next to Michael is Karen Broderick, Harvard's National Sales Manager.

6204             On my left is Daryl Holien, Harvard's Director of FM Programming and Creative Services.  Daryl has been in the radio business for 30 years, having served in every facet of the business from on‑air, production and programming.  As part of his current responsibilities, Daryl programs Harvard's Lite 92 FM in Regina.

6205             Next to Daryl is William Alexander, a Senior Manager with the proposed MIX 103.7.   William is of First Nations descent and has strong ties to the Southern Saskatchewan First Nations community.  He played a key role in the licensing and launch of CREEK‑FM, a community station located on Okanese First Nation north of Regina.  Prior to overseeing the operations of that station, William worked at Harvard Broadcasting and we are delighted that he has agreed to re‑join our team to serve as Senior Manager of MIX 103.7, if our application is approved.

6206             In the back row, beginning on my far right is Debra McLaughlin of Strategic Inc., the company that did our feasibility and consumer demand study.  Next to Debra is Rob Malcolmson, a partner at Goodmans LLP, our legal counsel.  Next to Rob is Tina Svedhal, Vice President Investments for Harvard Developments Inc., our parent company.

6207             Finally, on my left in the back row is Paul Hill, President and CEO of Harvard Developments Ltd.  Mr. Hill is one of Canada's business leaders and operates a family‑owned, diversified company that has just celebrated 103 years of doing business in Western Canada.  The success of the Hill companies has been built on two principles ‑‑ caring and commitment ‑‑ principles which guide not only our business operations but our attitude and social activities in the communities the Hill family serves.

6208             Paul will speak to you about why Harvard has chosen to apply for a new station in Fort McMurray, and how MIX 103.7 fits into our regional growth strategy.

6209             Debra will then give an overview of the rapidly growing Fort McMurray market and the extraordinarily high demand for the format we propose.

6210             Karen will speak to the demand for advertisers, and then Michael, Daryl and William will describe the station in more detail, including its target audience, and the kind of programming we are proposing.

6211             Finally, I will present our locally‑focused CTD package and our plans for an innovative partnership with the Aboriginal Peoples' Television Network.

6212             Paul..."


6213             MR. HILL:  Thank you, Bruce.

6214             As the Commission knows, Harvard has been in the broadcasting business since 1976 and we have been proud and honoured to serve the residents of Regina and Southern Saskatchewan ever since.  In the recent Commercial Radio Policy Review the Commission heard from Harvard and others on the importance of diversity in the broadcast system.

6215             There was a consistent view put forward that independent broadcasters play a critical role in providing balance and reflecting regional differenceS.  We are here today because we strongly believe that at the end of a period marked by considerable consolidation, there is an even greater need to expand the role for smaller and mid‑size owners.

6216             Harvard meets that need.

6217             We also offer a wealth of practical experience.  We operate in a market that has gone through ownership changes.  We have weathered economic downturns and shifts in formats.  Through it all we have maintained our focus.  Our audiences stay tuned to us because of our strong connection to the communities we serve.

6218             CKRM for example has defied all predictions about the demise of AM and remains a strong contributor to southern Saskatchewan life.

6219             We feel we can do more in the radio business and seek your approval to expand our contribution to Fort McMurray.

6220             As the Commission is aware, our goal is to grow Harvard's radio presence in western Canada. In furtherance of this objective, we appeared before you earlier this year seeking a licence in Calgary.

6221             Fort McMurray represents another key market for our regional growth strategy.  Harvard already plays a role in Fort McMurray.  Our parent company, Harvard Developments, is a major investor in the city's real estate development and housing sector.  Another Hill company, Harvard Energy, has recently made a significant investment in the oil sands and plans to play a major role in Fort McMurray's booming oil extraction sector.  We know from experience in the area that the city is under served and can support a new radio station.

6222             We hope the Commission will consider our unique qualifications and experience and recognize the role we can play in adding to diversity of ownership and editorial voices.  We ask you to approve our plan for Fort McMurray and allow us to extend our tradition of community service with the launch of MIX 103.7.


6223             MS McLAUGHLIN:  Fort McMurray meets all the tests for a new licence:  It's growing, it's wealthy and it's critically under served by local radio stations.  Advertisers would like more options and consumers demand more choice.

6224             Furthermore, there is clear gap in the formats that are being offered.  The number one "most listened to" music format in Canada, Adult Contemporary, is missing from the Fort McMurray radio spectrum.  Given this clear gap, it came as no surprise that we found a predictably high degree of consumer demand for the proposed format.

6225             It's no exaggeration to say that the city is growing at an explosive rate.  Its population has grown 9 percent from 2004, according to a municipal Census conducted in 2005, and is projected to rise an astounding 4 percent in the next 16 months, according to Financial Post Canadian Demographics.

6226             This outpaces the growth of any other market in Canada.  Moreover, fully 90 percent of Fort McMurray's population is below the age of 55, with over half between the ages of 25‑54.

6227             Significantly, only 25 percent of the respondents to our research reported that they were satisfied with the current choices of radio stations in Fort McMurray.  In fact, about two‑thirds of them listed a radio station from outside of the market as the service they spend the most time with.  Based on a market survey of people aged 18 to 54, we found that fully 89 percent stated that they would definitely or probably listen to a new Adult Contemporary radio station.  And it's noteworthy that interest in this format was found at both ends of the 18 to 54 demographic.

6228             Currently there are only two commercial radio stations in the market, a Rock and a Country format.  What is clearly missing is a service that provides a broader range of popular music and balances the market with a station that appeals to a female audience.

6229             MS BRODERICK:  Two factors bode well for advertising sales in Fort McMurray.  First, the growth of the city is fuelled by the oil and gas industry.  For every one job created in the oil sands, it is estimated that three more jobs are created in the region.  And developments in the oil sands industry alone will represent 60,000 jobs in the next 15 years.  With that population growth comes more construction and development, in both the residential and retail sectors.

6230             Second, Fort McMurray is a very wealthy community.  Over half the households in the city boast annual incomes of over $100,000, fully 56 percent above the national average and well above the average household incomes of large urban centres like Calgary, Toronto and Edmonton.

6231             The Strategic study found that media buyers were enthusiastic about the prospect of another radio station in Fort McMurray.  With the Canadian Real Estate Association estimating that the number of retail outlets will increase by 50 percent in the next three years, we expect that advertising and retail spending will grow accordingly.

6232             In the past year alone, retail sales in Fort McMurray have grown from 249 million, or 54 percent below the national average, to 771 million or 19 percent above the national average.  This dramatic expansion of the retail base, combined with the demand in the marketplace, means that more radio advertising dollars will be available to all stations in the market.

6233             Michael...?


6234             MR. OLSTROM:  Thank you, Karen.

6235             MIX 103.7 will be an Adult Contemporary service that plays a popular mix of currently charting music, recurrent selections and tracks from the '8Os and '90s.  About 70 percent of the playlist will be drawn from the AC format, while 30 percent will come from the Pop charts.  The draw from two charts will provide a more diverse selection of music, while focusing on artists largely unheard on local services.

6236             The Strategic study identified variety as the single most important element of the programming mix among Fort McMurray residents.  Providing a mix of AC and Pop will meet that demand.  More selection also means less repetition and greater distinction from existing services.

6237             The AC and Pop genres feature a wide range of new and emerging artists, something Fort McMurray residents have told us that they want, AC artists like Jully Black, DB Clifford, Amanda Stott, Collette Baron Reid and Pop artists like Mobile, Be Good Tanyas, City and Colour, Ron Sexsmith and Tomi Swick.  They will be showcased throughout our regular playlist.

6238             Our commitment to new and emerging artists is significant, representing fully 25 percent of our 40 percent Canadian content.

6239             In addition to differentiating ourselves with respect to the format, we note that both the Rock and Country formats often have a male skew.  So we see a prime opportunity to introduce a format that appeals to the female portion of the population.

6240             Furthermore, Harvard continues to recognize the need to provide services to a younger audience to ensure radio's place in their media choices as they age.  So after 8:00 p.m. MIX 103.7 will shift slightly younger, providing an increased emphasis on music drawn from the Pop charts.  After 8:00 p.m. there will be a shift in spoken word, music and, yes, even advertiser content that will let us address the interests of a younger demographic.

6241             William...?

6242             MR. ALEXANDER:  One of the programming elements that was given great importance by the respondents to the Strategic study, and has been confirmed in the research of many of the other applicants, is news.  Local, Canadian and international news scored almost 90 percent across each category.  Harvard has, therefore, made news an important part of the programming day.  We will offer 15 hours and 53 minutes of news and information programming per week.

6243             Our plan is to be highly focused on community‑level news and develop a strong identity as an intensely local Fort McMurray radio service, with comprehensive news, weather and sports coverage of the Fort McMurray and Wood Buffalo areas.

6244             In response to the importance of weather, our forecasts on MIX 103.7 will accompany each newscast.  Each hour will have a minimum of two more weather forecasts as announcer surveillance.

6245             In addition to sports coverage that will air as part of each newscast, MIX 103.7 will also create the "Fort McMurray Sports Spotlight", a one‑minute feature focusing on local sports, including hockey, baseball and high school athletics and airing four times daily.

6246             Finally, MIX 103.7 will offer a news and information program called the "Noon Report", a half‑hour, in‑depth forum on current events in the area.  This expanded news program will feature interviews with local newsmakers and provide the time to look behind the headlines.  Running Monday to Friday, the "Noon Report" will fill the very real demand for local news and will be a new voice in local coverage.

6247             Daryl...?

6248             MR. HOLIEN:  We are also planning a balanced mix of feature programming for the station, two of which will make a very tangible contribution to Canadian Talent Development.

6249             Six times daily the MIX 103.7 "Showcase" will feature new Canadian artists, with a particular focus on artists from Alberta and the Fort McMurray area.  The segment will include a short artist biography or interview, 90‑seconds in length, followed by a featured song.  This will both maximize the exposure for the artist and provide our core audience with the innovative programming mix they demand.

6250             MIX 103.7 will also place special emphasis on Canadian and regional AC and Pop artists through a one‑hour Canadian Spotlight feature that will air twice weekly and will showcase new Canadian talent to our audience.  We know that there is a strong appetite for new music and this feature programming will provide an opportunity for those wishing to expand their musical horizons.

6251             MR. ALEXANDER:  In addition to these shows, which highlight and expose Canadian talent, MIX 103.7 will feature other information programming of value to its listeners.

6252             These include the twice‑daily "Business Report", which will give our audience an overview of the day's trading in world markets and any changes in the corporate world that affect the Fort McMurray and Wood Buffalo region.

6253             Our "Recreational Reports" will provide outdoor enthusiasts with timely updates twice daily from Monday through Friday and three times daily on the weekend.

6254             Our "Community Calendar" will also air twice per day, to keep listeners informed on regional festivals, indigenous and other cultural celebrations, charity events and volunteer opportunities.

6255             And "Fort McMurray Moments" will recognize the rich and colourful heritage of the area by packaging, in a one‑minute feature, details about the Wood Buffalo region that will inform and entertain listeners.  There are at least five First Nation groups living in this area and, in addition to indigenous cultures, the city is home to first and second generation ethnic groups from around the world.

6256             While maybe not as diverse as major markets to the south, Fort McMurray has a strong French, Chinese and East Indian presence.  "Fort McMurray Moments" will draw on all of these influences with community reflection that will air twice daily during the week.

6257             To ensure that our programming remains relevant to and reflective of the local community, MIX 103.7 will establish a local advisory committee who will ensure we are addressing issues of unique concern to Fort McMurray.

6258             Six prominent members of the Fort McMurray community have agreed to serve on our local advisory committee.  A list of our local advisory committee members is attached as Schedule A to this presentation.  Like me, they are all anxious to get to work on bringing a new voice and sound to the residents of Fort McMurray.

6259             Now that you have heard all about MIX 103.7, let's sample its sound and hear from the Fort McMurray audience we seek to serve.

‑‑‑ Video presentation / Présentation vidéo

6260             MR. COWIE:  Mr. Chairman, I will conclude our presentation by outlining our plans for Canadian Talent Development.

6261             Harvard is committing $700,000 over seven years to foster Canadian Talent Development in the Fort McMurray area.

6262             This funding will go to three initiatives:

6263             First, Harvard will sponsor performances at the annual Interplay Visual and Performing Arts Festival.  Harvard's contribution of $40,000 per year for seven years will be directed 100 percent to artists.

6264             Second, Harvard will contribute $40,000 annually for scholarships to students studying in the visual and performing arts program at Keyano College, a community college that serves over 10,000 students.  Specifically, four annual scholarships of $10,000 each will be awarded to students demonstrating merit and financial need.

6265             Finally, Harvard will donate $20,000 per year for seven years to a Local Broadcast Centre, VoicePrint Canada.  This funding will provide the National Broadcast Reading Service with the means to train and develop "on‑air" readers and develop writers in the art of broadcast description.  Harvard's contribution will be directed in particular to the training of Aboriginal on‑air readers and writers.

6266             In addition to these direct CTD initiatives, we will invest in an innovative talent development program for Aboriginal broadcasters.  In partnership with APTN, Harvard will offer a news mentoring program in which it will accept and train one person from the local Aboriginal community each year in news reporting.

6267             The ultimate goal of this initiative is to provide hands-on training and broadcast experience to persons who might not otherwise have access to entry level positions and yet have a real passion for and career aspirations that include news.

6268             The President and CEO of APTN, Mr. Jean LaRose, will be speaking to you in Phase III about the critical importance of this initiative and how Harvard's innovative approach to developing Aboriginal talent has led to the establishment of the ground‑breaking Aboriginal Media Education Fund.

6269             Members of the Commission, that concludes our presentation in chief.

6270             In closing, I would like to summarize why we believe MIX 103.7 fulfils the Commission's licensing criteria:

6271             Harvard has a strong local presence in Fort McMurray through its involvement in the real estate, construction and oil sands sectors;

6272             We are a well‑established and well‑resourced company with a solid business plan for this new service;

6273             MIX 103.7 will supply an Adult Contemporary format that is missing from the market and that responds to the high demand on the part of the 18‑54 year old demographic;

6274             We have committed to 40 percent Canadian content throughout the broadcast day and week;

6275             We will promote the development of Canadian talent, both on‑the‑air and off, through our feature programming and a locally‑focused CTD package of $700,000;

6276             In addition, our partnership with APTN will help train a new generation of aboriginal reporters;

6277             Granting our application will bring a new voice and fresh editorial perspective to the market, strengthen an independent broadcaster with roots in Western Canada, and support Harvard's regional growth strategy.

6278             We thank you very much for your attention and would be pleased to answer any questions you may have.  Mr. Chairman, Mr. Olstrom will act as our quarterback for that section.

6279             Thank you.

6280             THE CHAIRPERSON:  Thank you very much, Mr. Cowie.

6281             Commissioner Cugini...?

6282             COMMISSIONER CUGINI:  Ladies and gentlemen, good morning.  I apologize for the quality of my voice today, but sitting in recycled air will sometimes do this to you.

6283             Like most applicants in these proceedings, if not all, your application was quite complete and your oral presentation this morning quite complementary to your application, so I am very happy to see that.

6284             Nonetheless, I do still have some questions for you.  If you have been sitting in the room you pretty well know the order.

6285             So we are going to start with your format, 70 percent Adult Contemporary, 30 percent popular music.  This morning you said that starting at 8:00 p.m. that will skew more of a younger audience.  I am assuming that is where you will play the 30 percent of popular music?

6286             MR. OLSTROM:  The majority of it would come throughout the course of the evening, Commissioner Cugini, but Pop music in general mixes in ‑‑ the charts cross.  The Pop charts and AC charts cross, but the majority of it will be programmed throughout the evening.

6287             I will turn to Daryl Holien to sort of give you an overview of how that sort of progresses throughout the day.

6288             COMMISSIONER CUGINI:  Sure.

6289             MR. HOLIEN:  The target audience of the radio station is 18 to 44, with the majority of the daytime programming focused towards a 25 to 44 year old, playing AC music, news, some spoken word and news features.

6290             After 8:00 p.m. in the evening the radio station will shift just slightly, become more of an 18 to 34 year old radio station with some of the features that would be played during the day not there.

6291             If we went on an average of songs played throughout the day, we would be playing nine songs an hour, with two of those being from the pop genre.

6292             In the evening time with some of these features not there, you are probably playing 14 songs and five of those would fall in the Pop arena.

6293             COMMISSIONER CUGINI:  When you say "features", are you also including spoken word programming?

6294             MR. HOLIEN:  Well, some of those ‑‑ I can speak to the music portion of it.  I can ask William to talk about some of the spoken word.

6295             COMMISSIONER CUGINI:  It's just because you mentioned the word "features" and I'm wondering if you mean music programming featuring particular artists or when you say "features" you also mean spoken word programming targeting that younger demographic?

6296             MR. HOLIEN:  Some of the features, for example, the business report and those kind of things that are played during the day would not be played in the evening, however the spoken word features we do have would be tailored to that younger audience.

6297             I can maybe let William talk about those.

6298             COMMISSIONER CUGINI:  Sure.

6299             MR. ALEXANDER:  Thanks, Daryl.

6300             Yes, the spoken word will change in the evening.  During the day news of course will be a formatted segment, on the hour/half hour news and information reports.

6301             In the evening, the news and information will be woven into more of the jaw‑talk segments.  This has not been included in our news and information estimates.

6302             We will still provide news updates as they happen, but the information will be presented in a less formal manner.  This will meet the younger demographic's need for information, while not encouraging tune‑out for those seeking more music.

6303             Information content of course will change was well.  For example, the "Community Report" will air in the evening, but it will be geared towards the younger demographic, with announcements such as grad rehearsals times at Fort McMurray Comp High or YMCA day camp volunteer opportunities through Westwood High School.

6304             It is common programming knowledge that the relevancy of spoken word and commercial content can significantly affect the enjoyability of a radio station.

6305             A common request among young listeners is more music, less talk and more new and emerging artists as well.  MIX 103.7 will meet these demands in the evening with the Canadian Showcase of new and emerging artists and more music‑based evening show and the talk about exists will be more on artists, the music and relevant current events.

6306             COMMISSIONER CUGINI:  So the overall picture, have you identified two different core audiences for these two day parts as a result?

6307             MR. OLSTROM:  Yes, we have.

6308             Primarily we are an Adult Contemporary radio station.  However, with the size of the marketplace you don't narrowcast.

6309             What we are looking to do is be a little bit broader and, as Harvard in the past has been before the Commission, we have a belief in serving the younger demographic and we feel there is an opportunity as the propensity for tuning as we know it across Canada tends to ‑‑ the under 25 demographic, the tuning is basically double to the 25‑54 demographic after 8:00 p.m. in the evening.  So we found this as a good opportunity in a market of this size to service that segment of the audience.

6310             The station won't change dramatically.  It's not like a switch goes off, but the Pop component definitely picks up and becomes a significant part that would appeal to that younger demographic.

6311             COMMISSIONER CUGINI:  You will also have anticipated, therefore, my next question which the Chair brings up with just about every applicant:  Have you identified a median age for both of those groups?

6312             MR. OLSTROM:  Median age for our radio station is 34.

6313             COMMISSIONER CUGINI:  Including the evening hours?  You still think the median age after 8:00 p.m. will be 34?

6314             MR. OLSTROM:  Well, no, the median age in the evening would not be ‑‑

6315             COMMISSIONER CUGINI:  Right.  That's why I asked for the two, in the two day parts.  Even though, as you say, it's not going to be a complete shift, but you will have a younger median age in the evening I'm assuming.

6316             MR. OLSTROM:  Yes.  I would like Debra McLaughlin to speak to that.

6317             COMMISSIONER CUGINI:  Sure.

6318             MS McLAUGHLIN:  The median age for the station overall will be 34.5 years of age; in the evening it will be 21.2.

6319             COMMISSIONER CUGINI:  That is pretty exact.

‑‑‑ Laughter / Rires

6320             COMMISSIONER LANGFORD:  More or less.

6321             COMMISSIONER CUGINI:  Yes, more of less.  You are a statistician I see.

‑‑‑ Laughter / Rires

6322             COMMISSIONER CUGINI:  You also mentioned in your opening statement this morning that it will also include advertising in terms of how the advertising will be directed to these two day parts.

6323             How do you anticipate doing that?

6324             MR. OLSTROM:  Well, there are a number of national advertisers that are looking to target those demographics and those opportunities do exist.  There are businesses in the Fort McMurray community that will be looking to address that audience.

6325             Maybe I could have Karen just briefly speak to that.

6326             COMMISSIONER CUGINI:  Yes.

6327             MS BRODERICK:  Our research has found that if advertising is relevant to a younger listener it is really not a tune‑out factor, so our plan is in the evenings when we are targeting that younger age demographic that our advertising will reflect that.  We have spoken with a number of advertisers in the market who don't really have an opportunity to reach that younger demographic so they look at this as an opportunity to do so.

6328             Wal‑Mart for example, they have set aside a whole marketing plan just for youth, so that is one example, but there are many others that we would probably shift into that evening time period.

6329             COMMISSIONER CUGINI:  All right.

6330             You mentioned new and emerging artists in your oral presentation this morning.  Without revisiting the lengthy discussions that took place a the radio review on this subject, first of all, the first question is:  How are you defining "new and emerging artists"?

6331             MR. OLSTROM:  We are utilizing what was submitted by the CAB, which is that they are considered new and emerging up until 12 months from the date they go top 40 on the BDS media base all formats charts or the artist reaches gold statu.

6332             COMMISSIONER CUGINI:  All right.  Thank you.

6333             Local programming an spoken word.  Like I said, your application is quite thorough and detailed with the paper that you gave us this morning, so thank you, but I would like to talk to you about your advisory committee.

6334             I do see the names and so the first question is off:  Who will be on that committee?

6335             What was the selection process?  What was the criteria for choosing these individuals?

6336             MR. COWIE:  Michael and I worked together on that.  We came into the market, we took advice as to who the involved people were who could be helpful in this regard.  I have family that live in Fort McMurray.  Through our own business connections there we were given names, not necessarily within our current realm of things but from their expanded view of the market.

6337             The number will actually be nine at the end of the day.  There are other candidates who chose to remain anonymous until such time as a licence is awarded, for their own reasons.

6338             But we tried to find a balance of people, for example the Chair, the person we have asked to chair it, is a homemaker, teacher.  Her husband and she run a very successful forest products business just north of Fort McMurray, but we wanted her to ‑‑ and we interviewed her in Fort McMurray.  We wanted her to be the social representative in the group:  How is the community in terms of the educational plant, recreational facility availability and those sorts of things?  What's happening to the cultural change here.

6339             For example, she told me that one teacher was having difficulty in a Kindergarten class because none of the children spoke English.  So she understand that change that is taking place, which is kind of under the dynamics of the oil and gas industry.

6340             So we wanted a person who understood the community, has lived here all her life, and how families are doing in this.

6341             Really, in building the advisory committee we were trying to answer two questions.  There is a whole new group of people here who don't know anything about Fort McMurray, and there is a whole group of people who have lived her for a long time who are wondering what is going on and how do they play in that?

6342             So we looked for people that, for example, represent the tourism industry, for people who understand infrastructure, who have been around for a long time and are part of building the ‑‑ not houses necessarily, the infrastructure is the city as a whole, it's planning, traffic and all of those things which are all hot topics here.

6343             You have a lot of people standing around Fort McMurray with nothing to do.  So we believe that our job as a licensee, should we be fortunate to be one, was to kind of help with that transition, for those that are coming, those who are here.  So we tried to build people around that knowledge base and have them support us by, on a fairly regular basis, meet with us, talk to us and make sure that we are talking about the right things, particularly in our news and information programs, that we are helping and that we are part of this growth going forward for both of those kinds of camps.

6344             COMMISSIONER CUGINI:  Will they be meeting on a regular basis or is this an ad hoc situation?

6345             MR. COWIE:  No.  We do have, by the way, the package that we discussed with them in terms of how it will work and we would be pleased to file that, if you wish.

6346             COMMISSIONER CUGINI:  Sure.

6347             MR. COWIE:  It meets the criteria of the CRTC, and so on, and is pretty straightforward in terms of the numbers of members, the numbers of times they will meet, how they will report, where their responsibilities lie, and so on.

6348             COMMISSIONER CUGINI:  If you have that, that would be great.

6349             MR. COWIE:  Yes.  We would be quite pleased to provide that.

6350             COMMISSIONER CUGINI:  When will you be able to file that with us?

6351             MR. COWIE:  We can file it today.

6352             COMMISSIONER CUGINI:  Thank you.

6353             Just since you are here, will the advisory committee also have a role to play in your news programming?

6354             MR. COWIE:  No.

6355             COMMISSIONER CUGINI:  They will not.

6356             MR. COWIE:  The advisory committee will be advisory only.

6357             COMMISSIONER CUGINI:  CTD.  You have stated that your commitment is $700,000 over the term of the licence.

6358             MR. COWIE:  Yes.

6359             COMMISSIONER CUGINI:  As you know, you may however be awarded a licence for a shorter period of time than seven years, or you may launch the service within a year, that is something that is shorter than ‑‑ therefore the first year may be shorter, so would you accept as a COL a requirement that you contribute $100,000 per year for the first seven consecutive broadcast years of your proposed undertaking?

6360             MR. COWIE:  Yes, we would.

6361             COMMISSIONER CUGINI:  Now I would like to go to the particulars of your CTD commitments.

6362             MR. COWIE:  All right.

6363             COMMISSIONER CUGINI:  I know that there has been correspondence between you and our staff in the deficiency process regarding the $20,000 a year for seven years to the Local Broadcast Centre for VoicePrint.

6364             Could you tell us what is your rationale for including this as a CTD expenditure?

6365             MR. COWIE:  Well, we believe as a group that VoicePrint and the activities of reading and writing for that group of people goes to the heart of the broadcast ‑‑ to the spirit of a broadcast licence, let me put it that way.  It is a very important part of things we do and it has bee approved in the past by the Commission in CRTC 2002‑91 and 92.  For Standard Radio and for Rogers VoicePrint has been approved as a qualifier for Canadian Talent Development.

6366             But more importantly, in this case, in Fort McMurray, this will be the first opportunity to begin to train Aboriginal readers.

6367             We came to it a couple of years ago and just found that this to us seemed like a very important thing to do with part of our CTD commitments.

6368             COMMISSIONER CUGINI:  If for some reason in our deliberations we don't quite see it the way you do, would you be willing to redirect that $20,000?

6369             MR. COWIE:  Yes, of course we would.

6370             COMMISSIONER CUGINI:  $10,000 per year for scholarships to Keyano College.

6371             MR. COWIE:  Yes.

6372             COMMISSIONER CUGINI:  Who will control these funds?  Will it be you or the college?

6373             MR. COWIE:  The college will.

6374             COMMISSIONER CUGINI:  The college will.  And what would the selection process be?  Do you write a cheque to the college or would you write a cheque to the students?

6375             MR. COWIE:  The only criteria that we require is that it be for music students.  After that, the college will make that decision as to who receives them, on merit and need.

6376             COMMISSIONER CUGINI:  Will this be a one $10,000 scholarship or five at $2,000 or 10 at $1,000?

6377             MR. COWIE:  No, they are ‑‑ what is it?

6378             MR. OLSTROM:  There are four annually.

6379             MR. COWIE:  Four at $10,000 each.

6380             MR. OLSTROM:  Four at $10,000.

6381             COMMISSIONER CUGINI:  Four at $10,000 each?  Okay.

6382             COMMISSIONER LANGFORD:  That's a lot of money.  I'm going back to school.

‑‑‑ Laughter / Rires

6383             MR. COWIE:  Many of the students at Keyano College are from outside the marketplace and there is a fairly significant group of First Nations people in those classes, and so on, so there is a need for scholarships at this level here.

6384             COMMISSIONER CUGINI:  $30,000 per year to the Interplay Visual and Performing Arts Festival.

6385             MR. COWIE:  Yes.

6386             COMMISSIONER CUGINI:  You indicated that this contribution would be limited to performance fees for Canadian artists.

6387             MR. COWIE:  Yes.  We wanted to make sure that every dollar of it went into the pockets of performers.

6388             COMMISSIONER CUGINI:  Would you accept this as a condition of licence?

6389             MR. COWIE:  Yes, we will.  And we have agreement from the Interplay group that that indeed will happen.

6390             COMMISSIONER CUGINI:  Your news mentoring programming to be offered to a person selected by APTN.

6391             I know this isn't in your CTD, but it is a benefit of this application.

6392             Is this is a paid internship?

6393             MR. COWIE:  It is a paid internship.  The candidate will be paid by Harvard, the company.  That is part of Harvard's contribution to this program.  So we accepted that responsibility as part of our agreement with APTN.

6394             COMMISSIONER CUGINI:  this is for one intern?

6395             MR. COWIE:  It is one intern per year.  We agree to hire at least one of those candidates over the period of the licence, over the seven years.  I say "at least one" because we may, and we are hopeful, of creating more than one candidate who we will then hire into our newsroom.

6396             COMMISSIONER CUGINI:  If we were to ask you to maintain this internship program over the course of your licence term on a year‑by‑year basis, would you accept that as a COL?

6397             MR. COWIE:  Absolutely, yes.

6398             COMMISSIONER CUGINI:  Thank you.

6399             We will now move on to business plan and impact.

6400             If you were here yesterday you will have heard the legal counsel ask any applicants if they had revised their projections to file them with us.

6401             Did you revise your projections?

6402             MR. COWIE:  We revisited our projections.  We did not refile, and I will tell you why we didn't.

6403             In the first instance, we did budget forward.  We projected in our own thinking that there would be a bubble in the next year or two.  We did not predict the bubble as quickly in one year as did occur, but over our current state and our first year of operation we have picked up that ‑‑ our projections included that kind of increase in the marketplace.

6404             So our revenue projections are at somewhere between $4 and $4.5 million.  I don't know exactly what it is.  It might be higher than that.  If it is, that might serve to reduce our losses in the first five or six years.

6405             However, on the other side, on the cost operating side, we are absolutely ‑‑ we did budget high on that side and we are very comfortable with those numbers.

6406             COMMISSIONER CUGINI:  So you did take into account the relatively high cost of living ‑‑

6407             MR. COWIE:  Yes.

6408             COMMISSIONER CUGINI:  ‑‑ in Fort McMurray and you stand by the financial projections as filed?

6409             MR. COWIE:  Yes.  I may have Paul Hill speak to this.  We also have the opportunity to somewhat control our own destiny in terms of availability of accommodation for people who will come into the market.  We will try to hire as many of our employees in the market as we can, but those that we can't, we are in a position to make sure (a) that we can provide accommodation and, if necessary, subsidize talent who might not otherwise come to Fort McMurray because of the costs, so we have made provisions for both of those.

6410             COMMISSIONER CUGINI:  Again, those provisions are included in your overall projections?

6411             MR. COWIE:  Yes, they are.

6412             COMMISSIONER CUGINI:  You heard discussion yesterday about how in order to attract talent to this market, and because of the high cost of living, you may have to pay salaries higher than you currently do in other markets?

6413             MR. COWIE:  Yes.  What we have done there is, first of all we budgeted an average that is pretty much equal to ‑‑ I have just forgot the name of the exact study, but it was done by OK Radio, and it said that in the sales and service sector that the average salary was something like $56,000 a year.  We have budgeted at that level so we are okay there.

6414             If we are required to subsidize above that, we are able to do so.

6415             COMMISSIONER CUGINI:  Is $56,000 the average salary?

6416             MR. COWIE:  In that sales and service sector.  That is out of a report.

6417             MS SVEDHAL:  Bruce, if you will, I can jump in for a minute.

6418             MR. COWIE:  All right.

6419             MS SVEDHAL:  Our average salaries that we budgeted were $53,000.  The OK Radio submission on May 24th in the sales and service sector was $46,000, so we are about 14 percent above that.  Our overall expenditures are $11 million, which is the second highest of the applicants.  We have a 10 percent cushion in those numbers and I'm very confident that we are very reasonable with them.

6420             COMMISSIONER CUGINI:  In terms of your staff numbers, how many staff members will be dedicated to news?

6421             MR. OLSTROM:  There will be four people dedicated to news in addition to the APTN reporter which will be providing stories of relevance on the aboriginal community.  So there are four people in news.

6422             COMMISSIONER CUGINI:  Will there be another group of people that will be dedicated to your spoken word local programming?

6423             MR. OLSTROM:  Those people, the spoken word programming will be developed through the news department as well as the on‑air talent and the programming department.

6424             COMMISSIONER CUGINI:  How many on‑air announcers?

6425             MR. OLSTROM:  There are five.

6426             COMMISSIONER CUGINI:  How many do you foresee in the programming department?

6427             MR. OLSTROM:  Those are five on‑air.

6428             COMMISSIONER CUGINI:  So they will be ‑‑

6429             MR. OLSTROM:  That would be a morning person, midday, afternoon and two evening swing.

6430             COMMISSIONER CUGINI:  So these nine people will be responsible for the five hours and 53 minutes of news and information programming?

6431             MR. OLSTROM:  No, the news and information will be developed primarily by the news department.

6432             COMMISSIONER CUGINI:  Including Canadian Showcase?

6433             MR. OLSTROM:  That would be a function of the programming department.  So the program director in conjunction with the other on‑air talent would produce these programs and develop these programs over the course of the week.

6434             COMMISSIONER CUGINI:  All right.

6435             So the total of 15 hours and 53 minutes will be produced locally?

6436             MR. OLSTROM:  That is correct.

6437             COMMISSIONER CUGINI:  There will be no programming shared with your other stations?

6438             MR. OLSTROM:  No.  No, none at all.

6439             COMMISSIONER CUGINI:  Are there any synergies at all with your other stations?

6440             MR. OLSTROM:  We did not look at any synergies, however, you know, if we found that there was a requirement to do so on a traffic basis or an accounting basis, that may occur, but we haven't planned for that in this situation.

6441             COMMISSIONER CUGINI:  So right now your plans are to be a standalone station in Fort McMurray?

6442             MR. OLSTROM:  Fully standalone operation, yes.

6443             COMMISSIONER CUGINI:  Which of course leads me to the big question that we always ask.

6444             As you know, there is a very strong incumbent in the area and how do you, as an independent coming into this market, believe that you will be able to compete with the incumbent already in Fort McMurray?

6445             MR. COWIE:  We may give you several answers on that, Commissioner.

6446             COMMISSIONER CUGINI:  The one you want the most for us to believe would be the good one.

6447             MR. COWIE:  Well, it is the highest demand format in Canada.  It is not present here in the marketplace.

6448             We have a combination of things.  We think we can come successfully into the market and, second, we think we can come successfully into the market and not upset the incumbent too much, because there are two stations sharing the total marketplace.

6449             I will go to Michael for the detail of this, but we think there is enough room, the market is growing fast enough and will grow over time to accept the radio station successfully and allow us to do all the things we want to do and compete at a very high level.

6450             MR. OLSTROM:  The thing you have to remember is, Adult Contemporary is a female leaning or skewing format and both the current radio station is a Rock station, a Country station, tend to be more predominant male.  Just in our anecdotal I guess qualitative research that we did in the marketplace and talking to a lot of women in the marketplace, it was like "Oh, my God, thank you.  Something for us".  So that solidified our decision in the direction that we should take.

6451             COMMISSIONER CUGINI:  How many radio stations do you believe Fort McMurray can handle?

6452             MR. COWIE:  I just looked at more economic information this morning that I have seen for the first time and the notion that this is a five‑year bubble and then everything is going to slow down just isn't going to happen.  This is going to go on for a long period of time.

6453             I think in this first phase, with the immediate growth we are seeing, we think it is likely that two licences would be appropriate.  Because within the timeframe of this licence period certainly there would be room for four stations in this market.

6454             COMMISSIONER CUGINI:  You have heard us ask other applicants about whether or not you felt it was such a strong market that we could even license two additional stations with similar formats.

6455             What are your thoughts on that?

6456             MR. COWIE:  That would not ‑‑

6457             COMMISSIONER CUGINI:  If you were one of the two, would you alter your format in any way if we were to do that?

6458             MR. COWIE:  Well, that's a different question, but if ‑‑

6459             COMMISSIONER CUGINI:  It goes hand‑in‑hand.

6460             MR. COWIE:  If we were one of two licensed in the same format we would adapt and compete and we would be quite comfortable with that.  That would not be our first choice, however.

6461             But I look at the roster of applicants here and there aren't a lot of choices in terms of variety of formats.  There are literally three and three.

6462             I understand your dilemma, but there is one older demographic, I guess, that has to be recognized in that equation as well in the lounge.

6463             But we would be quite comfortable and happy to compete, if that was the Commission's decision.

6464             COMMISSIONER CUGINI:  You know that two of the applicants before us are proposing gospel music stations.  Do you think that the market could sustain two additional services, plus one of them?

6465             MR. COWIE:  We think that is probable too.

6466             COMMISSIONER CUGINI:  That is ‑‑

6467             MR. COWIE:  Yes.

6468             COMMISSIONER CUGINI:  ‑‑ a problem?

6469             MR. COWIE:  No, no.  That's possible, too.

6470             COMMISSIONER CUGINI:  Okay.  Thank you.

6471             Thank you, Mr. Chair, those are my questions.

6472             THE CHAIRPERSON:  Commissioner Cram...?

6473             COMMISSIONER CRAM:  After yesterday I'm a little worried about broadcasters from my region.

6474             Can you tell me, Mr. Hill or Mr. Cowie, why you applied here and not Grande Prairie?

6475             MR. COWIE:  Well, I thought about that overnight and I thought of some answer that equated to what Elmer Hildebrand was doing on that day.

‑‑‑ Laughter / Rires

6476             MR. COWIE:  But I didn't want to go there particularly.

6477             Actually, in the circle of life and the sequence of things, at the time we were presented with the idea we did look at Grande Prairie.

6478             Presented with that idea we had a dilemma to deal with.  We believed then and believe now that a major market radio station is vital to our regional strategy, so our focus was clearly on Calgary.  Sequentially all of those things might look like they don't line up, but they do.

6479             Secondarily to that, and after a lot of thinking about it, the synergies that would exist between Calgary ‑‑ and we are not trying to presuppose anything here ‑‑ the synergies that would exist between the oil plant, which is here in Fort McMurray, and the ownership and management of it which is in Calgary, appealed to us.

6480             If you have two licences based on that kind of geographic connection and also business and social connection, it seemed to us that that would be the best place of the two for us.

6481             So we did think about applying for both, but at the end of the day that would be a much better configuration for us we think and would allow for information flowing both ways to our listeners about what is going on in the province from both a corporate point of view and from the place where it is actually taking place.

6482             COMMISSIONER CRAM:  I have to say, that is a better answer than ‑‑

‑‑‑ Laughter / Rires

6483             MR. COWIE:  I agree with that.

‑‑‑ Laughter / Rires

6484             COMMISSIONER CRAM:  You had to work on it, though, eh?  Sorry.

6485             COMMISSIONER LANGFORD:  But Mr. Hildebrand's was nice and short and we like pithy, epigrammatic responses.  We are giving him marks on that.

‑‑‑ Laughter / Rires

6486             COMMISSIONER CRAM:  I will ask my normal question about voice‑tracking.  How much are you planning?

6487             MR. OLSTROM:  There will be none during the broadcast week.

6488             COMMISSIONER CRAM:  Would you agree to a COL?

6489             MR. OLSTROM:  Does the Commission ‑‑

6490             COMMISSIONER CRAM:  If you recall, I asked ‑‑

6491             MR. OLSTROM:  Yes, we would.

6492             COMMISSIONER CRAM:  I asked the people last in Grande Prairie the same thing.

6493             MR. OLSTROM:  Yes, we would, Commissioner Cram.

6494             COMMISSIONER CRAM:  Thank you.

6495             My last question is:  Mr. Alexander, I had a hard time pronouncing your name when I went to visit you at the Creek.  Yuzicapi?

6496             MR. ALEXANDER:  Yuzicapi is my real last name.  William Alexander is on‑air name.

6497             COMMISSIONER CRAM:  How is the Creek doing?

6498             MR. ALEXANDER:  It's doing fine.  It's on its way back, yes.

6499             COMMISSIONER CRAM:  Oh, excellent.

6500             Thank you.  Thank you very much

6501             Thank you, Mr. Chair/

6502             THE CHAIRPERSON:  Commissioner Williams...?

6503             COMMISSIONER WILLIAMS:  Good morning, Mr. Cowie and Olstrom and panellists.

6504             I think I agree with you that decisions are made in Calgary and the plant is in Fort McMurray, but there is some considered belief that the money is spent in Edmonton, given the vast number of Fort McMurray workers that are on the highway between Fort McMurray and Edmonton every weekend, or I think it's Wednesday nights and weekends.

6505             Do you expect much of your ad revenue to come from Edmonton businesses?

6506             MR. COWIE:  We had not considered approaching Edmonton businesses, no.

6507             COMMISSIONER WILLIAMS:  So other than national advertisers your sales projections are focused primarily on the Fort McMurray market?

6508             MR. COWIE:  Yes.

6509             COMMISSIONER WILLIAMS:  All right.  Thank you very much.

6510             That's my question.

6511             THE CHAIRPERSON:  Commissioner Cram again.

6512             COMMISSIONER CRAM:  Sorry.

6513             In your written talk today you talked about leading to the Aboriginal Media Education Fund.  I have never heard of that.

6514             Can you tell me what that is?

6515             MR. COWIE:  Do you want to answer that?

6516             MR. OLSTROM:  Actually, what I would like to do is I would like to have Debra McLaughlin speak to that, because through her and ourselves and APTN Debra has background knowledge that she can relay to you.

6517             MR. COWIE:  Just before she does that, Commissioner Cram, Jean LaRose, the President and CEO of APTN will be here to speak about that in Phase III.

6518             COMMISSIONER CRAM:  All right.

6519             MR. COWIE:  But Debra has done the liaison work for us on this very special project, so we will have her answer.

6520             MS McLAUGHLIN:  The Aboriginal Media Education Fund was borne out of really a necessity and APTN is a lead sponsor in it.  Repeatedly APTN was challenged to find, not story ideas necessarily but the people to develop those story ideas into productions.  Not only that, they were continually being approached as the resource, or the potential resource, for referrals to talented aboriginal producers, writers, cameramen, any phase of production.  It became quite clear in some aspects that they were in danger of losing their staff and they couldn't find the people.

6521             So collectively I believe ‑‑ and as Bruce mentioned Jean LaRose will be here later to explain it in more detail ‑‑ but the idea of putting together a fund that was contributed to by many aspects and many companies in and outside the broadcasting industry was developed.

6522             It was announced this winter.  It was presented, I believe at Banff, and I know that Mr. LaRose has had meetings with some people at the Commission ‑‑ I'm not sure who, I wasn't party to those meetings ‑‑ to discuss this.

6523             The Harvard involvement comes ‑‑ actually, part of the reason he believed that this fund could work was because of the kind of initiatives Harvard was taking in actually mentoring, taking people into their organization and at the end of the year turning out skilled, in this case, news gatherers, news reporters.

6524             So it was announced, as I say, I believe this past winter.  It has been discussed with the Commission and it is now a viable fund with a separate operating company, I believe based in Toronto, and I think the goal is $10 million and they have started to collect that.

6525             COMMISSIONER CRAM:  Thank you.

6526             Thank you, Mr. Chair.

6527             THE CHAIRPERSON:  Thank you, Mrs. Cram.  I had a very similar question, so thank you for asking.

6528             Going back to your CTD plans, we quickly discussed VoicePrint and you answered if the Commission was to say that VoicePrint was not meeting the notion of CTD you will redirect the funding.

6529             Have you made up your mind where you will redirect that money?

6530             MR. COWIE:  We have not, but I would say this, that it would be directed in the area of music talent within the genre that we propose for this radio station and, as always, it would be in payments to artists to help them along in their careers.

6531             THE CHAIRPERSON:  Have you so far made any commitments to VoicePrint regarding the CTD commitment you were ready to make?

6532             MR. COWIE:  I think I have to ask Debra to answer that.  I don't think we have.

6533             MS McLAUGHLIN:  There has been a letter exchanged.  The Commission would have a copy in the file of a letter of support expressing VoicePrint's understanding that the funding will be coming to them.

6534             However, I have to qualify that by saying that VoicePrint hasn't spent the money, as it were, because their target in receiving these funds was to develop aboriginal readers and narrators.

6535             As you know, they have both skilled and non‑skilled readers and they have become quite the training base for providing people with their first exposure to on‑air presentation.

6536             So if the Commission was to decide that this was an ineligible recipient, then VoicePrint would not be negatively impacted as the program itself has not been developed for the Fort McMurray area.

6537             THE CHAIRPERSON:  Thank you.

6538             I know that legal counsel has a question.

6539             MS FISHER:  Thank you, Mr. Chair.

6540             I just wanted to clarify, you have indicated that you will provide additional information relating to your Local Advisory Committee at some point today and I just wanted to clarify if you could please provide that before the beginning of Phase III.

6541             MR. COWIE:  Yes, indeed we can.

6542             MS FISHER:  Thank you.

6543             Those are my questions.

6544             THE CHAIRPERSON:  Thank you.

6545             Mr. Cowie, you have two minutes to tell us why Harvard should be granted the licence to serve Fort McMurray.

6546             MR. COWIE:  Thank you very much, Mr. Chairman.

6547             This is the part I like.

‑‑‑ Laughter / Rires

6548             MR. COWIE:  At every hearing we try to find an analogy for our proposal and I'm going to thank Commissioner Langford for providing it for us on this occasion from a conversation yesterday.

6549             We are not the prince wandering the country with a slipper looking for a perfect fit.  Our proposal is the perfect fit for Fort McMurray.

6550             We offer a format Adult Contemporary that is not available in the market despite being the number one music format in Canada.

6551             Our version of AC is tailor‑made for Fort McMurray.  A proposal of 70 percent AC and 30 percent Pop clearly fills a program gap in the market and it meets consumer demand for this new service.  We offer you a format that appeals both to the under served female segment of the population and provides a listening opportunity for the youth in the market.

6552             Our core demo is 18‑44, a group that represents approximately 52 percent of the city's population.  Clearly our format will serve the needs of the majority.

6553             With 40 percent Canadian content, 25 percent of which will be devoted to new and emerging Canadian artists, Harvard will play a key role in developing Canadian artists and provide what is often missing in radio.

6554             The residents of Fort McMurray told us what they value and we have responded.  They want variety.  We are offering a broad AC format that appeals to both ends of the 18‑54 demographic and a strong commitment to new and emerging artists.

6555             News and information.  We are offering a comprehensive local news service which will provide extensive local reflection.  They want diversity.  With only two stations currently in the market we will be able to offer new music currently not available.

6556             In summary, Mr. Chairman, our format adds diversity.

6557             Our commitment to Canadian music will showcase indigenous talent with an emphasis on new Canadian artists.

6558             Our CTD package will develop talent at the local level, provide new resources to the vision impaired, and help train a new generation of aboriginal reporters.

6559             Finally, we know this market.  We have a significant presence in the real estate and housing markets and are involved in the oil sands.  This has provided us with invaluable insight into this unique and growing place.

6560             To ensure we reflect the community at all times, we have established a Local Advisory Committee, the members of which have strong ties to Fort McMurray.

6561             Mr. Chairman, we are prepared to invest in and grow with Fort McMurray.  We have found the slipper that fits, and with your approval Harvard and Fort McMurray will live happily ever after.

‑‑‑ Laughter / Rires

6562             MR. COWIE:  Thank you very much.

6563             THE CHAIRPERSON:  Thank you, Mr. Cowie.  Thank you to your team.

6564             We will take a 10‑minute, so we will get back for 10 to 10:00.

‑‑‑ Upon recessing at 0940 / Suspension à 0940

‑‑‑ Upon resuming at 1000 / Reprise à 1000

6565             THE CHAIRPERSON:  Madam Secretary, would you call the next applicant, please?

6566             THE SECRETARY:  Thank you, Mr. Chairman.

6567             Before we introduce the next panel I would just like to indicate that the applicant Harvard has just filed the additional information on their Local Advisory Committee.  The information will be placed on their application file and will be available in the examination room.

6568             We are now ready to proceed with Item 16 on the Agenda, which is an application by King's Kids Promotions Outreach Ministries Incorporated for a licence to operate an English‑language low power commercial specialty FM radio programming undertaking in Fort McMurray.

6569             The new station would operate on frequency 91.1 MHz, channel 216LP, with an effective radiated power of 35 watts, non‑directional antenna/antenna height of 71.5 metres.

6570             Appearing for the applicant is Mr. Rick Kirschner, who will introduce his colleagues.  You will then have 20 minutes for your presentation.

6571             Mr. Kirschner...?


6572             MR. R. KIRSCHNER:  Thank you.

6573             Good morning, Mr. Chairman, Members of CRTC and Commission staff.  Thank you for hearing our presentation today, but also for taking the time to investigate thoroughly the ramification of applicants for Fort McMurray, Alberta which is very distinct and unique in its social situation.

6574             Presenters for King's Kids Promotions Outreach Ministries Incorporated are, on my right, Dave Kirschner, a 28‑year resident and business owner in Fort McMurray.  Dave is a father, and a grandfather who has been involved in the social, economic and many other areas of the city's development during that time.

6575             On my left is Mr. Bruce Taylor an 11‑year pastor, parent and founder of the Centre for Hope, street‑level outreach in Fort McMurray.

6576             My name is Rick Kirschner.  I am a parent of three teenagers, a former Ontario Police Officer, business owner and currently an ordained minister.

6577             Mr. Chairman, we are here today to present our proposal for a new and distinct music service for Fort McMurray residents, a Christian music service, a specialty station with at least 90 percent of the weekly total music drawn from subcategory 35.

6578             KAOS 91.1, with a vision to "Expose Hope thru relevant Music, Talk, and Action", will impact more than simply the entertainment realm, but also the social, educational and spiritual climate of Fort McMurray as well.

6579             Today we will give a brief overview of King's Kids Promotions, which has been incorporated since 1992; its history prior to radio; it's current operation of KAOS 99.5 in Peterborough, Ontario, including a short DVD of how KAOS is unique from other Christian operations in Canada; why it is so appealing and applauded by Christian and secular artists, as well as secular and Christian advertisers.

6580             Number two, King's Kids presentation will also include an overview of the need for the format of the proposed station, as well as current partnerships and support already developed within the community.

6581             King's Kids lengthy history of Canadian Talent Development prior to radio broadcasting will be mentioned throughout this presentation.

6582             MR. D. KIRSCHNER:  Mr. Chairman, King's Kids was established by Reverend Rick and Cathy Kirschner and team in 1992 with a vision to "reach, build, and activate youth to impact the world for Jesus Christ".  Through music and performing arts, work projects and world mission trips, King's Kids has been involved with hundreds of youth, both Christian and secular, to help them reach their potential in life.

6583             Rick, a youth pastor for the past 18 years at Selwyn Outreach Centre, has always been encouraged to do whatever it takes to engage youth and help them grow.  Rick is very familiar with the youth culture of Canada, being a former police officer, high school teacher and youth pastor before entering radio broadcasting.

6584             On studying his Master's Degree in reaching the North American youth culture in the 21st century, Rick became even more convinced that the media was the most significant force in the culture today, a force that can either strengthen or weaken any community.

6585             In early 2000 Rick began to explore the Christian radio ministry, having been involved with the development of many Canadian artists prior to this time.  For Rick and King's Kids this is a natural fit, simply an extension of what they have been doing for years.

6586             King's Kids has produced seven Canadian CDs on an amateur basis and is currently working on two more.  Many of the over 100 first‑time artists King's Kids has recorded have gone on to write, produce, record and perform in professional careers today.

6587             King's Kids continues to reach people who need hope, encourage them to grow and pursue their dreams and help them become active in making the world a better place.

6588             Trevor McNevan from Thousand Foot Krutch states:

"I collectively have 2 bands on Tooth and Nail/EMI Records, Both `Thousand Foot Krutch' and `FM Static', as well as producing/ songwriting with/for other artists in this industry.  Rick Kirschner and KAOS Radio Peterborough have been a tremendous support to both our bands, both on and off the stage.  Even before the license was in hand, they were a large staple for encouraging and nurturing many local artists.  Their hearts are good, their vision is strong, and myself as well as many other Canadian U.S. artists I know will always support, and appreciate the help of KAOS Radio..."

6589             MR. R. KIRSCHNER:  Right now we would like to turn your attention to the DVD.

‑‑‑ Video presentation / Présentation vidéo

6590             MR. R. KIRSCHNER:  King's Kids current operation, KAOS 99.5 in Peterborough, Ontario.

6591             KAOS in Peterborough went on the air 24 November 2004, a low‑power undertaking which nicely covers the major population of the city.  The Contemporary Hit/Rock format of the station has mass appeal with the 34 and under demographic, but is also readily validated by those older in its ability to motivate and influence the younger generation.

6592             Music with Christian themes comes in many styles and expressions, from Rock, Hip‑Hop, traditional/classic, Skaw, Pop, Adult Contemporary and many more.

6593             Although 90 percent of the music comes from the subcategory 35, the other 10 percent could easily be considered the same type of music but written and performed by secular artists.  In no way does it stand against Judeo Christian themes and morality.  In fact, it is often more overt in its stance for Christian themes and morality than some Christian artists.

6594             The uniqueness of KAOS radio is its branding and approach to the market.  From the name "KAOS', which to many has a negative connotation although it is derived from the Bible in Genesis one, to the avoidance of calling the itself "Christian" has allowed the station to be positioned in the market as a positive new music alternative while not being considered religious.

6595             Post‑9/11 North American culture seems to be demanding a more positive approach from the music industry.  KAOS radio has responded to that need by exposing new music to our communities that emphasize hope and fun.

6596             MR. TAYLOR:  Mr. Chairman, the major benefit of this positioning and branding is threefold:

6597             First, Christian and Christian‑valued music and artists get exposed to the general market because thousands tune into a new music station that would never listen to a Christian station because they are often perceived as Bible‑thumping stations asking for money.

6598             A poor definition of Christianity has often caused people to shy away from things called Christian.  The following is an unsolicited e‑mail:

"Thank YOU so much for your wonderful station.  I listen at work on the internet everyday ... it ministers to me in a way that I never expected.  I have come to know some awesome bands like thousand foot Krutch through listening through your station...  My husband and I hope to move to Peterborough someday and are thankful that such a resource will be available to our girls ... when they need it. ‑ Wendy"

6599             MR. R. KIRSCHNER:  Mr. Chairman, the spirituality of the music is attractive to the audience and encourages both Christian and non‑Christian alike.  Youth social agencies are featured and lifestyle issues are explored in ways that are palatable to our listeners.

6600             Sometimes Christianity has been poorly defined by history.  This antiquated definition makes the religion not appealing to the culture.  By removing the name which is often poorly defined and misleading anyways, people can experience the ways and purposes of Christian spirituality for themselves.  The new approach is usually only offensive to some Christians who believes we are not being true to our beliefs.  However, consistently we engage a large number of non‑Christian people who are seeking spirituality but not religion.

6601             Dr. Dave for youth is an ordained Baptist Minister with a Ph.D. in Education.  He airs a feature on KAOS 99.5 in Peterborough.  Dave presents Judeo Christian value, talks to kids using common language.  He doesn't quote chapter and verse, although he is quoting the Bible and young people love it and are tuned in.

6602             Another example of this approach being beneficial was the production of a CD, which is included in your package, called "Journey, a Tribute to the life of Aaron Montgomery".  This CD incorporated positive encouraging general market and Christian music which was distributed to the entire population of a secular high school to help them cope with the suicide of a fellow student.  New and old Canadian Christian artists were exposed to the entire group and a major service was provided to a grieving student body.

6603             Post‑modern North American culture is very hungry for spiritual things and for the gospel of Jesus Christ if presented in relevant ways.

6604             Sonia, one girl says:

"I'm listening to Lucid Noize show on grieving and it answered some of my prayers.  When my mom died I just felt like giving up, it's to hard to be strong and to live without her on my own, when I heard you mention on Lucid Noize that with a loss of a close person sometimes we feel like dying with them, that's how I felt‑ but when you said `if there is one message just don't give up, grief is hard but it's going to get easier and you can get through it", those words helped me a lot.  Thanks for doing Lucid Noize and the messages".

6605             MR. TAYLOR:  A third benefit is that advertisers enjoy the positive music and programming, and although some is overtly Christian they are willing to support it because it is moral.  Many businesses advertise on our station because we have a moral positive stance.  There is no off‑coloured humour or sexual innuendo and people appreciate that whether they are Christian or not.

6606             Many Christians share values with other world religions and so by not branding the station Christian, but by upholding Judeo Christian values, initiatives, traditions and some overtly Christian specialty shows, the station has a much wider appeal and brings much wider market shares as a result.

6607             This philosophy of positive contemporary hit music is well received in Peterborough and the letters of support and community partnerships prove it.

6608             We have promised financial support from several Fort McMurray businesses who are not Christian because they believe in the moral philosophy of the station.

6609             Peterborough KAOS has a wide appeal because of how we include our values of promoting young local talent in our marketing and sales initiatives.  Currently our KAOS radio rode show incorporates a new act called "Stars on Stage" to our remotes.  Not only do we do a radio broadcast from the location, but we bring in three hours of bright Canadian local talent.  Every one wins.  The retail client gets a real show to enhance their event; the performers receive much needed exposure to the public; and KAOS radio adds value to its service, which makes us competitive in the market.

6610             This years' show includes over 20 new performers.  We are currently developing and hosting the "Peterborough Pop Idol" to be held at the Peterborough Exhibition, and the "Stars on Stage" are hosting a stage at the International Plowing Match in Peterborough this September.

6611             The organization is not even a year old and it is playing at premier venues sponsored by KAOS Radio.  Many corporate sponsors embrace this because of the community‑mindedness and promotion of local Canadian talent.

6612             Mr. Chairman, we will now look at expanding on our Canadian Talent Development.

6613             King's Kids has, for the past two years, conducted several battle of the bands in conjunction with local catholic and public school boards.  We have purchased and lend a professional sound system to schools churches and other groups and hold monthly shows designed to encourage and mentor new bands and artists.

6614             Our financial investment far exceeds the minimum requirements and is much more than proposed in our original application.  Again, our history shows we have consistently invested in Canadian Talent before we had a radio operation, and I believe KAOS operates in the true spirit of the CRTC's Canadian Talent Development requirements.

6615             A couple of Canadian bands have commented in your notes to support this.  They are there for you to read later, we wouldn't have time.

6616             But, Mr. Chairman, now we will continue with a review of the need for this Christian radio format in Fort McMurray.

6617             As a pastor and long‑time resident of Fort McMurray, there are many social issues that have emerged over time that we deal with on a daily basis.  It has brought me a great deal of hope to understand that there are those who want to come to Fort McMurray to make a difference in the community.  We have many people and businesses that come to our area to make money.

6618             We have a lot of spin‑off issues because of the fast‑paced growth that the drive for financial gain brings:  Drug and alcohol abuse, kids being kicked out of their homes, homeless people and families, a high cost of living that brings a sense of poverty to many working people, and other issues.

6619             KAOS radio is committed to being a part of the solutions to these types of issues.  They have expressed their primary desire for this proposal as being the need to provide a positive influence in the lives of the young people in our community.  Also, they have expressed the desire to partner with other non-profit agencies like the Salvation Army Shelter, the Centre of Hope for the homeless, Young Life, Youth with a Mission, the Soup Kitchen and others.

6620             I have reviewed most of the other applications and have even had some discussion with those involved with some of the those applications.  They have expressed a desire to be involved in the community, however this has always been secondary and they are business‑driven first.

6621             KAOS has shown time and time again that they will be committed to our community and flexible to how that needs to work.  As a Pastor, I can assure you that the majority of the church community is supportive of this application.  Also, I am certain that many of our churches will want to partner with the station for special events, advertising and concerts.  KAOS Radio would be a positive influence in our Community.

6622             MR. D. KIRSCHNER:  Mr. Chairman, we have a large‑base local steering committee and several letters to commit time and finances.  My KAOS 91.1 in Fort MCMurray with a vision to expose hope through relevant music, talk and action is bound to succeed.

6623             While we do not went to generalize or overstate the serious condition in Fort McMurray, we do want to acknowledge that there are significant social ills that affect every socioeconomic level of society.

6624             As stated by Rev Taylor, the mission of KAOS radio is to raise a standard of involvement in the social fabric of the community to not only offer a healthier music and programming solution, but to offer and support the many social services that are currently caring for the community.

6625             In a letter of support for our application by M.P. Brian Jean, he states the preference for a station in Fort McMurray with a mandate to help the younger demographic, a station that inspires personal community involvement and is not focused on making money as much as making a positive community difference.

6626             Our records indicate over 264 general letters of support and at least 20 business letters were mailed to the CRTC.  We regret that over 163 were returned as they were not received in time; even having been mailed 10 days prior to the deadline for interventions.

6627             Our Mayor, Melissa Blake, writes that she particularly likes the fact that this station is locally steered and programmed.

6628             From MP to MLA to our Mayor, every level of Fort McMurray government is supportive of the vision and people behind the station.  The church community has strongly supported this application from Evangelicals to Roman Catholics, including a letter from the Knights of Columbus who pledge financial support, as well as the youth ministry coordinator and many other parishioners.

6629             The Assistant Superintendent of the catholic board, Kim Jenkins, has pledged support and a keen interest, as well as principals from both the elementary and other high schools.

6630             This application includes interventions of people who have never advertised on radio before, but who have pledged significant financial support.  We also showed promise for others who currently advertise on radio that they would be willing to support as well financially.

6631             Rev Taylor and other local pastors all strongly support the application and suggest that they will also donate in significant ways to launch the station.

6632             KAOS staff has already been working to help locals develop their talent.  An excerpt from an unsolicited letter as follows expresses thanks to Mr. Kirschner's help with a local band:

"... Rick I want to thank you for the time you spent with me an `Liberty's Prelude' we appreciate your patience and care you gave us at our practice we look forward to you coming up here and helping out bands like us... Josh (McDaniel) Fort McMurray"

6633             Another established relationship agrees in principle to a partnership with KAOS.  Russell Thomas with the local publicist at Keyano Theatre has said that:

"During the annual InterPlay Festival of the Visual and Performing Arts, KAOS will sponsor a Sunday morning Musical Celebration of Faith.  Currently, the festival does not have any programming on the Sunday morning.  The Musical Celebration of Faith would be non‑denominational event that give the local performers a chance to express themselves in front of a family audience."

6634             MR. R. KIRSCHNER:  In closing, King's Kids and KAOS 91.1 are responding to a need in Fort McMurray.  I believe we have demonstrated impressive local support and a business plan which will help us make this resource a reality.

6635             We believe our long history of Canadian Talent Development, even before we were involved in broadcasting, is a reflection of the true spirit of the CRTC'S Canadian Talent Development requirement.

6636             King's Kids unique philosophy and approach with this new and distinct Christian music service is refreshing and bold and has proven in Peterborough to draw many people to this format, exposing more Christian and general market Canadian talent to the citizens of Canada.

6637             Thank you for your time.  We look forward to answering your questions.

6638             THE CHAIRPERSON:  Thank you, Mr. Kirschner.

6639             Commissioner Williams...?

6640             COMMISSIONER WILLIAMS:  Good morning, Mr. Kirschner and Taylor.

6641             I note you have filed some revised revenue and expense numbers here that I guess is almost a 70‑80 percent increase in sales revenue for example.

6642             MR. R. KIRSCHNER:  That is correct, sir.  That was done prior to coming

6643             COMMISSIONER WILLIAMS:  All right.  Thank you.

6644             Why have you chosen to use a 35 watt transmitter in the Fort McMurray marketplace?

6645             Is this power enough to serve your entire proposed market?

6646             MR. R. KIRSCHNER:  We found that wattage successful in Peterborough.  We did take that to our consultant and engineer in Montreal and he seemed to think that was quite sufficient to cover the area so we went ahead with that.

6647             COMMISSIONER WILLIAMS:  I'm not familiar with Peterborough.  How large is Peterborough in population, say, compared to McMurray?

6648             MR. R. KIRSCHNER:  It is 72,000 people.

6649             COMMISSIONER WILLIAMS:  So a little larger then?

6650             COMMISSIONER WILLIAMS:  The competing Christian radio application is a 20,000 watt station and I was just curious about this.

6651             Go ahead, Mr. Chair.

6652             THE CHAIRPERSON:  Back to the question that Commissioner Williams was asking you regarding technical, are they high enough buildings in Fort McMurray?

6653             MR. D. KIRSCHNER:  Yes.

6654             THE CHAIRPERSON:  Where do you plan to have your antenna?  Is it on the top of a building or on top of a mountain?

6655             MR. D. KIRSCHNER:  Our tower is actually just to the southeast of the city in the industrial park.

6656             If I could refer to the CRTC's document it gives the tower heights and I believe the tower that we are looking at transmitting out of is 71 metres, which is about a third higher than the other applicants.

6657             THE CHAIRPERSON:  So a 35 watt will give you fairly ‑‑ well, I can see the map and I know the engineers there, so I'm sure that they have taken everything into consideration, but I wanted only not to lead you to believe that there was some problems.

6658             All right.  Thank you.

6659             COMMISSIONER WILLIAMS:  I'm going to spend a bit of time gaining a better understanding of your proposed music format now.

6660             We note that 90 percent of your music will come from subcategory 35, non‑classic religious.  In your supplementary brief you describe your music format as Hot Adult Contemporary and Contemporary hit radio.  We realize that some artists that produce music in the non‑classic religious genre, Category 3, can find their music on billboards Hot AC or CHR charts as crossover artists.  As you know, these selections are usually classified as Category 2 music.

6661             This being said, could you explain to us how your musical format which you define as Hot AC, CHR format, will be predominantly 90 percent composed music from subcategory 35 non‑classic religious?

6662             Is it that contemporary music styles are also being produced by Canadian artists?

6663             MR. R. KIRSCHNER:  I'm sorry, I'm not really getting the full depth of the question.  I'm sorry.

6664             COMMISSIONER WILLIAMS:  All right, I will go through it again.  No problem.

6665             MR. R. KIRSCHNER:  Thank you.  Sorry.

6666             COMMISSIONER WILLIAMS:  Can you please explain to us how your musical format, which you define as Hot Adult Contemporary and Contemporary hit radio format will still be predominantly 90 percent composed of music from subcategory 35, which is non‑classic religious?

6667             Could it be possible and is it possible that contemporary music styles are also being produced by Christian artists?

6668             MR. R. KIRSCHNER:  That is correct.  There is almost exponential growth in the Christian music industry responding to the need for Christian contemporary music, Rock and CHR music as well.

6669             COMMISSIONER WILLIAMS:  I note that your programming will be directed mainly towards the youth of Fort McMurray.

6670             For the record, could you tell me what demographic will make up your core target audience and what would you expect would be the median age?

6671             MR. R. KIRSCHNER:  We project our major demographic to be 18 to 34, our secondary demographic to be 16 to 44.  The median age we would expect to be 29 years old.

6672             COMMISSIONER WILLIAMS:  Twenty‑nine years old.  I guess you are still a youth at 29, judging on my children.

6673             MR. R. KIRSCHNER:  Actually, at 44.

‑‑‑ Laughter / Rires

6674             COMMISSIONER WILLIAMS:  How similar or different will your proposed Fort McMurray station be to your existing Peterborough service?

6675             MR. R. KIRSCHNER:  Peterborough service is a CHR/Rock station.  It will be similar in the evenings when we would go to more of a Rock format or add some Rock to the format, being a little more inviting to the younger demographic.  But primarily in the day would be that Hot AC, CHR music format, a little bit of rock thrown in for the old rockers.

6676             COMMISSIONER WILLIAMS:  All right.

6677             In your deficiency response you indicated that 95 percent of the programming would be locally produced and the remaining 5 percent would feature programs which will assist in addressing issues of relevance in the Fort McMurray area.

6678             Could you tell us where the remaining 5 percent of the programming would originate from, indicating if it is Canadian or non‑Canadian and the amount from each source?

6679             MR. R. KIRSCHNER:  We are working potentially ‑‑ and the finalization will be up to the local steering committee, but we do anticipate local brokered programming of approximately three hours a week.  It could be people such as Focus on the Family, Insight for Living, Chuck Swindoll.

6680             This is American programming.  We are working hard to develop our own Canadian programming similar to this.  We have done that with Dr. Dave Overholt from Hamilton, Ontario.  We have developed Canadian Christian programming that we would like to air, but up to this point the quality is not yet sufficient to be deemed viable and suitable for the station.

6681             So three hours, to answer your question, would be brokered program.  The rest would be locally produced.

6682             COMMISSIONER WILLIAMS:  How soon do you anticipate being able to replace that American programming with Canadian‑produced?

6683             MR. R. KIRSCHNER:  I would be going out on a limb to really say that, but we have developed these two shows right now that are becoming prominent and there has been some ‑‑ Lucid Noize is the other program that we are half an hour.  It is a Canadian‑produced program in our studios by our volunteers and people on the streets in Peterborough, and there has been people interested in that program across the country.

6684             So I would like to say we could by next year be doing at least one hour, but I just really don't know how soon we could replace that completely.

6685             I would love to do it immediately.

6686             COMMISSIONER WILLIAMS:  Yes, I'm not looking for a condition, I was just looking for some leading indicators of where it was going.

6687             In reply to a deficiency response, you indicated that the proposed station would broadcast 67 hours per week of live‑to‑air programming and 32 hours voice‑track, for a total of 99 hours of programming per week.  The regulated broadcast week is 126 hours, which leaves 27 hours out of the broadcast week unaccounted for in your programming commitments.

6688             How do you plan to program these 27 hours that you have not accounted for?  Will you offer more station‑produced programming or would you fill this gap with syndicated programming or some other type of network programming?

6689             MR. R. KIRSCHNER:  We would like to fulfil it with local programming.  In Peterborough we do police features that are just a two‑minute feature ‑‑ or a one‑minute feature twice a day with the local police officers speaking about issues that are currently relevant to the demographic.  So we would produce those.

6690             COMMISSIONER WILLIAMS:  We note your spoken work programming will also encompass 15 hours per week with four hours of that being devoted to news.  I also note that for the proposed station your programming staff requirements would be as follows:  One program director, one production manager and one part‑time on‑air news person and morning show co‑host.

6691             Do you believe these proposed staffing numbers are sufficient in order to realize your proposed spoken word programming?

6692             MR. R. KIRSCHNER:  Commissioner Williams, you will note in the supplement that we ‑‑

6693             COMMISSIONER WILLIAMS:  Actually, I'm just turning to it.

6694             MR. R. KIRSCHNER:  All right.  We have adjusted that.

6695             As a result of our consultants as well as the local steering committee and the report issued by OK Radio, we recognized before we came here that we might be relying a little bit too much on the volunteer population in Fort McMurray.  Recent trends there have said volunteerism has dropped as well because of such a high demand in every other realm.

6696             So we have made adjustments long before this week to make those adjustments and now it looks like we are working at nine full‑time equivalent.  And we still really are engaged with the community and the social agencies, so we really do believe we are going to have a high concentration of volunteers, but we know we can operate with nine full‑time equivalent.

6697             COMMISSIONER WILLIAMS:  All right, that's good.

6698             What role will your volunteers play at your station and who will train them?

6699             MR. R. KIRSCHNER:  Volunteers will take many roles, right from on‑air, and we have some tentative commitments for some local youth workers to play on‑air roles to enhance programming.  There will certainly be members of the social service agencies that will be stringers and reporters from different areas in the community.

6700             Certainly the community involvement is where we will use those volunteers to report back.

6701             COMMISSIONER WILLIAMS:  Who will train these volunteers?

6702             MR. R. KIRSCHNER:  They will be trained by a volunteer coordinator in coordination with the program director and under the station manager.

6703             COMMISSIONER WILLIAMS:  Regarding news, can you provide us with more information on how news would be gathered and packaged for broadcast on your station?

6704             For example, would that be the responsibility of your part‑time on‑air news people or who?

6705             MR. R. KIRSCHNER:  Yes, that is a part‑time person.  And some of that would be brokered news from radio news which has been recommended by UCB, Touch has also referred to this service.  It is a Canadian news service used by UCB in Belleville, Ontario and services most of the Christian industry.  We would use those for international and national news, and then the rest, the remainder, would be locally produced by our news anchor and the stringers as well.

6706             COMMISSIONER WILLIAMS:  In your deficiency response you indicate that the proposed station will broadcast a minimum of 15 percent Canadian content in Category 3 music per week.

6707             What would be your reaction should the Commission impose this weekly level as a condition of licence?

6708             MR. R. KIRSCHNER:  We would welcome that condition.

6709             In Peterborough I think we reported that we operate around 25 percent to a little bit less now.  Our concern is that the Canadian Christian content, there isn't as much available, although we are working hard and producing as many local bands as possible, but we think that is no problem to maintain that 15 percent easily.

6710             COMMISSIONER WILLIAMS:  In response to a deficiency question regarding how many hours of religious spoken word programming you intend to do, you noted in one response that the proposed station intended to do five hours per week of religious programming, with additional three hours of locally produced religious programming on Sunday.

6711             However, in response to another question you indicated that the proposed station intended to air no more than six hours of religious spoken word programming.

6712             Could you take me through your program schedule and tell me which programs are religious and their length?  And then we will develop the totals, I guess, of how many hours of religious spoken programming there are.

6713             MR. R. KIRSCHNER:  It's just around six hours.  I was trying to work these numbers again last night.

6714             But the three hours of religious spoken will be done by the local steering committee.  We believe that the churches and the religious community in Fort McMurray will do at least three hours Sunday morning.  That is yet to be defined but it will be in the hands of the local steering committee.

6715             The remainder will be ‑‑ again, this is potentially brokered.  Sometimes these big agencies don't like to go with low‑power FM stations so it's just a proposal that potentially we could get Focus on the Family, which is a very family friendly program.  There was a half an hour show twice a week.

6716             COMMISSIONER WILLIAMS:  How long was the first one?

6717             MR. R. KIRSCHNER:  I'm sorry.  It's a half an hour program, it will be aired once Saturday and once Sunday.

6718             COMMISSIONER WILLIAMS:  All right.

6719             MR. R. KIRSCHNER:  Insight for Living as well is a half an hour program, once Saturday and once Sunday.

‑‑‑ Pause

6720             MR. R. KIRSCHNER:  Chuck Swindoll I believe is actually a one‑minute feature.  I think it has both, a one‑minute or a short feature as well as a full half hour program.  In the schedule I believe we have programmed in one half hour once Saturday and once Sunday.

6721             COMMISSIONER WILLIAMS:  So what is that, 4.5 hours so far?

6722             MR. R. KIRSCHNER:  I think it's six.

6723             COMMISSIONER WILLIAMS:  I'm just trying to establish the number of hours.

6724             You said five plus three, or in another case you said six, and we have established 4.5?

6725             MR. R. KIRSCHNER:  I have our brokered programming ‑‑ if I can just start from the top again and see if that clarifies, I'm sorry.

6726             COMMISSIONER LANGFORD:  Sure.  All right.  Yes, no problem.

6727             MR. R. KIRSCHNER:  Focus on the Family will be a half an hour Saturday and Sunday, total one hour weekly; Insight for Living, one half hour Saturday and Sunday, one hour weekly; Chuck Swindoll, half an hour Saturday and Sunday, which will be one hour weekly; the local church community, religious community, will be three hours on Sunday, which will be three hours weekly; and then there is a one‑minute Walk Mueller feature which airs once a day, which is a one‑minute ‑‑ seven minutes weekly.

6728             COMMISSIONER LANGFORD:  So six hours and seven minutes would be a fair characterization?

6729             MR. R. KIRSCHNER:  Yes, sir.

6730             COMMISSIONER WILLIAMS:  All right.  Thank you.

6731             Could you tell us a bit more about that religious programming?  For example, are we talking about station ‑‑ tell me a bit more about the station‑produced programming, programming produced and programming produced by a third party for your station.

6732             So what types of programming content would be featured in each of these types of programs?

6733             MR. R. KIRSCHNER:  Well, Lucid Noize is a program designed for youth social issues and it brings a spiritual opinion to the table.  We use our street team and our volunteers and our high school correspondents to gather information and they report on a series of questions related to the issue.

6734             We bring in local experts like Dr. Dave and people that are authorities in the particular area and they respond as we interact with the young people by way of a cellphone, you know a contact line, internet forum we interact, so we get quality data from the populace.

6735             The people who do the interviews are not even Christians necessarily, are students, so it is not biased in any way with that regard.  We would bring students in.  Co‑op students are not Christian students necessary and they come in, so it's unbiased, quite balanced programming.

6736             COMMISSIONER WILLIAMS:  Thank you.

6737             In Peterborough you have been on‑air since 2004?

6738             MR. R. KIRSCHNER:  Correct.

6739             COMMISSIONER WILLIAMS:  A similar demographic, a similar station.  What has been your experience in the support of the community of your undertaking?

6740             MR. R. KIRSCHNER:  It has been exceptional actually.  The social component, being a former social worker, police office, I have quite a lot of connections with the community, so the social component is very well received.  In fact, with the Boards of Education we are regularly involved in every level of the process of education among young people.  It has been well received.

6741             We launched our radio station with pretty significant national advertising, McDonald's, Subway, these things, when we launched as a low‑power FM in 2004 and maintain those contacts for an entire year.  Unfortunately, the lack of the ability to afford BBM ratings last year, some of those big advertisers just go with the top four in the market and we didn't have the BBM rating to prove what we were doing.

6742             However, at every level in engagement relationship with people we are welcomed into the community.  Even as a Christian station that is very significant, to go in the public school board and be welcomed in every level of their programming.  They know that we know the rules with regards to proselytizing and things like that.  So we are a welcome voice.

6743             In fact, in this fall we actually have a full partnership with the local arts school.  There is a brand new Mac Lab going into the school and we will be involved in formally training students with regard to our Lucid Noize and journalistic efforts.  So that is very exciting when you look at local support.

6744             Do you want me to be honest?

6745             COMMISSIONER LANGFORD:  No.

‑‑‑ Laughter / Rires

6746             MR. R. KIRSCHNER:  No.

6747             COMMISSIONER LANGFORD:  We wouldn't want any children in the audience to see you being honest.  That would be the last thing we would want.

6748             MR. R. KIRSCHNER:  In all honesty, to some degree we are a little too Christian for the non‑Christians and not Christian enough for the Christians.  That creates sometimes a financial pressure, that some people would like to support us but they are afraid what this other local Christian organization might think.

6749             So it is a real battle.  This is a hybrid station, but it is a very, very valid socially responsible media in my opinion.  It has some unique situations and some unique problems, but we are bearing with those.  There is tremendous community support from churches and some people, so I think we are faring well.

6750             It's not that if anybody didn't have $100,000 that they wanted to lend me that we wouldn't receive, but we are doing okay.

6751             COMMISSIONER WILLIAMS:  Let's talk a bit about Lucid Noize and balanced programming.

6752             You state in your application it is your intention to offer opportunities to present various points of view.  You say you are too religious for some and not religious enough for others.

6753             Do they all have the opportunity to present their point of view of Lucid Noize?

6754             MR. R. KIRSCHNER:  Exactly.  And we make sure that there is that kind of balance.  As I say, even making sure that it is not Christian biased in our reporters.  We have people who are not Christians on the steering committee of that to ensure that that is a proper reflection of the community.  We think that is true Christianity.

6755             COMMISSIONER WILLIAMS:  You have also stated that you will add a three‑minute feature that will air on Sundays which will allow opportunity for various backgrounds to air their views and education listeners on the various religious beliefs and perspectives.

6756             How widely is that available?  Is that available to all religions of the world?

6757             MR. R. KIRSCHNER:  Yes, it would have to be available to all if we were going to allow it to be one.

6758             It hasn't been developed yet, but I am currently the Chair of the Chaplaincy Committee in the local university, a secular university, and I have contact with all those different religious organizations and that is something we were looking at planning in the fall in Peterborough.  We would certainly open that to everyone and let the distinctives of that world religion be presented.

6759             COMMISSIONER WILLIAMS:  So this hasn't been introduced into the Peterborough market yet?

6760             MR. R. KIRSCHNER:  It hasn't been introduced.  We use our balance through the internet, through our hotline.  That's how we do our balance right now, and through our non‑biased reporters on the street.  That's something we looked at that we would bring in ‑‑

6761             COMMISSIONER WILLIAMS:  So your early thoughts and planning and consultations of developing this proposed three minute feature, could you tell us a bit more about it?  Like how do you feel it will provide balance?  Maybe give us some examples of what listeners in Fort McMurray might be able to hear?

6762             MR. R. KIRSCHNER:  I think as we were going to focus not just Christian social services, that as part of our mandate and introduction to those community groups we will offer them the opportunity to share the distinctives of their faith.

6763             I mean, in our KAOS Fort McMurray video, which you haven't seen today, we used a Bahai woman to act and share and dialogue about who she is and what she does.  Every level of the religious community is involved in this station, so we anticipate seeking them out, don't we, Bruce.

6764             MR. TAYLOR:  Yes, we have extremely strong partnerships developed in the community amongst social agencies.  We run a homeless drop‑in centre as a church that I am with.  We run a soup kitchen, we are involved with the homelessness initiatives, with the racism initiatives in the community, and those relationships go far and wide very deep.

6765             Our soup kitchen ministry that is run for instance in our church is a great example of that.  We have a variety of churches in the community that are representative of that, including some groups that would be considered non‑Christian.  They come on together under one roof and make that happen.

6766             I think it's the same kind of concept that we can use to ensure that we have balance in some of these features.

6767             MR. D. KIRSCHNER:  If I may, Mr. Williams...?

6768             COMMISSIONER WILLIAMS:  Yes.

6769             MR. D. KIRSCHNER:  Having settled into Fort McMurray in '78, the church, it has been a strong ecumenical community in Fort McMurray throughout the just about three decades I have been there.  As a founding member of the Food Bank and the Fort McMurray homeless shelter, it was a mix of all the denominations that came together and worked at the common ground issues and the needs of the community.  They continue to work strongly in that sense towards making good common goals and good basis for the community at large, and we would continue to do that and support that type of input.

6770             We seek out the common ground rather than the differences of all denominations.

6771             COMMISSIONER WILLIAMS:  I'm glad we are talking in this area now because it is actually the next area I planned on going into.

6772             We have heard much made of magnificent revenue opportunity and business opportunity, that Fort McMurray could present numbers as high as $135 billion over the next few years being spent in that area.  Clearly there must be some tremendous social issues caused by this boom environment and I would like to hear a bit of a description as to some of the maybe not so nice things that are happening in Fort McMurray and in how you propose your station could help.

6773             MR. D. KIRSCHNER:  That's a good question.  That I believe is what will come into the local programming aspect that will be discerned by the local steering committee.

6774             Things that we are faced ‑‑ I am a father of six children there.  I think we have collectively about 75 years in the school system, five daughters and one son, and they have been heavily involved in music and arts and sports since we started to have them in '79.  We touch on a lot of children coming and going from our home and we get a good cross‑reference of what the kids are up against and the peer pressures and such as that.

6775             So our local programming can move towards addressing some of the things such as latchkey children.

6776             The hours that the 14 year olds are working right now, the 12 years old that are being solicited to work in Fort McMurray because of the need for employees.

6777             Road rage is a big thing.  We have a fair bit of different driving cultures coming to Fort McMurray.  As we have heard, we have grown 20,000 people in three years.

6778             There is a lot of ‑‑ as rich as we are as a community in monetary sense, we are very poor.  That brings a lot of deficit wealth.  It divides families, it divides relationships in the sense that we all have an opportunity to pursue what the monetary dollar will bring.

6779             You have heard that the average salary is $100,000 and I will tell you the youth of the community or the average age of the community has that kind of money.  They are on the go continuously and it takes them ‑‑ we work hard at trying to have one meal a day at home, but I don't think the majority of the youth or people have that in the region.  So I mean there are problems ‑‑ there is divisions that come with affluence and those are some of the things we face in the community.

6780             There is a shortness of patience.  You line up wherever you got.

6781             There is pressure put on individuals in the retail sector because of the volume of people that come through.  We have a transient population that is just about 10 percent of our existing population, that although they are good people and such they are not at home and they act differently and then tend to put pressures on the community that they wouldn't necessarily in their own home town.

6782             So we work hard as a community to maintain a stability that helps grow the industry but still helps maintain the community that is going to give us stability to raise children and to bring up the next generation, if that answers some of your questions.

6783             COMMISSIONER WILLIAMS:  That's part of it.

6784             MR. D. KIRSCHNER:  All right.

6785             COMMISSIONER WILLIAMS:  So the latchkey children, child labour, road rage, line ups, broken homes dreams.

6786             Is there much poverty, crime, drug issues also within that community?

6787             MR. D. KIRSCHNER:  I will ask Bruce to touch on that because he is moreso in the downtown core.

6788             MR. TAYLOR:  Yes, certainly those are growing issues that we have in the community.  We see tons of people ‑‑ I really, truly mean that, there is a lot of people that come to our community because the streets are paved with gold they heard.  You know, someone told them, "Go to McMurray, you will get a job".  They might be 18, they could be 35, they could be 55.

6789             They show up in town, they have no money, they may or may not have their high school education, they may not have any other notable skills to get employment, and they know no one and have no place to live.  There is an extreme amount of pressure that is put on our community in that.  Communities the size of Fort McMurray, or similar in size ‑‑ maybe like a Red Deer or Grande Prairie, tend to have anywhere from three to five times the number of social agencies that Fort McMurray does because they have grown slowly over time.  So we have a huge demand in our community for more socially oriented groups to try to find out how we solve some of these problems in our community.

6790             What happens is, as soon as a guy is turned down on the street, he is alone, doesn't know anybody so he gets lonely, well, next thing you know he is making friends with the other people who are on the street.  So what are they doing?  Well, they are all getting drunk, they are all doing crack, you name it, they are doing it.

6791             So now we have a problem where there is a growing number of addictions.  We have people who are homeless in our community that have never been homeless anywhere else.

6792             So there is a real vast array of social issues that grow in there.  We have young families that come to the soup kitchen because they cannot afford necessarily to always pay for food, because rent is so high.  Yes, you can go and make $15 an hour at Tim Horton's or at a variety of places in the community, but can you live?

6793             So there are a real bunch of challenges out there in the community.  I think there is a high loneliness factor in the community.  There is a lot of depression.

6794             The wintertime is really hard on a lot of people with the reduced amount of daylight.  I grew up in town and I can tell you that it was a problem them.  It has grown exponentially over the years.  So I see a huge need in the community for people to feel like they are loved and cared for and that they are important and that the issues that they face need to be addressed and discussed in a very open manner.

6795             So I see this particular format of radio being about to flexibly kind of fit into that community and help meet some of those needs and partner with other social agencies to try and assist in conquering those issues.

6796             COMMISSIONER WILLIAMS:  That's where your 95 percent local programming initiatives will come in.

6797             Give me some examples, some specific programs that deal with some of these tremendous challenges that you have just described?

6798             MR. R. KIRSCHNER:  One of the things was the Straight Talk with the local police department.  We have been involved in two separate meetings with the RCMP, emphasizing what we are doing in Peterborough, and although they couldn't state at that point that yes, that is something they would go for, we have to go through a formal proposal, but they were certainly excited by that opportunity to gain relationship with the students.

6799             You will see in the package, the newsletter, the local involvement with the Peterborough police department, we created a high school liaison officer.  It's a pimped up car that it's got great music in it and it's got lights and it's got the road kit and everything.  Again, it's just to make the police more palatable and more approachable.

6800             You know, they go in with a big PT Cruiser because that is what the local Chrysler dealer will give you and they look at it and laugh.  I mean, how appropriate is that?  Well, it was great because we got it for free, but it just totally does not engage the culture.

6801             So those are initiatives we are after.

6802             The Lucid Noize is one of the most significant things.  I mean, we had a boy just die in Peterborough, it was just a complete accident, ran out in front of a car, and the community was just devastated, a lot of the youth community.  So what we said, "Well, let's just do a Lucid Noize program, bring them in around the table and dialogue with them".  It wasn't about as much that went on‑air, although we aired the feature and it was wonderful, but it was about engaging 130 kids in this process and grieving.

6803             You do have a CD in your package, we referred to that, about that process before.

6804             Again, to be truly community, like I have heard the other applicants talk about, you need to jump on those opportunities and it sometimes isn't about, "Well, can we sell that?  Can we get sponsorship for that?"  Sometimes you just have to bite the bullet and that's what you are here for.

6805             That is what relationship is about.  That is what community is about.  Get out there and do something about it whichever way you can.

6806             I know that's highly ideal, but they are some of the things that we are trying to do and that is what would be involved with the local community, social services allows you ‑‑ enables us to do.

6807             COMMISSIONER WILLIAMS:  More programs?

6808             MR. D. KIRSCHNER:  Again, the Events Guide and certainly the one‑minute social service feature.

6809             You know, we play a couple of times a day a feature just exposing the local agencies to the students.  I mean, if you walk through a high school guidance office you see racks and racks and racks of literature that are just really beautiful, and there are 30 there in September and there are 30 there in June.  Nobody has ever touched it.  It's about packaging, it's about promotion, it's about marketing.

6810             If you are going to say something to a young person, say it in music.  If you are going to connect, say it in music, say it in media, and you have a 10 times better chance of it getting connected.  Put it on a piece of paper because that is the way you have done it the last 30 years and it will still be there and it will never be engaged.

6811             So these programs, through local people, local interviews, will just expose the help lines, expose the help agencies to the young people.  Again, it's in a way that they can receive it and see it as valid in their lives.

6812             COMMISSIONER WILLIAMS:  How busy is your Food Bank?

6813             MR. D. KIRSCHNER:  It is very busy.  I did some numbers the other night and I think they are probably doing 20 hampers a day to supplement income to different people who are working and not working.

6814             They have a good process.  They have been going since 1983.  But it is well used.

6815             And when I say it has a good process, is they watch that the repeat user is directed somewhere else for assistance rather than enabling them just to use it as a resources, rather than ‑‑ it helps them to try to raise their bottom and bring out their best potential and see where they can help themselves better.

6816             COMMISSIONER WILLIAMS:  So would your station work with organizations like the Food Banks to raise their profile and their resources?

6817             MR. D. KIRSCHNER:  We certainly would.  There are a number of weeks that Fort McMurray has, it has Drug Awareness Week, Alberta Forest Week, Education Week, Public Health Week; Crime Prevention Week, Social Services Week, et cetera, and we would come in and assist them in supporting them and forwarding their cause during those weeks and any other time that they have specific food drives, which is at Christmas and such, we would do on‑air broadcasting and such.

6818             I don't know if Rick mentioned also, but the broadcasting to the schools as they come out for lunch, come out after school and such like that, we would look at doing some programming there that might assist them and getting on home to do their homework or a healthier lifestyle, just in the broadcasting process.

6819             MR. R. KIRSCHNER:  I'm sorry, if I could just interject one more thing?

6820             I didn't really speak about that, the high school reporters.  That is something we have developed in Peterborough and there is a report from every high school twice a day ‑‑ sorry, one high school featured every day what is happening in the local high school, just whatever.

6821             Also a reporter from the local university, also from Sir Sandford Fleming College.  This works on a two‑week cycle and so there is a contemporary report at 11:40 every day and 4:40 every day what is happening on the local campuses.

6822             Another feature is Dr. Dave Overholt.  He is the youth cultural specialist in Hamilton I referred to.  He just does principal talks on Coping as a Young Person, an excellent feature that we have produced.

6823             There is another feature Walt Mueller which is Understanding Today's Youth Culture.  It is an American program but the stats are real and relevant and it is helping adults understand the post‑modern culture we live in and how to understand this creature that is their adolescent or their child.  You know, what are the going through?  It is a very exciting feature that a lot of people really enjoy on our station.

6824             COMMISSIONER WILLIAMS:  Thank you, gentlemen.

6825             I think now we will talk a bit now on the guidelines on ethics as a condition of licence.

6826             As we just discussed, you will be broadcasting some religious programs.  The guidelines on ethics in a religious policy deal with the solicitation of funds and programming practices.

6827             What would be your reaction to the Commission imposing these as a condition of licence?

6828             MR. R. KIRSCHNER:  Practically would that me that we can't go on‑air and ask for money, or what does practically that mean?

6829             COMMISSIONER CRAM:  It means you can't threaten damnation if you don't give money.

6830             MR. R. KIRSCHNER:  Oh.

6831             COMMISSIONER LANGFORD:  We can do that, but you can't.

6832             MR. R. KIRSCHNER:  Actually, I heard that.

‑‑‑ Laughter / Rires

6833             MR. R. KIRSCHNER:  We would fully agree with that.  In fact, the policy in Peterborough has been that we don't solicit funds for ourselves.  Most Christian operations in Canada, that is a major part of their financial revenue stream is doing share‑a‑thons.  The verdict is still out for us whether we need to do that or not, but we have had a policy that we won't go on and solicit money for ourselves, we will solicit money for the social service agencies or the organizations.

6834             As I said, the verdict is still out on that, but we won't threaten anybody.

6835             COMMISSIONER WILLIAMS:  All right.  Thank you.  We will talk a bit about your proposed initiatives now.

6836             Besides directing $1,000 per year to workshops to assist with talent development and $800 per year to performing arts camp, I note you have proposed to direct $500 a month to KAOS Concert to develop a monthly show which would total $6,000 a year.

6837             However, in your January 9th letter you indicate that you will direct $5,800 a year.

6838             Could you please clarify the amount that will be directed to the Concert Series development?

6839             MR. R. KIRSCHNER:  We did set a rough budget of $500 a month.

6840             COMMISSIONER WILLIAMS:  So $6,000 would be the figure then?

6841             MR. R. KIRSCHNER:  Yes, sir.

6842             COMMISSIONER WILLIAMS:  All right.  As indicated above, we note that KAOS Concert Series development will be responsible for hosting and developing the monthly talent shows and that amount would cover operation costs associated with hosting the concert, including honorarium to musicians performing.

6843             Could you tell us what your involvement in the Concert Series is?  Do you have an ownership position?

6844             MR. R. KIRSCHNER:  No, we don't own it.  As a matter of fact, I am an unpaid volunteer for King's Kids Promotions.  There is no money.  The radio station simply puts on this concert to, again, surface young, local talent.  Some of them are not very good musicians as of yet, but they have a hint of passion ‑‑ a lot of passion and a hint of talent.  We give them an opportunity to play.

6845             We have done this actually for about 14 years.  It was called "The Gas Show".  Opposite to "The Gong Show" when somebody came out and you gonged them and made them look like a fool, "The Gas Show" is a guaranteed applause.  That means, it doesn't matter how bad you are, we applaud your effort to get up there on the stage and try to do something.

6846             So we have continued that and we believe there is great merit.  I mean, everybody wants to jump on the next great artist.  Everybody wants to put $10,000 into the next great artist and give him a CD and say, "Look at who we broke."  But I believe like panning for little specks of gold, if you go through hundreds of young, local people, try to help them into flame that little trickle of hope they have in them, or the little bit of talent, that that does far more for Canadian talent development than just jumping on the next big thing.

6847             So it doesn't look like a lot, but we consistently create an opportunity for young people to play and applaud them and encourage them and steer them maybe to the next level of their growth, that that is going to be much more significant in the landscape of Canadian talent in the future than is the $100,000 into the next record for one group.

6848             COMMISSIONER WILLIAMS:  We practice that to some degree in the broadcasting industry ourselves.

‑‑‑ Laughter / Rires

6849             COMMISSIONER WILLIAMS:  How will your performing musicians be chosen?

6850             MR. R. KIRSCHNER:  In that feature just young people have to just apply.  They just have to apply, usually four or five ‑‑

6851             COMMISSIONER WILLIAMS:  For them to apply, how would they hear about it?  How would you promote it?

6852             MR. R. KIRSCHNER:  Oh, it would be on‑air, like "Come to the KAOS Concert Series".  It's just come and apply.  Call Katey at

6853             COMMISSIONER WILLIAMS:  Would you use other media, posters or internet?

6854             MR. R. KIRSCHNER:  Posters, yes.  High schools, our street teams, poster‑it, flyer‑it, viral marketing.

6855             COMMISSIONER WILLIAMS:  Could you give us a breakdown or an overview of your other proposed initiatives, the workshops and performing arts camp?

6856             MR. R. KIRSCHNER:  This past year in Peterborough it was actually American Kingdom Bound said "We will fund money for Canadian talent."  So they said "Would you run a performing arts camp?"

6857             So we did that for 75 students.  They came in for the weekend, we brought in local artists and professional artists that were quality.  We just developed entry level, advanced level guitar, vocal, just different aspects of the musical industry.

6858             Then there were a couple of bands that actually came and we put them onto a promoter and an artist developer, so the varying levels depending on who comes, that is the kind of thing.  So we create either a one‑day event, or in Peterborough's case it was a weekend event.

6859             COMMISSIONER WILLIAMS:  All right.  Thank you.

6860             Let's talk a bit about possible synergies with your Peterborough station.

6861             In your January 9th letter you indicate that there will be some synergies with KAOS 99.5 in Peterborough.

6862             Could you elaborate on the extent of this and are you also expecting to realize any other synergies between your proposed station and the Peterborough station?

6863             MR. R. KIRSCHNER:  I think some of the programming like the Dr. Dave features, the Lucid Noize features could be similar, but we would have to get local responses, obviously, to the issues.

6864             COMMISSIONER WILLIAMS:  The issues may be different in the two communities.

6865             MR. R. KIRSCHNER:  Right.  Exactly.  So it would be a similar format, but local characters.

6866             COMMISSIONER WILLIAMS:  Would any of your existing staff in Peterborough be involved in, say, the training or recruitment or establishment of the proposed station?

6867             MR. R. KIRSCHNER:  As a matter of fact, yes.  We have some ‑‑ our staff will be given an opportunity if they would like to come to Fort McMurray.

6868             We have a Fort McMurray young person, our afternoon drive host right now, and so there would be some synergies and certainly he is a local boy.  He has been on here, trained in CJOK and KYX in Fort McMurray, and he is a great young talent and he could possibly come back and train some locals as well.

6869             COMMISSIONER WILLIAMS:  That brings us to the higher cost side of Fort McMurray.

6870             Can you explain to us how your business plan takes into account the relatively high cost of living, zero apartment vacancy rate for example?  For example, are you expecting to have to pay higher salaries or living allowances or ‑‑ I don't know.  I was in business in Yellowknife when it was a high‑cost area ‑‑ I guess it still is ‑‑ and we actually had to buy houses and trailers for our employees and rent them out at a reduced rate.  That was our entry, I guess, into the real estate business inadvertently.  We didn't want to be in the real estate business.

6871             MR. R. KIRSCHNER:  Yes, a couple of considerations there.

6872             We do admit that some of the people going into Christian broadcasting have a passion for the vision and so they are desirous to work for a little bit less.  It is also a policy of KAOS in Peterborough to not make the Christian broadcasters poor.  I don't think that is honouring to God or to anybody to make them work for nothing.  However, we do realize that there is a cost of doing business.

6873             So we are counting on a passion for the industry even more than a regular passion for radio.  We have also made exceptions for

6874             MR. D. KIRSCHNER:  Commissioner Williams, every business new and existing is facing the same challenges in Fort McMurray relative to hiring, staff retention and the costs of living that we are faced with there.  I see on a regular basis and know of national western businesses, as well as small businesses, that are struggling and are closing their doors because of the area's ‑‑ the growth impact there.

6875             I think that individuals ‑‑ I have found that in radio and the arts, as well as in aviation, that people who have a passion for that job, they will start wherever.

6876             But, as Rick said, our intention ‑‑ and with my staff, I have 35 staff, I always try to get them a little bit above the marketplace wage, as well as give them a better ‑‑ a great quality of work site that addresses their personal needs and assists them in their personal needs as well.

6877             As we have mentioned, we have a cross‑section of letters and support from the community from business, government, church, social and individual agencies, so we have been there ‑‑ or we have thousands of people connected.  We are well‑connected.

6878             My own business and family has connected seven new employees from Ontario to different businesses this year.  That is what the businesses are faced with.  There are people coming in and you have to facilitate their presence in the community.

6879             There are vacancies in Fort McMurray and there are people who are willing to help people to get established, because we need community.

6880             Of course we invite families first because the idea of the transient worker isn't as good for the community as it is to have families come and root themselves.  In the early '80s people came for one year, but they are still there today.  That's what we hope for in these new people coming.  And they are and can be facilitated through the connections that we have in the community.

6881             Again, we will try to keep their wages a little bit higher and move them forward.  My staff is in the $70,000 or $60,000 to $100,000 range.  They are married, they are having children, they are buying homes.  You can do it.  They have done it in Yellowknife, they did it in Toronto, they have done it in Vancouver over the decades.  You make it work.  It's all proportionate to the wage.  It's just they have 35 year mortgages now, not 25 year.

6882             So we believe that we are as connected as anyone and we see success in new people coming to every industry in the community.

6883             One idea we have, too, that seems to be working, I have been developing it over the last five years, is we train up our own staff.  We have a pool of truck drivers, for instance, junior, intermediate and senior level and we have always ‑‑ we have an educator on staff, a trainer on staff, and we just have three or four drivers on a regular basis to replace the ones that can go at any day.  We draw from a source more junior than our company.

6884             And right now our company as well is able to compete with ‑‑ basically all the small businesses in Fort McMurray is competing with the major oil industry and they are coming forward with increases and such to do so.  I think in the advertising sense the budgets are showing that they can do that as well.

6885             So we create our own pool, we pay well and we assist people to get settled.  It's happening and it will continue to happen in Fort McMurray.  I think with our connection in the community we can do that in radio as well.

6886             COMMISSIONER WILLIAMS:  Thank you.  We are nearing ‑‑

6887             MR. TAYLOR:  Just to add to that ‑‑

6888             COMMISSIONER WILLIAMS:  Oh, please.

6889             MR. TAYLOR:  ‑‑ if you would let me, I think we also have commitment from the religious community to this initiative, whereby if we are required to bring in staff from outside that the most difficult phase for new staff to the community is actually that first few months of getting settled and figuring out, you know, are you going to find a roommate and share an apartment or what are you going to do.  Can you get into affordable housing programs which are available in the community.

6890             We have a commitment from people within the religious community that they would be open to opening up a room or two in their existing housing for some of those people because they believe in the vision of what we are doing.

6891             So I think that gives us an advantage as well where these people, their rooms are empty right now because they are not in the idea of just renting out rooms for renting out rooms.  They don't want that, but they would be willing to do it to help this initiative.  So I think that is a positive.

6892             COMMISSIONER WILLIAMS:  All right.

6893             With one more question we have reached the end of my portion of this.  My colleagues may of course have more.

6894             I imagine you have heard part of this hearing, if not all of it, how many new radio stations do you believe Fort McMurray could support at this time?

6895             MR. R. KIRSCHNER:  Well, I think everyone has really underestimated the potential in our financial projections what is really available there.

6896             I think the short answer is ‑‑ again, I am not an experienced broadcaster like the wealth of knowledge around this table, but it would certain seem by the rationale I have heard that it could support two high‑power and one low‑power station.

6897             COMMISSIONER WILLIAMS:  So that would be, I presume, your station or a similar one, and any of the other high‑power applications?

6898             MR. R. KIRSCHNER:  Depending of course on the formats and everything that they line up in their ‑‑

6899             COMMISSIONER WILLIAMS:  Yes.  They have indicated Classic Hits and ‑‑

6900             MR. R. KIRSCHNER:  Yes.

6901             COMMISSIONER WILLIAMS:  All right.

6902             That concludes my portion of the questioning, Mr. Chair.  Thank you very much.

6903             THE CHAIRPERSON:  Commissioner Cram...?

6904             COMMISSIONER CRAM:  Thank you.

6905             Did you send a memo out to each other saying "Wear green today?"

6906             MR. R. KIRSCHNER:  No.

6907             COMMISSIONER CRAM:  No?

6908             MR. R. KIRSCHNER:  It's the only shirts we had left.

‑‑‑ Laughter / Rires

6909             COMMISSIONER CRAM:  I'm looking at your revenue projections, on the revised one on page 4, and there is an "annual Sheraton".

6910             What is that?  It is an annual donation?

6911             MR. R. KIRSCHNER:  It should say "Share‑a‑thon", I apologize.

6912             COMMISSIONER CRAM:  I'm wondering if the Sheraton Hotel is giving you $10,000 a year.

6913             MR. R. KIRSCHNER:  Well, I will approach them.

‑‑‑ Laughter / Rires

6914             MR. R. KIRSCHNER:  But it should say "Share‑a‑thon" and really it's a caption for meaning that we will anticipate we are going to get sponsorship from local churches.

6915             COMMISSIONER CRAM:  All right.

6916             Program sales.  Today you said it's not firmed up and you said there were problems or there are perceptions that low‑power is not an effective vehicle.  But do you have brokered sales on your Peterborough station?

                 MR. R. KIRSCHNER:  We do have a couple.  Actually, no, there was just advertising from local features that we are ‑‑ it was just advertising.  They purchased air time.  So we have no brokered sales at this point.

6917             COMMISSIONER CRAM:  All right.  So what would go if you couldn't get any brokered sales?  What would go in your programming?  What would your contingency be then?

6918             MR. R. KIRSCHNER:  That we get the sales people to make up the difference of $30,000.

6919             COMMISSIONER CRAM:  All right.  And what do your sales people do in Peterborough when you are not part of BBM?  Have you done surveys, things like that, to find out your share?

6920             MR. R. KIRSCHNER:  We have an unofficial kind of hint of what our share is.  Of course we can't use that in advertising.

6921             But we just really emphasize letters of successful advertisers, we try to put the while hat on and say, "Look at all the great things we are doing for the community", and that's pretty much all we can do.

6922             We are anticipating and projecting and working hard to be part of the BBM ratings this fall and we are just praying we will have a pleasant surprise there.  That's what we are hoping for.

6923             COMMISSIONER CRAM:  Mr. Rick Kirschner, you have such enthusiasm and such creativity, but this is going to be in a place where you want.  How are you going to sort of transfer your experience, your creativity, how are you going to transfer it to Fort McMurray so that if we gave you a licence you could have the same kind of station that sounds very interesting?

6924             MR. R. KIRSCHNER:  I think that I will spend a little bit of time in Fort McMurray.  I have spent lots of time prior to this process, certainly four separate times within the last year interacting with people on the street and things like that.

6925             I think there has been a lot of transference of enthusiasm already, but also a seeking out of like‑minded individuals.  There are many people in Fort McMurray with ‑‑ as a matter of fact, I think it is one of the most entrepreneurial and creative communities I have ever seen, and so I think there has already been some synergies and relationships developed by people with as much or more passion than I have for these people.

6926             So I just think I am just really part of a team of a bunch of people that will make this happen.

6927             We also have some transference happening in Peterborough right now with a Fort McMurray local who is working with our team who is part of what we are doing there, and we just don't know where he will go, but I know he likes home and there are lots of opportunities.

6928             COMMISSIONER CRAM:  It's not to say that you, Mr. Dave Kirschner are not creative and energetic and enthusiastic, or you Reverend Taylor, it's just that Rick, if I can call you that, you are just bubbling over with the enthusiasm and some creativity.

6929             Anyway, thank you very much.

6930             Thank you, Mr. Chair.

6931             MR. D. KIRSCHNER:  Commissioner Cram, if I may comment on that, your question to Rick, I am a resource expediter to every major resource in the region.  The name of my company is McMurray Serv‑U Expediting.  What my job has been for the last 30 years is to find the resource in Fort McMurray first to assist these companies to grow.  They are the major companies of the region.  I still have the contracts with them and such.

6932             And I have some question as to the possibility of finding that resource in Fort McMurray too, and I pondered it heavily over the last three months and again this week, but I believe that with the connection in the community and the resource in itself to assist the community, that those people will be flushed out.

6933             Again, having the letters of support from the broad section of the community, and I have to say, those people have to come forward in very short time.  They have come forward with their letters of support in our initial meetings, but as a resource expediter I still believe that it is such a resource and that it would come forward and it is worthy of pursuing.

6934             COMMISSIONER CRAM:  Thank you.

6935             Thank you, Mr. Chair.

6936             THE CHAIRPERSON:  Mr. Kirschner, or maybe your two other panel members may be in a much better position to answer the question that yourself because it is really towards Fort McMurray.

6937             How many other significant faiths are there in Fort McMurray?

6938             MR. TAYLOR:  That's always an interesting question.  I guess it depends on your perspective.

6939             The way I would look at it is, what we would call major faith groups would be certainly the Evangelical Christian group, the Catholic Christian group, there would be the Mormons, the Jehovah Witnesses, there is a significant Muslim community.  Those would sort of be the major groups.

6940             I think there are, you know, certainly a variety of First Nations variance in there, including Christian First Nations community, as well as certainly some smaller groups mixed in.

6941             It is a very diverse community that is represented by people from well over 50 different countries in the world, so I'm sure there are tons of little groups that we aren't quite fully aware of yet as well.

6942             THE CHAIRPERSON:  You are not including the Catholic in your definition of Christian?

6943             MR. TAYLOR:  Certainly.  Like I said, the Catholic Christian community.

6944             THE CHAIRPERSON:  I was born Catholic and they have told me all my life I was a Christian.

‑‑‑ Laughter / Rires

6945             MR. TAYLOR:  Certainly, no.  I did say the Catholic Christian community, just making a difference there that depending on people's perspective on how they define Christianity.  I know some Catholics that tend to tell me I should get onboard with real Christianity.  You know, I know some non‑Catholics that would tell the Catholics the same thing.

6946             We are quite ecumenical, especially in our group here even, on that matter and certainly they are a large portion of our community and we would see them as part of this initiative.

6947             THE CHAIRPERSON:  How aware are the other denominations of your project here?  Have you been talking, say with the Muslims, if there is a Jewish community as well in Fort McMurray?

6948             MR. TAYLOR:  Yes.

6949             THE CHAIRPERSON:  Are they aware of your project?

6950             MR. TAYLOR:  I think significant portions are aware.  One of the difficulties that we do have ‑‑ and initiatives like this I think help us, is communicating with some of the other groups.  Not all of them come to some events.  They tend to separate themselves.

6951             So, yes, there has been a little more difficulty communicating heavily with, say, the Muslims.  There has been some communication with them, but I wouldn't call it significant at this point, because they do try and separate themselves from us.

6952             We would like to use mediums like this that we can bring together a common positive message ‑‑ that applies just as much from them as it does from us ‑‑ to bring together a little more common ground for the community to work together on something.

6953             THE CHAIRPERSON:  If we grant we a licence and they knock at your door, would you be open to do programming with them?

6954             MR. D. KIRSCHNER:  By all means.  The Mormon community in particular are very family oriented and very strong community members.  I know the two Bishops personally and we talk on a regular basis about the challenges our youth and the youth of the community are faced with.

6955             We certainly would be open.  Two heads are better than one and the more, the merrier.  Like the better perspective we are going to get and the better product we will be able to produce.

6956             THE CHAIRPERSON:  Earlier today we heard Harvard Broadcasting.  While they were describing their programming format they were talking main AC during the day and then more Pop or Rock‑driven during the evening.

6957             When I heard you talking, you were talking almost in the same terms about being AC during the day and more Pop, Rock during the evening.

6958             How different do you think your programming schedule is from a standard commercial radio project like the one Harvard put before us?

6959             COMMISSIONER LANGFORD:  Mr. Chairman, I have never done this in seven and a half years on this Panel and I apologize, but I had too much coffee this morning and I need a two‑minute break.

‑‑‑ Laughter / Rires

6960             MR. R. KIRSCHNER:  And I will join you.

6961             COMMISSIONER LANGFORD:  Would you mind if I just stepped outside for two minutes.

6962             THE CHAIRPERSON:  All right.

‑‑‑ Laughter / Rires

6963             COMMISSIONER CUGINI:  You can think about your answer.

6964             UNIDENTIFIED SPEAKER:  Nature calls.

6965             COMMISSIONER LANGFORD:  That's your theme for the next one.

‑‑‑ Laughter / Rires

‑‑‑ Pause

6966             THE CHAIRPERSON: So are you ready to answer my question?

6967             MR. R. KIRSCHNER: Yes, sir.  I believe we are the last adult contemporary in the day, I apologize if I didn't make that clear.  I mean, it is more Hot AC which is on its way to CHR pop.  And then the evening will actually be a little bit more rock than it would be, you know, then just pop in the evening.  So a little bit more ‑‑ quite a bit more rock in the evening.

6968             THE CHAIRPERSON: So one of the questions that I asked to all of the applicants that have appeared here was will we be skewing more towards the male or the female?  I suspect with the type of music that you are planning it is going to be more towards the male gender rather than the female gender.

6969             MR. R. KIRSCHNER: No, we anticipate approximately a 60/40 split, female being 60 per cent of what we are going for.

6970             THE CHAIRPERSON: And what will be the median age of..?

6971             MR. R. KIRSCHNER: Twenty‑nine years old.

6972             THE CHAIRPERSON: Twenty‑nine years old.  As you know, there is another applicant for a religious radio station, Touch Canada.  They appeared ‑‑ I don't know if you were here when they appeared ‑‑

6973             MR. R. KIRSCHNER: Yes.

6974             THE CHAIRPERSON: ‑‑ for Grande Prairie.  I suspect the radio programming plan that they will propose for Fort McMurray will be similar.  And they are talking about contemporary gospel music and their base music usage is also subcategory 35.

6975             MR. R. KIRSCHNER: Okay.

6976             THE CHAIRPERSON: Do you qualify the music genre that you will be playing as also meeting that definition of contemporary gospel music?

6977             MR. R. KIRSCHNER: Yes, sir.  I don't want to define for Mr. Hunsperger.  I have listened to that and I did have the same question.  I believe, and he will clarify for us, that by gospel he means overtly evangelical in nature.  In other words, God has a good plan for your life, come to him.

6978             THE CHAIRPERSON: Yes, that is what he ‑‑ yes.

6979             MR. R. KIRSCHNER: Whereas, some of our music ‑‑ more of our music will just be traditional Judiah (ph) Christian themes, being hey when you fall down get back up.  That is a biblical theme, it is a Christian theme, but it is also a Muslim theme, you know.  So I think his is a little more overtly evangelical and I think that is wonderful.  As I said, there will be some of our overtly Christian evangelical songs as well.

6980             The songs will be as they are sonically a great song and a song that is doing well in North America.  We will play that song whether it has an overtly evangelical or gospel theme or not.  We won't apologize for that.  It is a Christian licence we are applying for.

6981             MR. TAYLOR: And if I could just add to that discussion briefly.  Certainly, when we talk about a 60/40 split female to male, you know, part of that mix is the fact that we believe that the daytime programming would swing a little more towards the female engender, whereas maybe a lot of the evening programming would actually be a little more even.

6982             And the other thing is, even with that median age of 29, and it is a reminder I like to give people, if we talk an average age in that area in the community that means for every 40‑year old there is a 20‑year old, for every 50‑year old there is two 20s.  There is a huge young population and so certainly, especially in the evenings and especially weekend evenings, we would swing to that younger population that really makes a predominant part of the culture up that we would be trying to work with.

6983             THE CHAIRPERSON: I seek your comments on my last question, is if the Commission was to grant you a licence and also grand a licence to Touch Canada, could you both go through and succeed?

6984             MR. R. KIRSCHNER: I believe we could both succeed and I would believe there would have to be collaboration in doing that, because there is similar play lists.  As I said before, there is not that many contemporary Christian artists.  So we would just have to really work on in collaborating.  The same kind of initiative happens in Peterborough market.  We have Life 100.3 broadcasting a repeater station in our community.  I program around him, you know, and he has a top seven at 7:00, you know, he has a top eight at 8:00 and I want to do a call‑in top seven I do it at 7:00.

6985             So I think there has to be some synergies and I think the Christian broadcasters are coming together and collaborating more than ever and that is certainly my prayer.  So I think we could work together.

6986             THE CHAIRPERSON: Thank you very much.  Well, as you know, we are giving you an opportunity to sum up and tell us in a few minutes why you should be granted the licence to serve Fort McMurray, so it is to you.

6987             MR. R. KIRSCHNER: Thank you.  Mr. Chairman, King's Kids steering committee has been working in Fort McMurray for a long time, even prior to a call for applications.  This has been considered and, of course, the call for applications has made us speed up our process.

6988             King's Kids has demonstrated from letters of intervention and other letters referred to in the oral presentations that we have exceptional local community support for this undertaking: local MP, MLA, mayor, school board, religious social services, RCMP and businesses are well represented in their support.

6989             MR. TAYLOR: King's Kids has a sound, realistic business plan having demonstrated, even in this hearing, an understanding of the ever changing market in Fort McMurray and a willingness to adjust and be flexible in order to be successful.

6990             MR. D. KIRSCHNER: King's Kids has a long‑standing history of Canadian Talent Development and letters of support testifying to their sincere commitment to artist development, a commitment which has borne fruit in the lives of more than one Canadian artist.

6991             MR. R. KIRSCHNER: King's Kids have current partnerships established to introduce new Christian talent in a well‑established local festival, interPLAY.

6992             MR. TAYLOR: King's Kids has demonstrated a need for this format to expose, support and strengthen local social service agencies who are often overwhelmed in this fast‑paced, high‑stressed community.

6993             MR. D. KIRSCHNER: King's Kids has outlined a unique philosophy and approach to the market with a Christian radio format and provided letters from the religious, business and Canadian talent communities validating many of the benefits for business, religious groups and artists, some of whom are not considered religious at all.  This approach will draw more listeners to our station, both Christian and non‑Christian.

6994             MR. R. KIRSCHNER: King's Kids believe we have a transcendent cause to expose hope to Fort McMurray through relevant music, talk and action.  We pray we have justified the need and demonstrated the support for this unique radio initiative.  If the Commission deems our proposal insufficient to warrant a speciality licence for Fort McMurray, we recommend you consider any other applicant proposing a Christian music service.

6995             Our research for the market has been personal, not arms‑length surveys, by independent brokers over months of personal interaction with the people of the community of Fort McMurray, two meetings with the police departments, over 45 high school teachers, hundreds of students, business members, church communities, street people, parents, local bands and promoters, college staff and even Tim Horton's employees.  Radio is about community, about people, about people touching people in relationships.  King's Kids research has been on the ground level in relationship with the people we intend to serve.

6996             Thank you very much.

6997             THE CHAIRPERSON: Gentlemen, thank you.

6998             We will take a real 10‑minute break, so the others have a chance to..  And we will do the next application immediately after.  So we will resume at 11:45.

‑‑‑ Upon recessing at 11:35 a.m.

‑‑‑ Upon resuming at 11:45 a.m.

6999             THE CHAIRPERSON: Ms Secretary.

7000             THE SECRETARY: Thank you, Mr. Chairman.

7001             We will now proceed with Item 17 on the agenda, which is an application by Newcap Inc. for a licence to operate an English‑language FM commercial radio programming undertaking in Fort McMurray.

7002             The new station would operate on frequency 110.5 MHz (channel 263B) with an effective radiated power of 20,000 watts (non‑directional antenna/antenna height of 54 metres).

7003             Appearing for the applicant is Mr. Robert Steele who will introduce his colleagues.  And I would like to say for the record that the applicant has filed some revised financial information which will be place on the application file and available in the examination room.  Mr. Steele.


7004             MR. STEELE: Well, good morning, still I guess.  For the record, I am Rob Steele, President and Chief Executive Officer of Newcap Radio and I would like to introduce my colleagues.  On your far right are David Murray, VP of operations; Rob Mise, Director of Programming for Newcap; Glenda Spenrath, Assistant GM of Newcap's Alberta Radio Group; Mark Maheu, Executive Vice‑President and Chief Operating Officer of Newcap Radio; and Al Anderson, GM of the Alberta Radio Group.

7005             Mr. Chair, members of the Commission, Commission staff, we at Newcap are very pleased to present this application for a new FM radio station to serve Fort McMurray.  And as the Commission has heard, the Fort McMurray with Buffalo region is a vibrant, growing community whose current population is 75,000, could well top 100,000 within the decade.

7006             Our research suggests a clear interest on the part of Fort McMurray residents for greater format choice.  Almost one in five say they are not at all satisfied with Fort McMurray radio, while only 14 per cent are 100 per cent satisfied.

7007             Applicants in this hearing have proposed variations on three different potential formats to serve these listeners and the health of the local economy should allow the Commission to licence at least one new commercial service.

7008             We believe that our application is worthy of your approval both because of its specifics and more generally because of what Newcap as a company can bring to Fort McMurray.  We are one of the few Canadian operators that remain equally committed to growth and in smaller and larger markets in Canada.  Small and mid‑market radio is and will remain our core business, we believe we are pretty good at it and our listeners and our shareholders seem to agree.

7009             MR. MAHEU: Attracting retaining listeners to radio is not exactly getting easier.  Picking the right format and complimenting it with the right kind and level of local news and information programming is essential, especially when the competition comes less and less from other stations in the market and more and more from radio's competitors, iPods, internet and, particularly in Fort McMurray, satellite radio.

7010             Newcap is proposing a classic hits station for Fort McMurray.  Our reason for choosing classic hits is simple, the research.  Our format research in Fort McMurray evaluated eight format options, 1980s, 1990s, active rock, CHR, classic hits, classic rock, country, Hot AC and Soft AC.  The research is projecting a 27 per cent share for classic hits.  Classic hits is going to generate the most interest of the formats we tested.  Half of the respondents to our survey expressed positive interest in classic hits.  A quarter expressed strong positive interest, ie. they would listen to classic hits all the time.

7011             At present, CKYX FM is the station that comes closest to serving this need, but less than 40 per cent of listeners overall, and those with positive interest in classic hits, associate CKYX with the format.  Half of both groups cannot identify any station with classic hits.

7012             As a result, classic hits is by far the largest format opportunity in Fort McMurray today.  The station's audience will be predominantly 35 ‑ 54.  Among 18 ‑ 64s overall the station should rank a strong third in the market, ensuring no undue impact on O.K. stations.

7013             The classic hit station that we propose for Fort McMurray will feature a wide variety of music and while the vast majority of the music will be from the 1970s, 1980s and 1990s, 10 per cent will be current and most of that will be Canadian.  Fort McMurray FM will combine the best of the past and present to create a compelling radio station.

7014             Now, to give you a better feel for the station, we have a short audio presentation.

‑‑‑ Audio presentation / Présentation audio

7015             MS SPENRATH: Both before and after we filed our application 15 months ago Al and I spent a lot of time in Fort McMurray speaking with residents, business owners and public officials.  The growth and changes in just 18 months is astounding.  What hasn't changed though is Fort McMurray residents' thirst for a strong new source of news and information on local radio, live and when it happens.

7016             With no local TV station and a small local daily newspaper Fort McMurray residents rely heavily on radio for local news and information.  So given only two local radio stations, both under one owner, the addition of strong, new, alternative local news and information sources is even more important.  Fort McMurray FM will significantly increase the diversity and availability of local news and information programming.  We will provide 53 newscasts throughout the week, including weekends, all of them sourced and presented by our staff in Fort McMurray.

7017             With the booming oil industry and issues associated with local growth there is little doubt that there is enough local news to warrant such coverage.  Fort McMurray FM plans to offer our listeners 75 per cent local content in all newscasts with the remaining 25 per cent being relevant news and information from Alberta, from Canada and from the rest of the world.  Each newscast will run approximately four minutes, inclusive of sports and weather, for a total of three and a half hours of news content weekly.

7018             Considering Fort McMurray's isolated geographic location, community presence will need to be an integral part of a successful radio station.  Eight daily 60‑second features called Fort McMurray Today will profile upcoming and recent community events.  We are confident these capsules will soon become an important source of information on the what, where and how to get more involved in the community.  This will add another hour of intensely local information dedicated to Fort McMurray.

7019             Frequent unscheduled updates breaking news, weather, traffic, road and forest fire conditions, together with music and other commentary, will bring our minimum total spoken word to 13 and a half hours.

7020             MR. ANDERSON: Our employees, and in particular those on the air, will be representative of the Fort McMurray mosaic and will focus their stories to reflect the reality of Canada's culture, ethnic, racial and Aboriginal diversity.  In addition, we will report on news that is very important to the community as a whole, being sensitive to the cultural nuances of the local population.  The station's news director will supervise a team of two reporters in Fort McMurray.

7021             In addition to the local news team focusing on Fort McMurray news, the station will benefit from Newcap's 40 existing news people on the ground and behind the mics in the rest of Alberta.

7022             Connected through today's technologies stories of national significance and those relevant to Western Canada can be instantly shared by our stations right across the country.  Consistent with Newcap's long tradition of providing intensely local service, this new station will make a difference to the community.

7023             MR. MAHEU: Our Canadian Talent Development plan is specifically designed to expose emerging artists and stars from the Fort McMurray area in Alberta.  We have proposed a package of Canadian Talent Development totalling $525,000 over the term of the licence, spending $75,000 in each of the first seven years of the licence term.

7024             Now, $37,500 each year for the first seven years of the licence will go to fund the initiatives of the Radio Starmaker Fund; $37,500 each year will go to fund local Canadian talent initiatives within the Fort McMurray school district.  Funds will be used for the purchase of instruments, the development of music curriculums and music festivals, including scholarships.

7025             Now, the economic impact on the existing stations.  Ensuring new licensees do not have an undue impact on incumbents is an important objective of the Commission's licensing process.  At Newcap we deliberately design our applications and launch new stations to ensure and share growth rather than just slicing up the existing pie.  In fact, we estimate that only 30 per cent of our year‑one revenues will be generated from existing radio advertising budgets primarily from local retailers simply unable to effectively reach Fort McMurray FM's potential target audience.

7026             Seventy per cent of the first‑year revenue is going to come from other sources, 40 per cent of it is going to come from new radio advertisers drawn because of the distinct audience that the radio station we are proposing will attract or from those who presently advertise in newspaper, outdoor advertising and other media, but will find them expensive when measured against the effectiveness of Fort McMurray FM.

7027             Thirty per cent will come from expanded radio advertising budgets.  While Fort McMurray FM's audience share will largely come from the existing private stations, our revenue will not.  Indeed, our estimated first‑year portion of $300,000 from existing radio budgets could largely be accommodated through current natural market growth alone.

7028             Mr. Chair, members of the Commission, we believe that our application strikes the right balance for Fort McMurray, the right format, the right plan and the right owner/operator.  Thank you for your consideration and we would be happy to answer any questions you may have.

7029             THE CHAIRPERSON: Thank you very much, Mr. Maheu.  Commissioner Cram.

7030             COMMISSIONER CRAM: Thank you.  You get me again, aren't you lucky?  Anyway, I was going to start with your programming and can I assume that all of your programming is going to be locally produced?

7031             MR. MAHEU: Yes, our programming will be locally produced.

7032             COMMISSIONER CRAM: Okay.  No co‑production with other stations

7033             MR. MAHEU: No, standalone station on a standalone basis.

7034             COMMISSIONER CRAM: Okay.  In the other application that you had with us at this hearing for Grande Prairie you had an hour of public affairs programming, and you are not planning that for Fort McMurray?

7035             MR. MAHEU: At this point in time it was not included in our supplemental brief.  We applied for Grande Prairie after our application for Fort McMurray went in.  In thinking about it going forward, obviously we don't want to and cannot change what we have already submitted in a competitive process.  But obviously dependent upon if we were to receive a licence and if there were other competitors licensed we are going to look for every opportunity we can to differentiate ourselves in the midst of competition.

7036             As we spoke about in Grande Prairie, we believe that live programming is becoming a more important way to differentiate along with the music, so it would certainly be a consideration going forward.

7037             COMMISSIONER CRAM: And your live to air 100 per cent of the regulated time?

7038             MR. MAHEU: Yes, we are proposing that we have live personalities on the radio station, Monday to Friday from 5:00 a.m. until midnight, and on the weekends from 6:00 a.m. to 6:00 p.m.  And when we are not live on the air we will be voice tracked and those voice tracks will be produced by station personnel locally.

7039             COMMISSIONER CRAM: Would you agree to a COL to be live to air during all of the regulated hours?

7040             MR. MAHEU: Sure.

7041             COMMISSIONER CRAM: Now your spoken word ‑‑ this, by the way, is a very handy little piece of paper, it has just about everything I wanted to know.

7042             MR. MAHEU: We are learning.

7043             THE CHAIRPERSON: Me too.

7044             COMMISSIONER CRAM: You have three fulltime equivalent news staff and will they be doing exclusively news?

7045             MR. MAHEU: What we are proposing in Fort McMurray is we will have three fulltime news staff and two part‑time for a total of five, which probably works out to about an equivalent of 3.9 or almost four.  And our news people are going to do a number of things.  Obviously, they are going to write and report news and deliver it on the air.  They are also going to report on stories throughout the city and do the things that reporters do.

7046             And we also would anticipate, based on our business plan, that potentially some of the part‑time news people would also help us in gathering information from the community for the eight times a day, one‑minute community updates that we are proposing to air on the station, so they will do a little more than just news, but it will be in that information gathering vein.

7047             COMMISSIONER CRAM: Okay.  And scheduled news that you have on this piece of paper that you filed with us it talks about 53 four‑minute news packages.  Now, I notice that you have unscheduled info reports, but these news packages would include news, weather, sports?

7048             MR. MAHEU: Yes, they would.

7049             COMMISSIONER CRAM: Okay.  And they are going to be four minutes.  When are these 53 news reports to be heard?

7050             MR. MAHEU: We can get that for you right ‑‑ on Monday to Friday the regularly scheduled newscasts ‑‑ thank you, Glenda ‑‑ 6:00 a.m., 6:30, 7:00 a.m., 7:30, 8:00 a.m., 8:30, noon, 4:00 and 5:00, all Monday to Friday.  And on the weekends, 7:00 a.m., 8:00 a.m., 9:00 a.m. and noon news on Saturday and Sunday.

7051             So basically what we wanted to make sure we were doing is that in prime time and in morning drive time and afternoon drive, in the high‑tune listening hours, that we do have news and information on the radio stations.

7052             COMMISSIONER CRAM: Okay.  And in terms of your news, is there a target for local, a proportion of local?

7053             MR. MAHEU: Yes, there is.  Our goal and our stated goal is to have 75 per cent of that news and information that we present be local and the other 25 per cent is a provincial, countrywide or international news and, wherever we can, we would localize that too based on the needs and wants of people in Fort McMurray.

7054             COMMISSIONER CRAM: Now, you talked in your application about listener pools.  How are these done and who does it and..?

7055             MR. MAHEU: They are an interesting feature and we do that on a number ‑‑ not all of our stations, but some of our stations where it makes sense we do them.  And basically it is an opportunity for listeners to give feedback on a big topical issue of the day.  And, in some cases on some of our radio stations, what we do is we kind of have that topic of the day, we are promoting it in the morning, it is kind of the kicker on the newscasts sometimes about, you know, we would like to know what you think about this big issue of the day.

7056             We have a phone number and we also have an email address that people can participate in.  We tape the phone calls and we do play some of them back on the air, because they are quite interesting and some of them can be quite entertaining, depending on the topic as well.  But it is great radio, it is a great way to be local and topical and it gives listeners a sense that they can have a say on the radio station to get things off their chest or let us know what is on their mind.  It also gives listeners a chance to get a sense of what other people think about a particular issue.  So we find it is quite a good feature and it is easy to do and there is always something to talk about.

7057             COMMISSIONER CRAM: And is it the news people that would be sort of ‑‑ or the announcers would be ‑‑ so everybody sort of gets together, the programming, announcers and news people and figure out what the issue is and then it is..?

7058             MR. MAHEU: You are correct, Commissioner Cram.  Largely, it begins on the morning show, so the morning team and the news team would kind of talk about what the big topical issue of the day is and agree on it and get rolling with it.

7059             COMMISSIONER CRAM: And Fort Mac Today, that would be done also by the news people or..?

7060             MR. MAHEU: Largely, yes.

7061             COMMISSIONER CRAM: Yes, okay.  Now, on your handy dandy list here I, again with my great skill in math, added them up and you have, I think under other, six hours and it is Then & Now, Time Capsule, Cool by Request.  How much at the end of the day did you allocate to announcer talk?

7062             MR. MAHEU: I am going to ask Glenda, her being a CA, she did the math and she can tell you that.

7063             MS SPENRATH: Yes, certainly.  We are allocating approximately one hour in total for the week for the features, Then & Now, Time Capsule, Cool by Request and the remaining portion, the five‑hours, would be announcer talk.

7064             COMMISSIONER CRAM: Five hours?

7065             MS SPENRATH: Nod, yes.

7066             COMMISSIONER CRAM: Programming staff, how many are you planning on hiring?

7067             MR. MAHEU: I will let, if I may, Dave Murray has the details on our staffing line‑up.

7068             MR. MURRAY: Yes, there is 10 individuals, seven fulltime, three part‑time, and be about nine fulltime equivalents on programming.

7069             COMMISSIONER CRAM: On programming?

7070             MR. MURRAY: Correct.

7071             COMMISSIONER CRAM: Okay.  Classic hits is your proposal.  How different would your classic hits be from that proposed by Vista and/or Standard?

7072             MR. MAHEU: I am going to ask Rob Mise in just a moment to kind of talk about the specific differences between Newcap's proposal and the other two.  Suffice it to say that it was clearly a large format opportunity, very similar to Grande Prairie, because of just the number of stations in the marketplace and it is quite a large hole and we believe our proposal is different.  And, Rob, if you would be kind enough to speak on that?

7073             MR. MISE: Sure.  Commissioner Cram, the differences between our classic hits and the rest of the competitors, first of all, you know it varies from market to market, also company to company, but let me take a look at each of them.

7074             The first one was Standard and, based on yesterday's application, they mentioned a difference of probably 30 ‑ 35 per cent of currents in there in addition to a healthy dose of 1980s and 1990s.  To our ears, that kind of recipe ends up kind of sounding like an AC, Hot AC, kind of pop station.  And most classic hit stations, and we operate a couple in the country, so does CHUM and Rogers, are largely about 90 per cent gold, 10 per cent currents.

7075             Vista is looking at a mix somewhat different than ours too.  They are looking at possibly less 1990s and more 1970s and 1980s.  So those are the big differences.

7076             I would also like to mention that if we are granted a licence, we would go back into the community, we would do a music test to actually pinpoint the exact science of the music mix in there.

7077             COMMISSIONER CRAM: And right now you are proposing the 90 per cent 1970s, 1980s and 1990s and then 10 per cent now?

7078             MR. MISE: That is correct.

7079             COMMISSIONER CRAM: Yes, okay.  How does is this different and/or similar from your Grande Prairie proposal?

7080             MR. MISE: It will be different again, because each market is slightly different.  The difference here is that there is probably going to be less 1990s in Fort McMurray, more 1990s in Grande Prairie.  That is the biggest difference there is that decade of 1990s, according to our research.

7081             COMMISSIONER CRAM: And why did you do that?

7082             MR. MISE: Again, it got back to the existing research.

7083             MR. MAHEU: Rob is correct in the fact that every market is a little bit different.  And you can go to almost any market in Canada and if there is not a classic hit station there there is certainly, in most markets, a pretty decent opportunity for it.  But, like anything else, people are different in every region and area of the country, so what necessarily works in Halifax you cannot transport that directly to another marketplace and have it work as effectively as finding out what that approach would be for that market.

7084             We kind of look at it, when we talk about the music mix, it is like a recipe.  Lots of people know how to make a cake, but there are a whole bunch of different recipes that still end up looking like cakes, tasting like cakes, but the flavours are different and formats are very similar.  So I think Vista, Standard and Newcap are all baking a cake, but our secret recipe and approach to it is a little bit different.

7085             And as Rob said, and we do this in every market that we do business in, if we are awarded a licence the first thing we do is we go back in right away and we do more research, because we want to know has anything changed.  And now that we know that we have a licence and we know what the format opportunity is we go in with a different type of research project and we get really specific and we get into cluster analysis, ear (ph) balance, piece (ph) and correlation, analysis of music to find out what songs work with other songs based on what the target audience wants.

7086             So what we have tried to give you here in the research that we did is an overview of what the market is saying they need  and want, using the standard kinds of descriptors, and then once you know that that is what you are going to do you would go back in and get really specific.  That recipe may change slightly, but I wouldn't anticipate very much.

7087             COMMISSIONER CRAM: Okay.  And oh yes, what would happen if we would licence two licences in this market and you were one but the second one was a similar format?

7088             MR. MAHEU: Well, there would be a heck of a race to begin with which, you know, kind of goes to radio's competitive side and we all can be competitive.  I got thinking about it because obviously we anticipated that kind of question.  You have asked a lot of licence applicants the same thing and I think it is a fair question.  It is interesting, Fort McMurray is one of those ‑‑ I don't think we could find another market where this type of circumstance would exist where you have this explosive growth, an underserved market, some pretty clear opportunities, but then the added layer of potentially a difficult business environment and that has to be a consideration obviously in this case.

7089             If there were two, if we were licensed along with another applicant who had the same format, although we would hustle as quickly as we could, we would obviously like to do classic hits, we see it as a great opportunity and we try to be first.  But if by chance we couldn't be first or another station launched the same day we did with classic hits we would all have a decision to make.  I think it would boil down to what we talked about just as second ago, that we would do more homework in the marketplace.  There are other opportunities, they are not necessarily as big, but the one thing we do know about radio is that it always changes.

7090             And, you know, even O.K. Radio Group who has been operating in the market pretty much on their own with two radio stations, their radio stations have grown and changed with their audience.  Things change, tastes change and trends come and go.  So even though they don't have that competitive pressure that they have to program to, they are always changing.

7091             We know, in this particular case, one of the two would probably end up being classic hits very definitely and the second one would have to find where it fit, because the other thing to consider is when classic hits comes on in the market it is going to cause changes with the other two incumbent radio stations and that in itself will create other opportunities.

7092             So as something new comes in, starts taking away share, other stations move a little bit, creates more of an opening maybe for another format that, when you do the research now in a vacuum, looks well it is not quite as big as you might like, but introducing classic hits to that marketplace may create a bigger opening for another hole.  So I think you go back in, you do your research and as long as the company has the financial wherewithal and the commitment to make it work in the market I am confident, I can only speak for Newcap, but I would assume that Standard and Vista would approach it the same way, that we would all find a place to live where we felt we could do well and fulfil our commitments as we have made them to you.

7093             COMMISSIONER CRAM: Okay.  Your target demo, the broad target, is 25 ‑ 54, focus 35 ‑ 54 and median age 40.  Male, female?

7094             MR. MAHEU: Slightly more male than female in this particular case.

7095             COMMISSIONER CRAM: Okay.  CTD, I want to talk about the Fort McMurray school district.  And my first question is in Fort McMurray, as in God's Country Saskatchewan, there is a separate school board and a public school board.  Is there such a thing in Fort McMurray or is it all under the same..?

7096             MR. MAHEU: Al Anderson has kind of been heading this up for us all.  I will let Al explain that to you.

7097             MR. ANDERSON: Yes there are, Glenda can attest to that as well.  When we met with the public school board in particular and spoke with Alice Cartwright they were very excited in more ways than one about our contribution to their music system.  And one of the reasons being, that we are putting our initiative to the beginning and the middle of a musician's career rather than at the tail end.

7098             So many of the initiatives are ready and willing to try and make another Celine Dion, another big Canadian star.  But as dentist would have to complete grade 12 before he or she could get into the university to become a dentist, so does that musician, somewhere along the way they need help in learning what they have to learn about music to make the music and that is where we come in.

7099             We are starting at the bottom rather than at the top and, as an example, the $16,000 that goes towards the purchase of instruments one might say well that is such an affluent area why do they need any help?  But when you talk to the people at the school boards you will find out very quickly that uh.. you know, Fort McMurray's reputation of being so affluent and there is money on the streets and there is another myth that King Ralph of Alberta just hands out money here, there and everywhere.

7100             COMMISSIONER CRAM: He does that.

7101             MR. ANDERSON: But the truth of the matter is it doesn't filter into all of those school systems and right here in Alberta there is a cutback in teachers, just to use ‑‑ right here in Edmonton I should say, you know, there is a cutback on the number of teachers they will have this coming year in the City of Edmonton.

7102             And so with that in mind, the school boards have to struggle to stay within the budget that they have.  And, in most cases, things like more instruments for the school band, etc. they are the things that don't get the proper funding for.  So that is one end of it that they are particularly excited about.  And another $6,500 goes to the music curriculum and that would include things like sheet music and instruction books and wherever it would be required.  And another part of it would be music festivals where we would support two festivals per year in each of the school boards to the tune of $10,000 and within that there would be about $5,000 ‑‑ well, there would be $5,000 allotted for scholarships within those particular festivals.

7103             So that, sort of in a big nutshell, is what we plan to do with the Canadian Talent Development.

7104             MS SPENRATH: If I might add, Madam Cram, to go back to your question, and before I do I would agree with you that Saskatchewan is God's country, the ‑‑

7105             COMMISSIONER CRAM: It is unanimous then?

7106             MS SPENRATH: Yes, it is.  We have done this in Lloydminster for several years, I have done it myself, I have been delivering instruments to the schools myself, and we have always split our funding and our instruments and other factors 50/50 between the Catholic and the public school system so we will do the same in Fort McMurray.

7107             COMMISSIONER CRAM: Okay, good.  So then what it really means when you say $16,000 for instruments it means $8,000 and $8,000?

7108             MS SPENRATH: Yes, that is correct.

7109             COMMISSIONER CRAM: Okay.  And then for the festivals, do they have separate festivals?

7110             MS SPENRATH: Typically the festivals they would travel to, probably Edmonton, they may go to Grande Prairie to a festival, they could very well go to the same festival, but doesn't have to.  I know in Lloydminster we go to festivals in Saskatoon, in Edmonton, in Red Deer.  We don't travel together, the Catholic and the public systems, they choose the festivals they go to separately.

7111             COMMISSIONER CRAM: Okay, so you are going to give each $5,000 for festivals, but $2,000 of that is to be allocated for scholarships.  Have I got that right?

7112             MS SPENRATH: That is correct.

7113             COMMISSIONER CRAM: And then the remainder, half and half, will go to each of the school boards for curricula‑related items?

7114             MS SPENRATH: Yes, that would be items like sheet music, music stands, instruction books for the kids.  Sometimes if the instructor does some research as to other types of music they would like to introduce into the classroom, those kinds of things.

7115             COMMISSIONER CRAM: Okay.  So then how do you handle this?  Do you sort of say here is a cheque, I want you to use it for this much, for this and for this and this and this and I want you to send me an accounting?  Is that what you do?

7116             MS SPENRATH: Typically, we decide ‑‑ I actually have done it for a number of years and we decide it ahead of time with the schools and I have worked together with them to order some of the materials and then I have them produce an invoice for us first and then we cut cheques to the schools once we have evidence.

7117             COMMISSIONER CRAM: Okay.  And you agree, Mr. Maheu, that the CTD will be payable over seven consecutive years commencing with the first year of operations, which may not necessarily be the first licence term?

7118             MR. MAHEU: That is correct.

7119             COMMISSIONER CRAM: Any synergies with your other stations, either here or in the Maritimes?

7120             MR. MAHEU: No, we are not anticipating any and we didn't budget for any or plan it that way.  Suffice it to say though that, you know, we have a pretty good infrastructure in place in Alberta and we are in a lot of smaller and mid‑size markets, some markets similar in size to Fort McMurray.  You know, we had people available, I guess that is one of the things that is helpful for us, that we have a lot of people who work for Newcap who live and work in Alberta.  Fort McMurray to some of those people would be a promotion or an opportunity and that is I think one of the advantages that we have is that we understand how to do radio in markets that size and have people that would like to be part of it and I think that could help us mobilize quickly.

7121             And in the event two were licensed and they were the same, we could have a head start in the race.  But in terms of supplying programming or anything like that, no.  No, it is a standalone.

7122             COMMISSIONER CRAM: And on a totally separate topic, in your application you referred to a study by Castlehof (ph) & Company but you didn't file it.  And we, being the suspicious regulators that we are, would ask that you would file it if you could.

7123             MR. MAHEU: Sure, we paid a lot of money for it we should have filed it, so sorry about that.  We will file it quickly.

7124             COMMISSION: Before Phase 3 I guess?

7125             MR. MAHEU: Dave, can we do that?

7126             MR. MURRAY: (off mic) Yes, we can file it today, sure.

7127             MR. MAHEU: Yes, sure.

7128             COMMISSIONER CRAM: Okay.  Your finances, and you did revise your numbers, if we gave you a licence I look at it and I think we are giving you a licence to lose money, at least the first five years.  How did you revise your projections?

7129             MR. MAHEU: We had to make a revision due to some circumstances.  I am going to let Dave talk to you about the specifics of those changes and the reason.

7130             MR. MURRAY: Right.  We had originally applied for a television station as well and there were a number of synergies between the radio and the television and on the back office side, administrative side.  So when we withdrew our television application it was obvious that our TV numbers were ‑‑ the expense numbers were far too low and so that was the nature of the revision.

7131             COMMISSIONER CRAM: Okay.  Your staffing salary costs, did you add a Fort McMurray factor?

7132             MR. MURRAY: Yes, we definitely did.  Compared to staffing this station, a similar market in Atlantic Canada were approximately 40 per cent higher, probably about 25 per cent higher than the average Alberta station of a similar size.

7133             COMMISSIONER CRAM: And that is the staffing costs alone or..?

7134             MR. MURRAY: Staffing, yes correct.

7135             COMMISSIONER CRAM: And what about commercial space?  Is there a Fort McMurray factor in that?

7136             MR. MURRAY: Yes, it is a little higher, it is about $25 a square foot, we have that factored in.

7137             COMMISSIONER CRAM: Okay.

7138             MR. MURRAY: Now, it is very difficult to find and, you know, we don't have a space but it seems to be getting increasingly more difficult than the report.  The Meyers, Norris Report is frightening but, you know, we are very confident that we have the resources to, you know, put a station on there and keep all of our commitments and do the job.

7139             COMMISSIONER CRAM: Okay.  Now, Mr. Steele, you said at least one radio licence in Fort McMurray.  How many do you think Fort McMurray ‑‑ is that the max?

7140             MR. STEELE: You know, Fort McMurray is a unique area and it is, you know, we were trying to ascertain how big the radio revenue is there and how big can it grow.  One certainly, two with some suspicion, that is my own view.  We have actually debated that amongst ourselves, but..

7141             COMMISSIONER CRAM: And plus a specialty?

7142             MR. STEELE: Yes, and two commercial, that is what I am referring to, yes.

7143             COMMISSIONER CRAM: Is there any disagreement with that?

7144             MR. MAHEU: No, I think two would be lots.

7145             MR. STEELE: You know, I think it is ‑‑

7146             COMMISSIONER CRAM: So what is the reservation?  You know, nobody else has ‑‑

7147             MR. MAHEU: I don't think the market is as big revenue wise as some might think it is.  We had ‑‑

7148             MR. STEELE: Also I think it is like, if you look at Thunder Bay for example, where it is kind of like it is an entity all on its own.

7149             MR. MAHEU: Yes.

7150             MR. STEELE: You look at Grande Prairie  and you look at the amount of radio revenue eventually coming out of there, I mean that is ‑‑ we were quite shocked by that.  We don't think it is the same case in Fort McMurray and it is sort of a little more isolated where Grande Prairie would be a hub of a trading area.  So it is almost ‑‑ the perfect prescription would probably be one and a half stations.

7151             COMMISSIONER CRAM: Okay.

7152             MR. MAHEU: But we wouldn't want the half station.

7153             COMMISSIONER CRAM: Yes.

7154             MR. MAHEU: Just picking up on what Rob said, we have a couple of stations in Thunder Bay and it is obviously not as prosperous there as it is in Fort McMurray, but geographically it is somewhat similar in the fact that you have this large population area in a northern local and not a lot around it, you have to drive quite a ways to get to anything of any size and you are conducting you're business in that marketplace.

7155             And in listening yesterday ‑‑ and the reason I am saying that we don't think the revenues may be as robust as everybody is thinking it might be ‑‑ listening yesterday to one of the presentations about, you know, calculating the potential value of the market based on knowing what national sales are and if national sales are X and then it is always a percentage of.  But we know from the research that we have done, speaking with national rep firms, that the cost per point in the Fort McMurray marketplace is much higher than it would be in any other market of a similar size.

7156             So that may distort, if you are using the standard percentages of say 25 per cent is always national, so if national's going $1.X million then we know that retail is at least this, we think that might not necessarily be the case because they are getting so much more nationally up there because they can and there is just no competition and the prices are higher.  So we think it is a healthy market and it is going to continue to get healthier in terms of the amount of retail spend and everything else.  But at this point in time our feeling is one for sure and stretched to two, you know.

7157             COMMISSIONER CRAM: Okay.  Well, it is a touch market because you have an incumbent with two stations and an incumbent that may become an infinitely larger incumbent with infinitely deeper pockets.  What kind of challenge does that present to you?

7158             MR. MAHEU: Commissioner Cram, competition is always a challenge and the bigger and more well‑funded the competitor is the bigger the challenge.  And if, for instance, if the situation that has been talked about with Rogers and O.K. Radio Group came to be and the Commission approved Rogers to take control of those radio stations, we have no problem at all competing with Rogers.  We compete with them in markets now and I will give you a really good example, a very recent example and it relates to classic hits, so it is even more relevant.

7159             We compete in Sudbury, Ontario, we are a standalone FM radio station in Sudbury.  Rogers is our only competitor, they have two FMs plus an AM, so it is three against one and we are the little guy there.  And we changed our format to classic hits back on New Year's Day this year and from top 40 because we couldn't make a living in top 40 in a market that small against a consolidated competitor.  And first book came out in April, so we were on the air for three months and we debuted with a 29 share and we became the number one radio station in the market overnight against a big, consolidated well‑funded competitor.

7160             So we know what our capabilities are and we know that the O.K. Radio Group's a tough competitor as well and it wouldn't matter to us who owned those radio stations, we would be really focused on doing a good job for listeners.  I think that is what always drives our approach to picking formats and doing a job for radio listeners.  We don't focus on competition, we don't focus on beating the competitor, we really do focus on putting a good product on the air and doing a great job for listeners and an excellent job for advertisers.  And if we keep our eyes on those two things, normally good  things happen and we get the result we are looking for.

7161             COMMISSIONER CRAM: What in this market, especially given the configuration of it ‑‑ you have heard others talk about maybe additional criteria that we should be thinking about, aside from the competitive balance, the adding a new voice, that sort of thing.  Is there anything else we should consider in this configuration of a market?

7162             MR. MAHEU: I think the uniqueness of this particular marketplace at this particular time, from the Commission's perspective, you may have to consider this time the financial wherewithal of potential applicants more than anything else and more than you might at any other time for a couple of reasons.  Costs continue to escalate.  You have an entrenched competitor in the marketplace.

7163             And the other thing that nobody has really spoken about or at least I haven't heard it yet, and God forbid, but Fort McMurray has a history of being a boom and bust town.  And if anybody has lived there for any length of time they know that the good times you always think they are going to be here for a long time.  They thought that in the mid 1960s, they thought it again in the late 1970s and the early 1980s and then boom, the bottom fell out of it.

7164             The whole economic environment in Alberta is riding high now on the price of oil and gas and there is no question that the oil sands are much more commercially viable now than they ever have been because of the price of crude oil.  On the one hand we hope that that prosperity continues.  On the other hand there is a bunch of consumers around the world that hope that alternatives develop and the pressure on producing oil at this price will go down.

7165             So I think the financial wherewithal of a company to be able to go into that market, invest capital, build infrastructure, potentially lose money for a while and be able to ride it out that if eight or nine years from now or seven or six years from now that oil goes back to $38 a barrel things may be quite different.  And while everybody else is pulling up stakes and heading out of town, we have a radio station there that we have to continue to own and operate and do a good job for.  And I think that is a consideration, I am not saying it is a probability by any stretch, but it has to be within our thinking.

7166             COMMISSIONER CRAM: God forbid that Alberta would become a have‑not province.

7167             MR. MAHEU: I don't anticipate that.

7168             COMMISSIONER CRAM: Thank you very much.

7169             MR. MAHEU: Thank you.

7170             COMMISSIONER CRAM: Mr. Chair.

7171             THE CHAIRPERSON: Thank you.  There is no further questions, Mr. Maheu, so if you want to take your two‑minutes to tell us why or, Mr. Steele, why we should strongly consider your application to the extent that we grant you the licence.

7172             MR. STEELE: Thank you, Mr. Chair, members of the Commission and Commission staff, for listening to us here today.

7173             We do believe that our application strikes the right balance for Fort McMurray and that we at Newcap can deliver the format and the plan that will serve the residents of Fort McMurray.  And it seems from the record of this proceeding that the Fort McMurray community can sustain the entry of one, perhaps more, commercial entrants.  However, given the strength of the two‑station incumbent combo that was just discussed, the challenges that exist in Fort McMurray of getting staff, housing, cost of doing business there, etc. it is going to be a challenge, but it is a challenge, it is going to be a challenge for anyone, it is a challenge that we are up for.

7174             But from our perspective, what makes our application strong is, first of all, the format.  Classic hits is a clear, it is a well‑defined market hole there and that can stand on its own against the other formats that currently exist.  Also, in our business plan we have anticipated a licensing of two new entrants and, as we have outlined in our plan, we anticipate losses over almost the first term ‑‑ full term of the licence.  At Newcap we have the resources to weather those losses.

7175             And thirdly, perhaps most important, our resources in this province and our commitment to small and mid‑market radio in this province will ensure that the community of Fort McMurray does get a quality service.  And because of the number of radio stations that we operate in rural Alberta we think we do bring an Alberta sensibility, if you will.  And for that matter, much has been made of the Atlantic Canadian presence in Fort McMurray and, for what it is worth, we bring that sensibility as well.

7176             We do have extensive experience with new station start‑ups in Alberta.  We are about to launch, for example, 90 minutes away in Lac La Biche a new station there and we have the staff, we have the people power to mobilize quickly in Fort McMurray.

7177             Thanks very much for letting us present our case here today.

7178             THE CHAIRPERSON: As a matter of fact you yourself are a Newfoundlander, so you probably have family already over there.

7179             MR. STEELE: Oh yes, I have a few friends there, yes.  And yes, I understand the concept of kitchen parties very well.

7180             THE CHAIRPERSON: I have been through one, yes.

7181             Mr. Steele, thank you very much.  Thank you to your team.  We will break for lunch and we will get back at 2:00.

‑‑‑ Upon recessing at 1245 / Suspension à 1245

‑‑‑ Upon resuming at 1403 / Reprise à 1403

7182             THE CHAIRPERSON:  Order, please.  Miss Secretary.

7183             THE SECRETARY:  Thank you, Mr. Chairman.

7184             Before we proceed to the next application, would just like to indicate for the record that Vista Radio has filed with the Commission the letter detailing the financial commitment made by Vista to the Fort McMurray School Board.  The letter will be placed on their application file. 

7185             And Newcap Inc. has also filed the market study that they referred to in their application earlier this morning.  Again, the market study will be placed on the application file and can be viewed in the examination room.

7186             And we will now proceed with Item 18 on the Agenda, which is an application by Radio CJVR Limited for a license to operate an English‑language FM commercial radio programming undertaking in Fort McMurray.  The new station would operate on frequency 105.9 megahertz (Channel 290B) with an effective radiated power of 20,000 watts (non‑directional antenna  / antenna height of 54 metres).  Appearing for the applicant is Mr. Jean Fabro and you will have 20 minutes for your presentation after the introduction of your colleagues.

Thank you.


7187             MR. FABRO:  Good afternoon, Mr. Chairman and Commissioners. 

7188             Before we begin our presentation, I would like to introduce the members of our team.  My name is Ken Singer, I'm Vice President and General Manager of Radio CJVR Limited.

7189             On my right is the President and Owner of Radio CJVR, Jean Fabro.

7190             To my left is Kevin Gemmell, General Sales Manager of our company.

7191             To his left is Jessica Schnell, Director of Research Services at Insightrix Research of Saskatoon.

7192             And next to her is Corinne Harper, a partner at Insightrix.

7193             Radio CJVR operates 2 stations in Melfort, Saskatchewan, CJVR FM and CKJH AM.  And we are excited about launching our newest operation, CIXM FM in Whitecourt, Alberta, by mid‑September of this year.

7194             Mr. Chairman and members of the Commission, Radio CJVR welcomes this opportunity to apply for a broadcasting license to operate an adult contemporary radio station on the frequency of 105.9 to serve Fort McMurray and the 11 surrounding communities within the Regional Municipality of Wood Buffalo.

7195             Increasingly the eyes of the international business community are focussed on Fort McMurray, located at the heart of the world's largest oil sands development which currently meets over 30% of Canada's crude oil production and is projected to fulfil 100% of the country's needs by 2011. 

7196             Upon spending time in Fort McMurray, one can liken the frenetic activity within the Wood Buffalo Region to a modern‑day Klondike Goldrush with all of the escalating economic activity, population explosion, immigrating workforce and attendant upward pressure on housing, municipal services and cost of living indicators among other key considerations.

7197             For McMurray's current population of 61,000 grew by 67 percent between 1999 and 2005, according to the 2005 Wood Buffalo Municipal Census, it is expected to increase to over 80,000 by 2010.

7198             Based on today's market conditions, it's highly likely that such projections are vastly understated.  Similar to Grande Prairie, the pace and level of economic development within the Wood Buffalo Region has outstripped Fort McMurray's ability to keep abreast of all of the service demands that such development creates, including the need for additional local radio programming choices. 

7199             It is essentially against that backdrop that CJVR, in responding to the Commission's July 2005 call for applications to serve Fort McMurray engaged Insightrix Research Services of Saskatoon to undertake a comprehensive consumer demand study of the local market as an integral part of our application process. 

7200             The primary objectives of the study were to assess the potential market for a new FM station for Fort McMurray and Wood Buffalo and to determine opinions regarding musical preferences, local news and other informational programming elements on the radio.

7201             Based on the results of the Insightrix Consumer Demands Study and 40 years of broadcasting experience, CJVR has developed a comprehensive FM undertaking that will help fulfil many of the programming needs and listening preferences identified by the 400 Fort McMurray residents age 18 to 64 who participated in the survey.

7202             The net result is 105.9 FM, an exciting new station whose unduplicated adult contemporary music format will provide Fort McMurray and its 61,000 residents with much‑needed additional local radio listening options.

7203             Fort McMurray is currently served by 2 local private stations, both owned by the OK Radio Group, CJOK FM is a country music station, while CKYX FM operates a classic mainstream rock format.

7204             Commission approval of 105.9 FM's unduplicated A/C format will bring significant programming diversity and listener choice to Fort McMurray and Wood Buffalo's more than 73,000 residents within the coverage area. 

7205             105.9 FM will also bring an element of competitive balance to the local marketplace that has been lacking under single ownership.

7206             One of the objectives of the Commissions long‑standing policy on common ownership has been to preserve the availability of distinct news voices in a community.  As such, the addition of 105.9 FM to the local radio market will provide a distinctly western Canadian alternative news voice for the benefit of Fort McMurray and surrounding area residents.

7207             Further to introducing an alternative news voice and establishing competitive balance, CJVR also brings ownership diversity to Fort McMurray's radio market as an independent dedicated career radio broadcaster. 

7208             As discussed earlier this week, in the context of our Grande Prairie application, CJVR Albertan owners, the Fabro family, has a wealth of broadcast experience, the financial strength, the human resources, the creative entrepreneurship and the corporate will and determination to play a larger role in western Canada's private radio sector.

7209             Like Grande Prairie, the Fort McMurray radio opportunity is of central importance to CJVR and its strategic broadcast plan to grow our critical broadcasting mass in western Canada.

7210             MR. GEMMELL:  Mr. Chairman, among the key findings of the Insightrix Consumer Demand study, is the fact that nearly 85 percent of respondents, upon hearing a description of the proposed new FM and a sampling of the music that would be played, stated it was very likely or somewhat likely they would listen to the new station.

7211             It was interesting to note that over 88% of females said they were very likely or somewhat likely to listen to the station, compared to 78 percent of males.  34 percent of total respondents stated that 105.9 FM would be their favourite station.  62 percent indicated the proposed new FM would become their first or second choice.

7212             In terms of spoken word programming, 94 percent of respondents overall said that local news and information specific to Fort McMurray is important to them.  Of equal importance was news, information on local road conditions and weather reports for the area.  In addition, over 83 percent of females compared to 6 3 percent of males said they agree or strongly agree they would spend more time listening to radio if there was a local station that placed an emphasis on softer music along with news and information specific to Fort McMurray.

7213             The Insightrix Study also indicates that nearly 39 percent of Fort McMurray residents tune to out of market stations in the absence of their listening preferences on local radio.  As such, 105.9 FM's unduplicated music format and locally relevant spoken word programming will help repatriate the majority of those out of market listeners.

7214             MR. SINGER:  Mr. Chairman, at the heart of CJVR's corporate culture is a deeply rooted sense of community from which all of our broadcasting goals and objectives flow. 

7215             At CJVR we see local programming as the window to a community's soul and as such we work very hard to provide locally relevant news and information and other programming elements that accurately reflect the community and its people.

7216             CJVR is keen to bring this experience to Fort McMurray and through 105.9 FM provide an addition to its unique music format, coverage of the daily news and information, along with an emphasis on those events and activities which define, reflect and promote a shared community of interest among residents living within the communities of Wood Buffalo.

7217             Musically speaking, 105.9 FM's A/C format will specialize in playing soft rock and pop songs from today along with the soft rock and pop hits of the 70's, 80's and 90's.

7218             As evidenced by the Insightrix Study, the proposed new FM will be most popular with female listeners.  In keeping with spoken word programming needs and listener preferences identified in the study, 105.9 FM will place an emphasis on local news, weather, road and school closing reports and information on upcoming community events among other listener interests.

7219             The station proposes a staff complement of 15 fulltime and 2 part‑time employees, including 3 fulltime news reporters to service the new Fort McMurray newsroom.

7220             In terms of newscasts, the station will broadcast locally originated news every half hour in the mornings and again during selected hours throughout the day as well as on weekends.

7221             Essentially, information packages will consist of news, sports, weather, traffic reports and community events and activities.  The station will provide over 5 hours of scheduled news broadcasts per week plus additional surveillance information when necessary and as it becomes available.

7222             Given the importance that respondents placed on traffic and road condition reports, road and condition reports will air every 30 minutes between 6 a.m. and 9 a.m. as required between 9 a.m. and 4 p.m. and then again every 30 minutes between 4 p.m. and 7 p.m.

7223             This is important not only for local residents, but for commuters and motorists who regularly travel portions of the Highway 63 corridor between Edmonton and Fort McMurray. 

7224             Fort McMurray historically has experienced critical weather extremes often causing school closures and dangerous driving conditions.  As such, 105.9 FM will provide weather reports with every newscast and in extreme conditions will air more frequent weather bulletins.

7225             Further to using the resources of Environment Canada, 105.9 FM will also engage the use of weather watchers around the coverage area who will call the station toll free with up to the minute weather observations.

7226             When bad weather strikes, 105.9 FM will bring in additional people to staff the "snowdesk" and ensure locals are frequently updated on school closings and school bus cancellations.

7227             MR. GEMMELL:  Mr. Chairman, to ensure that its existing and potential radio stations achieve their locally relevant community driven spoken word programming objectives, CJVR has developed an inclusive broadcast plan that will enable each station to keep a steady finger on the pulse of community life and the events and activities that occur within.

7228             This is achieved in a number of ways, including the recruitment of a network of community‑minded volunteers who regularly feed their mother station with news and information of what is happening in their respective areas.

7229             If licensed, 105.9 FM will participate in this initiative.  105.9 FM will utilize the station's community cruiser to broadcast live several times per week from a number of venues throughout the Wood Buffalo Region.

7230             As well, 105.9 FM proposes to broadcast a minimum of 4 community‑focussed features each day, entitled "Focus on Fort McMurray" which will be in addition to the 5 hours of news features noted earlier. 

7231             A staff member will write and produce these features, aimed at addressing everyday issues from a local and regional perspective. 

7232             In addition to its newscasts and community features, 105.9 FM will excel at keeping its audience informed with up to the minute local, regional and national sport coverage.

7233             As well, CJVR has had discussions with the Fort McMurray Oil Barons the areas popular Junior `A' Hockey Team, with a view of offering live play‑by‑play broadcasting of all home and away games.

7234             I would further note that the internet will assist 105.9 FM in its efforts to communicate with listeners and clients through a website that will display critical road and weather conditions, community information as well as relevant information about the radio station, its programming and promotions.

7235             MR. FABRO:  Mr. Chairman and Commissioners, CJVR brings to Fort McMurray and 105.9 FM a proud legacy of excellence, achievement and commitment in the area of talent development that has had significantly beneficial impact on the careers of many Canadian artists who have gone on to achieve national and international success. 

7236             As mentioned in our earlier presentation, part of the legacy stems from the fact that CJVR Melfort has been recognized 6 years in succession at the national level and an incredible 11 years in a row at the provincial level by the Canadian Country Music Association and the Saskatchewan Country Music Association, respectively.

7237             With respect to Fort McMurray, 105.9 FM has committed to a minimum of $25,000 per year or $175,000 over the course of a license term, in direct expenditures on a series of Canadian talent development initiatives which include $11,000 for "Fort McMurray Idol", $10,000 for Student Music Scholarships, $3600 for Aboriginal Scholarship and $400 for Factor. 

7238             In addition to the direct expenditures of $175,000, 105.9 FM has allocated an indirect on‑air expenditures budget of $105,000 per annum or $735,000 over the term of the license for the promotion of concert performers, artistic programs and other initiatives that will assist in the exposure and promotion of local talent within Fort McMurray and the Wood Buffalo area.

7239             The combined total of direct and indirect talent expenditure amount to $130,000 per annum or $910,000 over the license term.

7240             CJVR as a small independent broadcaster, is of the view that its direct expenditures are realistic and will yield a good return for the talent they are invested in.

7241             As we have noted on other occasions, the most valuable currency that a broadcaster can provide for talent, is access to on‑air exposure of their talents. 

7242             The multiple awards that CJVR has won over more than a decade were not awarded on the basis of the amount of direct dollars we were able to spend, but rather on the creativity, dedication and commitment to the hundreds of artists we have worked with over the years.

7243             Should CJVR be successful in its Fort McMurray application, we will apply the same efforts of talent development that have worked so well for us over the past number of years.

7244             MR. SINGER:  As we stated earlier this week in relation to Grande Prairie, CJVR has little doubt that the Fort McMurray market is also capable of supporting one or more new private commercial radio stations. 

7245             Undoubtedly, one of the major problems is not whether it is sufficient to support the exiting local stations and accommodate new entrants, the problem is trying to get an accurate read on what the real numbers are because the growth rate has been so rapid that some of the currently available market statistics are grossly inaccurate.

7246             Such a rapid growth rate places unprecedented pressure on the available dwelling spaces and the increase of married families with young children is placing great strain on the existing elementary schools.

7247             MR. FABRO:  Mr. Chairman, the owner of CJVR, my family, Fabro Investments Limited, is also in the housing business. 

7248             I have a pretty good idea of the housing situation and the land development opportunities within Fort McMurray as Fabmar is negotiated to acquire land within the city limits to build a number of apartment condominiums.

7249             Should CJVR be licensed for Fort McMurray, Fabmar's involvement in the area would be extremely helpful as we would provide discounted housing to our employees.

7250             MR. GEMMELL:  Mr. Chairman, according to Financial Post, 2005, retail sales in the combined Wood Buffalo and Cold Lake Census Division are estimated to be $1.05 billion.

7251             These sales were supposedly derived from a population of 103,000 people of which 73,000 resided in Wood Buffalo.  The report also states that there were a combined total of 485 businesses in these census areas of which 251 were in Wood Buffalo and 234 were in Cold Lake. 

7252             We commissioned the Fort McMurray Chamber of Commerce to undertake a study to determine an accurate count of the retail businesses in Fort McMurray.  They accounted for 583 such businesses in Fort McMurray alone, which is almost 22 times the number reported by the Financial Post for the entire Wood Buffalo Region.

7253             Well we believe the Financial Post numbers are grossly inaccurate and actual spending is substantially higher than what was reported, CJVR has used the FP Retail Sales Figures knowing that it will provide us with a conservative estimate for the Fort McMurray market.

7254             Based on the fact that over 70 percent of the population in these 2 census areas reside in Wood Buffalo, we believe we are being very conservative to estimate the retail sales in Fort McMurray to approximately $800,000,000 which is about 80 percent of the $1.05 billion.

7255             By applying the commonly accepted percentage of the total annual retail sales as a valid approximation of annual potential advertising revenues available in the market, we have estimated that the advertising revenues for Wood Buffalo to be approximately $20,000,000.

7256             CJVR's research has led us to conclude that in this market, $6,000,000 of the $20,000,000 should be obtainable by all local radio.

7257             We believe the 2 existing stations garner approximately 3.5 to 4 million dollars of that amount and operate profitably in the market.  The remaining 2 to 2.5 million dollars would be available to a new licensee.

7258             The Insightrix Study's findings strongly suggest that our proposed new FM will appeal to over 50 percent of the audience and attract approximately 20 percent of the total radio listening and total weekly hours tuned in our first year of operation.

7259             As such, CJVR has estimated our first year local revenues will conservatively amount to about 5 percent, or slightly over 1 million dollars of the total available retail advertising pool of $20,000,000. 

7260             Considering the rapid growth of the market and constant introduction of national box stores, we estimate our first year national sales will be about $340,000. 

7261             MR. SINGER:  Mr. Chairman and Commissioners, included among the many important benefits that approval of CJVR's 105.9 FM will yield for Fort McMurray and communities within Wood Buffalo are the following.

7262             105.9 FM's unduplicated music format will add significant programming diversity and listener choice to the market. 

7263             Our unduplicated A/C music format and locally relevant spoken word programming, will meet many of the listening needs and preferences of Fort McMurray's 25 to 54 underserved demographic. 

7264             105.9 FM's programming will strengthen Fort McMurray's local radio by repatriating the 39 percent of listeners who presently tune to out of market stations. 

7265             Fort McMurray radio will be further strengthened by 105.9 FM's ability to attract new listeners and draw lost listeners away from alternative audio options, resulting in increased hours of local tuning. 

7266             The commercial appeal and diversity offered by 105.9 FM's A/C format will result in new radio dollars being attracted to the Fort McMurray market with minimal impact on local stations. 

7267             The establishment of a new adult contemporary station will provide advertisers with a highly cost efficient alternative advertising vehicle to target the underserved 25 to 54 demo.

7268             The addition of 105.9 FM will establish competitive balance within the Fort McMurray single ownership market by providing a distinct alternative news voice. 

7269             Approval of 105.9 FM will increase ownership diversity within Fort McMurray and Alberta's private radio sector.

7270             Approval of CJVR's new undertaking will ensure continuance of a strong independent radio voice at a time when many smaller community broadcasting entities are disappearing through increasing industry concentration. 

7271             The addition of 105.9 FM to Fort McMurray's local radio spectrum, will result in new CTD initiatives involving a minimum direct expenditure of $175,000 and an indirect on‑air expenditures budget of $735,000, for a total of $910,000 over the license term.

7272             105.9 FM will optimize the utilization of the frequency by extending its unduplicated music format to meet the programming needs and preferences of the underserved 25 to 54 year olds. 

7273             105.9 FM through its daily spoken word programming will reflect the cultural and racial diversity within Fort McMurray's growing population.

7274             Approval of 105.9 FM will result in the creation of 15 fulltime and 2 part‑time employment equity opportunities.

7275             MR. FABRO:  Mr. Chairman, CJVR appreciates the opportunity to have appeared before you this week seeking broadcast licenses that are central to our efforts to grow our company's critical mass and to play a larger role in western Canadian radio broadcasting.

7276             At a time when Canada's private radio sector is evolving from a collection of independently‑owned radio stations, into commonly‑owned multiple chains of stations, my family feels it is more important than ever that strong independent radio voices be encouraged and maintained. 

7277             I respectfully ask you and your colleagues to approve our application for Fort McMurray.  We will be happy to answer any of your questions.

7278             THE CHAIRPERSON:  Thank you, Mr. Fabro.

7279             I think I shall probably direct my question to Mr. Singer.  So, Mr. Singer, if I'm referring you back to your page 9 of your oral presentation, or page 7 of your supplementary. because it is directly quoted, you are saying that based on the study that you have done, you estimated the advertising revenues in Wood Buffalo to be approximately $20,000,000. 

7280             And you are saying that $6,000,000 shall be attributed to radio.  The other $14,000,000 you see it allocated where?

7281             MR. SINGER:  I will defer that question to our Sales Manager, Kevin Gemmell, to talk to the numbers, if you don't mind.

7282             MR. GEMMELL:  Thanks, Ken.  A great question, Mr. Commissioner.  That would be spread out amongst many ways ‑‑ newspaper, advertising through the web, and the various other means, outdoor advertising in the area.

7283             THE CHAIRPERSON:  There's no television.  Is there a weekly paper?

7284             MR. GEMMELL:  There is a daily paper.

7285             THE CHAIRPERSON:  There is a daily paper.

7286             MR. GEMMELL:  Yes, there is.

7287             THE CHAIRPERSON:  There is a daily paper.

7288             MR. GEMMELL:  Fort McMurray Today.

7289             THE CHAIRPERSON:  I see.  So they, more than likely, they are taking the major share of that $14,000,000?

7290             MR. GEMMELL:  That and some of the outdoor advertising, there is some billboards around and, of course, portable outdoor advertising as well, which wouldn't be a huge amount.  I would think the newspaper would take the majority.

7291             THE CHAIRPERSON:  You think that will take the majority.

7292             MR. GEMMELL:  Yes.

7293             THE CHAIRPERSON:  Okay.  We'll follow the standard line‑up of questions that we have had over the last couple of days. 

7294             And I will start with the format and the music.  And really I don't have that many questions to ask. 

7295             But I understand that you are going to be aiming at the 25‑54 age group and if you will be skewed more towards the female gender.  And do you have an idea of the share?  Is it 60:40 or 55:45, 70:30?

7296             MR. SINGER:  You're referring ‑

7297             THE CHAIRPERSON:  To the gender.

7298             MR. SINGER:  To the gender mixture picture ‑‑ it's fairly close and I will possible turn you over to our people from Insightrix to give you the exact amount.

7299             MS SCHNELL:  Mr. Chairman, we are definitely targeting females and there's definitely a higher percentage of females who are interested in the station, but its also important to note that males had a high interest level as well.

7300             I believe we had over 80 percent of females saying they're interested or very interested and, well, over 60 percent of males as well, so that would give us about a 60:40, female‑male split in the listenership.

7301             THE CHAIRPERSON:  And within that demographic, the 25‑54, what will be the median age of your listener?

7302             MS SCHNELL:  Early 30's, probably 30‑31.  25 to 34 age group was the most interested.

7303             THE CHAIRPERSON:  Yes.  But your announcer will be talking, instruction will be he is talking to a 31, 32 year old female.

7304             MS SCHNELL:  Correct.

7305             THE CHAIRPERSON:  And then all the others are welcome.

7306             MR. SINGER:  That's correct.

‑‑‑ Laughter / Rires

7307             THE CHAIRPERSON:  But in his mindset, he is talking to a woman that is say, 32 years of age.

7308             MS SCHNELL:  Correct.

7309             THE CHAIRPERSON:  As you know, the Harvard and Golden West has also filed for the same format that you have filed.  How do you see the distinction between the music that they have proposed and the one that you are proposing here?

7310             MR. SINGER:  Mr. Chairman, we have a better grasp, I feel, of what Harvard is proposing than ‑‑ musically it was a little more defined, at least to us, than Golden West.

7311             But I would say, in comparison to Harvard, they are planning to insert a pop element and more of, like later in the day, but did mention that they would integrate a lot of the pop element throughout their day as well as it fits the A/C genre.

7312             We would be more of a pure A/C format, so we feel that perhaps the Harvard format would appeal to a slightly younger demographic than our proposed format would.

7313             THE CHAIRPERSON:  Getting back to your ‑‑ I took a lot of notes while you were talking, so I have to get back to make sure that I did cover them. 

7314             Okay, well, essentially those were my questions regarding your music format.  I have to say that your application is very complete and there's a lot of ‑‑

7315             MR. SINGER:  Thank you.

7316             THE CHAIRPERSON:  There's a lot of detail in it, so that's why we, well, obviously means that there is less questions.

7317             We will move now towards spoken word and again, here, this time you have said that you will have 15 employees, if my memory serves me well.

7318             MR. SINGER:  Correct.

7319             THE CHAIRPERSON:  And among them, there will be 3 fulltime news reporters.  What will they do?  And how many newscasts will they do a week?  And what will be the breakdown of the news schedule?

7320             MR. SINGER:  Okay, Mr. Chairman, we will have 3 news employees, as you noted.  One of them will be our News Director. 

7321             The duties of each of those 3 will be, obviously to write and search out stories with a great emphasis on the local component. 

7322             I would estimate, if similar to r other radio operations in smaller markets, we will strive to achieve at least an 80 percent component of local news, local and regionally local news content. 

7323             The number of newscasts they will prepare weekly, is 101 newscasts, with the door always open to do extra news coverage when situations warrant.

7324             We certainly understand that 3 news people, it's using everything they've got to do that many newscasts, but we really feel that that component is important. 

7325             And we also, as we have indicated in other applications, and will be employing on our new Whitecourt station, we will be endeavouring to set up as many stringers as we can out within he broadcast coverage area, who will assist our news department in keeping us informed of things going on in those areas and certainly not just from a news point of view, but also from just a human interest and public service point of view as well.

7326             THE CHAIRPERSON:  Now, you have been referring to them, your stringers, you have been referring to them as the community‑minded volunteers.

7327             MR. SINGER:  Correct.

7328             THE CHAIRPERSON:  So if they are volunteers, they are unpaid?

7329             MR. SINGER:  We do not have a budgeted pay plan for them, but in my experience with this type of a setup, we would offer some type of compensation to them in terms of a number of various things. 

7330             I also alluded to having weather watchers in our presentation.  One of the things I did many years ago with that type of a program was we actually got wrist watches for each of them with our call letters on them and our logo and that was ‑‑ they took quite a bit of pride in being part of the weather watcher army that we had out there. 

7331             And we would do a number of initiatives to them.  But in my experience, most of these people feel quite honoured to be a part of the whole broadcasting system.

7332             THE CHAIRPERSON:  How do you choose them?

7333             MR. SINGER:  Primarily, you know, we would advertise it, we would put it on our website, we would mention it on the air, we would also ‑‑ we encourage our on‑air people in all situations to become very involved in the communities, so there would be certainly some face to fact contact in selecting some of these people as well. 

7334             But we feel that just, you know, announcing that we do have a correspondent in such‑and‑such an area, if you would like to be one, let us know as well. 

7335             And certainly it's, you know, we are not under any obligation to use everything they give us.  It would certainly be edited by our news department and our programming staff.

7336             THE CHAIRPERSON:  Now, doing 101 newscasts a week means that you will have some people in your newsroom from 6 in the morning to ‑‑ and even earlier than 6 in the morning ‑‑ till midnight, 7 days a week?

7337             MR. SINGER:  We would have primarily our main focus would be 6 to 6.  But there would be, you know, some news assignments in the evening, depending on various things that were going on from a reporting point of view. 

7338             But without question, because of today's technology, we can instantly be in touch with any of our news reporters if something should break in the evening hours. 

7339             But we, because we don't plan to have any voice tracking on our Monday through Friday, there would be an announcer on duty in the evenings if a newscast was ‑‑ or a news story broke, a newsperson would be contacted immediately.  

7340             THE CHAIRPERSON:  And he could do the first call, even on air, if there was to be fire blaze somewhere he could mention it during his own shift.

7341             MR. SINGER:  Correct.

7342             THE CHAIRPERSON:  It doesn't need to have a newsperson to say that there is a fire blaze somewhere.

7343             MR. SINGER:  That's correct.

7344             THE CHAIRPERSON:  What will be the length of those newscasts?  You have 101 of them, but ‑‑

7345             MR. SINGER:  News and weather on our morning newscasts on the top of the hour are 5 minutes, the bottom of the hour are 3 minutes.  The weather component is approximately 30 seconds within those newscasts. 

7346             And then our mid‑day newscasts run about 3 minutes; noon hour we have a 5‑minute newscast, and then back to 3‑minute newscasts.

7347             THE CHAIRPERSON:  And what about sports?

7348             MR. SINGER:  Sports is in addition, one minute to two minutes in length, depending on time of day.  But there would be a sports component on pretty well all of our newscasts, and once again with emphasis on sports that are relevant to the local area.

7349             THE CHAIRPERSON:  Will your news people be asked to do other feature material like material related to, say to energy and to forest or whatever.

7350             MR. SINGER:  Yes, Mr. Chairman, we do have a number of spoken word features that the news department will be responsible for, in addition to our programming people.

7351             THE CHAIRPERSON:  And regarding on‑air people, how many people are you thinking of?

7352             MR. SINGER:  I too have a lot of notes.

‑‑‑ Laughter / Rires

7353             THE CHAIRPERSON:  You were expecting the questions.

‑‑‑ Laughter / Rires

7354             MR. SINGER:  Yes, I was.

7355             THE CHAIRPERSON:  Either from me or Commissioner Cram.

‑‑‑ Laughter / Rires

7356             MR. SINGER:  Yes.  We mentioned that there will be 15 full‑time employees and two part‑time.  We've already discussed the three newspeople.  Our on‑air hosts, our programming people, consist of a morning host, who will also be our program director, our midday announcer, an afternoon drive announcer, we will have an evening announcer and a swing announcer.  So five more employees there.

7357             In the administration area, we'll have a general manager who will also act as the sales manager, our accounting and traffic manager, we'll have a receptionist who will also have other duties, assisting with writing.  We hope that we'll be so busy we'll need extra writing resources.  She'll also work in the promotions area, or he will work in the promotions area.

7358             We anticipate having a creative staff in Fort McMurray consisting of a creative director who will also write commercials; a second writer who will also be the producer of the commercials; and we will have a half of a person doing writing in our Melfort operation for Fort McMurray; we will also have a part‑time technical person in Fort McMurray; and two salespeople.  So in total, that's 15 full‑time and two part‑time.

7359             THE CHAIRPERSON:  Two part‑time.  So it's the equivalent of 16 people.

7360             MR. SINGER:  And I should also mention, Mr. Chairman, that the accounting and traffic person would be also located in Melfort.  So two of our contingency would be working out of our Melfort facility.

7361             THE CHAIRPERSON:  Regarding spoken word by your announcers, will there be any script material or is it banter material?

7362             MR. SINGER:  Happy talk.  There will be a fair amount of ‑‑ you're talking about aside from the produced spoken word features?  You're talking about happy talk.

7363             My belief, in any on‑air responsibility, and it's been that way since I started in the business 40 years ago, is that you don't turn the microphone on until you know what you're going to say, and I was well‑trained in that area, and I'm not referring to you, Mr. Chairman.

‑‑‑ Laughter / Rires

7364             MR. SINGER:  And I'm breaking those rules here today too, I'm sure.

7365             Preparation is key to any good radio show.  I know some of our best announcers, and we have quite a few of them, are very good at what they do, are very, very prepared when they go in to do their show.  We encourage them to research what they're going to talk about today and we don't tell them they have to write it out.  Some choose to make notes.  Some go in with three‑ring binders with little newspaper clips and whatever they took off of the internet and whatever resources they chose to put their programs together.  But they do have a guideline.

7366             And I know we had a sign in our control room at one time that said, "Make sure your brain is in gear before engaging your mouth."  And that really again, I guess, speaks to being prepared and talking about things that are meaningful to the audience rather than ‑‑ if you were to monitor any of our stations today, you would hear much more than surveillance of song title and time of day.  We actually have a commitment within each of our hours where announcers do talk about local things going on and also, you know, really do bring something to the air that provokes a little bit of thought about what's going on out there, not just a list, it's not a shopping list of things to do.  So there is a plan.  Our announcers are monitored regularly and our program director critiques them on their level of content that they bring to each show.

7367             One of the things that we ask our announcers when they finish a shift is, "Tell me what you did today that you're proud of."  It's an important element of what you do on the air.

7368             THE CHAIRPERSON:  You have included in your programming grid a feature that you've called "Focus on Fort McMurray."

7369             Could you, for the benefit of the Commission, describe what those features will be and their duration and when you are planning to broadcast them?

7370             MR. SINGER:  "Focus on Fort McMurray" will run a minimum of four times per day.  It certainly is a feature that can cover many, many topics.  The idea for this was similar to what we explained in our previous application for a program called "Community Connections," but "Focus on Fort McMurray" would basically take the same direction, given the array of urban and rural communities that we would serve with our signal making up our coverage area, we would, again, through connections in these various communities, develop some type of, I guess, an on‑the‑scene person who could be our go‑to to find out what is going on in those respective areas.

7371             These reports would be written and produced by our news department and our programming department but based on information we receive and acquire from those volunteers in the various areas that we serve.

7372             Without question, the breadth of the information is immense depending on what's going on in those communities.  It would also reflect the cultural diversity of those communities as well.  I mean, if we, you know, had a contact in a First Nations community, obviously there would be opportunity for some dialogue on the Aboriginal issues that are going on in that community and events, and also give an insight to the culture and activities even from an historical point of view.  We feel it's kind of a mosaic about your community, and then it could be very specific about something that is going on this particular weekend, such as a folk festival or a powwow or a meeting or even a need in the community for fund‑raising, that type of thing.  So the range is pretty broad.

7373             THE COMMISSIONER:  Other than the news feature and the "Focus on Fort McMurray," will you have other types of features and which type will they be?

7374             MR. SINGER:  We will have a listener feedback line, which is an opportunity for our listeners to sound off or to give opinion.  Our news department ‑‑ we plan to do that in two modes:  one on our internet, where you could, you know, leave a comment on our web site and submit it to the radio station, or you could phone a talk line, a recorded talk line.  Our news department will choose ones that are appropriate for air and put together a bit of a montage that will run daily of listener feedback and comments, similar to ‑‑ I guess you've seen the CityTV concept with the television on the street or leave a comment.  But this certainly has a little more immediacy in terms of it being radio and audio; we can react quickly.  So we would prepare these in our news department.  Our news director would oversee this each day.

7375             THE CHAIRPERSON:  Will you deal with some public affairs matters and, if yes, how and at which period of time?

7376             MR. SINGER:  We don't have plans for an actual block of public affairs programming, but we certainly would incorporate that into I guess our produced features.

7377             One other spoken word feature that is included in our presentation, our application, is our community cruiser, which is again one of radio's great abilities, to go out, hook up with somebody, an organizer, a participant, and put them on the air instantly and back to the radio station.  It certainly provides an opportunity for organizations that need extra help and promotion to be on the air everywhere through our community cruiser.

7378             THE CHAIRPERSON:  You said that from Monday to Friday you will be live‑to‑air from six to midnight.  What about the weekends?

7379             MR. SINGER:  On Saturdays, we'll be live six to six; on Sundays, we'll be live from six till 3 p.m.

7380             THE CHAIRPERSON:  And after it will be voice tracking or is it brokered or syndicated shows or what?

7381             MR. SINGER:  We have no plans at this time for brokered programming.  We would run voice tracked hours, so in total, 15 hours a week maximum.

7382             As I mentioned in our application, we also have an agreement with the Fort McMurray Oil Barons hockey team, that should we be successful, we would enter into negotiations with them for the opportunity to do live hockey broadcasting.  So that would certainly take up some of those hours that we had planned as voice tracking, would be then live play‑by‑play.

7383             THE CHAIRPERSON:  Is the hockey team playing only over the weekend?

7384             MR. SINGER:  No, they have a schedule that varies, weekdays, weekends.  At present, they do have some of their games broadcast, but our intention and their interest in our proposal ‑‑

7385             THE CHAIRPERSON:  Having them all.

7386             MR. SINGER:  We would do them all, as we do in Saskatchewan on our stations.  In Melfort, we do 125 and more hockey broadcasts a year.

7387             THE COMMISSIONER:  And you will have some staff that will be capable to follow them and broadcast?  We're talking here junior hockey, junior Alberta hockey league?

7388             MR. SINGER:  Yes, yes.  And we would certainly have to add to our staff complement if we were successful.  Unless we were lucky enough ‑‑ and we have been lucky enough on some occasions ‑‑ that one of our announcers was very good at play‑by‑play, but we have some very qualified sports people working with us in Saskatchewan and we hope to develop more, and this would be an ideal opportunity for us in Fort McMurray.

7389             THE CHAIRPERSON:  We'll move now towards dealing with synergies.  You have already mentioned that traffic, writing, and part of creative will be done out of Melfort.  What about Whitecourt?  Are you planning to do any synergies with Whitecourt?

7390             MR. SINGER:  Most definitely, Mr. Chairman.  Our interest in Fort McMurray has increased dramatically because we applied for Fort McMurray and then acquired Whitecourt, and obviously that just gives us more ability to share some of our resources.  Number one, accounting and administration is perhaps one of the most obvious savings to us; but from the point of view of, I think, more importantly than the synergies, especially from a start‑up point of view, is this gives us an opportunity to exercise some of our best practices across the whole group of stations, and we can certainly utilize the training and development on a much more effective basis when we have more areas for our talent to go and practice their craft.  We are especially excited about, you know, the opportunities of recruiting a higher standard of talent because there would be more opportunities within our company.

7391             THE CHAIRPERSON:  And if you were granted the licence for Grande Prairie, will you have synergies as well with Grande Prairie?

7392             MR. SINGER:  I think from a regional point of view it would strengthen our ability in terms of content on our radio stations because then we would have three operations that really have an Alberta regional focus and there's a lot of commonalities there.

7393             We have plans, as you've seen on our Whitecourt application, to share some of the Canadian talent initiative ideas, not to just duplicate them and put them on in Whitecourt, but we have a very successful Canadian programming called "Canadian Coast to Coast" which features Canadian country artists and their music.  We have a Saskatchewan Country Sunday where we just feature Saskatchewan artists.  We would employ those kinds of ideas but give them an Alberta focus.  Obviously we're an Alberta radio station; we would put more emphasis on the local Alberta musicians.  At the same time, it's an opportunity to share with Alberta the Saskatchewan musicians' stories and successes.

7394             So there are some synergies in programming ideas.  Certainly there are synergies in the way we plan our programming.  We use resources to make our programming better.  We certainly feel that a company of our size can learn from broadcast consultants who give us programming tips.  Now we can apply them in several stations and not just one or two.  So those are savings.

7395             A news department certainly has tremendous opportunity to share resources ‑‑ again, if we were fortunate enough to have Grande Prairie and Fort McMurray added to our Whitecourt, what a great news department we're building here.  Without question, we would share each other's stories and expertise and try to localize them.  Not to say we'd write a story for Grande Prairie and play that to people in Fort McMurray as it is, but there might be a story created that really has an element very localized to any of those markets.

7396             THE CHAIRPERSON:  We will now talk about the CTD.  You have proposed to allocate $3600 per year to support students enrolled in the Aboriginal Entrepreneurship Program at Keyano College.  While such funding is worthy, we are not sure that an initiative of this nature qualifies as a CTD expenditure under the current CTD definition.

7397             If the initiative was to be declared by the Commission as non‑eligible, do you wish to maintain the initiative and thereby reduce your annual CTD, or will you allocate that CTD to another eligible expenditure?

7398             MR. SINGER:  Mr. Chairman, a good question and one that certainly came to mind, unfortunately, after we filed the application, that we recognized that it might not meet the definition.  So we have given it some thought, and we would definitely keep it within our budgeted direct expenditures, but we would redirect it to an initiative that would meet the definitions.

7399             Our preference would be, because it was an Aboriginal initiative, that we would find out and seek out another initiative that the benefactor would be an Aboriginal.

7400             THE CHAIRPERSON:  In your oral presentation again today you mentioned that you are committed to spend $25,000 per year or $175,000 over the course of the licence term but you may not be on air the day the Commission issued the licence.  Would you accept a condition of licence that it be seven consecutive years rather than the licence term, or are you ready to do it or spend the money over a five‑year period or a four‑year period?  It depends on when you are going to be launching this station.  It's up to you; take your pick.

7401             MR. SINGER:  I'll let Gene answer.

7402             MR. FABRO:  Yes, we would commit to send that over the term of the licence period.  So if the licence period was shorter than seven years because when you issued the licence, we would still spend the total amount committed over that period.

7403             THE COMMISSIONER:  So you will be increasing the amount on a per year basis?

7404             MR. FABRO:  Yes.

7405             MR. SINGER:  I'm sorry, I didn't understand the question.  Thank you, Gene.

‑‑‑ Laughter / Rires

7406             THE CHAIRPERSON:  I phrased it in a different manner than it was phrased to the others.  There was a twist in it.  But Mr. Fabro, being the president of the corporation, we're taking his word.

7407             MR. FABRO:  When it comes to money, my ears perk up.

‑‑‑ Laughter / Rires

7408             MR. FABRO:  But on the Canadian Talent Development initiatives, it's important to note, as I think Mr. Singer has pointed out and we said in our verbal submission here today, that part of our commitment to Canadian talent is a large commitment to the on‑air exposure.  We've proven in Saskatchewan that that's the real horsepower in making these artists professionals.

7409             The dollar amount a lot of times isn't monitored well by some of the broadcasters.  It's just paid out the door and broadcasters get their credit, they get their invoice and they have their records.

7410             Our company is much more committed to actually promoting Saskatchewan talent, and by having some of the radio programs that Mr. Singer indicated and our promotion of talent generally is probably I would say the best in the country, because I watch that kind of thing.  When we came up with our CTD commitments, it's not a small amount to ‑‑ basically $900,000 in terms of total commitment and $735,000 in air time.  That's a big number for us and it's a big commitment and it will work well for the artists.

7411             THE CHAIRPERSON:  I do agree with you.  That being said, since 1998, following a long consultation that did involve the CAB, a decision was made to assess the CTD only on the cash because all the broadcasters had non‑cash or non‑monetary involvement in various ways and those are very hard for the Commission to monitor.  Obviously you don't report on them.  That's why we didn't ask any questions.  For sure we agree and I think ‑‑ surely it's acknowledged by the fact that you have earned for eight consecutive years and eleven consecutive years the awards of the Canadian Country Music Association for the Prairies and for Saskatchewan.  I'm sure that those awards are directly related to the effort that you have been making to the support of Canadian talent, and I think you should be commended for these awards.

7412             MR. FABRO:  Thank you.

7413             THE CHAIRPERSON:  In making, obviously, our formal appraisal of all the applications, we are taking only into account the cash outlay.  We know the rest and we appreciate that you had raised it, but we need to have harder facts, something that we can see.  We can see the cheque and the receipts afterwards.

7414             MR. FABRO:  Right.  Well, Mr. Commissioner, as Mr. Singer alluded to, our commitment is a minimum commitment based on our financial forecast.  If we were to exceed the forecast, and hopefully that will happen if he were to get a licence, we would certainly examine very closely our CTD commitments and would commit further.

7415             THE CHAIRPERSON:  I think we appreciate that.  But we have to assess everybody with the same ‑‑ if I agree with your plan, they will all come back and say ‑‑

7416             MR. FABRO:  That's true, yes.  Maybe we can reflect on ‑‑

7417             THE CHAIRPERSON:  So we're not doing here an auction.  We're granted a licence but not through an auction process.

7418             MR. FABRO:  No.

7419             THE CHAIRPERSON:  We're not in Sweden and we're not in ‑‑ in Finland and Sweden, that's the way they've granted the last FM frequencies, through auction, but ...

7420             MR. FABRO:  But maybe ‑‑

7421             THE CHAIRPERSON:  And it was an FTD or STD, it was money to the treasury.

‑‑‑ Laughter / Rires

7422             MR. FABRO:  Maybe Mr. Singer can expand on our viewpoint in terms of our broadcast quality and training of staff just with regards to our financial forecast and what we believe what we're doing for the industry.

7423             MR. SINGER:  Thank you, Gene.

7424             Mr. Chairman, I certainly do understand the Commission's position on, yes, you have to measure by the direct.  We do too.  I guess ‑‑ you know, we're new to this game of applying for more licences, relatively new to this game.  Once you see all of the applications, in hindsight, we could make some great decisions here and put some tremendous stuff into our application.  But in all honesty, the number that we did submit was at the time, we thought, significant and reasonable for this competitive process; but we also formulated that number based on the business plan to go and set up a radio operation in a market that is perhaps twice as expensive to operate as we are accustomed to.

7425             Consequently, we also looked at how we're going to go about doing this.  We could easily reduce our costs in operating a station such as we're proposing in Fort McMurray by putting a morning show on and voice tracking this thing even from Melfort.  I mean, we've got the technology to do that nowadays.  But that is not going to work.  It's not going to serve the people of Fort McMurray and it's not going to possibly even meet the acceptance of the CRTC.  I understand we'd have to do a percentage of programming to be able to sell advertising that would originate locally.

7426             The truth of the matter is we don't want to just put a radio station on the air that serves the market reasonably adequately.  So now we have to make a decision.  We've got to bring some players to the table that can do a job, someone that can go in a control room and do more than the basics, and we have to hire a few more people because of the commitments we've indicated in our presentation today.

7427             So it gets down to a balancing act of how much Canadian talent dollars can I put on the table and offer a quality radio station to the marketplace?  I think we've identified that in our business plan.

7428             THE COMMISSIONER:  And I appreciate your comment.  It was raised during the radio review by some intervenors.  We heard the Ontario Independent Radio Group making some representations in that regard.  We also heard another trade association which is called l'Association des radios indépendantes privées du Quebec.  They made similar comments.  We heard some other applicants this week making the same representations.  And I understood from page 7, where you said, "CJVR is a small independent broadcaster"; you also add that you are well‑structured, well‑financed, and capable of being a player in Fort McMurray, but you are still at the stage of the development of CJVR Limited a small organization, independent organization, which cannot have the same level of commitments as some of the other larger organizations that have 40, 50 radio stations.

7429             Those are things that we're taking into account in assessing the various applications and we're giving a different weight to each applicant.  We see the need for the big organizations to expand, but we see the need also to bring in new players and not only totally new players but also smaller independent players to grow and eventually be in a position to buy those big operators.

‑‑‑ Laughter / Rires

7430             MR. SINGER:  That's our hope.  As Gene mentioned, if we exceed projections, we won't wait until the end of the licence term to be doing more.  I understand where he's coming from.  At the same time, I also ‑‑ and I appreciate the fairness of the CRTC in this matter because I really do think that our beginnings are no different than the beginnings of the Big 6 in our country.  They started with one and look where they are today.  We may never approach that capacity, but as we grow, so will our Canadian Talent Development direct expenditures.

7431             THE CHAIRPERSON:  I understand that.  If I'm turning the clock back to 1998, and I was on the other side of the fence, as you know, when the Commission came up with their commercial radio policy, everybody was saying, well, Telemedia will buy everybody, but they were the first to sell.  Nobody knows the future.  But I can assure you we're taking all of these factors into account.

7432             Your remarks are timely because I was moving towards the marketing and the business aspect of your application.  I notice that you haven't filed any supplementary information regarding revenues and expenses, so taking for granted that the numbers that you have filed in 2005 are still the ones which you think, even if the Fort McMurray market has exploded the way you stated it, with the type of financials you have put to us, you're capable to go forward?

7433             MR. GEMMELL:  Mr. Chairman, maybe I'll speak towards that.

7434             Yes, we are confident that the financials as filed are exactly what we want them to be.

7435             Just to give you an idea of ‑‑ we talked about potentially inaccurate numbers through the Financial Post Canadian Demographics.  The Financial Post 2005 Canadian Demographics showed a number of just shy of $250 million in retail activity, and that's a number quoted by some of the other worthy applicants.

7436             We estimated the amount to be closer to $800 million based on the entire Wood Buffalo‑Cold Lake census division and then taking population into account.

7437             We're delighted to note that the 2006 Financial Post Canadian Demographic estimate approximately $771 million in retail sales for this year, which is ‑‑ what ‑‑ 29 million shy of where we estimated them to be.  Once again, it reinforces that our numbers are dead on.

7438             THE CHAIRPERSON:  Dead on.  Start with the premise, as you said, Mr. Fabro, Fabmar is in the housing business and you even are contemplating, with or without the licence, to move into the construction business in Fort McMurray.  Let's start with the scenario and we will not discuss ‑‑ and we won't discuss the scenario where we don't get the licence.  If you have the licence, you will be owning your own facilities, your building?

7439             MR. FABRO:  Yes.  What we choose to do everywhere we operate is to buy our real estate to control our destiny.  We house our office building in Calgary to run our holding company, Fabmar, but we also run construction and other businesses from there; and in Fort McMurray, we would buy our own building.  In Saskatchewan, Melfort, we have our own building there and we have our own building in Whitecourt.

7440             Fort McMurray, in the short‑term, we may, if we were to receive a licence, we would probably lease until such time as we either built a building or bought one that was available.  But lease or buy, the attributed costs, the occupancy costs would be the same, we would still factor it in the same.

7441             With regards to our building business, yeah, we've been in the building business since 1987 in Calgary and area and just recently, the last four years, in Canmore, and we build anywhere from ‑‑ because we're in multi, single, and recreational building, we build anywhere from, say, 85 to 180 units per year, and we have the opportunity to come into the market here.  It does have its challenges, but we believe there's a long‑term benefit from being in the market, and the first two years it would be difficult to get all our trades lined up and to organize everything, but we think we could do very well here, also in Grande Prairie.  So there you go.

7442             THE CHAIRPERSON:  You have the experience to do that.  That also allows you to say that ‑‑ how do you say it?

7443             MR. FABRO:  Subsidize or ...

7444             THE CHAIRPERSON:  Subsidize.

7445             MR. FABRO:  Yes, that's what we would do is we would provide ‑‑ well, firstly, by having the opportunity to build here, you give one more outlet for any new employees to come to have a property because there's a limited amount of property and some of it is not Class A space, and the types of product that they build here isn't probably what we'd build.  We'd probably pick it up a notch, so to speak.

7446             And what we would do is subsidize our employees.  They could live in the houses and the condominiums that the housing company would build, and that would be a perq for the employees and also a bit of glue to keep them here in Fort McMurray because we believe that our units would be desirable to live in.

7447             THE CHAIRPERSON:  In your oral presentation, you said that you have commissioned the Fort McMurray Chamber of Commerce to undertake a study to determine the accumulate count of retail business in Fort McMurray.

7448             Do you have a copy of that report and could you provide the Commission with one?

7449             MR. GEMMELL  Mr. Chairman, it was actually supplied with the licence application, I believe.

7450             THE CHAIRPERSON:  I have a Take Five from you.

7451             MR. GEMMELL:  Yeah, yeah.  Schedule 5 is the Fort McMurray Retail Business List.  It lists it by, first of all, area of town, and then it's done by street, and we further developed this list into a mailing list as we were attaining letters of support.  We mailed out to all of these businesses and received very few returned as undeliverable, so we know there's about 583 businesses.

7452             THE CHAIRPERSON:  As you can see ...

7453             MR. GEMMELL:   Yes, I understand.

7454             THE CHAIRPERSON:  We wade through tons of paper.

7455             MR. GEMMELL:   Yes.

7456             THE CHAIRPERSON:  So it's either somewhere here or been left in my office.  Thank you.  If we have it, we have it.  Thank you very much.

7457             MR. SINGER:  If you require another copy of it, we would be happy to file one.

7458             THE CHAIRPERSON:  I only have one bag to leave.

‑‑‑ Laughter / Rires

7459             THE CHAIRPERSON:  Thank you very much, Mr. Singer.

7460             In the oral presentation, you alluded to the number of stations that the Fort McMurray market could support.  You said at least one and maybe two.  What if the Commission was to grant two licences and what would be the impact on your business plan?

7461             MR. SINGER:  We do believe the market will support more than one new licensee.  We certainly would have to review our business plan.  It would be our hope that we could certainly make this work as the business plan exists because of the ongoing growth of the market.

7462             Again, you know, we don't hear the downside of this market, that things are going to suddenly stop in Fort McMurray.  I feel that the quality ‑‑ as I may have mentioned earlier ‑‑ the quality of life will continue to improve in Fort McMurray.  It's a little scary right now.  But I think, you know, there's going to be more settlement and more stability in that market as time goes on, and I don't think you're going to see this market grow to a huge proportion and then just all of a sudden dry up because I've heard too many that share that point of view ‑‑

7463             THE CHAIRPERSON:  It will never become a metropolis.

7464             MR. SINGER:  That's right.  I do believe that, you know, down the road, there will probably be another call for applications in that market.  Certainly, in talking to residents of Fort McMurray and through our surveys, you know, the people of Fort McMurray, I mean, their comments to us, and many of them are on file with our letters of support, would, thank God, more than two choices on the dial.  How ecstatic will they be if they've got four choices?  That would be great.

7465             I think there is room and I'm confident that our business plan and our projections can support ‑‑ we can be competitive in that environment.

7466             MR. GEMMELL:   Maybe if I can interject just quickly on some of the calculations?  I don't want to bore you with lots of numbers because it's been a long week so far ‑‑

7467             THE CHAIRPERSON:  But it helps.

7468             MR. GEMMELL:   Yes.  Well, and that's good.

7469             As we suggested, $800 million is what we feel is the economic activity or the retail sales in the market.  We suggested there be $20 million in advertising spending, of which $6 million would be spent on radio.  We made the assumption initially in the application that the O.K. stations were taking between $3.5 million and $4 million out of the market.

7470             June 6th of this year, Broadcasting Public Notice CRTC 2006‑70, the O.K. Group applied to amend their broadcasting operations by increasing the transmitter height, and their first year of their seven‑year financial projections showed a combined revenue of $4.1 million.

7471             Now, when you take into consideration that the most recent CRTC Radio Revenue Reports show that FM radio in Alberta has seen a five‑year growth of 8 percent in revenue per year, that means that last year the O.K. Group probably billed about $3.75 million.  So, again, we're bang on in our suggestions.

7472             THE CHAIRPERSON:  When you say two new stations, what if the Commission was to grant one of the specialty Christian services?

7473             MR. SINGER:  I think the Christian applications would have a minimal effect on our business plan and our ability to achieve that revenue, and it would, again, bring some other diversity to the marketplace.  As long as that's the format that they ‑‑ you know, if that's the format they propose and that's the format they put on the air, I think we can compete in that market.

7474             THE CHAIRPERSON:  Now, we have had discussions with the other applicants, and you will be the last one with whom we are going to have that discussion, but while you have described your format a bit different than the one of Harvard and Golden West, the reality is that there is, mind you, some closed minds on that format.

7475             What if the Commission was to grant two licences in the market but to you and one of the other adult contemporary applicants?  What will that mean for you?

7476             MR. SINGER:  Mr. Commissioner, I think the Harvard application identified that they were going after the broadest possible target of this adult contemporary mix of music because they had the pop, the new pop element within their format.

7477             I would suggest that if Harvard was licensed with that format as they described today and we were licensed with our format, that we can compete with it by being a pure AC/soft rock style radio station against that format.

7478             We certainly would do additional research to have some confidence in that theory, but it always gets down to, if you licence more than one, whoever gets on the air first is going to have the advantage, and that advantage would be something ‑‑ or that new situation would be something we'd have to measure and we'd certainly go back to the marketplace to see what will work.  Without question, the premise of our entire application is, there's lots of room in this market, and I think Mr. Hildebrand and his team identified that as well, that there is a tremendous ‑‑ it's not like applying for a licence in Edmonton where we'd have to narrowly focus what will work here.  This market is very, very wide, and the two stations are doing a good job serving the market, but they don't meet all the musical needs and there's, I think, several choices in the market.  The one that we chose is the one we believe in.  Hopefully you'll approve that and we'll be the first one on the air and that will be the other station's problem, what they're going to do.

‑‑‑ Laughter / Rires

7479             THE CHAIRPERSON:  But it surely won't be, if it was to be Harvard and you, it won't be a real estate issue in both instances.

7480             MR. SINGER:  I'll leave that up to Gene to decide that.

‑‑‑ Laughter / Rires

7481             THE CHAIRPERSON:  Well, those are my questions, Mr. Singer.  I another your colleague, Commissioner Cram, wants to ask a question.

7482             MR. SINGER:  Thank you.

7483             COMMISSIONER CRAM:  Thank you, Mr. Chair.  I just have a few issues.

7484             I was reading your deficiency letter of February 28, '06, at page 5, and it's 5(a) and it says, "What are your plans in the area of live‑on air talent, voice‑tracked or automated programming?"  And then you say you plan to broadcast live weekdays from 6 a.m. to 12 a.m.

7485             Did you mean 12 p.m.?  Because that's what I'm hearing today.

7486             MR. SINGER:  No, 6 a.m. till midnight.

7487             COMMISSIONER CRAM:  Okay, but that's noon.  12 a.m. is noon, isn't it?

7488             MR. SINGER:  No, it's p.m.

7489             COMMISSIONER CRAM:  Oh, then that's my problem.  Okay.

‑‑‑ Laughter / Rires

7490             COMMISSIONER CRAM:  Okay.  Thank you.

7491             And would you agree to a CoL?

7492             COMMISSIONER LANGFORD:   You're going to have to spell it out, Barb?  What CoL?

7493             COMMISSIONER CRAM:  CoL that you would program live‑to‑air during the entirety of the broadcast, regulated broadcast time?

7494             MR. SINGER:  Yes, we would.

7495             COMMISSIONER CRAM:  Good, thanks.

7496             Mr. Fabro, do you know the cost of commercial space in Fort Mac?

7497             MR. FABRO:  To purchase or to lease?

7498             COMMISSIONER CRAM:  Lease.

7499             MR. FABRO:  Yes, I do.  I think we estimated, for the studios that we would need, to be about $60,000 in rent.

7500             COMMISSIONER CRAM:  Per square foot ‑‑

7501             MR. FABRO:  No, that's total ‑‑ and I can just check that figure here but ‑‑ let me just see what I had here.

7502             That's like $25 gross a foot.

7503             COMMISSIONER CRAM:  Okay.

7504             MR. FABRO:  Which is ‑‑ we've checked the market, that we should be well be able to do that.

7505             COMMISSIONER CRAM:  Commissioner Williams wants me to ask you, what's the construction costs for Class A?

7506             MR. FABRO:  Class A.  Depends where we build, I guess, and it's Class A of Cadillac or Class A of Volkswagen, but we think that selling ‑‑ the selling cost here would be $325 to $350 a foot in order to make it worthwhile.

7507             COMMISSIONER CRAM:  Okay.  Thank you.

7508             And then ‑‑ I don't know which one of you ladies from Insightrix I wanted to ask.  At page 3 of your ‑‑ I think it's the executive summary of your study, so it's (iii), under "Demographics," you said, "Quotas were used to obtain a sample of 60 percent females and 40 percent males."

7509             I'm asking myself why you did that because, if I've got it right, 55.8 percent of the population of the City of Fort McMurray are male.

7510             MS SCHNELL:  Madam Commissioner, we did target females ‑‑ the format that we were targeting is primarily targeting females and we were anticipating that about 60 percent of the listening audience would be female.  So we wanted to get opinions of the residents, representative of what we feel that our licensing audience would be.

7511             COMMISSIONER CRAM:  So because the others were targeting male, is that what happened, you wanted to find out what females wanted to listen to?

7512             MS SCHNELL:  Because the other stations in the area are more directed towards males, so we wanted to direct our station more towards females.

7513             COMMISSIONER CRAM:  Okay, okay.  Thank you.

7514             Thank you, Mr. Chair.

7515             MR. SINGER:  Mr. Chair, I've just noticed, and Commissioner Cram, I've made an error here on this amount of voice‑tracking.  I'm glad you drew my attention to page 5 here of the deficiency because I think I've stated it several times in our appearance here before you today that we were automating 15 hours a week ‑‑ or voice‑tracking 15 hours, and I was calculating that on us being live Sundays 6a to 3p, and that is in fact 9 a.m. to 3 p.m., so you've got to add three more hours to our ‑‑ so the voice‑tracking amount will be no more than 18 hours per week.

7516             THE CHAIRPERSON:  Mr. Fabro, Mr. Singer, we are giving you a couple of minutes to sum up and say to the Commission why you should be granted the licence for Fort McMurray.

7517             MR. FABRO:  We believe that we should be granted a licence because there's an opportunity here in the market.  We believe that we have chosen the right format.  If there are two entrants in the market, we think we can do a significant enough format adjustment so that both new entrants can play and win.

7518             Our business plan is well‑thought‑out, it's conservative but it's well‑done.  We know we can deliver on it.  We have the financial and human capital in our company to deliver on what we say we deliver, and for all the time that we've been in Melfort, we have delivered and delivered more than what other operators probably would have delivered.

7519             If we were to get a licence here in Fort McMurray, it would be complementary to our Melfort and Whitecourt operations and would obviously be complementary to Grande Prairie, if we were so lucky.

7520             It would also be complementary to our other business here, our budding business, as we've mentioned, and we do also have a coupling company that sells into the oilsands and it would be complementary to that because we would have people coming through town and it would just make it easier to manage all those businesses.

7521             We have a passion for the business, with Radio CJVR being on the air for 40 years and our ownership for 15, we've proven it.  We have the business acumen, we have the entrepreneurialship, and we have the financial capacity.

7522             We believe that there will be a correct balance in the market with a small market broadcaster coming into this market, and we believe that we can deliver what we say we can deliver and we would like the chance to prove it.

7523             Thank you for your time today.

7524             THE CHAIRPERSON:  Thank you, Mr. Fabro, thank you Mr. Singer, thank you to your team.

7525             We will take a ten‑minute recess.  Then we will hear the last applicant for the day.

7526             I will invite all the applicants that have made the decision not to appear in Phase 2 to inform the Secretary of their decision so that we plan the lineup for Phase 2.  Thank you very much.

‑‑‑ Upon recessing at 1535 / Suspension à 1535

‑‑‑ Upon resuming at 1549 / Reprise à 1549

7527             THE SECRETARY:  Thank you, Mr. Chairman.

7528             Just would like to indicate to the applicants, that if they wish to comment on any revised financial projections that were filed by other applicants at this hearing, you may do so by filing written submissions with the commission no later than Friday, June 30th.  The applicants will have the right to reply by filing written comments no later than Monday, July 10th.

7529             And we will now proceed with Item 19 on the agenda which is an application by Touch Canada Broadcasting Inc. for a license to operate an English‑language commercial specialty FM radio programming undertaking in Fort McMurray.

7530             The new station would operate on frequency 104.5 megahertz (channel 283B) with an effective radiated power of 20,000 watts (non‑directional antenna/antenna height of 54 metres).

7531             Appearing for the applicant is Mr. Allan Hunsperger.  He will introduce his colleagues and you will have 20 minutes for your presentation.

7532             Mr. Hunsperger.


7533             MR. HUNSPERGER:  Thank you, Madam Secretary.

7534             THE CHAIRPERSON:  Could I have a minute?

7535             MR. HUNSPERGER:  Yes.

7536             THE CHAIRPERSON:  Just to pick up on what the Secretary announced regarding financial statement.

7537             The Commission expects that those who will file comments will copy all the other applicants with their comments so that they are made aware that there have been comments filed.  Thank you.

7538             MR. HUNSPERGER:  Good afternoon, Mr. Chairman, members of the CRTC and Commission staff.

7539             We are here today to make our second presentation of this hearing for a new gospel music FM radio station in Fort McMurray.

7540             Before I start our presentation, I would like to reintroduce you to our team briefly.

7541             I'm Allan Hunsperger, Founder and Director of Touch Canada Broadcasting Inc.

7542             With me is a team that brings Shine FM to Edmonton and Calgary and CJCA The Light to Edmonton.

7543             To my immediate left is Jamie Moffat, the Director of Sales for our Edmonton stations.  Jamie has 15 years of experience selling radio advertising in B.C. and Alberta for a variety of radio companies, including Nornet, Telemedia and Newcap.

7544             To his left is Chris Ferneyhough of Ipsos‑Reid, the company that conducted our audience research in Fort McMurray.

7545             And beside him is Bev Gillespie who is the Business Manager of our stations.

7546             On my immediate right is Malcolm Hunt, Touch Canada Network Program Manager.

7547             Beside Malcolm is Hollie Taylor who is our afternoon drive host on 105.9 Shine FM in Edmonton.

7548             And beside Holly is Shawna McConechy the Promotions Director in Edmonton.  Shawna has almost 10 years on air and promotions experience in the radio industry.

7549             Today's application is by Touch Canada Broadcasting Inc.  As you are aware, we have developed significant expertise in the operating gospel music radio stations in Alberta.

7550             CJRY in Edmonton, known as 105.9 Shine FM, provides a contemporary gospel music sound aimed at young adults, while AM 930 CJCA The Light in Edmonton provides a southern gospel sound and significant spoken word programming which serves an older audience.

7551             In Calgary, CJSI, 88.9 Shine FM provides a format that serves both audience with contemporary gospel music through most day parts with southern gospel specialty shows and a range of syndicated and local spoken word features.

7552             Today's application aims to bring 104.5 Shine FM to Fort McMurray.

7553             While it may seem counterintuitive that the gospel music station would be attractive to what people think is the wild and woolly frontier town of Fort McMurray, in fact our experience leads us to believe that our station would find a welcome home in this great city.

7554             Fort McMurray is a growing community of families.  Where once dad worked in the oil patch with the family living elsewhere, over the last 10 years the whole family has migrated there.

7555             Services and organizations such as schools, churches, community organizations like the Scouts, soccer, hockey leagues, Keyano Community College, have all become established to meet family needs.

7556             To confirm our market knowledge, and the local interest in our proposed station, we asked Ipsos‑Reid to survey the market for us.  I will ask Chris to describe what research found for us.

7557             MR. FERNEYHOUGH:  Thanks, Allan, and good afternoon all.

7558             Last August 24th to 28th, Ipsos‑Reid interviewed a random sample of 300 residents of Fort McMurray to test their interest in Touch Canada's proposed station.

7559             A sample size of 300 provides a margin of error of plus or minus 5.7 percent, 19 times out of 20.

7560             Interest in a contemporary Christian music station is strong among Fort McMurray residents, as 33 percent of respondents indicate that they would listen to this type of radio station described.

7561             Interest is even higher among females, as 39 percent say they would listen to this type of station.

7562             Interest among the different age groups is fairly consistent, as approximately 1 in 3 of each age group say they would listen to this station.

7563             Among those who say they would listen to this station, they indicate that on average, they would listen for just over 90 minutes every day.

7564             MR. MOFFAT:  Thanks, Chris.  The results from Ipsos‑Reid lead to a number of conclusions for us, particularly when filtered through our own experience in operating our stations.

7565             First, clearly there is an audience for this kind of station with fully a third of respondents indicating that they would listen to it.

7566             Second, in the last BBM book we subscribed to in Calgary, in fall of 2004, we received 4.7 percent of hours tuned in a very competitive market.  Given the Ipsos‑Reid research results and the fact that Fort McMurray's market is less competitive, we are confident we could reach a 5 share.

7567             Third, a 5 share in a small market reflects the potential of a niche market format.  Our projections for advertising revenue reflect the modest audience share that we will reach.

7568             We only expect to receive about $325,000 in advertising in the first year of operations, growing to $811,000 by the end of the first term of license.

7569             Yesterday legal counsel indicated that applicants could re‑file financial projections.  We heard standard estimates of both costs and revenue growth in the market and concur that such change has occurred.

7570             When we re‑visited our business model, we realized that our salaries would have to increase.  But the increase in the market revenues essentially covers those increases, leaving us in more or less the same profit situation.

7571             We have attached copies of the revisions to these remarks, along with the breakdown of our revenue projections.

7572             Our first year advertising revenues represent about 5 percent of what most applicants have estimated the potential radio market to be right now.  In fact, if the growth in the economy noted by all continues, the growth alone will accommodate our first 2 revenues handily.

7573             Of course, we could not keep the doors of the station open based upon only these advertising revenues.

7574             About one quarter of our revenues will come from the sale of air time to spoken word programmers.  In total, we will provide 15 hours per week of this kind of programming.

7575             Rounding out the revenue side are contra‑revenues where we provide air time in exchange for promotional opportunities such as vehicles, contest prizes and advertising and other media and other similar costs.

7576             With such relatively modest revenues, we will rely heavily on the expertise, back office functions and programming sharing with our Edmonton and Calgary operations, to allow us to provide a high quality sound for Fort McMurray.

7577             To tell you more about the sound of the station, here is Malcolm Hunt.

7578             MR. HUNT:  Thanks, Jamie, and good afternoon Mr. Chairman and members of the Commission.

7579             Gospel music is undergoing an incredible period of growth in the U.S.  In our brief we provided some illustrations of this.

7580             This growth is happening here in Canada as well.  The number and diversity of the artists recording across Canada is growing.

7581             Perhaps the best way for me to explain to you how dynamic the gospel music industry has become, is to list some of the 23 categories at the annual Shai Awards which Dionne Smith discussed with you the other day.

7582             The number of categories rivals the Juno Awards, including contemporary artist of the year, group, male and female vocalists, as well as worship album, hard rock, inspirational, rap/hip‑hop, southern gospel and alternative rock.

7583             Well over 60 artists were nominated in 2005 and there is a special emphasis on new and emerging talent.

7584             At Shine FM and CJCA, we play many of these artists, including the 2005 winners in several of these categories.  Some of the winners we are currently playing in high rotation include Starfield, Thousand Foot Krutch and Amanda Falk who also won a Juno last April.

7585             Touch Canada is an important sponsor of this event and we propose to devote an additional $56,000 over the course of the license to the Shai Awards if we are licensed in Fort McMurray.

7586             104.5 Shine FM, Fort McMurray, will provide a mix of programming similar to the one we described in our Grande Prairie presentation.

7587             Essentially our station will be a mix of adult contemporary and CHR styles of gospel music, supplemented by southern gospel, rock and hip‑hop specialty music programs.

7588             We will play this contemporary mix of programming from 6 a.m. to 9 p.m., Monday to Friday, along with news, surveillance and other spoken word features.

7589             On the weekends we will provide some special interest programs.  We will serve our southern gospel listeners with the programs "Gospel Greats" and "Homecoming Radio".

7590             We will also serve the younger demographic in Fort McMurray by providing a range of programs such as "The Vibe Radio Network", "Sound of Light", "Z‑Jam" and "The Red Letter Rock 20 Countdown".

7591             Sunday morning will focus more on praise and worship music.  Someone who isn't familiar with gospel music might consider all of what we play to be praise and worship music.  However, like southern gospel, praise and worship is a style unto itself.

7592             From 6 to 10 a.m. we will broadcast "Power Praise", a Touch Canada produced program which will be followed by "Heart of Worship", a 2 hour syndicated program of artist interviews and CD reviews.

7593             As we outlined in our Grande Prairie presentation, our stations continue to exceed the regulatory requirement for Canadian content.

7594             Of course a radio station is a lot more than music.  Shine FM, Fort McMurray, will provide a range of news and other spoken word features totalling 31.4 hours per week.

7595             From inception we will provide major news, weather, sports and other information packages on the half hour during the morning drive period, one at noon hour, and on the hour in the afternoon drive.

7596             In total, we will provide 6.6 hours of information programming per week, of which just over half will be news.

7597             In addition, 8.3 hours will be devoted to local reflection and announcer content, an hour and a half to human interest and comedy features, and there will be 15 hours of brokered programming.

7598             As we mentioned in our Grande Prairie presentation, we take the requirement for balance seriously, and we are willing to accept the conditions of license we discussed with you yesterday.

7599             To speak more about the program flow, here is Hollie Taylor.

7600             MS TAYLOR:  Malcolm laid out the skeleton of what we will program at Shine FM in Fort McMurray.  I'm here to address how this plan will translate to the on‑air sound that the announcers will execute.

7601             An important part of our reaching out to our listeners, is our talk to them during our music programs.

7602             We estimate that announcer talk is about 8 1/3 hours per week.  This includes talk about the music, the artists and about what is going on around town.

7603             For example, I'm sure you heard all about the talk about the Oiler roller coaster run for the Stanley Cup.  In Fort McMurray this same type of talk will occur when the Junior Hockey Team, the Barons, are in their playoff run.

7604             Community events and promotions would be a priority for our announcers as they are the keys in setting us apart from the other options that exist, such as satellite radio, internet and cell phone downloads.

7605             Taking calls from the listeners to record and air, reading our e‑mails and taking requests, will also aid in our attempts to be as local and topical as possible.

7606             Another example of our involvement in our communities is our community spotlight, a one minute PSA in rotation several times a day that will help local organizations get the word out about their events.

7607             These are but a few examples of how we serve our communities.  To talk further about our community involvement and promotions, here is Shawna McConechy.

7608             MS McCONECHY:  A major element of what we do at Touch Canada Broadcasting through our promotions department is to build and strengthen relationships between communities.

7609             Street level marketing is key.  Being at the events, being on the streets, personalizing with our listeners, is what makes us a family friendly station.

7610             We continuously try to ensure an on‑air personality is at every event for our listeners to meet.  We find this hands‑on approach is extremely successful with our listeners.

7611             Listeners want to meet the people who get them up in the morning, who keep them company on their drive home and who bring them the brand of music they love.

7612             We are excited with the opportunity to be a part of the community events that happen in and around Fort McMurray, like the "Petro Canada Frosty Frolics" which support both the Public Library and Fort McMurray Food Bank.

7613             There is also the "Family Fun Day Skate" at Borealis Park, a very similar event to the one 88.9 Shine FM runs in Calgary.

7614             We also intend to be a part of "The Country Fair and Market" that is held numerous times throughout the year.  The event took place 8 times in 2005.

7615             These 3 events are very grassroots and it's what we like to do best.

7616             Fundraising is another large component of what we do at Touch Canada.  We wholeheartedly believe in giving back to the communities we serve.

7617             For instance, all of our existing stations hold 3 annual "radio‑thons".  We pre‑promote these 12 hour live radio fundraisers with live on‑air chat and with pre‑produced promos.

7618             A few of the charities we have assisted are the Calgary Dream Centre, the Kids' Kottage in Edmonton and The Mustard Seed in both cities.

7619             We are very pleased to say that in the last year, between these 3 stations, we have raised over 1.1 million dollars.

7620             We have also raised money for various other charities through live on‑air auctions, web auctions and through a variety of events like fundraising dinners and pledge‑gathering activities.

7621             We would love to duplicate these fundraising formats for local charities in Fort McMurray if our application is granted.

7622             MR. HUNT:  As you are aware there are gospel stations across this great country, many of them low power and many of them struggling.

7623             The fans of our kinds of social family‑friendly programming really feel the need for stations like Shine FM and The Light.  They don't hear the music that we play anywhere else on the radio dial.

7624             We often have comments from our listeners who feel our popular‑based music programming is a safe place for them to dial in.  They like the fact that they can listen to contemporary music which they do not have to turn off when their kids are around.

7625             At the same time we recognize we are a niche format, attracting about 5 percent of the tuning in the communities we serve.

7626             While such a share is more than adequate in Canada's larger markets like Montreal, Toronto or Vancouver, it does not attract sufficient revenues in smaller markets to sustain high quality service.

7627             Our vision is to touch as many Albertans as possible, leveraging our presence in Edmonton and Calgary to ensure excellent programming.

7628             Touch Canada Broadcasting is at this hearing with 2 applications to provide service in northern Alberta.

7629             There is a vision which motivates our approach.  Additional stations will create a stronger foundation to extend our unique format to other communities.

7630             This is why we have the confidence to make a number of commitments.  We are confident we can meet and exceed the required Canadian content levels in all of our FM stations.

7631             We at present provide $28,560 annually to the Shai Awards from our 3 stations and we have proposed specific contributions in each of the applications we have filed.

7632             The granting of additional Shine FM stations to our group will permit us to launch 2 new weekly programs:  a new national gospel music countdown featuring both Canadian and international performers, and a totally Canadian gospel countdown show.

7633             We will air both programs in each of the markets we serve and make them available to gospel music stations across the country at no cost other than delivery.

7634             MR. HUNSPERGER:  Mr. Chairman and members of the Commission, Touch Canada Broadcasting is very excited to propose the opportunity to serve gospel music fans in Fort McMurray.

7635             I can remember back in the mid‑sixties, travelling to Fort McMurray with some of my college friends on a painting contract.  Back then Fort McMurray was going to be this little boomtown because of something people were calling the "tarsands".

7636             None of my college buddies, nor myself, could have imagined what is Fort McMurray today.  If we had, perhaps we would have bought some land or even some houses we painted and just maybe things might have been different today.

7637             Last month, when I was up in Fort McMurray, we had some time, so my lifelong buddy who has lived in Fort McMurray for the last 30 years drove me around to every neighbourhood in Fort McMurray.

7638             It looked like any other city in Alberta ‑‑ parks, community centres, churches, strip malls, condos, apartments, playgrounds, all to serve families that have now made their home in this beautiful Alberta city.

7639             Fort McMurray is a place that none of us really understand, except for this.  Twenty years from now, people will still be moving to Fort McMurray and they will still be mining the raw resources that this province has in that area.

7640             Touch Canada Broadcasting wants to be there serving this community with our contemporary gospel format, family friendly kind of radio.

7641             We believe that our niche application is in keeping with the spirit of the Broadcasting Act that stipulates the system should be diverse, balanced and representative of all Canadians.

7642             While our gospel format may not attract a large audience, this audience has a need to be served.

7643             Mr. Chairman, thank you for your attention and we would be pleased to respond to your questions.

7644             THE CHAIRMAN:  Thank you, Mr. Hunsperger.

7645             You have filed copies of your revised financials with us, as of today.  I will ask the Secretary to make sure that a copy is made available in the public records, so those who want to consult them can go and review them now.  Since you're the last item and it may be of interest to the other applicants ‑‑

7646             MR. HUNSPERGER:  Yes.

7647             THE CHAIRMAN:  ‑‑ I want to makes sure that it is done as well as expeditial as possible.

7648             Commissioner Langford will ask you the first questions.

7649             COMMISSIONER LANGFORD:  Just like old times, isn't it?

‑‑‑ Laughter / Rires

7650             How was the kick‑off to Lent, by the way?

‑‑‑ Laughter / Rires

7651             MS TAYLOR:  It was fabulous.

7652             COMMISSIONER LANGFORD:  Was it?

7653             MS TAYLOR:  You should have been there.

‑‑‑ Laughter / Rires

7654             COMMISSIONER LANGFORD:  Good answer.  Okay.

7655             I don't think we need to drag this out.  We have heard you on Grande Prairie, and as you said some of the stuff is kind of repetitive on format ‑‑ not repetitive, but I mean similar, almost the same.  So we can whiz through some of that.

7656             But I do have some questions and then I do have some uncertainties about some of the numbers given this afternoon.  They don't quite seem to tie up with some of the other ones.  So, I will have a few questions, but hopefully we can keep the pain to a minimum.

7657             And I think we sorted out a lot on the whole question of religious balance.  I think the undertaking you have given here today sells it as far as I'm concerned.

7658             My colleagues have some questions, but I think we are finally all singing on the same page there.  And I think that is major progress.  I hope you agree.

7659             I want to start, Mr. Hunsperger, with some questions directly at you.  I think you are the appropriate person.

7660             I don't quite understand why some applications are under the name of Hunsperger and some are under the name of Touch.  I just don't get it.

7661             I have read the corporate breakdown that you have filed in Section 2 of the standard application, but is there a strategy here that is quite simple but I'm just missing?

7662             MR. HUNSPERGER:  I don't think there is any strategy.  I mean, because Grande Prairie Radio Limited is not an incorporated company at this point, that is really who did the application for Grande Prairie.

7663             COMMISSIONER LANGFORD:  Okay.

7664             MR. HUNSPERGER:  I'm just being the representative.  And Touch Canada, the same thing, I'm just a representative.

7665             COMMISSIONER LANGFORD:  Okay.  So, they basically all go back to the same shareholder, the same 100 percent shareholder?

7666             MR. HUNSPERGER:  Yes, sir.

7667             COMMISSIONER LANGFORD:  Okay.  Thank you.  I just wasn't sure whether ‑‑

7668             THE CHAIRPERSON:  Not for the case of Grande Prairie, it's a 50:50 ‑‑

7669             COMMISSIONER LANGFORD:  Yes.  Fifty percent goes to a Mr. Teichroeb and 50 percent goes to Touch Canada Broadcasting.

7670             COMMISSIONER LANGFORD:  That is quite right.  You have a partner in Grande Prairie.

7671             MR. HUNSPERGER:  Yes, sir.

7672             COMMISSIONER LANGFORD:  Do you have any partners, just out of curiosity, for any of your other licenses or do they all go back to Mr. Allard.

7673             MR. HUNSPERGER:  Mr. Allard, yes.

7674             COMMISSIONER LANGFORD:  Mr. Allard, sorry.

7675             MR. HUNSPERGER:  Yes.

7676             COMMISSIONER LANGFORD:  I live close to Quebec, so it's Allard, you know.

‑‑‑ Laughter / Rires

7677             If I stay here another week it will be "A‑lard" or something.  I don't know.  I will get it.  I have a pee cap in my bag.  I'm practising.

‑‑‑ Laughter / Rires

7678             Okay.  Now, you have stations in Calgary, Edmonton.  You may have one in Grande Prairie.

7679             And as a standalone in Fort McMurray, what we have heard from a lot of other applicants is this an expensive proposition.

7680             This is an expensive town.  And it's an isolated town.  And it's hard to put synergies if you don't have anything to make synergies with.

7681             We heard from Golden West that they would actually, you know, try their best with things like accounting and stuff like that, to keep the cost down.  Everyone seems to be conscious of costs in this location.

7682             What are you going to do?  Have you got a strategy using some of your other stations to help you to meet the incumbent and the cost factor?

7683             MR. HUNSPERGER:  We do, and I will give that over to our business manager, Beverley.

7684             COMMISSIONER LANGFORD:  Okay.  Thank you.

7685             MS GILLESPIE:  Hello.  Yes, we do have synergies in our administration, our traffic, our H.R., our back office.  We also have synergies with our tech.

7686             Malcolm can explain later on how he is going to handle the programming staff.

7687             But we do realize the high cost of the wages out in Fort McMurray, so we are going to try the best we can to use as much back office staff in Edmonton as we can.

7688             COMMISSIONER LANGFORD:  Edmonton would probably be where the connection would be.

7689             MS GILLESPIE:  Being the Head Office, yes.

7690             COMMISSIONER LANGFORD:  And do you have central accounting for all of your stations?

7691             MS GILLESPIE:  Yes.

7692             COMMISSIONER LANGFORD:  Yes, you do.  So you are ‑‑ you and Mr. Hildebrand are kind of in tandem on that approach.  Probably everyone is these days.

7693             There is a sentence in your, in Mr. Hunt's part of your opening presentation today, just near the bottom of page 13:

7694                  "Our vision is to touch as many Albertans as possible, leveraging our presence in Edmonton and Calgary to ensure excellent programming."(As Read)

7695             How will that sort of synergistic statement work?

7696             MR. HUNT:  Well we do have ‑‑ most of our production is done out of Edmonton.  Most of our writing is done out of Edmonton.  And I think a lot of our music is scheduled out of Edmonton.

7697             Of course in each of the stations that we have, they have separate logs, they have separate music logs.  Everything is completely separated.

7698             But we utilize that Edmonton Head Office as sort of the central zone so, you know, we have some more staff there in Edmonton as opposed to even Calgary, we have more staff in Edmonton because it is sort of the hub.  That answer the ‑‑

7699             COMMISSIONER LANGFORD:  No, we are getting there, but when you say all your writing is done Edmonton, can you give me a little more information on that?  Did you say all your writing was ‑‑

7700             MR. HUNT:  The commercial writing, the writing for commercials.

7701             COMMISSIONER LANGFORD:  Oh, commercial writing.

7702             MR. HUNT:  Yeah.

7703             COMMISSIONER LANGFORD:  We are not talking about programming, then.

7704             MR. HUNT:  Programming writing?

7705             COMMISSIONER LANGFORD:  You are not scripting ‑‑

7706             MR. HUNT:  No, no, no.

7707             COMMISSIONER LANGFORD:  ‑‑ announcers or ‑‑

7708             MR. HUNT:  No, no.

7709             COMMISSIONER LANGFORD:  ‑‑ news or that sort of thing.

7710             MR. HUNT:  No.

7711             COMMISSIONER LANGFORD:  No.  Okay.  Maybe the way of the future, but anyway, you are not yet, at any rate.

7712             Okay, then sticking with financial, since we somehow started there, I wanted to ‑‑ and you have tabled new financial statements today.  And we have got those on the record and we will look at them.  So, some of my numbers, if I bring them up, might be off and you can correct them.

7713             But I wanted to look at expenses which were ‑‑ I think you filed on March 30th of this year, some revised expenses and perhaps some more today.  I haven't compared them to see whether they are still the same.

7714             But I guess maybe the simplest way would be to take me through the big items.

7715             So, for example wages ‑‑ everyone here is talking wages in this town, or in the town of Fort McMurray.

7716             Can you give me an idea of your workforce and put some kind of round salary figures beside them?

7717             MR. HUNSPERGER:  I will let Malcolm talk about the programming.  And then maybe Beverley can round that off with how we look at that increase.

7718             COMMISSIONER LANGFORD:  Okay.

7719             MR. HUNT:  Of course we need to be ‑‑ obviously we have talked about it ‑‑ conscious of the costs in, really in any market that we are in, Fort McMurray included in that of course.

7720             But, you know our plan is to have very similar staff to what we proposed in Grande Prairie:  a live morning person, a live afternoon person and a part‑time co‑host for the morning who will take care of the news.

7721             That is really, you know, the general plan for most of our new start‑ups in terms of programming, because again we go back to a lot of the synergies that we can utilize in Edmonton and the rest of our company.

7722             COMMISSIONER LANGFORD:  So, I have got 2 2 people for programming, that's it?

7723             MR. HUNT:  Yes.

7724             COMMISSIONER LANGFORD:  Does that give you 7 days a week?

7725             MR. HUNT:  Yes, it does.

7726             COMMISSIONER LANGFORD:  It does.

7727             MR. HUNT:  Yes.

7728             COMMISSIONER LANGFORD:  Okay.  Can you put some round figures beside those live morning, live p.m. and the sort of half person here for morning?

7729             MR. HUNT:  Did you want budget figures for that?

7730             COMMISSIONER LANGFORD:  Yes, please.

7731             MS GILLESPIE:  Okay.  What we have done with the revised amounts that we have given was we have added an additional 60 percent increase in our programming.

7732             So, now currently our programming staff runs around $110,000 plus another 10 percent for benefits.  And $24,000 for what we're allocating for our writer and our creative writer in Edmonton.

7733             COMMISSIONER LANGFORD:  So this a third, leave the half ‑‑ well, this is yet another category, the writer.

7734             MS GILLESPIE:  Yes.  It is still under our programming expenses though.

7735             COMMISSIONER LANGFORD:  Okay.  So you had given me ‑‑ I just want to make sure ‑‑ we have got live morning, live p.m., and a kind of half co‑host.  And that is $110,000 plus ten for benefits?

7736             MS GILLESPIE:  Ten percent, which is around $13,400.

7737             COMMISSIONER LANGFORD:  Ten percent for benefits, okay.

7738             MS GILLESPIE:  Yes.

7739             COMMISSIONER LANGFORD:  And then we have a writer.

7740             MS GILLESPIE:  One full‑time position which is a writer/creative writer/production person which would bring in $24,000 annually.

7741             COMMISSIONER LANGFORD:  And any benefits ‑‑ another 10 percent on benefits or ‑‑

7742             MS GILLESPIE:  That 10 percent is included in the $13,000.

7743             COMMISSIONER LANGFORD:  Did you say $13,000?

7744             MS GILLESPIE:  Yes.

7745             COMMISSIONER LANGFORD:  I thought you said $24,000.

7746             MS GILLESPIE:  $24,000 ‑‑

7747             COMMISSIONER LANGFORD:  Yes.

7748             MS GILLESPIE:  ‑‑ is the salary for the one full‑time production/creative writer.

7749             And I gave you a figure of $13,000.  That is 10 percent of our entire promotion salaries ‑‑ or, sorry our programming salaries.  Ten percent of the entire benefits is $13,000.

7750             COMMISSIONER LANGFORD:  Got it.  Okay, $134,000 plus 10.

7751             MS GILLESPIE:  Yes.

7752             COMMISSIONER LANGFORD:  Okay.  So, what else?  What else have we got for people?

7753             MS GILLESPIE:  For people?

7754             COMMISSIONER LANGFORD:  Yes, please.

7755             MS GILLESPIE:  Okay.  Next we have, in our administration we have an office manager which at this point it $48,000 plus another 10 percent for benefits.

7756             And that is currently roughly 50 percent higher than what we pay in Calgary and 10 percent higher than we pay an experienced one in Edmonton.

7757             COMMISSIONER LANGFORD:  Okay.

7758             MS GILLESPIE:  In our technical department, we have a part‑time position also in Edmonton.  That is $12,000 with 10 percent benefits.

7759             We also have a contract, but that is not as part of our employee.

7760             COMMISSIONER LANGFORD:  Yes.

7761             MS GILLESPIE:  That is just part of our technical.

7762             And then for our sales department we pay slightly higher than the rest of the other radios out there, slightly because we are in a niche market and we want to attract someone.

7763             COMMISSIONER LANGFORD:  Yes.

7764             MS GILLESPIE:  We give 22 percent commission plus the 10 percent benefits and we have a General Sales Manager getting another 8 percent.

7765             COMMISSIONER LANGFORD:  That is for one salesperson, 22 percent, they are working on straight commissions, then.

7766             MS GILLESPIE:  Yes.

7767             COMMISSIONER LANGFORD:  Plus 10 percent benefit and then you add 8 ‑‑

7768             MS GILLESPIE:  Another 8 percent commission for the sales manager.

7769             COMMISSIONER LANGFORD:  So 30 percent.

7770             MS GILLESPIE:  Yes.

7771             COMMISSIONER LANGFORD:  For the sales manager.

7772             MS GILLESPIE:  Sales manager.

7773             COMMISSIONER LANGFORD:  Plus the 10 percent benefits.

7774             MS GILLESPIE:  Plus the benefits, yes.

7775             COMMISSIONER LANGFORD:  And that is the whole lot?  No?

7776             MS GILLESPIE:  And we have a half position for Promotions Director, sitting at $12,000.

7777             So our wage salary expense ratio roughly right now is about 46 percent of expenses.

7778             COMMISSIONER LANGFORD:  What was that ratio again, sorry?

7779             MS GILLESPIE:  Forty‑six percent.

7780             COMMISSIONER LANGFORD:  Of ‑‑ and what was ‑‑

7781             MS GILLESPIE:  Of expenses.

7782             COMMISSIONER LANGFORD:  Sorry.  Got to go right back to basics here for me.  Just to start ‑‑

7783             MS GILLESPIE:  Our salary wage expense ratio is 46 percent.

7784             COMMISSIONER LANGFORD:  Thank you very much.  Been making notes of this please (inaudible) ‑‑

‑‑‑ Laughter / Rires

7785             I am not writing as fast as I used to, you know.  Okay.

7786             All right, that covers that.

‑‑‑ Laughter / Rires

7787             And I thank you very much.  It really helps us make sense of these things because we have got filing and then re‑filing and then some adjustments.

7788             And if we don't get it straight now, you know, it is kind of expensive to call another hearing just to get this stuff done.

‑‑‑ Laughter / Rires

7789             Okay.  Let's look then at ‑‑ costs and salaries, I have got that done ‑‑ of studio and antenna costs and that sort of thing.  Can you take me through that?

7790             Are they any ‑‑ first of all are there any changes there at all from March 30th?

7791             MS GILLESPIE:  No.

7792             COMMISSIONER LANGFORD:  No.  And it is all in the March 30th one?

7793             MS GILLESPIE:  Yes.

7794             COMMISSIONER LANGFORD:  No changes at all?  Okay.  So, studio ‑‑

‑‑‑ Off microphone / Hors microphone

7795             COMMISSIONER LANGFORD:  Do I need this right now?  No?  Oh, good.

‑‑‑ Laughter / Rires

7796             Give it to me later.  It's a good thing they are nice.

7797             Okay.  So, studio and antenna, no change.  And are you still going to share antenna space with the CBC, that is still on?

7798             MR. HUNSPERGER:  Yes, sir.

7799             COMMISSIONER LANGFORD:  Okay.  Thank you very much.

7800             Now, revenue figures on brokered and contra‑programming, you made quite a point of that, I think a couple of times this afternoon in your opening remarks saying, you know, as a niche market ‑‑ I'm not trying to coach you, but paraphrasing you ‑‑ you can't make it go, at least in the early innings, on advertising revenue, so you rely on brokered and contra.

7801             Could I just have the most up‑to‑date figures on brokered fees and contra, the revenues, just to be sure I have got those?

7802             MS GILLESPIE:  They haven't changed in our proposal there.

7803             COMMISSIONER LANGFORD:  Okay.  There are no changes at all on that.

7804             MS GILLESPIE:  No, no.

7805             COMMISSIONER LANGFORD:  Okay.  Thank you.

7806             MS GILLESPIE:  The only we changed was our local advertising.

7807             COMMISSIONER LANGFORD:  Okay.

7808             Now the contra, how do you reckon that exactly?  I mean how can you be sure of it, is it just experience or ‑‑

7809             MR. HUNSPERGER:  Well, what we do is we, you know, it's a trade off, obviously and we have really tightened that up in the last few years, thanks to Beverley.

7810             But we have made sure that if we can make some trades, like, for example, with cars ‑‑

7811             COMMISSIONER LANGFORD:  Right.

7812             MR. HUNSPERGER:  ‑‑ or whatever, then we do that.  And we give the ‑‑ it works, like, for example, on a car, it works great for an advertiser because he basically, the car dealer, gives us a car and he puts it under his demo package.

7813             So he gets paid by the company to have that as a demo, plus he gets advertising from us and we get a station vehicle that gives us promotion.

7814             COMMISSIONER LANGFORD:  God, I hope Revenue Canada's not listening.  That sounds so complicated doesn't it?

‑‑‑ Laughter / Rires

7815             THE CHAIRPERSON:  Can I comment on that?

7816             COMMISSIONER LANGFORD:  Yes.

7817             THE CHAIRPERSON:  Just a minute.

7818             COMMISSIONER LANGFORD:  Absolutely.  The Chairman has a question.

7819             THE CHAIRPERSON:  Where do you put the expense for the contra?

7820             MS GILLESPIE:  It is under our sales, advertising and promotion.  So that 391 for example, in the first year ‑‑

7821             COMMISSIONER LANGFORD:  It includes ‑‑

7822             MS GILLESPIE:  ‑‑ includes the 140, yes.

7823             COMMISSIONER LANGFORD:  Okay.

7824             COMMISSIONER LANGFORD:  Okay.  Moving right along ‑‑ and you are confident, just from experience again.

7825             Is that really the answer ‑‑ you have done this before and these numbers are reasonable.  Is that essentially what you are saying?

7826             MR. HUNSPERGER:  Yes, sir.

7827             COMMISSIONER LANGFORD:  Okay.  I mean, I wouldn't know, so it's good to hear it from you.

7828             Nobody has ever given me a car.

7829             MR. MOFFAT:  Well, if you listen to 105.9 Shine FM in Edmonton, you might win one.

‑‑‑ Laughter / Rires

7830             COMMISSIONER LANGFORD:  I might win a car.

7831             MR. MOFFAT:  Yes.

7832             COMMISSIONER LANGFORD:  Or I could roll up the rim.  Yes.

‑‑‑ Laughter / Rires

7833             Then on the brokered programming, you have got numbers there, they are fairly substantial.

7834             But how sure of those are you?  Do you have agreements with the program suppliers?  Or this again just experience?

7835             MR. HUNSPERGER:  Well, it's both.  Let me say, we don't have agreements as far as written contracts as yet.

7836             COMMISSIONER LANGFORD:  Right.

7837             MR. HUNSPERGER:  But we work very closely with the agencies that handle the programs and they have told us verbally that the clients that they have very much want to get into these markets and have the dollars to do so.

7838             And we also speak of experience in that area.

7839             COMMISSIONER LANGFORD:  Okay.  And do these basically match up with the kind of numbers you are getting in other stations for the same sort of programs?

7840             MR. HUNSPERGER:  Yes, sir.

7841             COMMISSIONER LANGFORD:  Okay.  So we can be confident that they are pretty close.

7842             MR. HUNSPERGER:  Yes, sir.

7843             COMMISSIONER LANGFORD:  Okay.  Now, speaking of brokered, why don't we just use that as a little bridge to move from money to programming, because I somehow have not understood correctly ‑‑ and I guess I apologize for it, unless you are going to apologize to me and tell me you have made a mistake or something.

7844             But I heard you say a number of times this afternoon, somebody in your team said, I think at least twice, that you ‑‑ yes, here we have it at least once on page 9, talking about programming.

7845             And there are a number of figures in here that don't jive with what I was able to pull out of your written submissions.  On brokered, you have 15 hours of brokered programming:

7846                  "There will be 15 hours of brokered programming."(As read)

7847             I have a higher number than that.  When I look at your supplementary brief, page 3, I read, just about 2/3 of the way down:

7848                  "Eighty percent of the total weekly program will be locally produced.  Twenty percent will be made available for purchase to organizations that provide spoken word programs, such as Focus on the Family and Insight for Living."(As read)

7849             Now, assuming you are going at 126 hours, 20 percent of that would be closer to 25 hours than 15, and there lies my confusion.

7850             MR. HUNSPERGER:  That is incorrect and we apologize, sir.

7851             COMMISSIONER LANGFORD:  Which is incorrect?

7852             MR. HUNSPERGER:  The 80:20.

7853             COMMISSIONER LANGFORD:  Ah.  Okay.

7854             MR. HUNSPERGER:  The 15 hours is the correct one.

7855             COMMISSIONER LANGFORD:  Okay.  So you will be a little patient with some of my questions if they tend to be maybe not quite right, because I have prepared them on what you have presented before.

7856             MS GILLESPIE:  Just for further clarification, we made it available, but in the first year we have 3 hours per day of brokered spoken word, which is 15.

7857             The second year we were going to go to 4 hours a day which brings it up to 20.

7858             And then again for the third year being 5 hours a day, bringing it up to 25, and we wouldn't want to go much more than that.

7859             COMMISSIONER LANGFORD:  So we are at 20 percent then.

7860             MS GILLESPIE:  Yes.

7861             MR. HUNSPERGER:  In the seventh year.

7862             MS GILLESPIE:  In the third year.

7863             MR. HUNSPERGER:  Oh, third year, okay.

‑‑‑ Laughter / Rires

7864             MS GILLESPIE:  Got to check those numbers.

7865             COMMISSIONER LANGFORD:  Yes, repeat, no.  Okay.

7866             So ‑‑ well let's go through it.  I mean, is it 80:20 by year 3, or is it somehow the 15 works as an average, or how do I understand this?

7867             MS GILLESPIE:  Well, what we have in our budget is we have 3 hours per day, the 15 hours for the first year.  Then we have 20 for the second.  Then we have 5 hours per day, in the third year and that is the most we are going to do for our programming.

7868             Then after that for revenue we are going to increase it by 5 percent a year after that.  Not increasing the hours, just increasing our billing.

7869             COMMISSIONER LANGFORD:  Just increasing your ‑‑

7870             MS GILLESPIE:  The billing.

7871             COMMISSIONER LANGFORD:  The fees for ‑‑

7872             MS GILLESPIE:  The fees, yeah.

7873             COMMISSIONER LANGFORD:  ‑‑ that you charge.

7874             MS GILLESPIE:  So, in a way they are both right.  Page 9 of the opening statement is right about year one.

7875             After that we start to ratchet it up, as Ms. Gillespie says.  And then by year 3, page 3 of the supplementary brief is right.

7876             MR. HUNSPERGER:  Yes, sir.

7877             COMMISSIONER LANGFORD:  Okay.  Good.  Everybody is right.  What a wonderful world.

7878             Now, where do I go from here?  Just hold on for a second.

7879             So, let's finish off this brokered.  Now we know how much there is ‑‑ bring you back to a discussion you and I have had before ‑‑ how do you control the content?  How do you ensure that you can meet the COL on balance, plus the regulations on ethics and solicitation that are so much a part of religious broadcasting in Canada?

7880             MR. HUNSPERGER:  I will let Mr. Hunt answer that.

7881             COMMISSIONER LANGFORD:  Okay.

7882             MR. HUNT:  Well, as we have mentioned before, we receive a Q‑sheet which is an explanation of the content of each of the programs that we air.

7883             And that content is reviewed before it ever gets to air.

7884             And of course we, you know, we have been doing this for about 12 years now.  And again, we haven't had a single complaint about anything regarding balance or any other issue.

7885             And we also have the mechanisms in place in terms of the recorded phone lines, as we mentioned before.

7886             COMMISSIONER LANGFORD:  Right.

7887             MR. HUNT:  And we feel that we meet the required balance ‑‑

7888             MR. HUNSPERGER:  We also, sir, you know, have over the years, we have had many broadcasters want to put their program on our station because we won the International award, for example, of an AM radio station in Canada by one of the programs that we have on.

7889             So we know that people are wanting to, but there are programs that we refuse to operate because either the content of it or the solicitation of funds on it, we have eliminated those.

7890             COMMISSIONER LANGFORD:  Okay.

7891             MR. HUNSPERGER:  Our programs that we have on our company now and our ‑‑ what we are broadcasting ‑‑ do not solicit funds and do not break the ethics of the rulings that are in line with the Broadcasting Act.

7892             COMMISSIONER LANGFORD:  So, you wouldn't have any trouble accepting as a COL, not only the balance policy, but the ethics policy and the solicitation policy?

7893             MR. HUNSPERGER:  No problem at all.

7894             COMMISSIONER LANGFORD:  Okay.  Thank you very much.

7895             Now, just one question, Mr. Hunt, about content sheets.  Are these précis or is this, you know, are these précis, short summaries of what you are getting, or this the whole script you are getting?

7896             MR. HUNT:  No, you get a snapshot, if you will ‑‑

7897             COMMISSIONER LANGFORD:  Okay.

7898             MR. HUNT:  ‑‑ of what the program is about.

7899             COMMISSIONER LANGFORD:  That's what you get.

7900             MR. HUNT:  Yes.

7901             COMMISSIONER LANGFORD:  Now, what have you got in place in case the snapshot was misleading and someone is going bonkers and making ‑‑ and the program is inappropriate, to put it that way.

7902             Can you stop it?  Do you have a way to deal with that?

7903             MR. HUNSPERGER:  Well, yes we do.  First of all, our staff download it all and, in other words, every program that comes to us is now downloaded into our computer.

7904             COMMISSIONER LANGFORD:  Okay.

7905             MR. HUNSPERGER:  So, they download that.  If they ever found anything that they even thought was going sideways here to the Q‑sheets ‑‑

7906             COMMISSIONER LANGFORD:  Yes.

7907             MR. HUNSPERGER:  ‑‑ they would notify Mr. Hunt and go from there.

7908             COMMISSIONER LANGFORD:  So it's pre‑screened by your staff?

7909             MR. HUNSPERGER:  Yes.  We have never had it happen.

7910             COMMISSIONER LANGFORD:  Right.

7911             MR. HUNSPERGER:  But I can tell you, we keep in personal contact, even, with people that have programs on our station.

7912             For example, I go down to the United States.  Jamie also goes down.  We talk to them face to face.

7913             COMMISSIONER LANGFORD:  Yes.

7914             MR. HUNSPERGER:  We meet with them.  There are even people like Vision TV representatives are there.

7915             And we talk about the concerns of Canada.  And we talk about what would be appropriate to air on the station and what is not appropriate.  It might be appropriate in American, but it's not appropriate in Canada.

7916             COMMISSIONER LANGFORD:  Right.

7917             MR. HUNSPERGER:  And so we keep those relationships very well.  I fly down the States several times in the year to make sure that it's a face to face relationship with these people.

7918             I have got an invitation to go to Lincoln, Nebraska, in September, there's a ‑‑ one of our programmers that I have never met personally, "Back to the Bible" ‑‑ he's a very good guy and doesn't bring controversial things.  But we are going to fly down there and meet him and talk to him about what's happening in Canada and those kinds of things.

7919             COMMISSIONER LANGFORD:  Well, that's good.  So you are doing your due‑diligence.

7920             MR. HUNSPERGER:  Trying to.

7921             COMMISSIONER LANGFORD:  Yes.  Because, I mean, I think you mentioned Vision and you know as well as I do, they are incredibly respectable.

7922             MR. HUNSPERGER:  Yes.

7923             COMMISSIONER LANGFORD:  And hard‑working ‑‑

7924             MR. HUNSPERGER:  Yes.

7925             COMMISSIONER LANGFORD:  ‑‑ programmer.  But they got caught flat‑footed ‑‑

7926             MR. HUNSPERGER:  Yes.

7927             COMMISSIONER LANGFORD:  ‑‑ not too long ago.  And you know, red faces all around, but it still caused quite a controversy.  And so, it can happen.

7928             MR. HUNSPERGER:  Yes, that's true.  But all of our broadcasters also know that there is a line‑up of people that want on our air.  And so, they wouldn't want to be taken off.

7929             COMMISSIONER LANGFORD:  I see.

7930             MR. HUNSPERGER:  And we would take them off if that indeed happens, as we have done that with one individual already.

7931             COMMISSIONER LANGFORD:  Okay.  Thank you.  I think that is enough on that subject.

7932             And your agreement to abide by the usual COL's is certainly helpful.  And your due‑diligence and your practice gives us the comfort I think we need in that area.

7933             Let's move on to your own spoken word because I don't think we will have to spend too long on musical format.  It sounds like I have heard about that before this week, but we will touch on it to be certain.

7934             Again, I have a few problems with the numbers I am seeing on page 9, which I think were Mr. Hunt's bailiwick, but I can't ‑‑ I don't remember.

7935             Anyway, page 9, the large paragraph in the middle of the page of your opening remarks has a number of numbers.  And you say:

7936                  "Shine FM, Fort McMurray, will provide a full range of news and other spoken word features, totalling 31.4 hours per week."(As read)

7937             Now, the number that I have extracted, the total number I have extracted from your written submissions, is 27 percent.  So does that jive?  Is that what the 27 percent is?

7938             We can always call on Commissioner Cram to do the math, but we will be here till midnight, so...

‑‑‑ Laughter / Rires

7939             Is that about 27 percent?

7940             THE CHAIRPERSON:  Which page is the 25(sic) percent, if you mind me asking for the ‑‑

7941             COMMISSIONER LANGFORD:  The 27 percent?

7942             THE CHAIRPERSON:  Yes.

7943             COMMISSIONER LANGFORD:  Oh, boy.

7944             MR. HUNSPERGER:  I'm sorry, 27 percent according to our Sales Manager here, is about 34 percent.

7945             COMMISSIONER LANGFORD:  Thirty‑four.

7946             MR. HUNSPERGER:  I'm sorry, 34 hours ‑‑ 27 ‑‑

7947             COMMISSIONER LANGFORD:  Thirty‑four hours, right.

7948             MR. HUNSPERGER:  Yes.

7949             COMMISSIONER LANGFORD:  And you have got 31.4 here.  So how do you ‑‑ and actually I do have that written down, 34, in my notes.

7950             So how do you explain that small discrepancy?  What happened to the other ‑‑ I don't know, 2 1/2 hours, or whatever?

‑‑‑ Pause

7951             Well, maybe somebody can think about that.  I mean, it's not the end of the world, but we are just trying to get this accurate and when numbers change, it makes it a bit difficult.

7952             MR. HUNSPERGER:  I might error here, by sticking my foot in my mouth, which I do several times, but this one on page 9 would be the accurate one.

7953             COMMISSIONER LANGFORD:  Okay.  So, the 34 hours that I got from somewhere else ‑‑ but I didn't make it up.

7954             So, maybe Steve as you were trying so hard to hand me notes before ‑‑

‑‑‑ Laughter / Rires

7955             You could hand me a note on this one sometime this afternoon.  Okay.  So we will leave that, and we will leave that with Steve.  And he will bring us a note ‑‑ or not.

‑‑‑ Laughter / Rires

7956             I have on news, weather and sports, from your written submission, 7 hours and 9 minutes.  But then today, in the middle of the same paragraph:

7957                  "In total we will provide 6.6 hours of information programming per week, of which just over half will be news."(As read)

7958             So, that just seems ‑‑ like just over half of 6.6 would be, say, 4.  And maybe in this sort of 4 hours today you haven't added the sports and weather.

7959             I don't know, but I'm confused a little bit.  These numbers are not, they are not jiving,

7960             MR. HUNSPERGER:  May I try to make an explanation of this?

7961             COMMISSIONER LANGFORD:  Sure.

7962             MR. HUNSPERGER:  Mr. Hunt wasn't involved in putting the numbers together on our original application.

7963             COMMISSIONER LANGFORD:  Okay.

7964             MR. HUNSPERGER:  Since then, because we have been going before the CRTC more than once ‑‑ I mean, the last time we were in front of the CRTC was 10 years ago, so ‑‑ I'm talking about since Calgary.

7965             COMMISSIONER LANGFORD:  I was going to say, it may seem like 10 years.

‑‑‑ Laughter / Rires

7966             But it wasn't that long ago.

7967             MR. HUNSPERGER:  So, what has happened is he has ‑‑ we, as you can tell, we have put all out staff who are responsible for the various divisions of the application ‑‑ we have now put them, like hands‑on.

7968             For example ‑‑

7969             COMMISSIONER LANGFORD:  Okay.

7970             MR. HUNSPERGER:  ‑‑ the application that we are going to be filing for Regina and Saskatoon, Malcolm did all the programming, Jamie did the sales.

7971             I mean we got everybody now hands on, where before it was kind of myself and my assistant doing it within our office.

7972             COMMISSIONER LANGFORD:  Okay.  So, how ‑‑

7973             MR. HUNSPERGER:  And so that is where you get discrepancy.

7974             So, what you have here on page 9, is really the correct one.

7975             COMMISSIONER LANGFORD:  How do you want to do it then?  I mean, we need to know, obviously, because it's a competitive process and we need to know about local reflection and news.

7976             And, you know, the people from ‑‑ the other applicants ‑‑ want to know as well.

7977             We can sit here and I can say, you said 7 hours, now you are saying 6 hours and we won't get anywhere.

7978             I see Mr. Hunt ‑‑ I suspect we won't ‑‑ has got a pile of statistics, he has got a fistful of them there and he is looking not happy.

‑‑‑ Laughter / Rires

7979             And Steve on our side, who I have assigned to this, isn't looking any happier than Mr. Hunt.

‑‑‑ Laughter / Rires

7980             So, could we go through ‑‑ I am going to suggest this, and maybe legal can kind of give me a nod if they think it's a good idea, because it's a little unparalleled, unprecedented.

7981             Could we ‑‑ could I go through some questions with you and we will leave the answers blank and you could fill them in and get them to us, get us the accurate answers on this?

7982             Because it's not something, I don't think ‑‑ I'm thinking aloud here ‑‑ It's not something the other applicants are going to want to reply to, really.  They are just going to want to know.  And we are going to want to know.  And we are around 7 hours or 6 hours, I don't know.

7983             What ‑‑ do my colleagues have any thoughts about this or...

7984             COMMISSIONER CRAM:  I am suggesting a time out.

7985             COMMISSIONER LANGFORD:  Time out?

7986             UNIDENTIFIED SPEAKER:  Yes.

7987             COMMISSIONER LANGFORD:  Okay.  Mr. Chairman, maybe you could give us a time out.

7988             THE CHAIRPERSON:  I think we could give you some, well, a few minutes.  How long will you need to get the file straight and ‑‑

7989             MR. HUNSPERGER:  We have it right here in front of us.

7990             MR. HUNT:  I can file this page with ‑‑ if you wish ‑‑ right here.  The one that I have with the current numbers that are accurate.

7991             COMMISSIONER LANGFORD:  These are the new numbers?

7992             MR. HUNT:  Well, yes.

7993             COMMISSIONER LANGFORD:  Okay.  Have you got a copy of that too?

‑‑‑ Pause

7994             COMMISSIONER LANGFORD:  Yes.  Okay. I have got the source of my information.  Thank you, Mr. Aguiar.

7995             Mr. Aguiar on our staff has given me the source of our ‑‑ my information which I stupidly didn't source in my own notes.

7996             But it's your response, undated, but your response to our December 9th, 2005 deficiency letter.  And in there you very clearly set out the figures that I have been referring to ‑‑ 34 hours, 7 hours 9 minutes of news ‑‑ the sort of figures I have built my questions on.

7997             If you have got new figures, I can simply go through them with you right now and you can answer the questions, or volunteer information should the questions not be sufficient.

7998             So, I'm just going to close down this file which is no longer relevant.

7999             And maybe we should just start.  Spoken word, news, weather and sports ‑‑ do they all go together in your latest numbers?

8000             MR. HUNT:  Yes, they do.

8001             COMMISSIONER LANGFORD:  Could you let me have those on a weekly basis?

8002             MR. HUNT:  6.6 hours per week.

8003             COMMISSIONER LANGFORD:  6.6 hours.  And how does that break down?

8004             Excuse me for a second, I'm not just not sure whether my colleagues are with me.  Hold on.

8005             We are going to adjourn for 5 minutes before we do this.  We have to have what in the O.J. trial became known as "a sidebar".

‑‑‑ Laughter / Rires

8006             And ‑‑ but we will be with you.  But I think the glove will fit.

‑‑‑ Upon recessing at 1641 / Suspension à 1641

‑‑‑ Upon resuming at 1643 / Reprise à 1643

8007             COMMISSIONER LANGFORD:  Thank you very much for your patience.  Our ‑‑ anyway, there will be ‑‑ if anyone is taken by surprise ‑‑ our worry is that somebody else, some other party might be taken by surprise, or feel somehow disadvantaged.

8008             I don't ‑‑ an assessment on the first number I have heard ‑‑ it doesn't sound like it's going to be that way.  But then there are, there is a Phase IV where, if someone does feel disadvantaged, they can reply and we can make our assessment.

8009             We do have your first figures in your letter, in response to our December 9th, 2005 letter and we will get the figures today and then we will see what happens.

8010             So, if I could return ‑‑ the first number you've given me is 6.6 hours for news, weather and sports per week.

8011             MR. HUNT:  Correct.

8012             COMMISSIONER LANGFORD:  And can you break that down anymore as to sort of an average Monday to Friday day and an average weekend day?

8013             MR. HUNT:  It breaks down to 10 newscasts per day, Monday to Friday.  I mean we would love to do a lot of weekend news, but it's just not part of this particular programming plan.

8014             COMMISSIONER LANGFORD:  Yes.

8015             MR. HUNT:  So, again, 10 per day, an average of 8 minutes per, which would include about 5 minutes of news, 60 percent national and 40 percent local,

8016             COMMISSIONER LANGFORD:  Right.

8017             MR. HUNT:  Approximately a minute of weather, 2 minutes of sports, which would make up the 8 minutes.

8018             COMMISSIONER LANGFORD:  Okay.  And on weekends?

8019             MR. HUNT:  And on the weekend, again, as I said, I wish we could include that in this, but we are not prepared to do the weekend stuff at this time.

8020             COMMISSIONER LANGFORD:  There will be none at all.

8021             MR. HUNT:  Right.

8022             COMMISSIONER LANGFORD:  Okay.  That answers that question.

8023             Other spoken word ‑‑ I have it as 27 percent of all programming, including the news.

8024             Do you have an overall figure now?  Is it 30 ‑‑

8025             MR. HUNT:  31.4 would be ‑‑

8026             COMMISSIONER LANGFORD:  31.4 hours.

8027             MR. HUNT:  ‑‑ a total amount of spoken word.

8028             COMMISSIONER LANGFORD:  Instead of 34, okay.  So, it's down a little.

8029             And what ‑‑ let's go through the spoken word.

8030             MR. HUNT:  Sure.

8031             COMMISSIONER LANGFORD:  Let's make sure we know exactly what makes up that 31.4 hours ‑‑ 6.6. is news, obviously.

8032             MR. HUNT:  Yes.  15 hours of brokered programming, as we mentioned before, 8.3 hours of the announcer banter and the local reflection and our community calendar.

8033             COMMISSIONER LANGFORD:  Sorry, give me that last number ‑‑ 8 ‑‑

8034             MR. HUNT:  8.3.

8035             COMMISSIONER LANGFORD:  Yes.

8036             MR. HUNT:  And 1.45 hours of ‑‑ those would be like comedy and human interest features and what not, for a total of 31.4.

8037             COMMISSIONER LANGFORD:  So, you've included the brokered in ‑‑

8038             MR. HUNT:  Correct.

8039             COMMISSIONER LANGFORD:  ‑‑ the 15 hours of brokered.

8040             And, of course, as we now know, that number will actually rise, the brokered number will rise by your 3 to a higher number, about 25 hours or something like that.

8041             MR. HUNT:  Yes.

8042             COMMISSIONER LANGFORD:  Okay.  Now, you mentioned as well, in your supplementary brief, on page 1, first line of the second paragraph:

8043                  "The format will include gospel music, spoken word programs, contests."(As read)

8044             Where do they fit in?

8045             MR. HUNT:  Into the 8.3.

8046             COMMISSIONER LANGFORD:  Oh, okay.  Then maybe you better give me a better break‑down of the 8.3, so I have it all.  Slowly ‑‑ sorry.

8047             MR. HUNT:  It's basically all of the announcer content that is heard on the radio.  I think you have ‑‑

8048             COMMISSIONER LANGFORD:  How about those Oilers?

8049             MR. HUNT:  ‑‑ termed it "happy talk", I think.  Yes.

‑‑‑ Laughter / Rires

8050             COMMISSIONER LANGFORD:  Announcer banter ‑‑ we'll borrow the Chairman's term ‑‑ I like it.  And ‑‑ but that is not a contest.

8051             MR. HUNT:  That is part of that, you know.  That is the ‑‑ the contest would be, you know, them giving away a prize and then ‑‑

8052             COMMISSIONER LANGFORD:  Oh, I see ‑‑

8053             MR. HUNT:  ‑‑ give it to the listener ‑‑

8054             COMMISSIONER LANGFORD:  ‑‑ the first one who knows, so ‑‑

8055             MR. HUNT:  Exactly.

8056             COMMISSIONER LANGFORD:  ‑‑ who won the soccer tournament, or something, gets a mug or a T‑shirt.  Oh, okay.  So this isn't some half hour show ‑‑

8057             MR. HUNT:  No.

8058             COMMISSIONER LANGFORD:  ‑‑ where you give away ‑‑

8059             MR. HUNT:  Not at all.

8060             COMMISSIONER LANGFORD:  ‑‑ an oil rig to the lucky winner.

8061             MR. HUNT:  It's just part of their every‑‑

‑‑‑ Laughter / Rires

8062             COMMISSIONER LANGFORD:  Okay.  So, it's basically all of that.  It's all announcer ‑‑ it's announcer talk, okay.

8063             MR. HUNT:  Yes.

8064             COMMISSIONER LANGFORD:  Fine.

8065             I'm going to stop here for a minute.  Do any of my colleagues have any questions at all at this point, since we are doing this piece by piece?  Are we all clear on spoken word at this point?  Okay.

8066             Now, will all of this spoken word content ‑‑ let's take out the 15 hours of brokered, and I guess we have to take out the 8.3 hours of "banter", if we are calling it that, announcer talk.

8067             So, we are left with 6.6 hours of news, 1.45 hours of what you call comedy and human interest.  Is all of that exclusive to Fort McMurray, or might some of that, for example, comedy and human interest, have been scripted somewhere else?

8068             MR. HUNT:  It would be pre‑packaged syndicated, yes, some of it.

8069             And as I mentioned, we mentioned, in the Grande Prairie one, some of the comedy stuff is stuff that we produce ourselves.

8070             COMMISSIONER LANGFORD:  Right.

8071             MR. HUNT:  Based on the, you know, we have one particular morning show feature that is about the morning show people.

8072             COMMISSIONER LANGFORD:  Right.

8073             MR. HUNT:  Which could be something that we would produce for that particular market as well.

8074             COMMISSIONER LANGFORD:  Okay.  But we shouldn't count on that 1.5 hours as being either produced in Fort McMurray, or produced exclusively for Fort McMurray.

8075             MR. HUNT:  No.