TRANSCRIPT OF PROCEEDINGS
FOR THE CANADIAN RADIO-TELEVISION AND
TRANSCRIPTION DES AUDIENCES DU
CONSEIL DE LA RADIODIFFUSION
ET DES TÉLÉCOMMUNICATIONS CANADIENNES
SUBJECT / SUJET:
BROADCASTING APPLICATIONS AND LICENCES/
DEMANDES ET LICENCES EN RADIODIFFUSION
HELD AT: TENUE À:
Triumph Howard Johnson Triumph Howard Johnson
MacDonald-Cartier Salle de bal
2737 Keele Street 2737, rue Keele
Toronto, Ontario Toronto (Ontario)
January 31, 2000 Le 31 janvier 2000
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
Conseil de la radiodiffusion et des
Transcript / Transcription
Public Hearing / Audience publique
Broadcasting Applications and Licences/
Demandes et licences en radiodiffusion
BEFORE / DEVANT:
A. Wylie Commissioner/Conseillère
M. Wilson Commissioner/Conseillère
J. Pennefather Commissioner/Conseillère
A. Cardozo Commissioner/Conseiller
R. Williams Commissioner/Conseiller
C. Grauer Commissioner/Conseillère
A. Noël Commissioner/Conseillère
ALSO PRESENT / AUSSI PRÉSENTS:
P. Cussons Hearing Manager and Secretary / Gérant de l'audience et
D. Rhéaume Legal Counsel /
HELD AT: TENUE À:
Triumph Howard Johnson Triumph Howard Johnson
MacDonald-Cartier Salle de bal
2737 Keele Street 2737, rue Keele
Toronto, Ontario Toronto (Ontario)
January 31, 2000 Le 31 janvier 2000
TABLE OF CONTENTS / TABLE DES MATIÈRES
YTV CANADA 8
Questions by the Commission 24
Questions by Commission Counsel 83
CHWO ONTARIO INC. 88
Questions by the Commission 106
Questions by Commission Counsel 184
GARY FARMER 191
Questions by the Commission 204
Questions by Commission Counsel 322
Toronto, Ontario / Toronto (Ontario)
--- Upon commencing on Monday, January 31, 2000
at 0900 / L'audience débute le lundi
31 janvier 1999, à 0900
1 THE CHAIRPERSON: Order please. À l'ordre, s'il vous
2 Good morning, ladies and gentlemen, and welcome to this
CRTC public hearing to consider competing applications for radio stations in
3 Bonjour, mesdames et messieurs, et bienvenue à cette
audience publique du CRTC sur l'étude de demandes concurrentes visant
l'exploitation d'une entreprise de programmation de radio dans le marché
4 I'm Andrée Wylie, Vice-Chair, Broadcasting, and I will
be presiding over this hearing.
5 Joining me on the Panel are my colleagues and fellow
Commissioners: on my right, Martha Wilson; on her right, Joan Pennefather; and
on Joan's right, Andrew Cardozo; on my left, Ronald Williams; on his left, Cindy
Grauer; and on her left Andrée Noël.
6 CRTC staff members assisting us at this hearing are: our
Legal Counsel, Donald Rhéaume; Hearing Manager and Secretary, Peter Cussons; as
well as Mike Amodeo, Andrew McRae; and, in the examination room, Diane Daley. Do
not hesitate to contact them on any procedural issue.
7 Le personnel du Conseil qui nous secondera lors de cette
audience sont le conseiller juridique, Donald Rhéaume; le gestionnaire de
l'audience, Peter Cussons qui agira également à titre de secrétaire de
l'audience; le gestionnaire de la salle d'examen est Diane Daley et nous avons
aussi avec nous Mike Amodeo et Andrew McRae.
8 In 1998, an Order in Council directed the Commission to
reserve frequencies 93.5 MHz on the FM band, 740 kHz on the AM band, or any
other appropriate frequency on the FM band for the use of radio services in
Toronto in keeping with the objectives set out in subparagraph 3(1)(d) of the
9 Following a call for applications in accordance with
this order, the CRTC is hearing this week 15 applicants for the use of 93.5,
106.3, 106.5 MHz on the FM band, and 740 kHz on the AM band filed by parties who
already provide or are interested in providing radio services in
10 The hearing follows the Commission's review of a number
of its radio policies which it wished to complete prior to its consideration of
applications for the provision of radio service in Toronto.
11 The applicants should clearly demonstrate to us the
need for, as well as a market for, the proposed use of the frequencies concerned
in accordance with the Commission's new commercial radio policy.
12 The Commission is particularly interested in the
following issues: the contribution that the service will make towards achieving
the objectives of the Broadcasting Act, as well as to the provision of service
meaningful to the community concerned; the service's proposed listening
audience; how the applicant intends to promote the development of Canadian
talent, particularly local and regional talent; the soundness of the applicant's
business plan, including market analysis and potential advertising revenue; and,
the availability of financial resources to meet the requirements set out in the
financial projections of the applicant's business plan.
13 This hearing will take place in five phases.
14 First, the Commission will hear the presentations of
the applicants. Next, we will hear the applicants' intervention to each other
proposals. In the third phase, we will hear interventions from the public. In a
final phase, each applicant may respond to all comments and interventions filed
or presented with respect to his application.
15 Finally, the Commission will hear the application from
Dufferin Communications for CIDC-FM for authority to relocate its transmitter
and to decrease its effective radiated power. We will also hear interventions to
16 The applications filed are competitive on various
grounds. Several are mutually exclusive on technical grounds. The Panel wishes
to put applicants on notice that, in order to ensure fairness and an orderly
proceeding, it will not generally be inclined to allow, at this late stage,
changes or additions to applications that it may consider
17 Les demandes soumises se concurrencent à divers points
de vue. Plusieurs s'excluent l'une l'autre au point de vue technique. Par souci
d'impartialité, et pour assurer la bonne marche de l'audience, le comité
d'audition désire informer les requérantes qu'à un stade aussi avancé, il ne
sera pas enclin à autoriser une modification ou un ajout qu'il jugerait
substantiel aux demandes qui sont devant lui.
18 The proceedings will be transcribed and filed on the
public record. To ensure that the people responsible for recording the
transcripts are able to provide an accurate record, I would ask that when you
speak you press on the small button on the microphone in front of you to
activate the microphone. In order not to create interference, we ask that when
you are not speaking you please turn the microphone off. The red light indicates
whether the microphone is on or off.
19 My second engineering comment is, please turn off your
20 We will sit every day, Monday to Friday, from 9:00 a.m.
to approximately 6:00 p.m., with a reasonable break for lunch. We hope to
complete this hearing within two weeks. We intend to hear three applications per
21 Nous proposons d'entendre trois demandes par
22 This should give you all some indication of when you
will be heard.
23 Should there be a need to make changes to sitting hours
to achieve our aim, I will keep you posted as to our schedule as the hearing
24 Nous siégerons tous les jours du lundi au vendredi de 9
heures à 18 heures environ, en prenant une pause raisonnable pour le
25 Nous espérons avoir terminé d'ici deux semaines, ce qui
exigera, comme je l'ai déjà dit, que nous entendions trois demandes par jour. Si
pour y parvenir nous devons apporter des modifications aux heures d'audience, je
vous en informerai en temps et lieu.
26 I will now ask the Secretary, Peter Cussons, to
provide any further detail with regard to procedures and to invite the first
27 Mr. Cussons.
28 MR. CUSSONS: Thank you,
29 As you mention, the Commission does have a standard
practice for dealing with competitive applications.
30 During the first phase, which we anticipate will take
up most if not all of this week, we invite applicants to come forward and
present their proposals. We allow 20 minutes for this exercise, including any
audiovisual material. Questions by the CRTC panel normally follow.
31 Phase two consists of the applicants again coming
forward, in the same order, to intervene to competing applications. Ten minutes
maximum are allowed.
32 With phase three, we invite other parties who have
specifically requested to appear to present their interventions on any or all of
the competing applications. They are allowed no more than
33 Phase four involves the competing applicants returning
in reverse order to comment on or rebut any or all interventions. Again, they
will have 10 minutes to make their remarks.
34 I should mention that there are several applications on
this hearing where appearance was deemed to be unnecessary and decisions will
also be rendered on them.
35 Now it is my pleasure to introduce the first
application by YTV Canada Incorporated for a broadcasting licence to carry on an
English language AM radio programming undertaking at Toronto. The new station
would operate on frequency 740 kHz with a transmitter power of 50,000
36 The applicant is proposing a children's radio station
that will provide a blend of music, entertainment and information.
37 YTV Canada Incorporated currently operates in a
national English language children, youth and family-oriented specialty
38 The Commission notes that this application is
technically mutually exclusive with other applications scheduled at this hearing
for the use of the 740 kHz frequency.
39 I now invite Mr. Cassaday to introduce his
40 Mr. Cassaday.
PRESENTATION / PRÉSENTATION
41 MR. CASSADAY: Thank you, Mr. Secretary.
42 Good morning, Madam Chair and Commissioners. I'm John
Cassaday, President and CEO of Chorus Entertainment.
43 Let me begin this morning by introducing our team. To
my immediate left is Paul Robertson, President of YTV; to his left is
Ted Kennedy, Director of Programming; on my right is Susan Mandryk, Vice
President, Market Development; behind me, from left to right, are Kathleen
McNair, Vice President, Regulatory Affairs; and to her right is Jamie Haggarty,
Vice President of Finance, YTV.
44 This is a great day for Chorus. We are a brand new
entertainment company and this is our first CRTC appearance. We have an
application of which we are tremendously proud. With your approval, we will
launch the only radio station in the country dedicated exclusively to
45 Our enthusiasm for this project stems from a strong
belief in the importance of providing for children at a very impressionable
stage in their development a station that speaks to them in their own language,
to the things that they find relevant, interesting and fun, where the music
contains none of the violent, sexual or antisocial messages that permeate much
of today's popular music, where the hosts are characters and good role models,
and where the children have a sense of place and have a common bond with kids
from all backgrounds and cultures across the listening area.
46 There is a complete void in Canadian radio for a
service of this kind, one that provides a safe haven for kids in the "anything
goes" environment of today's adult-oriented entertainment world.
47 In children's programming, we have gained a
comprehensive understanding of what is popular and appropriate for children. We
know that we can take the ingredients that have made YTV so well received and
apply them with equal success to the new radio service that we are
48 We were encouraged by the Order in Council directing
the Commission to reserve the 740 for a radio service that contributes to the
achievement of the objectives of the Canadian broadcasting policy. The specific
section referred to in the call provides that the system should, through its
programming, serve the needs and interests of Canadian men, women and children,
including equal rights, the linguistic duality and multicultural and multiracial
nature of Canadian society, and the special place of aboriginal peoples within
49 YTV Radio will fulfil such a mandate. It will be a
station that is dedicated to the needs and aspirations of Canadian children. We
will provide programming to an audience of almost half a million six to eleven
year olds within the 740 full coverage area.
50 This audience is not simply underserved, it is a group
that is not being served at all by any commercial radio station. YTV Radio will
be very inclusive to serve this large and diverse audience. Our programming will
reflect the circumstances and interests of all cultural groups comprised within
the almost half million potential listeners.
51 Young children are very receptive to a variety of new
influences. We believe that music, whether it is Caribbean or Celtic, Salsa or
novelty, can be used as the common bond among a number of cultural groups. The
station will broaden children's appreciation of a range of musical styles from
Toronto's cultural mosaic. Interwoven within our musical offerings will be
spoken word programming tailored to this age group and designed to be reflective
of the diverse cultural fabric of Toronto.
52 In light of this, we believe that YTV Radio is one of
the most inclusive applications before you and therefore one that will serve to
fulfil the objectives of the Broadcasting Act.
53 I will now ask Paul Robertson to describe our proposed
54 MR. ROBERTSON: YTV Radio will give children a sense of
ownership of a station dedicated to them. This will ensure that YTV Radio is
reflective of the very diverse audience we will serve with broad appeal across
social, ethnic and cultural lines. We will have our finger on the pulse of
Toronto's very diverse population. The daily schedule will provide for a
significant level of interaction with our young audience.
55 YTV Radio will work closely with kids both on and off
the air. Children will keep us up to date by participating regularly with our
on-air personalities through program features, our request line, quizzes,
general dialogue, and focus groups.
56 The station will reach into the community through our
remote radio roamers and our student radio reporters. YTV Radio will have a
prominent place on YTV's Web site, which is the number one kids Web site in
Canada. Children across Canada and from around the world who are on the net will
be able to connect with the station.
57 At all times, the station will be a fun experience for
kids with a fresh and quirky style that has made YTV so popular. YTV Radio will
also create a new showcase for Canadian music and expose Canadian selections and
artists to a new audience, the six to eleven year olds.
58 We will broadcast at least 100 hours of local
programming each week. Since this is not a niche programming service, we have
committed to a minimum Canadian content level of 35 per cent. As is the case
with YTV, we see our commitment to Canadian content as a minimum requirement to
59 We will make maximum use of Canadian resources in the
creation and presentation of our programming, which will be drawn from local,
regional and national/international sources.
60 Additionally, YTV Radio has committed more than $1.6
million to community and talent development initiatives. All of our initiatives
were designed to encourage interactivity with our audience and to create a
diverse backdrop for our programming.
61 In addition to the annual Canadian talent development
requirements, YTV Radio has proposed three innovative commitments. I will now
ask Susan Mandryk to describe these initiatives.
62 MS MANDRYK: The engine that will play an important role
in the design of this radio station, the savvy server initiative, was designed
with this in mind. Currently, there is no equivalent to the broadcast code for
advertising to children on the Internet and they can easily become victimized, a
real concern for both parents and educators.
63 YTV Radio would work in co-operation with the Media
Awareness Network, the Concerned Children's Advertisers and the GTA school board
in the development of this Internet literacy program, and we have committed
$700,000 over the course of this term of our licence.
64 In order to keep our finger on the pulse of the kids'
community, YTV Radio would also commit $350,000 in honorariums to establish a
YTV Radio reporters program with the elementary schools and the GTA. Each
reporter would call in with news from his or her school to keep the station and
the listeners current on events and issues throughout our coverage area. Our
reporters will ensure that the station continually reflects the cultural
diversity both in Toronto schools and the city itself.
65 Finally, YTV Radio will sponsor a number of annual
children's festivals in Toronto that are developed to showcase Canadian talent
and enhance the broadcasting environment. This initiative will provide a total
of $364,000 to children's focused festivals such as Word on the Street or
Sprocket's The Toronto Kids' Film Festival. These important events are
chronically short of funding and YTV Radio welcomes the opportunity to provide
support to these valuable initiatives.
66 MR. ROBERTSON: YTV Radio will introduce a new and
inclusive radio voice into the Toronto market without having a negative impact
on any existing station. YTV Radio will generate its audience from children who
do not currently listen to radio or who have tuned to stations that are
programming for a much older audience. BBM does not even measure the listening
habits of anyone under the age of twelve Since this group is not measured, the
attraction of six to eleven year olds to our station will have no financial
impact on existing radio services.
67 Our revenue will flow from advertisers who do not
currently use the medium of radio for market growth. The revenue reported,
prepared by Echo Advertising, filed as part of our application, concludes that
YTV Radio's share of tuning and revenues will have a negligible impact on
68 The Angus Reid survey, also submitted with our
application, demonstrates the need and desire for a radio station that presents
programming designed for children. The results were absolute and overwhelming.
91 per cent of those surveyed think that a kids' station is a good idea, and
60 per cent think it is a great idea. The survey also reveals that
10 per cent of kids currently do not even listen to radio, and 22 per cent
don't have a favourite station. YTV Radio will provide these children with a
station they can call their own.
69 The introduction of YTV Radio as an AM service
attractive to children will bring a new audience to this band, which should
create positive attitudes towards AM. To ensure children adopt a station as
their own, YTV Radio will be entertaining and informative. Our station will be
known as much for what it is not as for what it is. We will not play popular
songs that depict violence or contain explicitly sexual lyrics. Many of the
songs that are played on top 40 stations would not be appropriate for YTV
70 Children and their parents will know what to expect
when they tune to 740, a unique station with a playful and inviting approach,
that will also create opportunities for the family to share a laugh and discuss
issues of concern.
71 I will now ask Ted Kennedy to describe a typical
program day for YTV Radio.
72 MR. KENNEDY: Today, YTV Radio is creating a new format
in Canada. It is a unique concept: radio for kids.
73 Morning shows on most radio stations follow a set
standard: a wacky morning team, two men, one woman; risqué humour aimed at
teenagers and young adults; phone contests; news and sports every half hour;
traffic reports every ten minutes; time and temperature every time the
microphone is open.
74 Mornings on YTV Radio will have few of these elements
because the kids' world is focused in different directions from adults. Hosts
will use character voices. Standard newscasts will not exist. Rather,
information will be spread in easily digestible pieces throughout the hour:
places and times for this weekend's comic book convention, for example; the time
and place of the skateboarding competition; or how Ty is planning to replace the
beanie babies. Coverage of the Stanley Cup may be an interview with the Zambonie
operator. The weather will be supplemented by directly relating just how cold
that temperature really is and what you should be wearing to be
75 On the phone lines, an elementary school boy from
Downsview is telling his joke of the day, a Rexdale girl wins a trip to
Wonderland by knowing the number of bumps on a Delicious apple, or Winkie and
Hank explain the similarities between today's federal election and playing the
board game Risk.
76 During the late mornings and early afternoons, YTV
Radio may repeat some of the morning show segments for kids that may be at home.
A half hour interactive feature will be used in schools to instruct kids on how
to research information for their science projects on the Web. Hit music will be
interspersed with reports from the Toronto Kids' Film Festival, or Terrabana,
and the noon hour features the top 12 e-mail requests of the day from across
77 After school, the YTV Radio student reporters give the
results of the question of the day, finding that 73 per cent of kids figure that
9:00 p.m. is the proper bedtime for an eight-year old, or that the afternoon
host talks to Britney Spears on the phone about her upcoming concert at the Air
78 The replay of the countdown show hit list follows at
7:00 p.m., followed by an interview with J.K. Rowling, who discusses her
upcoming Harry Potter novel and gives a short reading from the book. Slug and
Gobble have to be rescued after making a mistake repairing the static generator
at the science centre setting off every fire sprinkler and nearly drowning. The
song parity of the day reworks Mambo No. 5 into your local burger joint's
Combo No. 5.
79 MR. ROBERTSON: YTV Radio will engage and stimulate
children's imaginations by speaking to them in their language. We will tell kids
to keep it weird, using the YTV definition, meaning: unexpected, cool,
delightful and playful. Parents will know that YTV Radio is a place where their
children can safely experience and enjoy the music, humour and opinions of other
kids their age. It will be a welcomed alternative to radio stations designed for
an older audience.
80 MS MANDRYK: YTV Radio will be much more than just an
entertainment outlet. We will develop initiatives with school boards to create
programming that is informative and educational, but presented in an
entertaining style. We know from experience that anything with a serious message
presented to six to eleven year olds must be done in a humorous or quirky
81 We have had very positive discussions with the Toronto
School Board regarding the development of programming by YTV Radio to complement
the existing curriculum. Because there is now a consistent course curriculum
across area schools, we will work with the board to identify areas where
additional resources can be effectively utilized by the teaching community. We
intend to feature afternoon programming that will enhance existing in-class
curriculum including: background programming on special celebrations and current
events such as Chinese New Year or celebrating the creation of Nunavut;
historical programming such as War of the World or Famous Political Addresses;
and, also readings and storytelling using Canadian and international
82 MR. ROBERTSON: To ensure that we were on the right
track, YTV created a demonstration Web site for YTV Radio to test our
programming ideas from the children and the current feedback from the children
on the proposed radio service. The demonstration featured a sample morning show,
contained a listener buzzback line, tested a number of musical clips, and
encouraged children to provide their opinions on the proposed station. We
believe the Web demonstration captures the quirky spirit of YTV
83 Let's show you what the kids experienced on-line.
--- Off microphone / Sans microphone
84 MR. ROBERTSON: ...for a four-week period to go to this
--- Video presentation / Présentation vidéo
85 MR. ROBERTSON: Kids could provide their feedback up
here. Clearly, I loved it so I'm going to say something. I guess I'm biased.
Here is how the songs might be presented.
--- Video presentation / Présentation vidéo
86 MR. ROBERTSON: Interaction with the kids on air is a
really critical part of what we plan to do.
--- Video presentation / Présentation vidéo
87 MR. ROBERTSON: Then, when the demonstration was
finished, you completed this little survey. I guess 15 or more is the category
--- Off microphone / Sans microphone
88 MR. ROBERTSON: ... loved it, a chance to submit a
written comment, which I will spare you at this time.
89 We were delighted with the response we received. More
than 4,000 children participated, and 80 per cent said they would listen to a
YTV Radio service.
90 We are very excited about the opportunity to create a
Toronto radio service dedicated to children. Our application responds to the
call and will contribute to the achievement of the objectives of the Canadian
91 YTV Radio will increase diversity in Toronto without
negatively impacting any other station in the market. It will provide at a
minimum 100 hours of local programming each week. Here, with an inclusive
outlook, YTV Radio will reflect the multicultural nature of Toronto society to
92 We will contribute more than $1.6 million to
community and talent initiatives and YTV Radio will bring six to eleven year
olds to a new AM station dedicated to entertaining, enlightening and informing
this completely underserved group.
93 This concludes our presentation. We would be pleased to
answer your questions.
94 THE CHAIRPERSON: Thank you.
95 Good morning, Mr. Cassaday, ladies and gentlemen.
Welcome to our hearing.
96 I have some questions for you which will focus, in
general, on demand for the service, revenues, programming and a few technical
questions. Of course, as we stated earlier, demand in a competitive hearing,
such as this one, is of some importance.
97 The Angus Reid study that you filed with your
application reveals at page 5 that six to eleven year old children listen to
approximately 8.5 hours weekly of radio, compared to teenagers, 13.2 hours
weekly, and adults, 22.7 hours weekly, yet you estimate an audience share of 7.5
tuning in year one from the six to elevens, and growing to 15 in year
98 Are your audience assumptions based on the proposition
that children six to eleven don't listen to radio because there is no station
available that appeals to them?
99 MR. ROBERTSON: I will start by answering the question
and perhaps Susan Mandryk would add to it.
100 We believe that there is a fair bit of tuning by six
to elevens, but that there would be a lot more if the radio station was
specifically tuned into their needs. So what we did was we looked at the amount
of radio that teens consume and felt that with the appropriate programming and
the focus and the interactivity that we are going to bring to YTV Radio, we
could encourage the six to eleven group to be radio tuners, much along the lines
of the teens, and that is where our audience estimates were derived
101 MS MANDRYK: We also took a look at several of the
models around the world of children's radio and investigated how the response to
that was. What we found was that in many cases the listening behaviour of
children was substantially altered over time, to the point where the models were
very successful and were rolling out in many new markets. So our assumption is
that the same model would apply here.
102 THE CHAIRPERSON: You acknowledge yourself, in response
to a deficiency question -- I think it was in response to question
2 -- that that demographic has now an overdeveloped visual orientation and
that you hope to move away from that orientation. In fact, a BBM fall survey
shows that 78.1 per cent of all children, seven to eleven, tune to TV at least
once a week, between 4:00 and 7:00 to the visual medium, and 94.4 per cent of
the seven to elevens in the same survey tune to a TV service at least once a
103 How difficult may it be to achieve your estimated
audience share? Because I note that in your audience projections, which are
attached to your Schedule 18, you show that the 3:00 to 7:00 time frame is going
to be a high period of tuning to the radio station. How do you combine that with
the known visual orientation of children and the BBM showing that they watch TV
when they come home after school?
104 MR. ROBERTSON: Thank you,
105 There is no question that the children are attracted
to television as a primary way they get their entertainment, and, as you say,
particularly in the after school period. We believe that children are not
listening to radio in a large measure due to default and that a service that was
dedicated to them, with programming focused on their needs, again would
encourage their tuning.
106 With respect to the times that children might tune
into such a radio station, we think that the radio station would have a similar
development as most radio stations: when the children are being driven to school
in the morning, at the end of the day. Also, though, we believe that there is a
great opportunity for around bedtime for storytelling, and even at noontimes for
those kids that are able to come home. So, with respect to the after school
period, in particular, we think that television will continue to be the
strongest draw for these children, but that we can encourage some strong tuning
with children, also by promoting the YTV Radio station through YTV.
107 Perhaps Susan would like to add to this
108 MS MANDRYK: I think, just following up from Paul's
point on bedtime storytelling, that is a huge opportunity for us to increase
tuning time. We know that, for example, most teens listen predominantly in the
early evening hours just before they go to bed, so we know that that is not at
all listened to right now by children of this age group. It is our anticipation
that we will be opening up a whole new time during the day when they would be
listening to radio in addition to the after school period.
109 THE CHAIRPERSON: It is somewhat difficult, I would
imagine, to completely isolate the six to elevens from the twelve to thirteens,
and with regard to demand we find that, when you look at the BBMs, the share of
tuning to AM by the twelve to seventeen group, which is the demographic that BBM
does measure, has decreased from a 7.9 share in 1992 to a .9 share in 1998,
while FM tuning for that group has increased from 3.8 per cent in 1992 to 5.6
per cent in 1998.
110 Are you not worried that children are already used to
an FM quality sound and will find AM deficient? I know that you propose that
children are not that discriminating and that AM, even though there will be a
substantial component of music, will not be a problem. Is it not a problem that
children are used to the FM quality sound when they listen to the stations that
are already existing or that are listened to by their teenage sisters and
brothers or their parents, and also from the other sound equipment that they may
be using, and AM will be found deficient for them as well and not
111 MR. ROBERTSON: I would be pleased to answer
112 First of all, we are focused very specifically on the
six to eleven-year-old group, and through our experience at YTV we have been
pretty effective at being able to isolate these different target groups. Really
there is, as you are well aware of, substantial differences in terms of their
interests and their attitudes and what kind of material they find enjoyable. In
our demonstration you heard about Winkie and Hank. Clearly, that is kids stuff.
That would probably turn the teens off more than turn them on. So we do think
that we can isolate this six to eleven-year-old group effectively.
113 With respect to their enthusiasm about AM radio versus
other sources, their primary use of radio is often through a walkman, which will
have varying degrees of sound quality associated with it. But, through our
experiences, children six to eleven react much more to the programming and the
way in which it is presented than the actual quality of the broadcast itself. So
what we like about this service is not so much that we really think the kids
will be attracted to it, but also we think we can change some attitudes about AM
radio, that if the kids get an opportunity to see something exciting and cool
that is on AM, perhaps that will open up new possibilities for the AM band down
114 THE CHAIRPERSON: You mentioned, Mr. Robertson,
that you were able to isolate the six to eleven group from the top seventeen,
but presumably there are six to elevens who now listen to the same stations as
the twelve plus, since there is some listening to radio. I understand that
presumably you would repatriate them, or some of them, to YTV if you had a
children-oriented station and that you would get listeners who don't listen now.
But the fact of the matter is, children that age do register, according to the
Angus Reid study, as listening to some stations at the moment.
115 MR. ROBERTSON: There is no question that there is
listening, among the six to elevens, of radio stations that are designed for
older kids. That is our concern and that is where we think that a children's
radio station is most appropriate, because when they listen to these stations
some of the music and material is fine, but other parts of the music deal with
themes that make it very difficult for the kids to understand, or have them ask
their parents questions which their parents don't really want to deal with at
this stage of their development. So it is this kind of tuning and the unease
that parents have about what their children are hearing that we want to address
so that the parents can feel totally comfortable with what the children are
listening to, and we can be age appropriate with all the programming material
and song selection.
116 MR. CASSADAY: Paul, if I could just add.
117 Paul has talked about why it is a concern that kids
six to eleven might be listening to older targeted radio stations. The other
side of it is: When is the last time any of you ever heard a child six to
eleven's voice on any of these other radio stations? Quite frankly, no radio
operator wants a seven year old on his station listening to him make a request
because it sends a message that that station is not the coolest station in
118 So this is another opportunity to be inclusive and to
provide, as we said, not only a safe haven but a home for these kids to express
their interests in music and their interests in general.
119 THE CHAIRPERSON: When examining demands for the
proposal that you have before us, I looked at the Angus Reid report at page 6,
which indicates with bars the radio listening the six to elevens do and how it
is broken down. It shows that 73 per cent is done in the morning in the
car, 63 per cent in the morning at home, 72 per cent in the afternoon at home or
at a friend's house, 66 per cent in the afternoon in the car, and 74 per cent in
120 I assume that when they are listening to the radio in
the car, morning or afternoon, or even at home, that they are listening probably
to their parents' choice of radio stations, where the eight year old may not be
too concerned about whether he or she needs mittens but the mother is, and is
listening to weather reports and things that are of no interest to children, and
maybe the driver of the car wants to know if there is a traffic jam somewhere or
may just be simply trying to pick up the news in the morning.
121 I imagine a kitchen set up with everybody having
breakfast and the children running around and trying to find their boots. I
can't imagine the radio station being tuned to what you have described as a
quirky, weird, frantic radio station intended for six to eleven year
122 Is it your assumption that the parents will actually
give up their radio station during drive times, and in the home when the
household is getting organized, to ensure that the children have access to
123 MR. CASSADAY: That is a very good question.
124 What we have found, working with children for many
years, is that they always tend to get their way. This is also the same thing we
have found at home. The influence that children exert on the decisions that
their parents make is, at times, extraordinary, and we believe that children
will come to desire this radio station and they will ask their parents to tune
it in, and when they do that, the parents will feel good about this decision
because they know that everything that will be broadcast on this radio station
will be appropriate for their children.
125 I think in the morning and in those afternoon drive
periods, sometimes it is not just the parents' station that is being tuned to,
it might be an older brother or an older sister, or perhaps the child just
enjoys tuning to a particular station by default because there is nothing
available that is exactly right for them.
126 So we do believe that children will exert an influence
on the station selection and that indeed there will be a strong tuning to the
127 THE CHAIRPERSON: In your application, the Disney
Experience, and the possibility that that network would expand because it was
very successful -- have you checked their Web site lately and are you aware
of how many stations they still have in the market and what their success is?
Our last check was during the night.
128 MR. ROBERTSON: Then you are going to be very up to
129 Our most recent information suggests that they are now
serving 60 markets and that they also have representation in all of the top 20
large markets in the U.S. So this is a service that has come from one station in
1996 to now covering the majority of the United States today.
130 Certainly, they have been encouraged by the type of
response that they have had from the children and that has led them to increase
the geographic distribution of the service, so we really felt that that was a
very positive indicator that a service directed to children could be
131 THE CHAIRPERSON: I stand to be corrected, and you will
be back at the reply stage to correct me if I'm wrong, but our latest check
indicates that they are still at 44 stations and that there has not been an
expansion, but maybe their Web site isn't up to date.
132 In any event, there will come a correction if that
expansion has occurred when you come back at the reply stage.
133 I think it is fair to assume that children who now
listen to radio probably listen to stations that are popular with teens. Would
that be fair?
134 MR. ROBERTSON: Yes. Primarily, they would listen to
radio stations with teen popularity, but we think that that listenership is
really quite scattered.
135 Now, we do not have comprehensive tuning data for
children two to eleven because BBM doesn't measure it, so anything in this area
we would be making assumptions.
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136 MR. CASSADAY: ...Paul, would it be safe to say that it
probably patterns the age or the demographics in the household?
137 If there are teens in the household -- not every
six to eleven year old has an older brother or sister -- then chances are
good that they would be exposed to the music that they listen to. But in the
event that the eight year old is the oldest in the family, they are possibly
listening to a station that their parents listen to. But, clearly, there is
nothing specifically targeted at them at this point in time.
138 THE CHAIRPERSON: My experience is that cool children
of that age want to listen to what the teens, slightly older than they are,
listen to if they have -- assuming no other choice more suitable to them.
In fact, I think it would be fair to look at, in Toronto, the 1999 fall BBM
survey, which indicates that the highest tuning in the twelve to seventeen age
groups are CISS-FM, CING-FM, CIDC-FM, and CFNY-FM. I think a correlation of
sorts can be made between what is appealing to an eleven year old is likely to
be what is appealing to a twelve year old.
139 It is not scientific, but would that be fair? I don't
have ten year old children, but I have ten year old grandchildren, two of them,
a boy and a girl. How about that?
140 MR. ROBERTSON: Well, we certainly do realize that
children tend to aspire up in terms of the way in which they consider their
141 The YTV experience has been that we can capture the
imaginations of the six to eleven group. That would be our primary target. YTV
serves the ages two through to seventeen, but much of the programming that we
develop focuses particularly on the six to elevens, and those six to elevens
think it is pretty cool to be part of YTV, despite the fact that it is a station
that is developed just for them.
142 So we think that children, when a station is developed
with them in mind, will be attracted to it, much like children have been
attracted to YTV.
143 Perhaps, though, Ted Kennedy could give you a little
more of a feel of some of the programming elements and how they will capture the
kids' imagination of six to eleven.
144 MR. KENNEDY: There is obviously a transition phase
between the ages of six and eleven. An six year old is transitioning from the
Raffi and Barney stage into something that is a little bit more evolved. At the
other end of the spectrum, the eleven or twelve year old does aspire to perhaps
some of the traditional top 40 styles of music. But there are two points that I
would like to make there.
145 One is that what they are hearing on the traditional
top 40 stations. They are definitely skewing towards a certain style of music,
like the Backstreet Boys or Britney Spears, a much younger style, and there is a
lot of other content on those stations that we feel is inappropriate and many
parents feel it is inappropriate for children of that age to be listening
146 The majority of the children in the six to eleven year
old age group, I don't think they are aspiring to be older teenagers at that
particular point. Maybe once they reach the upper end of that demo that starts
to creep into it, but, certainly, six, eight, ten year olds are looking for
something that they particularly like.
147 What you won't be hearing on YTV Radio are things that
are inappropriate for kids of that age, like the Foo Fighters, the Counting
Crows and Filter, which are rock acts targeting older teenagers, or the more
sophisticated adult acts that you hear on some of the adult or hit radio
stations like Whitney Houston, Mariah Carrey, Celine Dion.
148 Certainly, the most important part of this element is
a lot of the explicit sexual or violent lyrics that are a part of contemporary
hit radio that won't be a part of YTV Radio -- and we can come up with a
number of examples there -- that just are inappropriate for that age
149 So it is really important to us to be able to program
music and spoken content that communicates to these children, and develop a safe
haven where we don't have to have these concerns.
150 THE CHAIRPERSON: I can understand with the spoken word
content, but with the music, you keep referring to what is not appropriate, what
parents don't want, a safe haven. Demand requires that to successfully show
demand you have to also show that you will be successful in appealing to the
demographic, and children don't come at it from what is appropriate or not
appropriate. They come at it from do they like to listen to what they are
listening to. Some of the time they may not even know what is inappropriate,
they may not even know what it says, but that is the sound they like, et
151 It is not just a question of having -- you know,
there is obviously value in an appropriate station from the parents'
perspective, but it won't make the child listen. The child may turn it off, do
something else, watch TV, go out, or whatever. It has to be
152 I would like to hear how different your music would
be, apart from appropriateness but at the level of appeal, for those eleven and
ten year olds who may be listeners to the four stations I mentioned who register
a high tuning by twelve to seventeens. What will be different in the music and
how will it be appealing, not to the parents but to the demographic that you are
153 MR. KENNEDY: Our reaction, and it was confirmed by the
results on the Web site, the kind of music that these kids are choosing to
listen to are things that are normally considered viable for the safe haven.
They are the younger acts, Britney Spears, N'Sync, the Backstreet Boys. They are
not listening to the Ambers or the Monicas, or the Next, who are dealing with
the sexually explicit lyrics.
154 These types of songs are testing well with older
teenagers or young adults that are listening to contemporary hit radio. They
don't much appeal to the kids, so if we eliminate them from the mix, we are not
adjusting our appeal downwards. It's not affecting the appeal.
155 There may be the very rare occasion, but I can't think
of one right off the top of my head that is existing in the charts this week, of
an inappropriate lyrics song that would appeal to a six to eleven year old, but
we are concerned about the exposure while they are waiting for the Backstreet
Boys or Britney Spears to appear that they are going to be exposed to this other
kind of music which is not appropriate.
156 THE CHAIRPERSON: We are still using the word
"appropriate" to a large extent. I'm trying to look at appeal. We want to be
comforted, when there are a number of parties competing for the frequency you
propose, that indeed you will have something that is indeed appealing to the six
to eleven year olds because of the high component of music and the possibility
that the spoken word programming maybe at times will -- you know, not every
parent is generous enough during drive time to turn to a weird, frantic station
instead of finding out what the news is while the children are waking up in the
157 All that combined, what is the music component going
to be that is different? Are you going to scan The Barenaked Ladies, which
children do listen to, and find numbers that are appropriate but are still a
music style that is appealing to the six to elevens?
158 MR. ROBERTSON: Let me start, if I may, and first of
all say that you are asking a question concerning, you know, will this service
be appealing to children six to eleven years old and what will the music
component be that is unique that will be appealing to them.
159 We have a long-running show, I think it is our longest
running series show, on YTV called YTV Hit List. YTV Hit List takes the music
that the kids enjoy. It excludes some of the songs that we don't think are
appropriate and maintains a strong core of music that they particularly want to
160 THE CHAIRPERSON: This is on TV?
161 MR. ROBERTSON: And this is on TV.
162 We were very encouraged that YTV's Hit List is the
most popular countdown show on the air of any show. So we know from our
experience that we can get strong, strong tuning to this type of song mix by the
six to eleven year olds.
163 Also, I would just add that the Disney Experience, and
the difference between the 60 and the 42, may indeed be projections versus
actual to date or markets versus stations we can clarify, but the important
thing about the Disney Experience is that they started with one station and now
they are up over 40, which means that they are finding their audience. They
realize that they can program to this six to eleven year old group and they will
164 I would just like to add one more thought in response
to your comment about being a sort of frenetic service -- I believe those
are the words you used -- and whether the parents --
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165 THE CHAIRPERSON: ... frantic, quirky, weird. Those are
your words. I can tell you exactly where they are.
166 MR. ROBERTSON: Absolutely.
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167 MR. ROBERTSON: Well, we make no apology for that. This
is what the kids are looking for.
168 You know, what we found on YTV is that there is as
much adults viewing with their children as there are children viewing by
themselves. We intend to take the same format, the same feeling and environment
and extend it into radio, and if parents are pleased to listen and watch with
their kids on television, we believe the same thing is true for
169 MS MANDRYK: I would just add the fact that we have
received, over the course of the four weeks that the YTV Radio demo was
on -- we purposefully put in a number of different genres of music and
orientations towards music to give us a sense for whether or not the kids would
be accepting of the broad base that we wanted to present to them, which was very
different from what they were hearing on conventional radio. The feedback that
we got week over week over week was that they either -- you know, 80 per
cent of the kids either loved or liked the selection of music that we were
presenting to them.
170 So that gave us some encouragement that in fact they
are much more open to a broader base of music styles than what they are
currently hearing on the radio.
171 THE CHAIRPERSON: Now, obviously, the question about
whether the six to eleven target will be the target that will make this proposal
viable leads us to wonder how easy it would be to move closer to the twelve to
seventeen group, which has a higher listening and has, in Toronto, some popular
stations for that group.
172 Do you know -- I should know this but I
don't -- are the six to elevens measured in the -- listening measured
in the United States? It is not measured either?
173 MS MANDRYK: No, it's not. No.
174 THE CHAIRPERSON: So the experience with Disney would
be based on expansion?
175 MS MANDRYK: Well, Disney, in fact, commissions their
own research in the U.S. to ensure that they get a good handle on what is going
on, but it is not traditionally measured.
176 THE CHAIRPERSON: In your application at 10.4, you
indicate that your primary target group is the six to elevens, and the surveys
have been based on that, and that is what we have been talking about this
morning. You nevertheless estimate in Schedule 18 that you will get from the
twelve plus a .8 share in year one and 1.1 in year two.
177 I'm looking at Schedule 18, under "Audience
Projections", which would be I think the fourth page in of Schedule 18. You have
here your audience projections for the six to elevens and then the twelve plus.
You did not measure the twelve to seventeens or project the twelve to
178 My question is, if I were to take not all persons
twelve plus, which is what you did here -- you did six to elevens and then
jumped to all persons twelve plus and year two had a 1.1 share -- if
instead of all persons twelve plus you had twelve to seventeens, what
projections would you have had instead for audiences? Do you follow
179 MR. ROBERTSON: Yes. You are asking the question: If
all of the twelve plus were indeed twelve to seventeens, what
180 THE CHAIRPERSON: No. Why you didn't project the twelve
to seventeens and instead jump from six to eleven to twelve plus?
181 Because once you get to nineteen you are not going to
have, I suppose, any listeners, if you are successful in having a proposal that
is indeed well suited to the six to elevens. But that would not necessarily be
true of the twelve, thirteen year olds who may be less mature, who may be more
like eleven year olds.
182 It is obvious that the question that will come now is:
What would prevent you on AM to pitch to the twelve to seventeens if the six to
elevens doesn't work?
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183 THE CHAIRPERSON: ...from skewing the service to an
older demographic and, therefore, in a competitive situation, having obtained a
licence on the basis of a proposal that may or may not be viable as put
184 MR. ROBERTSON: Yes.
185 Certainly, we have focused our efforts on the six to
eleven group, but we also thought that the six to eleven year old group would
be -- that their parents would listen to the service with them.
186 Picture a family trip with young children, picture the
drive time to school, back home from school. What we hoped is that the children
would ask to tune to YTV Radio and their parents would listen with them. So when
we devised our target group, our particular audience focus, we really did say
six to eleven is what we are aiming at. That is going to be the demographics
that we will really keep an eye on. That will be the demographic that will work
with our advertisers and will end up generating commerce.
187 The twelve plus group we really envisioned would be
parents viewing with the young children. Perhaps there is going to be an older
brother and sister also in that audience to comprise it, but we have no
intention of programming to the teens and therefore we don't believe that this
service will appeal to the teens for two reasons.
188 One is that, as you pointed out earlier, the teens
aspire up and are going to be looking to broad-based radio that they think is
cool, that they want to be associated with. The teens are not going to want to
be associated with a kids channel.
189 The second reason is, as you have also pointed out,
there is some quality restrictions to AM radio, and the teens, as they are
coming into that age, get very savvy about different quality of sound and will
say, "Oh, you know, I don't want to be listening to the AM. That's for the
190 We are very confident that these are the sort of
attitudes that prevail, so we have nothing in our application that focuses on
anything above six to eleven except that parental viewing, and that is why it
was structured in that way.
191 THE CHAIRPERSON: In the Angus Reid study, at page 9,
there is a pie chart there showing that when the children six to eleven in the
study group were asked, "Do you think kids should have their own radio station
in Toronto", 88 per cent felt that kids should have their own station in
192 Do you think that we should get a whole lot of comfort
193 MS MANDRYK: Well, again --
194 THE CHAIRPERSON: This is on the phone.
195 MS MANDRYK: Right.
196 THE CHAIRPERSON: It is on the telephone.
197 MS MANDRYK: At YTV, we have done a lot of research
with kids in the target group between six and eleven, so even though it is very
difficult to get a lot of valid information from that target group there are
ways of doing it.
198 When we retained Angus Reid, we were very specific
about the type of information that we needed to get from the children and we
know that it is, in fact -- it's possible to get good feedback from kids
and, in fact, have driven a lot of our YTV programming as a result of feedback
we are getting from children.
199 I would also say that we looked for proxies of demand
in other places around the world, as I mentioned before, to see whether or not
the notion of kids having their own radio station was a viable option. Based on
everything we saw, from the United States to the United Kingdom, when kids are
provided with radio stations that are their own, their listening habits go up.
So we were encouraged by not only other samples from around the world, but also
from experience we had with research on YTV.
200 THE CHAIRPERSON: I'm somewhat puzzled by the very high
percentage of children who claim to have access to the Internet, I think six and
ten are 51 per cent. Is that not very high?
201 MS MANDRYK: It is broad access. Either it's school or
from their libraries or from their homes. So it is a variety of different
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202 THE CHAIRPERSON: ...to access at home, which I think
would be lower probably.
203 MS MANDRYK: It's probably around a third,
204 THE CHAIRPERSON: Now revenues.
205 Of course demand and revenues go hand in hand in
trying to ascertain whether this is an efficient use of 740 in light of the
number of parties who are interested in using the frequency.
206 There is some confusion in your application, which I
would like to clear up first, with regard to the split between the national and
local revenues that you expect.
207 I don't know how easy it is for you to get these, but
if you look at Schedule 17, you mention there that 60 per cent, local -- it
is financial operations in response to paragraph 9 or requirement 9 in the
application form -- that it is 60 per cent local and 20 per cent
national. Then, if I look at Schedule 18, the second page, at the top of the
page, the small paragraph that says:
"YTV Radio will derive 60 per cent of its revenues from local advertising."
208 Now, if I look at your financial assumptions,
however -- or the financial operations rather, the projections, and I look
at national -- now I'm looking at 9.1 -- do you follow me -- if I
do the split it is about $900,000 for national and $600,000 for local, which
gives me a 60/40 split national to local.
209 So, what is it? Is that sheet the right
210 MR. HAGGARTY: Madam Chair, your struggles with it are
well founded because there is a typographical error in Schedule 9.1. The local
revenue stream should actually be switched with the national revenue
211 So Schedule 18 and so on, those are all absolutely
correct. It is Schedule 9.1 --
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212 THE CHAIRPERSON: ...financial operations is
213 MR. HAGGARTY: Well, the numbers are accurate, but
rather the captions associated with -- for instance, the national revenue
in year one of $900,000, that should actually be the local line.
214 THE CHAIRPERSON: Okay.
215 So you have something that is a little different from
the achievement by AM stations in Toronto, Ontario, Canada, but not as much at
odds as this would have looked like.
216 So you would invert the words, so that gives you 60
local, 40 national, which is still high on national compared to what is
achieved -- 1998 AM stations is about 18 per cent, 19 per cent, and FM, 25
per cent to 26 per cent.
217 What has led you to have a national that is higher
than what we usually see?
218 MR. ROBERTSON: When we were developing the radio
application we conferred with the advertising community and we were really
enthusiastic about the kind of response to a Toronto radio service that would be
focused particularly on kids. We knew, from those discussions, that what we
would be able to do would be to take the YTV national service and then add to it
a YTV radio component and some other elements of a plan and create a partnership
agreement with these advertisers that would lead to a strong national component
of YTV Radio.
219 So it really comes from our strength in YTV and our
ability to package YTV Radio into existing relationships.
220 THE CHAIRPERSON: Do you envisage a sale in conjunction
with YTV to advertisers?
221 MR. ROBERTSON: Yes. In part, it would be done that
way, and then at other times, if the advertiser was not a current YTV customer
or was more of a local advertiser than a national one, then certainly we would
go directly to them and build the business that way. But certainly we did see a
strong component of this being an integrated offering with YTV.
222 THE CHAIRPERSON: Do you envisage actual sales in
conjunction with YTV? Presumably, a Treehouse would be possible, too, although I
guess you are going to tell me the Treehouse is for preschoolers so it won't be
223 MR. ROBERTSON: That's correct. Treehouse is
non-commercial, so we are really speaking of the connection of YTV, the
television service, to YTV the radio service, which the advertisers said, "You
know, this sounds really exciting."
224 Currently, television is well developed and tends to
be the primary game in town for the kids. The idea of having a radio station, a
different way of connecting with the target groups that they work with, was
exciting to them and they were very supportive of the idea.
225 THE CHAIRPERSON: You do stress in your supplementary
brief that there would be also limitless cross-promotional opportunities between
the two. When we talk about programming, we can also talk about the possible
synergies there, but other than having a relationship with advertisers that may
include the two, would you also use one and the other to promote?
226 MR. ROBERTSON: Yes.
227 YTV has several different ways of entertaining the
children. The best example is that when we -- we used to be just YTV, the
television service. Then we launched our Web site and we were able to, on the
air, on YTV, to tell kids, you know, "Go to ytv.com", and since we are telling
them that every day, we are giving them a reason to go.
228 The YTV Web site has now become the number one kids'
Web site in Canada. On an international basis, this is a Web site that has come
into international prominence as being one of the best in the world. It is the
YTV television service that was used to stimulate that YTV Web site.
229 Since that, we have launched a YTV magazine, which
also represents a promotional opportunity.
230 All these, whether it is the television service, the
Web site, the magazine, all of these can be used to drive demand for YTV Radio.
So in this area we are extremely confident that we can create a market for this
231 THE CHAIRPERSON: In Schedule 18, where you discuss
your revenue rationale, at the very bottom of the page you speak about the fact
that you will have to be careful to safeguard the value of the radio station
offering, not allowing advertisers to perceive YTV Radio to be value-added,
meaning at no charge. Can you clarify what is intended here?
232 MR. ROBERTSON: Yes.
233 This is a concern that has been mostly associated with
the Web site offerings of broadcasters, whether it is radio or television. The
concern is that if you add a new way for the advertisers to access their target
market, they may say, "Well, that sounds just terrific. Why don't you throw that
in for the same price as I'm currently paying you on YTV." They call that,
euphemistically, value-added. One might consider it a discount or
234 So, anyway, we would work very hard to establish a
separate value for YTV Radio, just as we have for the YTV Web site, so that we
can really get a discrete stream of revenue that can be used of course to fund
the strongest possible programming offering possible.
235 THE CHAIRPERSON: In the Echo Advertising and Marketing
study, it is one of the conclusions that there are some advertising agencies
that may be hesitant to include radio to reach kids.
236 Have you had some face-to-face discussions with
advertising agencies or advertisers that you deal with about how this transition
can be made so that it is not value-added but a distinct revenue stream for
237 Also, what is your view of how these companies reach
238 MR. ROBERTSON: Yes, we have consulted with the
advertising agency community, and the response we got was extremely positive. We
will reference some of the positive interventions we received from advertisers,
particularly OptaMedia, which is responsible for General Mills and is known to
be one of the most formidable agencies working with children in the country. To
paraphrase, their comment was that YTV was ideally suited to develop a radio
station for the children.
239 So we were really encouraged by the response by the
advertising community and felt that this was an area where we would receive
240 THE CHAIRPERSON: In your Schedule 18, where you
discuss your marketing efforts, if I understand, when you are asked where your
revenues will be derived, it will be 20 per cent from current advertisers and 80
per cent from advertisers who use radio but not to kids. Is that
241 Actually, what I want to focus on is the pie chart
that is attached to Schedule 18 and understand it better, where you identify
your revenue sources.
242 Of course, everyone before us at this hearing will say
that they won't take -- they will take a minimal or insignificant amount of
revenues from existing stations. That is one of the questions that is usually
looked into: What effects will there be on the market? I don't quite understand
the pie chart in that regard, and especially the difference between YTV-derived
and promo tie-ins with YTV.
243 Mind you, when you look at demand, and revenues
therefore as well, the connection with YTV is obvious, that, quite possibly, if
anyone at all can start a six to eleven radio station, it is someone who
has -- a good argument can be made that it would be more likely to be
successful if you have the synergy with a service that already pitches to
children or skews its programming to children of that age. It doesn't get you
all the way home, but I would like to understand better what this pie chart
means and especially the difference between the two items I have
244 MR. ROBERTSON: I would be pleased to answer
245 If you look at the two sections of the pie that you
referred to, the YTV-derived and the promotional tie-ins, we really meant by
that that we could -- on the YTV-derived side, that we could go to an
existing YTV advertiser, such as Kraft, where we have a large relationship, and
add YTV Radio into that relationship. So that would be 13 per cent of our source
246 The other 7 per cent, called promotional tie-ins, is
going to existing YTV advertisers and developing a promotional basis for them to
247 Often we have promotions like super-soaker promotions
or whatever the promotional platform is that runs on the television. It runs in
the magazine, it runs on the Web site, and now it would indeed run on YTV Radio
248 So that 20 per cent, if you add the 13 and the 7
together, would be an immediate source of revenue that we could access on the
basis of extending existing YTV relationships.
249 Do you want me to continue on with the pie?
250 Then, in the next section, the national radio section,
we thought that this was an area where we could get national advertising with
advertisers that are currently not customers of YTV. An example here might be
Jamieson Vitamins, who we would love to have on the air, but perhaps they are
more of a radio advertiser than a television advertiser, so we would get them on
the air with YTV Radio and then maybe some day they would graduate to YTV the
television service. Who knows? But that is 20 per cent.
251 Down into existing family retail, this is things like,
say, Sam-the-Record-Man, where you have families coming to buy CDs. That would
be a logical one. That is not currently on YTV, but they would be a radio
252 THE CHAIRPERSON: Already on other existing radio
stations that would add some of their buys to YTV?
253 MR. ROBERTSON: Yes. That's correct. The existing
advertising using those teen demographics or adult demographics.
254 THE CHAIRPERSON: Yes. To other stations,
255 MR. ROBERTSON: They would have to come up with a new
budget for this one because they would be now opening up a kids target group, so
that would be the key there.
256 We have some, you know, really intriguing new stores
opening up that are just starting to develop an advertising presence. One such
retailer is the Peanut Club that works with this particular demographic, the
257 The next section, the 20 per cent, which is local
youth combo with teen radio, this is the opportunity to look at buys that are
currently teen-oriented buys and say, "Hey, you know, let's add a child
component onto that teen buy. Let's put them both together", so you are not
displacing the teen advertising, but you are complementing it with a kid
258 A good example of that might be HMV, which is
currently a very strong teen advertiser but don't have a child dimension. We
could add that on there.
259 Then, the last piece of the pie, the 20 per cent
which is local attractions, probably the most notable example would be Canada's
Wonderland, where they, on a promotional basis, sometimes get involved in the
television area. But we think that local attractions is a terrific market for us
as they open up the kid demographic.
260 So, as you look at this pie, and just try to recast
it, it is 40 per cent national, which is the top right breakout slices of the
pie, and it is 60 per cent local.
261 As we say, this is exclusively new business because
six to elevens aren't even monitored by BBM at this stage, so this would be
incremental business to the radio market which will be a good thing for radio
and not impact existing players.
262 THE CHAIRPERSON: That helps.
263 We all know that 740 is a frequency that has got a
very broad appeal throughout large parts of southwestern Ontario. In projecting
your audience shares and your revenues and, for example, when we discuss
programming, the counting of 600 schools, you say it is in the GTA -- the
Greater Toronto Area, I guess -- and you also say there are 350,000 six to
elevens in the GTA. What area did you actually look at?
264 I have maps, of course, of the contour, et cetera, but
I would like a better feeling from you as to where you counted these six to
elevens, these 600 schools, and therefore your projections.
265 MS MANDRYK: Yes.
266 The numbers that are quoted in the application are the
Toronto GTA and the CMA, which would be the surrounding areas. If you look at
the full frequency reach of the 740 frequency, we are in fact up at around
470,000 students, probably closer to half a million. So it is underestimated
there in the application, because we were looking at just the GTA, not the full
coverage area. So if you do look at the full coverage area, we are up at a half
267 THE CHAIRPERSON: That includes the core of
268 MS MANDRYK: That includes the core of Toronto, right,
elementary school students, six to eleven.
269 THE CHAIRPERSON: You know from reading the decision
that was issued after the last hearing in Toronto that 740 was abandoned by the
CBC on the grounds that it was technically weak or of limited quality in the
core of Toronto.
270 Do you have any concerns with regard to that, or do
you count in all the children 6 to 11 that are in those areas as
271 MS MANDRYK: We did count them in for purposes of the
population, but we are not concerned about that. We believe that the majority of
the population that we were going after will not be in the core of downtown
Toronto. It is not going to be in the high density buildings. It will be, for
the most part, in the outer areas and the suburban surrounding areas.
272 THE CHAIRPERSON: Or in the areas that are surrounding
273 MS MANDRYK: Yes.
274 THE CHAIRPERSON: Which means, then, from a programming
perspective, if we can move to programming, you would have to make your
programming relevant to a very large area, you know, in terms of which schools
are open, what is going on in various communities.
275 For example, with your radio roamers, et cetera,
you would have a large area to cover for a proposal that I think would be fair
to say would depend on interactivity, visible presence in schools or wherever
there are happenings that involve young children.
276 MS MANDRYK: Yes. It would be our plan that we would
break out the larger area into probably five separate regions and on a weekly
basis we would concentrate on one particular region. That would give us numbers
that were manageable in terms of radio reporters reporting into the
277 So, for example, week one we would look at sort of the
western part of the block and we would have the radio reporters reporting in on
sort of -- during the week. We would take that information and put it back
onto the air for just that region for that week, and then the second week we
would move to a different region.
278 So we would try to really focus and concentrate on
particular areas every week so that we could maintain that relevancy.
279 In addition to the YTV Radio reporters we also have
roamers, who would be YTV staff who would be out in the community also looking
for community information.
280 So the combination of segmenting the YTV Radio
reporters input as well as having the staff roamers out on the street I think
will allow us to maintain a relevant currency about the activities that are
281 THE CHAIRPERSON: That should be quite expensive,
shouldn't it? We are a little puzzled by the fact that if we look at the seven
year projections and -- well, first let me ask you: YTV reporters, and so
on, those activities, would they fall under programming, the roamers and --
well, the Canadian talent development reporters, I understand. The roamers would
not be -- would simply be an expense of the station.
282 MS MANDRYK: That's correct.
283 THE CHAIRPERSON: That would be found in
284 MS MANDRYK: Yes, that would be found in
285 MS HAGGARTY: Yes, that's correct.
286 THE CHAIRPERSON: If I look at the figures for seven
years, your programming expenses, even if I add the higher than required
Canadian talent development to it, would add up to in the neighbourhood of maybe
30 per cent of your revenue spent on programming, which is a good 10 per cent
lower than what AM stations in Toronto spend on programming.
287 Do you consider this proposal to be not as expensive a
proposal -- I know talk TV, for example, is expensive, but the large area
that you will have to cover and be relevant to entice children to hear it and
find it relevant to them, will require high expenditures.
288 MS MANDRYK: Actually, let me just clarify. The costs
associated with the radio roamers is in the sales, advertising and promotion
line, not in the programming line. So that is an expense that YTV Radio
will incur as part of their advertising and promotion expense.
289 THE CHAIRPERSON: So it would not include it, and it
would not be included either for roamers to schools or roamers to children's
events or festivals, or so on?
290 MS MANDRYK: Right. No, the Canadian Talent Development
Fund, the second line, includes all of the initiatives associated with the
Canadian talent development as well as the community initiative.
291 THE CHAIRPERSON: Now, of course, I haven't calculated
whether those expenses are higher than the average AM stations, so presumably it
should be because that, to me, sounds like an expensive proposition if you
really want to be relevant. There are 600 schools.
292 I think it would be fair to say that this being a new
proposal you will have to lure children away from the stations they may be
listening to now or get them onto radio listening. So you will have to do quite
a bit of that.
293 Anyway, we will have a chance to examine whether those
expenses are higher since that is where you are going to put roaming.
294 MR. ROBERTSON: If I might add that one of the real
strengths of this radio station is that it will have the strength of YTV behind
it. That kind of support you can't always lock into dollars and cents to be
spent in a cash basis against the service. In fact, we would expect to be able
to mention YTV Radio frequently on the air on the YTV service.
295 We also think that the outstanding creative pool of
talent that is available on YTV can be buttonholed to take their concepts and
their ideas that they are just bubbling over with and extend them into YTV
Radio. So there is going to be a lot of benefit coming from the YTV side that is
above and beyond these levels of support that have been specifically outlined in
296 THE CHAIRPERSON: My colleague tells me that sales,
advertising and promotion average for a Toronto AM station is $1.5 million and
yours don't reach $1.5 by year seven. It's still $1.3. So they are not higher
than the average, but they are rather lower.
297 MR. ROBERTSON: There is also a non-cash contribution
that YTV makes that will really be a critical part of the success of YTV Radio.
We will be able to mention YTV Radio on the air every time, you know, we take a
break. We will be able to promote it through the Web site, through the
298 We haven't put a cash value on all those promotional
elements because we really don't see that as an out-of-pocket expense. But, in
addition to the strong level of existing support that is there from a cash
basis, there will be a powerful big brother there called YTV which will be
reporting and developing new listeners.
299 So we are very confident that the marketing plan that
has been put together can generate the type of audience that we have identified
in our plan.
300 THE CHAIRPERSON: What could I envisage as a parent,
that there would be an identifiable YTV Radio station vehicle of some sort
visiting the school when some -- let's say it's a Christmas concert or some
special event that the Grade 1 is having a graduation party, or whatever it
is that is on, there will be a visibly identifiable person there with a visibly
identifiable vehicle participating. Well, what will they do? They will tape
what's going on?
301 I understand that you have looked at the YTV
reporters, you say you have spoken to school boards and they are quite onside
302 What about the roamer? Has that been -- is every
school satisfied that that is acceptable to them, to have this commercial
operation on site when they have school events?
303 MS MANDRYK: It will be entirely up to the individual
schools whether they participate in these opportunities, but in our discussions
with the Board the feedback that we received is that they expect that there
would be a high participation rate. But unless you go out to every single Board
and ask them, you really don't know what that is.
304 But their expectation is that we are bringing enough
value into the community that it is entirely likely that most of the schools
will want to participate.
305 I think the notion is we would take the vans into the
schools, but it is very much a community initiative so our intent is to report
on things that are relevant to children in that area that they are going to want
to hear about and know about and the parents are going to want to have more
information about. So it's much less of the commercial element than it is more
of the community reporting element that becomes the critical part of the
initiative in the community.
306 THE CHAIRPERSON: I understand you will be dealing with
307 MS MANDRYK: Yes.
308 THE CHAIRPERSON: That is where, of course, you can
play the appropriateness part --
309 MS MANDRYK: Yes.
310 THE CHAIRPERSON: -- of getting children to
listen to a more appropriate radio station.
311 How many of the 600 schools do you expect you would
roam to in one year?
312 MS MANDRYK: We are hoping that we would get access to
at least half of those from the roaming standpoint.
313 THE CHAIRPERSON: That's quite an endeavour I would
314 MS MANDRYK: Yes. And it will ramp up over time as we
become more familiar with the structure and how to work through the schools and
become more efficient at it. It will ramp up over time.
315 THE CHAIRPERSON: And there will be, of course,
duplication and overlap because Christmas concerts are usually at the same time
of the year, which will create some difficulties as well.
316 MS MANDRYK: Yes. Hopefully we will be able to
supplement that with the in-school reporting though, to make sure that everyone
gets their fair share on-air.
317 THE CHAIRPERSON: How will you gather information from
that very broad coverage area about school closings, school
318 MS MANDRYK: We expect that we will have the technology
set up to enable either voice mail or via the Internet or via direct to hard
drive, abilities for people to call in and give us that information automated
and then we deal with it from that standpoint.
319 THE CHAIRPERSON: Now I would like some more
clarification on what your broadcast day will be.
320 In Schedule 18 you talk about sales rotation to
start at 6:00 a.m. rather than the traditional 5:00 a.m. and to end at
11:00 p.m. rather than the traditional 1:00 a.m. for radio stations.
321 What exactly is going to be your broadcast day?
Because I think your answer in the application to the question of how many hours
it is 126. So how do you calculate your broadcast day?
322 I'm leading to the question of you say there will be
100 hours of local. Will there be then more hours of local, or where would the
number of hours come from?
323 MR. KENNEDY: We are planning on an 18-hour broadcast
day, from 6:00 a.m. until midnight. The 100 hours of local would then leave our
maximum -- it's a minimum of 100 hours local, it would leave a maximum of
26 hours for syndicated programming.
324 THE CHAIRPERSON: A minimum of 100 hours of
325 MR. KENNEDY: That's correct.
326 THE CHAIRPERSON: What would the other hours
327 MR. KENNEDY: Syndicated programming could include
things -- there are syndicated humour programs, jokes, top 10 lists; there
are story times available from various countries around the world.
328 We have done some research, there are 20 or 30
companies that we have identified -- we haven't approached any of them as
yet, but we have identified that are in the business of selling children's
programming, audio programming, that we could approach; readings.
329 There is some public domain material. There are
companies like BBC and CBC and Australian broadcasting companies that are
producing programming for sale.
330 We have begun some encouraging discussions with the
ATTN(ph) here in Canada, the possibility of simulcasting programs on television
as well, for example concerts and things of that nature.
331 That is basically what we are looking at for that
syndicated programming. Again, that is a maximum of 26 hours a
332 THE CHAIRPERSON: So by local you are using the
traditional definition of station produced?
333 MR. KENNEDY: That's correct.
334 THE CHAIRPERSON: Do you propose to try to get any of
the programming from Disney?
335 MR. KENNEDY: That's has not been discussed at this
336 THE CHAIRPERSON: Is that an opportunity that could
work? You haven't explored it?
337 MR. KENNEDY: We haven't explored it.
338 We look for all opportunities to get whatever
programming is appropriate for this age group, but at this point in time we
haven't had discussions with Disney, no.
339 THE CHAIRPERSON: I understand that Disney is a network
of a number of stations. Is that how it works?
340 MR. CASSADAY: Yes, it is.
341 THE CHAIRPERSON: In the same format?
342 MR. CASSADAY: It is not entirely the same format.
Disney also programs to preschoolers and we have chosen to focus our application
entirely on 6 to 11.
343 THE CHAIRPERSON: Have there been in your plans, if
this were to work, to try to expand this format in other areas in Canada, or
have you not thought about it yet, or do you not want to tell me if you
344 MR. CASSADAY: Well, one thing, for example, I was in
London a couple of weeks ago and our AM station in London is predominantly a
talk station but on the weekend they play music because of the costs associated
with mounting a legitimate news service over the weekend, and the programmer
asked me if I thought there would ever be a possibility where YTV Radio, if it
was successful, could be syndicated on weekends.
345 Madam Chair, if in fact we did think there was an
opportunity for network syndication we would come back to the Commission to
request a licence to do that.
346 But it is possible that AM stations across the
country, many of whom are still struggling, would be very grateful for some form
of syndication, a network-type relationship with a successful kids service,
particularly for the weekend time periods when it is difficult for them to mount
the kind of programming they need to be competitive.
347 THE CHAIRPERSON: To be inserted into their normal
348 MR. CASSADAY: That's correct.
349 THE CHAIRPERSON: -- at appropriate
350 MR. CASSADAY: That's correct.
351 THE CHAIRPERSON: -- and which could become a
source of revenue, I guess, for you.
352 MR. CASSADAY: Correct.
353 THE CHAIRPERSON: And more appropriate radio across the
354 MR. CASSADAY: Well, generally it would be replacing
talk at most of these AM stations. But again, we think, as Paul alluded to
earlier, that we have identified a true market opportunity to serve a segment of
the population that is currently not being addressed by any radio operator in
355 THE CHAIRPERSON: You speak in your supplementary brief
at page 6 of the transformation of YTV TV programs to radio. How would that be
356 MR. KENNEDY: There are several opportunities here.
One, we had mentioned simulcast on an appropriate program, for example a concert
or something of that nature. There is also the option of developing the YTV hit
list into a syndicated countdown program that would be available for the radio
357 Some of the story time readings we think -- that
are developed with the company -- would be appropriate for YTV Radio. Those
are the sorts of examples we are looking for.
358 THE CHAIRPERSON: The Angus Reid report has found that
children are very receptive to the idea of a radio station designed to play
music that is picked by children of their age and the opportunity to interact
with disc jockeys of their age. How will that work?
359 In the choice of on-air hosts and of DJs and of
actually the music, how will you -- will you have actually children on-air,
YTV reporters support? What will that lead to?
360 You mentioned earlier as well the fact that children
love to hear children's voices on the air, so I suspect -- will have
not -- not child labour, that would be inappropriate, but will you have
children on-air rather than simply an open-line type of
361 MR. KENNEDY: While we have made great strides
technically over the last decade I think we are still beyond the capability of
having 7 or 8-year-old disc jockeys.
362 I think the interaction with the children on the air
will be hearing other children's voices on the air in the buzz back sections of
the program, or hearing them request songs or talk to the disc jockey on the
telephone. That's where we get some of that interaction, because they can react
to something else that they have heard on the air.
363 Our disc jockeys obviously have to be able to
communicate and relate to these people, so the same way that I would assume that
YTV would choose a VJ we will be choosing disc jockeys that are young, youthful
and able to relate to this audience.
364 That goes for the radio roamers as well. Although they
have to be old enough to drive, obviously, we want them to be young enough to
feel comfortable in those surroundings.
365 MR. ROBERTSON: Perhaps I could just build on Ted's
answer and say that on the YTV television side what we think of is that our
program jockeys would be perhaps a child's older brother or sister, and that is
the kind of model that we look for.
366 So we want somebody that speaks their language, that
can relate to them not as a parent would to a child, but also not on a straight
peer level either because we hope to help set a positive role model for these
children. We hope to be able to teach them something while they are being
entertained, and that is what an older person can do, although of course they
are selected to be very young and hip and something -- someone that the
kids would find cool.
367 THE CHAIRPERSON: Besides the traditional feedback
similar to audience sweeps, et cetera, will you have a system, some type of
system to get feedback as to whether you are successful in pitching to the 6 to
11 radio listener, which may be different from the TV viewer?
368 MR. ROBERTSON: Yes. We would expect to have a constant
feedback loop with the children 6 to 11 and that could be done by
letters that they send in, it could be phone calls to the station, it could be
Web site interaction, but all these things -- you know, we would see our
responsibility to be very specific in this area, that we would give them
tailored responses, we would listen to what they had to say and we would act on
369 On the YTV front, the only way that we have been able
to maintain our current nature and continue to be cool for the kids is because
we take their direction. We actually listen to them and change our approach
based on what they have to say.
370 These kids are not shy, they will give you their
honest opinion. Sometimes it's a little on the brutal side. We are tough and we
can take it. We certainly learn from it and will change the service to meet
371 THE CHAIRPERSON: One last question on your Canadian
talent development: $52,000 a year to children's festivals. That will be simply
money given to help the staging of festivals? How will this contribution
372 MS MANDRYK: Well, what we expect is that we would set
up a committee that would evaluate all of the opportunities of the children's
festivals in the local area that help to further Canadian talent development as
well as the broadcast, the broadcast specifically of television and radio. We
would set up a committee and we would have a number of criteria that we would
373 What we believe is that we would pay this money to the
third party, which would be the festival. So, for example, for "Word on the
Street" or for "Sprockets", which is a kid's Toronto film festival, that money
would be paid to the third party's festival for use in their local
374 THE CHAIRPERSON: Now for the frequency, or a technical
375 We have a number of applicants for the use of 740.
Have you thought of alternatives for your competitors, if not for yourself, in
the AM band for example?
376 The AM band, the extended portion of it from 605
kilohertz to 705 kilohertz? Are there other alternatives that you can generously
suggest to your competitors to implement an AM proposal in Toronto, or have you
simply applied for 740 and not looked at what else may be available?
377 MR. CASSADAY: We have simply applied, Madam Chair, for
740. A number of -- I guess two of the applicants for AM have also applied
for FM. It's an either/or scenario.
378 THE CHAIRPERSON: So you don't have anything more to
379 MR. CASSADAY: We think that this 740 signal,
while it may be weak in the core of Toronto it is an incredible signal and
argues for a service as inclusive as the one which we are proposing which we in
fact would argue is the most inclusive of the services and provides, we think,
tremendous utility for such an exceptional signal.
380 THE CHAIRPERSON: Now that you are in full flight,
Mr. Cassaday, I will give you five minutes -- these are my
questions -- to tell us why you should get 740, if you have any more to
say -- Mr. Robertson is all smiles, so he obviously has -- or to
answer any other question I didn't ask.
381 MR. ROBERTSON: Okay. Well, that's very generous of
you, Madam Chair.
382 First of all, I think we have a clarification in the
nature of your question concerning program expenditures compared to market and
these sorts of things.
383 Perhaps I could ask Jamie Haggarty, first of all, to
comment on that.
384 MR. HAGGARTY: Yes. I guess we just wanted to
supplement some of the comments or questions around some of our spending
385 On the programming expenditures I think we are quite
proud to acknowledge that we have committed $5.3 million over the seven years,
which is second to no other applicant for the AM frequency. So clearly we are
deeply committed to spending and supporting our programming for the $5.3
million. That includes both our personnel costs, but also acquisition costs for
other programming for radio services, spoken word as well as music.
386 So I just wanted to sort of note that our spending on
programming is second to none.
387 On the sales and promotion I just wanted to sort of
add to, I guess, the analysis of the YTV Radio's spending for our sales and
388 If I compare our assumptions for sales and promotion
as a percentage of revenue, in year one our sales and promotion are 76 per cent
of our revenue. By year seven sales and promotion expenses are still 31 per cent
of revenue. If I compare that to the AM/FM Toronto market spending of sales and
promotion that was included with the call for the applications, in all the
Toronto market sales and promotion spending in 1998 was 27 per cent.
389 So I think we are clearly committed to sales and
promotion because our -- even by the seventh year we still exceed the
average spent in 1998 in all the Toronto AM and FM.
390 THE CHAIRPERSON: You are combining AM and
391 MR. HAGGARTY: That's right.
392 THE CHAIRPERSON: I was using AM figures.
393 MR. HAGGARTY: Okay.
394 MR. ROBERTSON: We could clarify those numbers on the
AM basis as well.
395 I think that what we are enthusiastic to project is
that when we developed this application we did it with, you know, all the proper
tools put in place, not only the support that is on paper but also the strong
support of YTV behind the scenes.
396 In terms of the big reasons why we believe the
Commission should say yes to YTV Radio, first of all, this is a fresh new
format, there has been nothing like it in Canada. It is something that clearly
adds diversity to the dial.
397 Second, kids are not served by radio. They are not
under served, they are not served at all. Yes, they are listening to radio
stations, but what they are listening to is not always appropriate.
398 Third, 100 hours of local programming I think will
stack up as a very favourable commitment in terms of the nature of this
programming and it being a unique offering to the marketplace.
399 Fourth, $1.6 million in talent and community
initiatives, which again is an extraordinary strong level of support and typical
of our powerful commitment behind the service.
400 Fifth, need for a safe haven versus some of the
inappropriate options that are out there.
401 Sixth, we think it's good for radio, and AM in
particular, if we can get these kids involved in the AM and in radio, that it
will speak good things about the future of radio.
402 Finally, we believe it will have a negligible impact
on existing radio services which we think is a major, major positive aspect of
403 We have added 22 people to run this YTV Radio station.
We are going to get people that understand radio, people who understand kids,
put them together with the kind of energy and positive outlook that we have at
YTV and create just an outstanding service that kids will be really enthusiastic
to take part in and that parents will endorse.
404 THE CHAIRPERSON: Thank you.
406 MR. RHEAUME: Thank you, Madam Chairperson.
407 Just a few clarifications at
408 You indicated, I believe, that you would have 100
hours of local hours that the station produced. What proportion would be repeats
and originals? Because you did mention repeats in the evening at
409 MR. KENNEDY: We haven't specifically targeted a
number. We feel that everything that we put effort into producing, for example
for the school board and daytime programming, we think that has tremendous value
to people who may have been in class when it originally aired and were not able
to hear it, and we would expect to repeat those in time periods when people were
available in the evening or in the afternoon time periods.
410 Although at this point in time we haven't targeted a
specific number we do feel a strong commitment to doing that and it will
probably ramp up, you know, from day one up to year seven.
411 MR. RHEAUME: How about weekends? Do you have repeats
scheduled on the weekend? Because you don't say a lot about your weekend
schedule, I believe, in your application.
412 MR. KENNEDY: The weekend schedule we are viewing as
similar to the afternoon and the evenings in that the kids are available most of
the day part. So we will just program the weekends as we program the 3:00 to
8:00 or 3:00 to 9:00 p.m. period.
413 MR. CASSADAY: Just, counsel, one additional
414 For this particular target repetition is a virtue not
a sin, and I think the points that Ted is making are such that we really will
have to find out as we go the appropriate level of repetition, but we know kids
do like to hear the same thing over and over again until they can internalize
415 MR. RHEAUME: I was not accusing you of sinning, by any
416 Just one final question, maybe clarification on the
community development initiative. You did mention the radio reporters and the
417 The Savvy Surfers, literacy on the Web, how would that
work? Would that be direct contributions? That's essentially what I'm
418 MS MANDRYK: We would expect that that program --
we would work in conjunction with the media awareness network and the school
boards as well as the Concerned Children's Advertisers to put together a program
that has four phases to it.
419 One would be, obviously, providing in-class resourcing
material for teachers and educators.
420 The second part would be a public awareness
421 The third part would be working to develop CD-ROMs and
Internet-based information for the students.
422 The last point would be an Internet Web site for the
423 So those four elements would be combined together,
which we would develop in concert with these other organizations.
424 MR. RHEAUME: And that would be cash outlay on the part
of your company?
425 MS MANDRYK: Yes.
426 MR. RHEAUME: And you do volunteer all of these as
conditions of licence. Is that correct?
427 MS MANDRYK: Yes.
428 MR. RHEAUME: Thank you.
429 THE CHAIRPERSON: Thank you, counsel.
430 Thank you, Mr. Cassaday, ladies and gentlemen. We
thank you for your co-operation.
431 We will adjourn now for 15 minutes. We will be back at
11:15 and we will sit until approximately 12:30, depending on what is a
reasonable point to take our lunch break.
432 Thank you.
433 Nous reprendrons 11 h 15.
--- Upon recessing at 1100 / Suspension à 1100
--- Upon resuming at 1120 / Reprise à 1120
434 THE CHAIRPERSON: Mr. Secretary.
435 MR. RHEAUME: Thank you, Madam Chairperson.
436 Our next application is by CHWO Ontario Incorporated
on behalf of 1210361 Ontario, the general partner, and Ken Harrigan, George
Patton, Terry Patterson and Peter Gilgan limited partners in a limited
partnership to be created and to be known as AM 740 PrimeTime Radio, for a
broadcasting licence to carry on an English-language AM radio programming
undertaking at Toronto.
437 The new station would operate on frequency
740 kilohertz with a transmitter power of 50,000 watts.
438 The Applicant is proposing to offer music and spoken
word programming of particular relevance to listeners who are 50 years of
age or older.
439 The Commission notes that this application is
technically mutually exclusive with other applications scheduled at this hearing
for the use of the 740 kilohertz frequency.
440 We have Jean Caine and her colleagues.
441 Ms Caine.
PRESENTATION / PRÉSENTATION
442 MS JEAN CAINE: Good morning, Madam Chair, ladies and
gentlemen of the Commission. My name is Jean Caine and I am the Chairperson and
Chief Executive Officer of CHWO Radio Limited.
443 On behalf of CHWO and the proposed limited partnership
to be known as AM 740 PrimeTime Radio, I am grateful for this opportunity
to appear before you with our application for a new and a much needed radio
station to serve Toronto and Southern Ontario at 740 on the AM dial.
444 Before we begin our presentation I would like to
introduce you to the members on my panel.
445 On my immediate right here is my son, Michael Caine.
Michael is the President and General Manager of our company. He has spent over
30 years in the radio business and I am very proud that his exceptional
leadership has enabled our company to achieve far more than even his father and
I ever dreamed possible, and I can tell you, we had some pretty big
446 Sitting next to Michael is Harry McDonald, who is our
Vice-President of Sales and Marketing.
447 To Harry's immediate right is Jacqui Gerrard, CHWO's
448 Directly behind is our legal counsel from Borden
Elliot, John Hylton. Incidentally, John is also the Chair of the School of Radio
and Television Arts at Ryerson Polytechnic University.
449 Next to John is Kaan Yigit. Kaan is the President of
Solutions Research Group who conducted our market research for us.
450 Beside Kaan is our Music Director, Brian
451 Seated next to Brian is our Program Supervisor and
News Director, Bob Sheppard.
452 To Bob's right is Jim Leek, the host of the national
award winning program "Celebrate" on CJMR.
453 Finally, to the far right at the back I would like
to -- no, now they have moved over here to the left, I'm sorry. I have them
pinned now -- are Naomi Strasser and Lori Payne who are going to be
assisting with the audio and visual portions of the presentation.
454 Over to my very right -- I have lost him
now -- behind me -- is the third generation of the broadcasting
Caine's, Matthew Caine, my grandson. He too will be assisting with the audio and
visual portions of our presentation.
--- Musical interlude / Intermède musical
455 MR. MICHAEL CAINE: I bet you could be tapping your
toes right now along with a lot of the other people in the room.
456 You can bring it down now. Thanks very
457 If we had started with "I Left My Heart in San
Francisco" I bet you could sing all the words along with Tony Bennett as
458 You see, there is a reason for the great adult
standards of the hit parade and why there will forever be the hallmark of the
people who shape the latter half of the 20th century. It's timeless, it touches
the heart, it has lasting relevance.
459 This application is all about what a huge number of
people in Toronto and surrounding want in a radio station but is currently
unavailable to them. It's about an affluent demographic group that makes up
one-quarter of the population of Canada's largest city.
460 According to the CRTC, and specifically section 3
of the Broadcasting Act, we are challenged to achieve a varied and comprehensive
broadcast system that provides a balance of information and entertainment for
people of all ages, cultures, interests and tastes.
461 The submission we present to you today not only
satisfies those challenging goals, but the other expectations of the Commission
as outlined in its call for application.
462 When it comes to relevant programming, today's 50, 60
and 70-year-olds do not want to limit themselves to weekly bingo. They want to
know where the snow is falling so they can strap on their "fatboys" and hit the
463 This mature, active, healthy and affluent generation
is growing younger by the minute, but not so young that they want to immerse
themselves in the world of rock and rap. Today they want memories of the hit
parade, the romance of Sinatra, the cool ease of Nat King Cole. And yes, they
even want Johnny Favourites swing orchestra, Celine Dion and Harry Connick
Junior. They want to know what's happening in the world and they want to know
the best destination for a Sunday outing with their children and
464 They have always worked hard, continue to work hard
and want access to the products and services that will keep them and help them
to live well. They want a radio station that addresses these needs. They want a
radio station of their own.
465 We are the people who understand the 50-plus
demographic. We are experts at bringing them programming that will always meet
their needs, whether we are in 1956 or 2006.
466 There are currently 23 radio stations licensed in the
GTA. There are several ethnic stations, adult contemporary and top 40 stations,
stations that feature classical, jazz and other special interests. We have news,
talk and sports stations and stations that carry new rock, oldies rock,
alternative rock and urban rock. With a variety of rock on one end and hard news
and talk on the other, it could be said that the 50-plus of Toronto are between
a rock and a hard place.
467 What it means is that over 1.2 million listeners
over the age of 50 in the GTA are channel surfing, looking for the kind of music
they love and the information programming designed for them.
468 Furthermore, there is limited opportunity for
advertisers and programmers to bring relevant consumer and issues-oriented
messages to this vibrant, active and affluent demographic.
469 For the past 44 years my family has operated
CHWO 1250, a successful independent radio station in Oakville. When CHWO
went to air in 1956 there were a number of radio stations in southern Ontario
that served a mature audience. As its out-of-town competitors began to abandon
the mature market by targeting younger listeners, CHWO became the only station
in the area, AM or FM, to remain true to the adult standards format and
committed to listeners who are 50 years of age and older.
470 The one area of complaint has and continues to be:
They can't hear us. This has nothing to do with growing older.
471 Well, it's time to change that. Most 50-plus listeners
in Toronto and other communities in southern Ontario are outside CHWO's local
coverage area. Because our signal is too weak and often distorted by
interference we are cut off from a huge portion of our potential audience,
especially in the import early morning, late afternoon, evening and nighttime
hours when we must cut power and change patterns in accordance with
472 Now, this map, prepared for us by Bell Actimedia,
shows where the 50-plus of southern Ontario are concentrated. The three darker
colours show a high concentration of 50-plus while the cream colour shows a
lower density of 50-plus residents.
473 Focusing now on the local service areas, this map of
the Golden Horseshoe shows where the 50-plus live in and around the greater
474 The CRTC, Industry Canada and others look at the 15
millivolt contour of an AM station as the bench mark to define its local service
475 Now, as we have overlaid this 15 millivolt daytime
contour of CHWO 1250 on the map, you can see that it does not even reach
the old City of Toronto, but instead only reaches as far as the Humber Bay in
Etobicoke, it barely covers the Toronto International Airport in Mississauga and
the City Centre of Brampton. It skirts just under the town centre of Milton and
finishes up by barely covering half the City of Burlington. With a 50 per
cent reduction in power and a pattern shift, you can imagine how much smaller
our nighttime coverage is.
476 This demonstrates, we think, that the vast majority of
those over the age of 50 are beyond CHWO's local service area, even in the
daytime. A man from Scarborough put it best in a complaint letter to the
Commission a few years ago when he commented about our 1250 signal in
Oakville by saying "You can't get to hear from there". That's
477 It also explains why over 7,000 people took the time
during the busy holiday season to write emotionally charged letters to you in
support of our application.
478 Now, as you can see, the 15 millivolt contour of AM
740 easily covers all of Toronto and surrounding areas where the affluent and
discerning 50-plus demographic is concentrated. With AM 740 PrimeTime Radio
mature listeners everywhere will finally be able to hear a radio station
designed for them which can be heard interference free.
479 Here is why they will want to listen.
481 MR. SHEPPARD: We commissioned the Solutions Research
Group, one of the four most independent research firms in the country today, to
study the 50-plus age group in Toronto. Their research reveals that 93 per
cent of those aged 53 years and older identify listening to music as their
number one interest.
482 The CHWO team brings extensive experience in 50-plus
radio programming, and a broad knowledge of the kind of music that shaped the
last century. Guided by professional research and demographic studies,
AM 740 PrimeTime Radio will be a refreshing new option for the people who
grew up listening to AM radio and form the majority of its listeners
483 For our AM-friendly 50-plus audience we will blend a
mix of M.O.R., easy listening, '50s pop, big band, swing and nostalgia into
a single unified and carefully crafted musical format known throughout the
industry as adult standards.
484 The adult standards radio format is perhaps the most
misunderstood format on the dial. Simply put, it's a dynamic and growing format
appealing to the increasingly important 50-plus population base in most radio
markets in the United States, over 550 stations nationwide in 1998, and in
many Canadian centres, with the glaring exception of Toronto. With the arrival
of 740 PrimeTime Radio the 50-plus of Toronto will finally be able to
listen to the kind of music that belongs to them, presented by well-known and
485 Naturally, as the years go by and other stations vary
their musical formats to chase those new generations of coveted 18 to
30-year-olds, PrimeTime Radio will adjust its play list accordingly in order to
appeal to the 50-plus audience.
486 PrimeTime Radio will also deliver a comprehensive
schedule of regional and local news, as well as an array of entertaining and
informative programs, everything from "The S.A.L.T. Report" to "Relatively
Speaking" where three generations from the same family discuss issues of
487 Though it's our intention to bring the golden age of
radio back to Toronto, we want to make it clear that AM 740 PrimeTime Radio
will not be lost in a mid-20th century time warp.
488 Our studios will be Internet equipped to add strength
and precision to the information we share with our listeners. Through our Web
site primetimeradio.net AM 740 commentary and discussion will be
referenced, expanded and linked so that audiences can continue to learn,
participate and comment long after our feature has left the air.
489 Our companion print publication, "PrimeTimes", will
keep our listeners in tune and a step ahead of topics and events that affect
their lives. At AM 740 PrimeTime Radio we will connect with our
audience better than before.
490 To ensure that all we do remains relevant and current
to our 50-plus audience, we have the AM 740 Advisory Council. We are
pleased and honoured that a number of prominent Canadians have already agreed to
become members of our advisory counsel.
491 The chief anchor for CTV News, Lloyd Robertson
will be our expert on news and public affairs.
492 Keeping us in touch with political affairs and other
important issues facing Torontonians will be David Crombie, former Mayor of the
City of Toronto and Chairman of Toronto's Waterfront Commission.
493 University of Toronto Professor of Economics and best
selling author of "Boom Bust and Echo", Dr. David Foot will share his
considerable expertise on demography and trends.
494 Dr. Elaine Denbe is one of Canada's most recognized
experts on health and wellness, as well as being a best seller author, media
personality and motivational speaker.
495 Lillian Morgenthau is the President of CARP, the
Canadian Association of Retired Persons, and will be a valuable resource to
PrimeTime Radio on all issues involving those over 50.
496 Finally, Russ Little will help us maintain our musical
focus. Russ is a former Director of Music at CTV and a successful and
accomplished musician, composer, arranger, conductor and record
498 MR. McDONALD: Perhaps because it was the United
Nations International Year of Older Persons, it seems especially over the past
year our television sets, magazines, newspapers, trade associations and
government agencies have all reported on the huge size of the 50-plus market and
its buyer power and economic influence on our society today.
499 The 50-plus demographic group controls 80 per
cent of the country's personal wealth. It represents 28 per cent of all
discretionary income, accounting for the largest share of spending on most
categories of goods and services, a share that will increase steadily over the
next 15 years.
500 This silent, demographic majority is not so silent at
the cash registers. They are the power players that drive our economy today and
it is certain that they will be in the driver's seat into the foreseeable
501 AM 740 PrimeTime Radio will be the only radio
station capable of delivering this specific audience group to an advertiser
within the greater Toronto area and throughout southern Ontario.
502 CHWO's existing sales and marketing initiatives are
enormously successful. As a proven leader in the 50-plus market, we confidently
submit to you the sales projections for AM 740 PrimeTime Radio. They are
supported by independent findings from the Solutions Research Group and
Harrison, Young, Pesonen & Newell, HYPN, one of Canada's largest and most
respected media planning and buying organizations.
503 The Solutions Research Group estimates that PrimeTime
Radio will have a weekly cume in year one of about 400,000 people in the 50-plus
504 In terms of hours tuned, the data suggests a market
share in the 9.6 to 12.8 per cent range among adults 50-plus, placing the
station in the top five in Toronto in this demographic group.
505 HYPN has analyzed this data and projected that
PrimeTime Radio will be 65 per cent sold out in year one and rise to
100 per cent sold out in year five, when it will earn a 1.52 per cent
share of the total radio advertising dollars available in Toronto.
506 AM 740 PrimeTime Radio will have a major head
start on revenues, since CHWO has pledged to transfer a significant amount of
its air time sales from its existing 1250 operation to the new venture. This
means that approximately 60 per cent of the projected first year sales for
AM 740 have already been accounted for through current income.
507 Because of the programming and sales plans for
CHWO 1250 and its subsidiary CJMR 1320, the financial stability of the
parent company will not be harmed.
508 Finally, the research studies also indicate that the
impact of AM 740 PrimeTime Radio on the audience share and advertising
revenues of existing Toronto radio stations will be, quote,
510 MS GERRARD: For the past 44 years we have
successfully operated an AM radio station in the most competitive broadcasting
environment in Canada. However, to survive on the new and emerging playing field
of multiple ownership, LMA's, industry giants and new technologies, it is
crucial that this independent, family-owned radio station be given the
opportunity to maximize its potential that can only be achieved through the
granting of this application for AM 740 PrimeTime Radio.
511 We are confident that we have realistically projected
the costs of operating and financing the new venture in every detail, including
synergies that will be realized in the administration and technical
512 The economic foundations of AM 740 PrimeTime
Radio are built upon the enthusiastic support of solid investors. The partners
of this venture, all successful Canadian entrepreneurs, are committed to
achieving the goals and objectives of our collective vision, which is to build
the preeminent radio station in the greater Toronto area catering to the musical
and information interests of those in our society who are 50 years of age
and older. Their business acumen and successful management and leadership skills
will ensure that AM 740 PrimeTime Radio will be a success in every
513 You have heard the essential elements of a formidable
business plan that will make AM 740 PrimeTime Radio a viable competitor in
the Toronto market.
514 Let me summarize by saying that the strength of the
business plan for this application rests on three pillars:
515 - A proven format and track record;
516 - Responsible economic stability; and
517 - Responsible, experienced partners.
519 MR. MICHAEL CAINE: Thank you, Jacqui.
520 I would like to bring our presentation to a close by
coming full circle and returning to the substantial public benefits associated
with this application.
521 One we haven't mentioned yet is our commitment to the
development of Canadian talent. AM 740 PrimeTime Radio will annually
contribute funds to five worthy recipients who are all directly and actively
involved in the development of Canadian talent.
522 Our CTD partners are:
- One of Canada's foremost educational institutions, the School of
Performing Arts at Humber College which focuses on jazz, big band and commercial
- The Music Theatre Program at Sheridan College, considered to be one of
the top three of its kind in North America;
- Canadian Music Week will work with us to bring a higher profile to big
band and pop orchestral music to their premier trade event for the international
music and broadcasting industries;
- To Factor;
- And to the establishment of the Toronto Big Band Festival, the first
festival of its kind in Toronto that will provide much needed exposure to
Canadian talent in this genre and will bring strong tourism and economic
opportunities to the city.
523 Another benefit of the AM 740 PrimeTime Radio
application is that after a three month simulcast period when the adult
standards format is moved completely to AM 740, CHWO will become
JOY 1250, the area's first full-time station dedicated to family values,
positive living and contemporary Christian music.
524 At the present time, listeners who enjoy this kind of
programming must tune out-of-country to WDCX in Buffalo, which BBM reports as
having 40,000 listeners in the GTA, almost twice as many as it has in
525 Furthermore, WDCX claims that 66 per cent of its
revenues come from Canadian advertisers. JOY 1250 will repatriate those
listeners and substantial advertising dollars back to Canadian radio.
526 Ladies and gentlemen, we conclude our presentation by
highlighting the main reasons we believe that our application should be
1. The contribution of the proposed AM 740 PrimeTime Radio service not
only achieves but surpasses the objectives established in the Broadcasting
2. The huge 50-plus demographic, over 1.2 million strong, is the
largest, most under served segment of Toronto's population. They appreciate AM
radio and deserve service on the last available AM frequency.
3. With AM 740, CHWO can finally reach all of its potential audience
with a clear, interference-free signal.
4. Granting CHWO's application will bring diversity of ownership to the
Toronto market and allow CHWO to survive in a new competitive environment that
includes multiple ownerships, LMAs, industry giants and new technologies.
5. A significant but largely ignored segment of the domestic music scene will
receive much needed Canadian talent development funds and exposure.
6. Solid investors and favourable independent market studies show realistic
and achievable audience and financial
527 MS JEAN CAINE: Ladies and gentlemen, that concludes
our formal presentation.
528 We would be delighted to answer any questions you may
529 THE CHAIRPERSON: Thank you, Mrs. Caine, Mr.
Caine, ladies and gentlemen.
530 Commissioner Wilson.
531 COMMISSIONER WILSON: Good morning, Mr. Caine,
ladies and gentlemen.
532 I'm going to take, I guess a somewhat linear approach.
I'm going to go through the various things that you have submitted to us I
guess, except for the fact that I am going to start with the supplementary brief
which actually comes at the end of the application.
533 Before I was at the CRTC I always wondered why it was
called a supplementary brief since it's always the first thing that I read in
terms of describing what the application is all about, but have their
534 So I'm going to start with the supplementary brief and
go through a few general questions and some questions of
535 I want to take a look at the Solutions Research Group
study and the HYPN analysis of the SRG results.
536 I have one very quick question about the Nordicity
Group Study and then I want to look through your business plan in terms of some
of the assumptions that you have made, as well as the financial impact on your
537 If you don't mind, although they are not before us in
application form, you have brought these changes in format to your existing
stations to us as additional benefits of this application, I would like to look
at some programming issues associated with those two stations.
538 The Canadian talent benefits and technical
539 I will just warn you that there is likely to be some
overlap as I work my way through each of these sections, but at the end I
imagine we will emerge with a clearer picture, at least in my head hopefully,
and my colleague's heads too.
540 I will also warn you that although I did spend quite a
bit of time in the communications industry before I came to the CRTC, I never
had the honour of working in radio, so you will forgive some of questions that
might suggest a certain lack of knowledge about some of the radio audience
ratings aspects. I'm going to ask for your help on those things.
541 I will just leave it up to you, Mr. Caine, to
decide amongst you who is the best person to answer the various questions that I
put to you.
542 You have been quite eloquent in articulating
throughout your application, and again in your presentation, what a significant
demographic we are dealing with with the 50-plus age group. I'm just wondering,
in your opinion, because you have been serving this demographic for such a long
time, why are the Toronto radio stations not programming to that group,
considering their economic power and everything else that you have presented as
backup for the fact that this demographic is a very important one?
543 MR. MICHAEL CAINE: Well, one of the first areas to
respond to that is that the 50-plus of course are -- as Bob had indicated
in his comments with the adult standards format -- it's probably one of the
most misunderstood formats going because of the demographic group. There is no
question about the buying power, the size, the importance to the economic part
of our community and our country.
544 But I think in radio, in competitive radio in Canada
at least, everyone seems to chase those 18 to 34 demos. Or, if you
want to be blend them, between 18-34 and 25-54. Those are the main areas that
advertisers look at, that research is geared towards, and it excludes the
50-plus generation, or those who are over 50-plus. So in order to attract the
kind of advertising dollars and the larger generic audience size, they seem to
go after that blended 18 to 54 demographic and the over-50 fall off
545 Quite frankly, as we say in Schedule 16, we don't
know why they are ignoring one-quarter of the population of Toronto. We have
been doing it for a long time, and quite successfully, but we are unable to
cover the whole area.
546 Why other stations have chosen to go after those
younger demographics I suspect is because of the advertising potential and the
way that the system is structured.
547 COMMISSIONER WILSON: I guess I'm just curious, based
on the evidence that you present in your application, if the 50-plus demographic
has such incredible spending power and appeal why other broadcasters aren't
going after them and I'm wondering if you looked at the spending power of the
sort of expanded 18 to 54 range versus the spending patterns of 50-plus, if that
would give you any indication of why?
548 MR. MICHAEL CAINE: There is no question that the
18 -- the younger demographics are sexier demos.
549 COMMISSIONER WILSON: Are they spending more
550 MR. MICHAEL CAINE: No. The 50-plus actually
spent -- out-spend the younger demographics in almost every product
category, according to the research that we have seen from Canadian broadcast
551 COMMISSIONER WILSON: Okay. Thank you.
552 Now, the BBM fall 1999 results identify the target
audience for your current station in Oakville, CHWO, as 35 to 54, though I
notice in your application you state numerous times that the audience is 50-plus
and that the audience for the new station is 50-plus, and I'm just wondering if
you could explain why BBM identifies your target audience at that age
553 MR. McDONALD: BBM target that audience of 35 to 54,
but there is very little in the way of demographics going beyond 54. It's almost
like the 50-plus market just doesn't exist. That's why we have had a lot of
difficulty over the last few years trying to encourage national advertisers to
use our station. But 35 to 54, in fact if you look closer to the numbers you
will find that over 90 per cent of our audience is over 50 years of
554 COMMISSIONER WILSON: I'm trying to figure out --
somebody is turning on and off the microphones for us.
555 So over 90 per cent of your audience?
556 MR. McDONALD: Over 90 per cent of our audience is
557 COMMISSIONER WILSON: Is over 50?
558 MR. McDONALD: Yes.
559 COMMISSIONER WILSON: Okay. That's actually part of my
560 So 90 per cent of your audience comes from over
50. The rest comes from what age group? Just broadly speaking, 18 to
561 MR. McDONALD: Yes, obviously. Well, if you want to cut
that down even to not a pure demographic but to pure numbers, it's over
562 COMMISSIONER WILSON: On page 6 of your supplementary
brief you say that:
"PrimeTime Radio will offer a carefully researched mix of music from the big
band era to some of today's easy listening standards of tomorrow."
563 I realize that we don't regulate formats any more, but
what percentage of your play list would be today's easy listening standards of
tomorrow versus everything else which is described in the SRG study on page 17
and the question that you asked your survey respondents describing the
564 There is a big, long list of different kinds of music
in there and big band era is on one end and the easy listening standards of
tomorrow are on the other. So what percentage of your play list would be the
easy listening standards?
565 MR. MICHAEL CAINE: The easy listening standards of
tomorrow, today. That's actually a very small percentage of the play list. It's
a lot of the easy listening tunes from, say, broadway, the Canadian cast
recording of Phantom of the Opera. That sort of thing would be included in the
play list today in those easy listening standards.
566 The bulk of the music is coming from the '50s pop and
about 20 per cent of the play list is made up of the earlier, the big band
sounds, which is what gives the station its unique flavour and
567 COMMISSIONER WILSON: I'm sorry, Mr. Caine, the
fan just went on again so I had a bit of trouble hearing the middle part of your
answer. If you could just give me those numbers again?
568 MR. MICHAEL CAINE: A very small percentage of the
music play list are those easy listening standards today of tomorrow -- or
how did you describe it -- or we describe it?
569 The bulk of the play list is from the '50s pop, now,
the Perry Como's as opposed to the early rock and roll type of thing, and then
about 20 per cent of the play list is from the big band swing era, which is
what gives the station -- or will give the station its character and its
570 COMMISSIONER WILSON: The reason that I'm asking
you -- and I guess we will go back to this in a little more detail
later -- is that two stations from which you expect to draw the most
audience are CFRB and CHFI and I was just wondering how much like them you are
likely to sound on your station since, you know, big portions of the people who
are looking for the kind of music that you are offering are currently listening
to those two stations?
571 MR. MICHAEL CAINE: Well, clearly we are not going to
sound very much like CFRB at all, because it's all talk and news and this is a
572 In response to that, in fact in response to a question
posed by an intervenor, we took the play list, the sample play list that you
have in the application, and we submitted it to the top 10 stations that
had any 50-plus listeners in Toronto, and only two of them -- and asked
them to compare what they play versus what we intend to play.
573 There were only two stations that there was any kind
of duplication at all, and that was CHFI, who indicated that 8.3 per cent
of our proposed play list them played.
574 The other was 1050 CHUM, which is an oldies
'50s-60s rock and roll station, and the duplication there was just over
10 per cent.
575 There was no duplication on any other station in
Toronto and, of course, there were several that were not applicable, like CFRB,
Talk 640, the FAN, all of whom had listeners who were 50-plus but are
spoken word format.
576 The others were easy rock, the mix, 99.9, and Q107. I
think that is the 10 of them.
577 COMMISSIONER WILSON: That's really interesting, but
maybe you can just explain for me, then, why -- I mean, if CFRB has changed
its format now into a news and talk, why do you expect to draw such a
significant portion of your audience from them?
578 The SRG study listed the 13 stations including
your own in Oakville from which you expect to draw audience in the Toronto
market and CFRB is, I believe, the largest -- has the largest percentage at
26 per cent of your total projected weekly cume. So I'm just wondering why
you expect to draw from there.
579 MR. MICHAEL CAINE: CFRB of course has a long and
illustrious history in Toronto of serving a mature market. They were the adult
standard station in Canada -- the premier adult standard station in Canada
for decades. There is an awful lot of loyalty to that station, and rightly so,
amongst the 50-plus.
580 We have also found that a number -- and if you
read a lot of those letters that have been sent to you, a lot of the people who
listened to CFRB before don't want all that talk and commentary and they are
looking for their music.
581 I think it demonstrates the fact that the 50-plus are
active and involved in their neighbourhoods and in their world and they want to
know what's going on around them and want to participate in that kind of
discussion, but they also want to hear their music. So I would think CFRB, there
is a significant number of people who listen to CFRB who are 50-plus and they
are satisfying that specific niche.
582 We will let Kaan answer that perhaps, because it is
leading to research.
583 Well, I will let him do it now because I have lost my
584 MR. YIGIT: Thanks.
585 I just wanted to point out a couple of things with
respect to audience composition.
586 First of all, CFRB gets affected a little bit more
than others, and we have a saying in the research business "law of large
numbers". They are the dominant station by far in the 40-plus demographic, so no
matter what kind of a station you put up there targeting 50-plus, by default
CFRB would get affected a little bit more.
587 According to the research on page 12, I think, of
that appendix, they have a reach of about 28 per cent, nearly 30 per
cent in the 50-plus demographic. So they already -- of the roughly 800,000
to 900,000 listeners they have weekly, close to 40 per cent comes from that
588 Now, as the slides earlier indicated, the projected
audience, weekly audience for the new CHWO is about 400,000. Quite a number of
that obviously will come from when the signal switches off in Oakville will
migrate. Of the rest you are looking at 26 per cent of the remaining
audience coming from CFRB.
589 So when you actually work the numbers down, while on
the table that we presented because we are showing audience competitions at the
top, when you work it back to the CFRB's base of almost a million listeners, it
still isn't a huge number that you are looking at.
590 The second station is CHFR obviously, and then there
are five or six stations that lose a little bit here and there.
591 COMMISSIONER WILSON: What is the weekly reach for CHWO
592 MR. McDONALD: We cume as 182,000. That is at the fall
593 COMMISSIONER WILSON: One hundred and eighty-two
594 MR. McDONALD: One eighty-two, yes.
595 COMMISSIONER WILSON: Okay, that is very helpful.
596 On page 7 of your supplementary brief, and
actually again in this morning's presentation, you referred to your on-air
talent and said that it would consist of "well-known", friendly "and polite"
597 You know that Canadians are well-known for our
politeness, so I'm just wondering who else in the Toronto market besides Howard
Stern is impolite?
--- Laughter / Rires
598 COMMISSIONER WILSON: I'm just wondering if there is
something we should know about.
599 I'm just kidding.
--- Laughter / Rires
600 COMMISSIONER WILSON: But I did notice that. I was
trying to think of all the stations that I listen to when I'm driving to and
from work in Toronto who I would consider impolite, and I'm not sure I could
really come up with one.
601 More polite. Your announcers would be more polite than
the other polite announcers?
602 MR. SHEPPARD: I might add that our listening audience
is the first to bring us to task if we forget manners, I can assure
603 COMMISSIONER WILSON: I'm big
604 You make another comment in this vein on page 17
where you state that when selling your announcers won't exhort. So you're saying
that your ads won't be like nationwide warehouse where the guy is yelling at you
to buy something?
605 MR. MICHAEL CAINE: There is definitely a knack and a
position when advertising to people 50-plus and it does require manners and it
does require not the hard-sell type that you often hear elsewhere.
606 We have become quite good at it. In fact, Harry and I
go quite often to 50-plus marketing seminars and make presentations just how to
appeal to the 50-plus and especially through radio.
607 COMMISSIONER WILSON: I know I'm taking a bit of a
lighthearted approach, but I guess what I'm trying to get at is how your station
will sound different from the stations that are currently serving people in this
demographic in the Toronto market currently.
608 Just one other very quick question.
609 On page 18 you mention that you sell video tapes
and I was just curious what kinds of video tapes a radio station is
610 MR. McDONALD: Very polite.
--- Laughter / Rires
611 COMMISSIONER WILSON: My background, of course, is in
television, so, you know, my ears immediately perked up when I saw
612 MR. McDONALD: Yes. Over the years -- well, a
number of years ago we formed a company called the Heritage Library and the
Heritage Library was made up basically of a number of -- a lot of BBC video
tapes. I'm talking about the comedy that a lot of people have seen over the
years, "Keeping Up Appearances", "Tony Hancock", "Faulty Towers", all that type
of thing, and we have been very successful over the years in selling those video
613 We have also expanded into CD-ROMs. We have a CD-ROM
in Scotland, and I am very proud of that, but we have a British program, we have
a Scottish program, also an Irish program. Therefore, Once again, we have been
serving that community and we have gone out to big band video tapes.
614 We actually sell more -- not video tapes, CDs and
cassettes. We sell more CDs and cassettes of the Spitfire Band than any other
retailer in Canada. So it became another arm of CHWO and the service that we are
presenting to our listeners.
615 COMMISSIONER WILSON: So it's really just a way of
servicing your demographic to the fullest extent possible.
616 MR. McDONALD: Very much so. Always has
617 COMMISSIONER WILSON: Thank you.
618 I would like to turn to the Solutions Research Group
619 I might just suggest you will have to speak up fairly
clearly from the back row because with the fan it's pretty hard to hear
620 But since the audience projections from the SRG study
really form the basis of the business plan in terms of the revenue projections
for PrimeTime Radio, I just wanted to explore some of the data with you and try
to understand a little better how you reached your conclusions.
621 I admit to sitting at my kitchen table with my
calculator. I'm obviously not in the ratings business, but I was trying to
figure out how you got there from here, if I can borrow one of your own
622 So let me just take you through some questions. I
guess the point that I'm really looking at exploring is how you get from the
projected weekly reach of 32 per cent to the market share of 9.6 to
12.8 per cent, but I will just take you through a couple of questions to
623 Now, at the beginning of your study you say that the
household selection was based on the presence of at least one adult
50 years of age or older.
624 This may sound like a really picky point, but was that
the person you actually spoke to, the person who was 50-plus?
625 MR. YIGIT: Yes, correct. The screening criteria was,
you phone into a household, obviously -- and it's a random selection
process. It's not from a database, Commissioner.
626 COMMISSIONER WILSON: But I mean --
627 MR. YIGIT: Yes, correct. You have to
628 COMMISSIONER WILSON: You can say, "Is there a person
50-plus in your household?" but then you don't speak to them.
629 MR. YIGIT: No, no. In fact, just to be accurate about
this, at the end of -- the sample composition actually accurately reflects
the gender and age distribution in the 50-plus age group in Toronto central,
which is the radio market we are talking about.
630 So roughly, for example, 50 per cent of the
50-plus population is 50-64, another 50 per cent is 65-plus, and the study
is really a microcosm. That 400 respondents fit in all material ways to
that demographic. That's the fundamental part of it.
631 COMMISSIONER WILSON: Thank you.
632 On page 5 where you state the weekly reach
estimates for the stations of the Toronto market for the 50-plus demographic
group were obtained. That phrase "were obtained" is used a couple of times in
your study, but it doesn't seem to me you actually told me where you obtained
them. Did you get them from somewhere else or did you come up with those
633 MR. YIGIT: As you will note at the back of the
Appendix, the full interview schedule or the questionnaire is also
634 Just to give you a bit of a sense of how this market
research really was done, after we find the person in the 50-plus age group in
the household, then we ask them about their radio listening habits. We ask them
how much radio they -- how much time they spent listening to radio. Then we
go into questions about "What radio stations have you listened to in the last
seven days and which stations do you listen to most often?" Those form the basis
for what we refer to as reach projections on page 5.
635 So everything that is recorded in the research was
obtained through the interviewing of this representative sample of 50-plus
persons in the Toronto area.
636 COMMISSIONER WILSON: Do you double check those reach
estimates for the stations in the Toronto markets against BBM to figure out
whether or not they were accurate?
637 MR. YIGIT: The short answer is yes.
638 Just to give you an idea, BBM of course uses diaries
to measure radio listening, and I have been active in radio measurement for
about 10 years now and in every market study we like to just do a double
check to make sure that we are generally in line.
639 There will be some differences between what BBM
produces and what we produce because we use a telephone methodology which is
more responsive to certain types of formats versus a diary methodology. For
example, a diary methodology is not particularly useful or has problems in the
640 But, in any case, in terms of the ordering of the
station in the 50-plus demographic, the rank ordering and the weekly reach and
share, you will find that our listing of reach numbers will correspond fairly
closely to BBM numbers. They will tell you that CFRB has the biggest cume and
share in that age group and we will tell you the same thing.
641 COMMISSIONER WILSON: Okay. Thank you.
642 Speaking of share, on pages 5, 6 and 13 you use
two terms with respect to share. The first is "share of preference" and the
second is "share of hours tuned" or "market share".
643 You talk about CFRB having a reach of 37 per cent
and a 26 per cent share of preference in the 65-plus age demo, while CHFI
has a 25 per cent reach and a 12 per cent share of preference in the
50 to 64 age demo. Then on page 6 you state that PrimeTime Radio has a
weekly potential reach estimate of 32 per cent.
644 I did go through your calculations and your questions.
You say that that implies a market share of 9.6 per cent to 12.8 per
cent in the 50-plus age demo.
645 So there are a lot of shares being tossed around in
two pages in particular, pages 5 and 6, and this is where really my
lack of experience in the radio industry is going to express itself.
646 But I don't think we are comparing apples to apples
here. You are talking about share of preference, you are not talking about share
of hours tuned, are you?
647 MR. YIGIT: No, and that is actually precisely why
those -- the terminology is distinct in that regard.
648 Share of preference -- let me just try to explain
it this way: The best you could do when you are doing radio research using
telephone methodology is determine share of preference, for a number of reasons.
Share of preference really refers to this: Have you listened to a
station -- let's say, how many stations have you listened to in the last
week? Four. And then you could identify them.
649 The station that you listen to most often, as per this
research, becomes your preferred station. So if in this market, in a different
table, you will see that -- for example, let me take that
650 I'm on 65-plus age group. Thirty-seven reach means
that of 100 people randomly selected in that age group in the market 37 will say
that they have listened to CFRB in the past seven days and 26 of them will
say that it's their most listened to or favourite station. So that is what we
are measuring in the study.
651 Now, when we are translating the reach, potential
reach numbers for CHWO, or AM 740 PrimeTime Radio in the second paragraph
that you quoted, what we are doing is using our model and projecting a share
number that is consistent with what you would use from BBM so that in fact you
could plug that into a business plan. So we are not -- we are skipping the
share of preference in that regard and just going directly to share.
652 I could go through the detail of that model. Just for
background, the projection model that we use is not, you know, custom-made for
this particular application, it has been in use in 1992 in every possible market
you could imagine in Canada. So it's not something we put -- it is a bit of
a -- it has a bit of a history, predictive history, if you will, in that
653 So the 9.6 to 12.8 reference is comparable to a
BBM-type of share projection.
654 COMMISSIONER WILSON: Just for that particular
demographic, for the 50-plus demographic?
655 MR. YIGIT: I'm sorry?
656 COMMISSIONER WILSON: Just for the 50-plus
657 MR. YIGIT: Yes. The way the model works is --
just bear briefly without boring everybody -- we first
658 COMMISSIONER WILSON: I'm not bored.
659 MR. YIGIT: Okay. We first project a reach number, if
you will. In this case we found after two filtered questions that 32 per
cent of this demo might be weekly listeners to the station. That's about 400,000
660 Then we literally turn that into share projection this
way: Every station has a relationship of share versus reach, so if I take an
example in Toronto, to give you -- Mix 99.9 had 20 per cent reach and
8 per cent share in the spring of 1999, okay. So that's a factor of .4,
let's say. What that means is, .4 of your reach is actually translating into
661 So based on that kind of a logic we are saying, if
it's, you know, 32 per cent reach, then your market share in 50-plus will
be such and -- you know, 9.6 to 12.8.
662 Then the next step is to bring it down to 12-plus,
which is the common, if you will, currency that all radio stations use to sell
advertising. That's when you get into -- in the business plan I think the
3-4 point range.
663 COMMISSIONER WILSON: Okay. Thank you for explaining
that to me and contributing to my education, because a couple of times you said
that the weekly reach implied a certain share but the steps between the two was
never explained in your study. So I appreciate the clarification.
664 On page 24 of your study you mentioned that
32 per cent of the respondents to the survey stated that there was too
little of their favourite type of music on Toronto radio. Is it just
coincidental that this is the same amount as the projected weekly
665 MR. YIGIT: It's one of those delightful
666 That question, by the way, is also included in every
market research study we do on radio. It is sort of a proxy indicator of under
served demand. So if I ask the entire Commission this question and if two our of
seven said, you know, "Too little", then I would say, "Well, that percentage is
under served. There is something there."
667 So it is a separate question that generates the
32 per cent number and through another set of questions, as you would have
noted, we came up to about the same number. But that is pure
668 But it is also quite powerful in that both two
separate measures in the same survey research instrument is generating exactly
the same result.
669 So the implication is that of that 50-plus demographic
somewhere in the neighbourhood of -- if I look at all the numbers here,
somewhere in the neighbourhood of 30 per cent to 40 per cent of that
total feels under served.
670 Not everybody is under served. I mean, arguably they
could grow into this format, and so on and so forth, but there are people in
that demographic to whom this radio station would not necessarily be, you
know -- it might be one of the choices, but not a favourite.
671 Does that answer the --
672 COMMISSIONER WILSON: Thank you. In terms of drawing
audience from the other stations the 50 plus age group listens to, particularly
CFRB and CHFI, do you know what per cent of their total audience they stand to
lose to Prime Time Radio?
673 MR. YIGIT: Yes. That could be easily calculated
using -- I believe there was on -- table 10 on page 28 of that
appendix has a listing of all the different stations. I don't have exact
numbers, but they are very easy to calculate because all we do is look at the
audience composition for CHWM 740, which is that we are looking at 400,000
674 If we make a very aggressive assumption that as per
that table everybody, you know, who say that they might listen will switch from
their current favourite radio station, then we could calculate for each station
675 To give you an example, for CHFI, for example, 14 per
cent of total. Again they make an assumption. If we assumed about 250,000
listeners, then 14 per cent of that would be about 40,000 and CHFI, in looking
up my other figures here, has 910,000 listeners currently, if they all switch,
which they won't do by the way, but this is to keep it, you know, straight and
narrow. If they all switched, SHFI might go from 910 to 870.
676 I guess what I'm trying to say without going on
forever is that it could be calculated at a theoretical level for each station
in the marketplace.
677 COMMISSIONER WILSON: Okay.
678 MR. M. CAINE: If I could just add to that or remind
you that none of the Toronto stations has intervened against this application in
terms of their concern of potential audience loss.
679 COMMISSIONER WILSON: I did notice that. I just wanted
to ask the questions while I had the numbers guy in the back row.
680 One of the things that you have asked for in this
application is relief from the regulation which requires 35 per cent Canadian
content due to the lack of inventory in the genre. I noticed on page 17 of the
SRT study in the description of the new service that was read to respondents
that not one of the artists' names offered as an example of type of music you
will be playing was Canadian.
681 MR. M. CAINE: I will defer to Mr. Yigit.
682 COMMISSIONER WILSON: Canadian content is (technical
difficulty) the largest. I just thought I would ask the question if Guy Lombardo
wouldn't fit in there.
683 MR. M. CAINE: If the Commission deems Guy Lombardo to
be Canadian, we will be happy to include him in the list.
684 COMMISSIONER WILSON: I would not (technical
difficulty) to deem that. Who wrote the question?
685 MR. YIGIT: I did actually, but I know the last time I
checked this, the Spitfire band I believe is Canadian.
686 COMMISSIONER WILSON: I guess that shows my lack of
familiarity with adult entertainment.
687 MR. M. CAINE: Just as a point of (technical
difficulty) we took great pain in trying to make sure that question is balanced
and representative of what the station will actually play on the air and the
four streams are chosen accordingly.
688 As you will note in the description, (technical
difficulty) it's fairly clean and, you know, basic so that we could properly
689 COMMISSIONER WILSON: That's a good answer. You said
that the weekly reach for CHWO is currently 182,000. What's the total 50 plus in
your coverage area?
690 MR. McDONALD: In the coverage area of CHWO or --
the coverage area of CHWO? About four million I believe it is if you look at the
full contour. Are you looking just at the 50 millivolt contour
691 COMMISSIONER WILSON: I'm talking about your local
station. You can't have four million -- maybe we are talking about two
692 MR. McDONALD: We are obviously. I was talking about
the full coverage area of the total station, not just the local station. I'm
thinking about the AM 740 actually. Sorry.
693 COMMISSIONER WILSON: Yes, but I was going to say four
million, that's the broad CMA population, but what's the 50 plus population
within the contour of your existing station?
694 MR. CAINE: Commissioner, if you look at the map here
and get some idea -- it's hard to tell from there. It's in your package, of
course, the same chart. You can see then in the coloured areas, within the red
contour there the 50 plus are concentrated along the lake and into the Etobicoke
area of Toronto.
695 There's also a lot of lighter colours there, so they
are not as concentrated within our red contour. The number that we were able to
get from Bell Actimedia with respect to this map is that in the Golden
Horseshoe -- now, within the AM 740 thing, this is what Mr. McDonald was
just talking about -- is 1.5 million people over the age of 50.
696 You are asking, of course, what is CHW -- what is
the potential that CHWO has in that area.
697 COMMISSIONER WILSON: Well, I guess what I'm interested
to know is the relationship between the listenership that you receive and the 50
plus population that is within your contour in terms of establishing how much
more demand there might be and whether or not your financial projections are
realistic in terms of the listenership that you are going to get.
698 MR. McDONALD: The current audience of CHWO in the
Toronto area, for instance, against 182,000 CHUM is 40 per cent. The Toronto
audience for existing CHWO is approximately 72,000. The rest will then come from
Mississauga, Oakville and Burlington and slightly less from Hamilton.
699 COMMISSIONER WILSON: Okay.
700 MR. CAINE: Does that answer the question?
701 COMMISSIONER WILSON: I think so. Going to the HYPN,
what you did with this was you took the share, the projected share of 9.6 to
12.8 per cent of this demographic. You don't have anybody from HYPN here who can
talk to this.
702 MR. CAINE: I'm sorry, Commissioner, no, we don't have
someone from HYPN, but I think amongst us all we can provide you the answers you
are looking for.
703 COMMISSIONER WILSON: I guess what I was hoping to get
was just a thumb nail sketch of how the 9.6 to 12.8 per cent share of adult 50
plus translates into a 1.2 per cent share of the combined 18 to 49 and 25 to 54
age demographic and then into a potential share of the radio advertising
revenues of 1.52 per cent.
704 HYPN goes through this, but they start with 32 per
cent weekly reach. They move to the share that was developed by SRJ and then
they take that through a number of calculations. I guess they're plugging it
into a model like the model that you have been using for a significant period of
705 MR. YIGIT: I don't want to speak out of turn for
another company, but it has been explained to me. They have a model that they
use -- actually, they submit quite a number of projection type things to
the Commission. It runs on 18-20 and 25-54 demos.
706 We didn't know this at the outset. When the research
was submitted, they said "Well, we have got a model that predicts what you will
do, but it's based on these demographics". Now, it actually ties back to another
question you asked as to advertisers.
707 As of 55, people cease to exist. I mean this is mainly
708 COMMISSIONER WILSON: I'm not quite there
709 MR. YIGIT: The average age for a media buyer in this
town is about 24. The model works on that basis. What they did is they used a
Vancouver station as a proxy to see if you have this share of 50 plus, will you
have any spill into, you know, the 35 to 50 age group and what that might be and
then worked out -- because they are saying that your audience in those age
groups is most predictive of your advertising revenues in general.
710 I think what they have done is went from 32 per cent
down to about 9.8 to 12.8, translated into about three and a half per cent share
of the 12 plus market, okay, and they built in a little premium for the, you
know, under 50 age group of people and said really, at the end of the day the
market will recognize that audience more so than it will recognize the 50 plus
711 Now, Michael will have other things to say about that,
but that was the basis of their projections that ended up with how a three share
ends up being a 1.5 share of advertising revenues is -- they are saying not
every share point in the market is the same value as the other share
712 If you bring in a demographic that is 18 to 34, I will
give you a premium. If you bring me a different demographic, I will, you
know -- I don't know if that helps, but that's my understanding of the
basis of the projections.
713 COMMISSIONER WILSON: That is very helpful. Thank you.
714 MR. CAINE: Well, my only thing to add, as Kaan knows,
I am prepared to jump in on this, is the projections, and perhaps the
Commissioner is leading you to other questions that you are getting into in the
business plan with it.
715 We want to quickly point out that the financial
projections that are submitted to you are based on -- well, not based on
but supported by the numbers from HYPN. What we want to quickly point out to you
is that the HYPN analysis excludes 76 per cent of our potential
716 Because HYPN, and they are one of the biggest and
largest in the business, does not or has not yet developed the methodology for
determining, as Kaan explained, for determining audiences over 50 that this is
the way it ends and it's a tried and true formula. It has certainly worked many,
many times before for you when you are able to determine those kinds of
717 In our particular demographic group that we are going
after, we feel that the numbers that have been presented to you in terms of
sales projections and so on are extremely conservative because the HYPN study
actually doesn't even take into account three quarters of the audience we are
718 COMMISSIONER WILSON: Yes, and I mean -- I guess
I'm kind of laying myself bare here in terms of not understanding how this all
works. When I look at the bottom line in terms of your projections, intuitively
I see that they seem quite conservative, but I just wanted to try and understand
a little better how you got your way there. It's just useful for me in terms of
719 I told you I had one very, very quick question on the
Nordicity study which I did find very interesting, even though it's a little out
of date. It did present some interesting insights into the market, some of which
would still seem relevant. I just have this one question. It's not one of
particular consequence, but what does AQH stand for?
720 MR. CAINE: Average quarter hour.
721 COMMISSIONER WILSON: I should have known
722 MR. CAINE: It's one of those radio
723 COMMISSIONER WILSON: (technical difficulty) you know,
the lawyerly approach where the first time you spell it out and then you put it
in brackets. I didn't find it anywhere. I work with so many lawyers.
724 THE CHAIRPERSON: This appears to be a good time to
take a break so you can get some more lawyerly help.
725 We will resume at a quarter to two. Thank
726 Alors nous reprendrons à deux heures moins le
--- Recess at 1231 / Suspension à 1231
--- Upon resuming at 1350 / reprise à 1350
727 THE CHAIRPERSON: Order, please. The application by
728 Commissioner Wilson.
729 COMMISSIONER WILSON: Thank you, Madam Vice-Chair. I
got lots of lawyerly advice during the lunch hour, so you know I followed up on
that suggestion by the Chair of the panel.
730 I want to turn now to your business plan. You filed
with us three statements of revenues and expenses, one for Prime Time Radio and,
at our request, two for your current stations, CHWO Oakville, looking at the
impact on that station of either an approval or a denial of Prime
731 I recognize that you filed those latter two statements
in confidence, so I will not be quoting any exact figures. I may be looking at
the percentages and hopefully you have got the statements with you so that we
can look at them together, but I do have some questions about those statements
and some of the figures in them that I want to go through with you.
732 I will start asking my questions about all three of
the statements. This is probably the area where you will see the most overlap
because there is obviously sort of a domino effect through your other stations
if this application were approved.
733 The revenues that you projected, if you turn to your
projected financial statement of revenues and expenses for the new station,
Prime Time Radio. The revenues projected for years one through five are
precisely those that were calculated for you by HYPN.
734 This morning you said that a portion of your revenues
from your current station in Oakville would move over and that that portion
would constitute 60 per cent of your first year's expected sales revenues, and
these are number I can quote because they are not in confidence, 1.8 million the
735 When I looked at the statements, and I do have one big
issue with the two statements that you filed in confidence in terms of your
revenue figures, but approximately 35 per cent of the revenues for your Oakville
station, based on the August 31, 1999 results, were gone as of year one and I
assume into Prime Time Radio, so they would constitute part of that 1.8 million
736 I'm trying to figure out how 35 per cent of the
revenues from your current station equal 60 per cent of your total sales in your
new station because by my calculations, it only costs you about 25 per cent of
your first year sales if you move that revenue over.
737 MS GERRARD: I just want to clarify. You are talking
regarding the comparison between 740 projections and between the JOY 1250
projections or the 1250 status quo?
738 COMMISSIONER WILSON: The JOY 1250 projections. If you
look at the JOY 1250, in year one the revenues are 35 per cent lower.
739 MS GERRARD: Yes, they are. What we have done is the
1250, the sales related to the format on 1250 that will be moved over to 740,
pretty well all of those revenues will be moved over and the sales for JOY 1250
are some current sales that are currently on CJMR right now because 1320 is
split between some religious programming and ethnic programming. Those will be
moved over to 1250 plus new air time commercial local sales as well.
740 In actual fact, the revenues that are showing on JOY
1250 are currently not reflected on CHWO 1250 right now. Have I made things more
741 COMMISSIONER WILSON: Let me try that one more
742 MS GERRARD: The sales that are currently on CHWO 1250
with the 50 plus format will be transferred over to the AM 740
743 COMMISSIONER WILSON: And that's about 35 per cent of
the revenues that you show at August 31. Is that a consolidated
744 MS GERRARD: No.
745 MR. McDONALD: Yes, I believe it is a consolidated
figure. If you were to take the CHWO 1250 revenue and look at that, that's what
we will be turning over to AM 740.
746 COMMISSIONER WILSON: Maybe we should go there first
before we pursue this because when I went through these statements, sort of
looking at how the revenues are moving, I looked at your results for the current
station in Oakville in the CRTC database based on your annual return. Those are
not the same revenues that appear on the statement in the approvals scenario for
August 31, 1999. Do you have the approvals scenario revenue
747 MS GERRARD: I'm sorry. You are looking at the numbers
for the status quo 1250.
748 COMMISSIONER WILSON: No, I'm not.
749 MS GERRARD: The only location where we showed the
August 31 numbers were for the status quo. The JOY 1250 is not
750 COMMISSIONER WILSON: It is on mine.
751 MS GERRARD: It's kind of hard to sort this out if we
can't actually use the numbers, but -- were the numbers from the deficiency
752 COMMISSIONER WILSON: And these are the two statements
that were filed in confidence. One is the projected statement of earnings and
deficit for CHWO JOY 1250. I think you filed these two statements with some
financial assumptions in response to a deficiency question. Yes. Locate the
deficiency letter. I believe it was the first one, was it not?
753 MR. CAINE: I don't know if this is helpful,
Commissioner Wilson, but of course the status quo assumptions were prepared
before the annual statements were complete and mailed to the Commission, if you
are talking August 1999.
754 COMMISSIONER WILSON: Okay. I'm looking for the sake of
argument because the same number appears on both of the statements that I am
looking at. Just (technical difficulty) I am looking at copies of these
statements that are in my factum book prepared by the staff.
755 MR. RHÉAUME: Can I interrupt for one second? Maybe
that will be helpful. Could I give the applicants a copy of what you are looking
at just now.
756 COMMISSIONER WILSON: That would be really
757 MR. RHÉAUME: Thank you.
758 COMMISSIONER WILSON: Okay. Page 109. Okay. I believe
that this is a photocopy of what you submitted to us. It's on blue paper, but
it's a photocopy of what you submitted to us.
759 MS GERRARD: I find it now. My copy has that one column
just removed. It was more done for public information. We didn't want to show
the current year file, the current annual year's statement for 1999.
760 Yes, the numbers that you are looking at, under August
31, 1999, (technical difficulty) the revenues for CHWO 1250, the difference
being in the sales is the management fee that we charged to sister company CJMR
which on a consolidated basis is eliminated.
761 COMMISSIONER WILSON: It is eliminated from the amount
that you report to the CRTC and which appears in your financial
762 MS GERRARD: No, no. It's (technical difficulty)
between the sales and expenses.
763 COMMISSIONER WILSON: Okay. I guess it would have been
really helpful to have a note to that effect under your assumptions because when
I am reviewing these and trying to prepare my questions for you, if I don't know
that then I have to try and reconcile in my mind and then bring to you now to
reconcile why your revenues are 35 per cent higher than what we have in our
database because that's a significant difference from what we are showing as the
revenues for the station that you operate right now.
764 The number that we have in our database, and I can't
say that number, is 35 per cent lower. It's actually closer to the number. If
you look under the year one column, that's the number that we have for the
August 31, 1999.
765 MS GERRARD: Yes.
766 COMMISSIONER WILSON: Okay. So explain to me, now that
we have got that sorted out, explain to me if that's the level of revenues for
the current station, how many of those revenues are going to move
767 MS GERRARD: We will be moving all of the 1250 revenues
over. Those were the sales for 1999, year ending 1999. They are higher for this
year as well.
768 COMMISSIONER WILSON: So that's how you arrive at
meeting 60 per cent of your projected sales figures for year one.
769 MS GERRARD: Yes. One other note to add. In the
calculations for the sales figures number, the Toronto rates that we would
charge on 740 were used to equalize the sales so that they would be reflective
of the 740 revenues, equivalent to the 740 revenues that we would see because on
740, of course, a higher spot rate would be allowed, we would ask
770 COMMISSIONER WILSON: Okay. Let me just turn you to the
assumptions on the statement that was not filed in confidence, the one that we
can actually talk about the numbers for.
771 In schedule 10 and in the presentation this morning,
you said that you would be 65 per cent sold in year one in terms of your ad
inventory. Under your assumptions, the assumption number that I am looking at is
2(e) for 740 Prime Time Radio, year one is showing 50 per cent. I am just
wondering what's the difference.
772 I am looking at the fill rate. It's got 50 per cent of
fill in the year ending 2001 and it shows 50 per cent. That 50 per cent is
equivalent to the revenues that you are projecting based on the HYPN analysis of
the market share.
773 MS GERRARD: Yes. The HYPN analysis of the market
share, to arrive at the total dollars, works from the top down. What they would
do, what they have done is determine what the total market revenue in Toronto
would be, apply our 1.5 to 2 per cent share to that, and then they have applied
the fill rate to that to lower it down to the 1.87.
774 What we did internally, we worked from the bottom up
in that we estimate the number of commercials per hour, the number of spots per
day, anticipated rate per spot to arrive at a total gross revenue. Our gross
revenue figures were slightly higher than HYPN's. With applying a 50 per cent
fill rate, that gave us an equivalent to HYPN.
775 Our sales numbers we feel are conservative based on
the 1.52 per cent share we feel is low because of the amount of our demographic
not included in the market study and also with the fill rate.
776 COMMISSIONER WILSON: Okay. Thanks for that
explanation. This is more a question just for curiosity.
777 Under the three scenarios that you have provided to
us, the 740 AM and JOY 1250 and CJMR, under your assumptions in 2(e) you
calculate different number of spots per day, so the total inventory of spots
that you are selling at under the three scenarios are very different. Actually
you can use the blue sheets even if you want to and you will see.
778 MS GERRARD: Even comparing JOY 1250 with the AM 740,
there is a reduced number of spots available because we have spoken word
programming of which the commercial time is not -- is it eight minutes per
hour. There may only be two or three. So the number of spots available for
commercials is reduced on JOY 1250.
779 COMMISSIONER WILSON: Thank you. I want to ask you a
couple of questions. Actually
Commissioner Wylie was questioning a party this morning on the same
780 On page 18 of your supplementary brief you state that
your launch promotion budget will be $400,00, half from station dedicated funds
and half from contract arrangements. I'm assuming that the $200,000 for
advertising and promotion which appears in your business plan assumptions for
startup is the station -- represents the station dedicated funds of
$200,000, half that $400,000 amount.
781 MS GERRARD: Yes, it is. That's for pre-operating
costs. That's not the regular ongoing advertising costs.
782 COMMISSIONER WILSON: You may recall from this
morning's conversation that -- well, the reason that I am asking and I mean
you have been in this business a long time so maybe you can tell me how you
think you can get away with what I would say is a pretty low amount for a
Toronto area station considering that the average is 1.5 million. YPD Radio is
planning to spend in the range of 1.1, somewhere thereabouts.
783 You know, when you consider the range of promotional
and advertising activities that you are proposing to undertake, all of which are
described on page 19 of your supplementary brief -- you talk about mass
media advertising, billboards, transit advertising, television, newspapers,
784 It was just hard for me to imagine, considering the
size of your coverage, the new coverage area, on 740 and the competitiveness of
the market. I recognize to our simulcasting for three months, so you will bring
those listeners which I am sure is an important contribution to your
listenership. It just struck me that the $400,000 was pretty low, a bit
785 I think your ongoing budget is $250,000, again half in
cash and half in contract compared to an average of 1.5 million a
786 MR. CAINE: If I could just start off and then I am
going to ask our VP sales marketing to respond to that question.
787 Just from the competitive standpoint within the
market, and we have already -- I am sure you are aware that this is one of
the most competitive areas in the country, so I don't disagree with -- I am
unaware of that number, but I think you said the average was 1.5
788 COMMISSIONER WILSON: For an AM station, the typical AM
station in Toronto.
789 MR. CAINE: Yes.
790 COMMISSIONER WILSON: The Toronto CMA spending about
one and a half million dollars on advertising and promotion of sales.
791 MR. CAINE: Okay. I wouldn't have access to that
information. Personally, that seems excessive to me from what I have seen in
Toronto. We have been successfully marketing CHWO to this demographic group for
many years now. We are looking forward in serving them again.
792 I think the word is going to get out very, very
quickly. They have been looking for this kind of station in all of the letters
of support you see. I think it's going to happen very quickly and the loyalty of
those listeners to this kind of format is incredible. The Commission is more
than aware of some of the format changes going on in Ottawa and what's happening
793 We believe that a great percentage of all the people
within that black line are going to know pretty quickly about the single and
only choice that they have, but we do need to obviously reach them. We have
successfully done it with much less in terms of our budget.
794 I will ask Mr. McDonald to perhaps describe some of
the plans on how we are going to utilize that $400,000.
795 MR. McDONALD: Thank you. I think right off the bat we
are an existing station. We have an existing target market. $400,000 represented
by $200,000 cash and $200,000 in kind will immediately -- the cash portion
will probably go to the billboards, the transit advertising, newspapers and
796 That's when you are trying to reach out to the mass
market. Now we have got to back up and start looking at the 50 plus market and
how can we can target that specific area of advertising and promotion. That's
where the existing publications within that market come into play, like Forever
Young, Mature Lifestyles, the CSA news, Big Band World, Adult
797 I mean there are approximately eight publications
already targeting this market. Therefore, we don't have to immediately start
buying the Toronto Star or the Globe and Mail or the Toronto Sun to reach that
market. We reach a great portion of it already on the air waves, but then by
supplementing that with these other areas.
798 COMMISSIONER WILSON: So you would
799 MR. McDONALD: If I could hold this magazine up. This
is our own organ too. Our next edition of this goes out in March of this year.
That's going into 50,000 homes in the Greater Toronto area.
800 COMMISSIONER WILSON: That's 50,000?
801 MR. McDONALD: Fifty thousand, yes.
802 MR. CAINE: But not general, targeted to high density
fifty plus by postal code. It's not just 50,000 going all over the city. We have
targeted where they are going to go.
803 COMMISSIONER WILSON: Yes. I made that assumption. It's
not in my house, for example.
804 The reason that I am asking these questions obviously
is -- we were talking this morning about trying, when you have only two or
three frequencies left in a market, you want to try and make sure that you are
going to make the best use of it and that you are going to be able to create a
demand amongst your target audience for the station. That's why I'm asking the
805 I am certainly familiar with being very creative with
a small amount of money in terms of promoting something. I have been there
myself. The Toronto market is quite different from what you are doing now. It's
806 MR. CAINE: It is much bigger. I think the response is
rather than us creating the demand for our radio station, the demand is there.
The demand exists. They are screaming at you. Thousands of them are screaming at
you "Please give us at least one radio station out of a city where there are
something like 23 stations, give us at least one that caters to the kind of kind
of musical and information needs that we have. There is this little outfit out
there in Oakville, but we can't hear it because of the interference of it and
the restrictions". They don't know anything about it.
807 There's a wonderful letter in there from a gentleman
in Guelph who set up a whole AM array around his house. He explained to me how
he had to go and buy from all across the United States to get this equipment.
The bottom line was to him "Why am I telling you all this? For God's sake, don't
change your format". He finally was able to hear us with all this.
808 The demand is already there. We don't have to create
it. That's why I said it's going to spread like wildfire when they finally have
got a radio station and that big, beautiful 740 frequency, nobody is kidding
ourselves about that, about how big it is. It is in my opinion in exact
proportion to the need. The demand for this kind format all across southern
Ontario, not only Toronto, is what's key to, as you say, Madam Commissioner, the
best use of the spectrum. That's what we are trying to show you.
809 I think that even as little as you may be concerned it
is, I think we believe anyway that it is more than adequate to get out name out
in that year one.
810 COMMISSIONER WILSON: Thank you, Mr. Caine.
811 MR. CAINE: I beg your pardon. That's over three
months. Yes, thank you, Jacqui. It's not year one. That's launch
812 COMMISSIONER WILSON: Right. And you have $250,000 a
year. I realize the $400,000 was the launch money.
813 Can I just ask you a question about your capital
expenses. For the new station you are showing $201,000 in capital expenses and
in schedule 14 of your application you outline what that's made up of. Are you
going to be operating this station out of your existing facilities in Oakville?
It says new offices. It says studio leasehold equipment sales office.
814 MR. CAINE: No. We will be operating it out of Toronto.
Admin, of course, we talked about the synergies of some of the departments,
administration and technical, will be operated out of the broadcast centre in
Oakville but no, the studio facilities, sales office will be located in
815 COMMISSIONER WILSON: Okay. Maybe if I can turn you to
page -- if you look at the blue sheets, Ms Gerrard, it might be easier to
follow me, but page 111 of the blue sheets where you show capital assets. I'm
not mentioning any numbers here, but you show capital assets for JOY 1250. They
are significantly higher than what you are going to spend on the new station.
Why is that?
816 MS GERRARD: The current capital assets that are
showing for the JOY 1250 is in existence for the parent company right now, so
it's a continuation.
817 COMMISSIONER WILSON: So those aren't new.
818 MS GERRARD: No.
819 COMMISSIONER WILSON: Okay. In the approval scenario,
blue pages, 109, your projections in the scenario also indicate significant
operating expense reductions for the Oakville station. Are these the result of
synergies and economies of scale resulting from the combined operations of your
820 I will tell you why I'm asking you. The one that I am
most curious about is the reduction in sales expense because you are taking the
station to a new format.
821 If Nordicity was right in its study was right when
they said that a religious format generally appeals to non-traditional radio
advertisers, I'm just wondering if you wouldn't expect that you might have to
spend more on sales in the early years to try and build -- I realize you
are bringing some existing format from CJMR over to JOY 1250, so you will bring
something with it. I know you obviously have some experience selling advertising
for that format, but you are going to be running an entire station based on that
822 I see a reduction in your sales expenses, for example.
Would you not need to spend a bit more in the early years to try and build your
advertising base for the new station?
823 MS GERRARD: You are talking about a reduction of our
current reported sales.
824 COMMISSIONER WILSON: I'm looking at the financial
assumptions for prime time radio, 2(e), the summary of significant assumptions
and 2(e) is projected revenues based on a percentage of fulfilment of the total
inventory of time available for local advertising. Should that read local and
825 MS GERRARD: Yes.
826 COMMISSIONER WILSON: Okay. It shows two strains on
your financial projection.
827 MS GERRARD: Yes. Those were combined for the 1.8.
Three seven is a combination of both.
828 COMMISSIONER WILSON: But in the case of JOY 1250, it
is strictly local.
829 MS GERRARD: It is local sales plus spoken word
830 COMMISSIONER WILSON: Okay. So that would account for
the differences then if you look at page 110 and 113 which show your projected
annual sales. Then you look at the revenue line in those two statements. They
are obviously quite different. The differences between the local sales and the
revenues that you show for 1250 AM, the difference between the local sales and
those revenue brokeraged times.
831 MS GERRARD: It's the sales showing on 110, line 110
832 COMMISSIONER WILSON: Yes.
833 MS GERRARD: Those are for local sales, local
834 COMMISSIONER WILSON: If I now look at 109. I know you
explained to me on the statement of revenue and expenses and then the
assumptions for 740 AM that you have done a top down and a bottom up calculation
to try and mesh the two approaches to arriving at the same number.
835 If you look at the revenues, the sales revenues that
you are projecting for JOY 1250, years one through five, and you look at the
annual sales that you are projecting, years one through five under that
assumption 2(c), the annual sales for year one, for example, are only about a
quarter of what your revenues are projected to be. So the rest of that would be
836 MS GERRARD: Yes, it is, current broker
837 COMMISSIONER WILSON: Current or projected because this
is looking out. In the event that we approved your sub 40 application and in
turn JOY -- you turned JOY (technical difficulty) into JOY 1250.
838 MS GERRARD: That is the current (technical difficulty)
which is programming that would be transferred from 1320 to JOY 1250. It's not
839 COMMISSIONER WILSON: Okay. Just give me a second here
while I look at where I am at. Okay. Under the status quo, page 112, and this is
where we don't approve Prime Time Radio and your Oakville station continues as
it is, the outlook for your revenues is really quite spectacular, I think a 53
per cent increase over five years. Would you consider that a pretty good result?
Sorry. Here I am yattering over here.
840 MS GERRARD: In the status quo the sales revenue
figures include the management fee. Remember we spoke about that before? If you
take a look at August 31, 1999, you are indicating that that number was higher
than what was reported.
841 When we do internal projected statements, because we
have the 1250, 1320, even in our budgeting we allocate those costs. On a
consolidated basis they do, you know, they do mesh out. These numbers include
the management fee for the projects for 1250 status quo.
842 COMMISSIONER WILSON: So what percentage of these
figures would be the management fee? I'm looking at page 112, the year one sales
revenue figure, for example.
843 MS GERRARD: I just did August 1999. It would have been
about 31.5 per cent. The year one would be about 27 per cent.
844 COMMISSIONER WILSON: Okay. So then what is your actual
projected growth rate under your status quo scenario? I should have brought my
845 MS GERRARD: It's approximately 20 per cent a year,
just a little under 20 per cent a year.
846 COMMISSIONER WILSON: And is that based on your
historical growth? Is that a reasonable assumption?
847 MR. McDONALD: Yes, it is. Historically over the last
two years you have obviously seen the figures, Madam Commissioner, as being a
large increase in local sales simply by the investment that we have made into
that department. I think last year just finished, we showed a 25 per cent
increase in local sales -- in local sales, not total sales. We will see
that going forward like that for the next few years.
848 COMMISSIONER WILSON: Okay. Thanks. I guess I want to
explore with you a little bit from the financial perspective the reorientation
of the old station to JOY 1250. You describe that as a station being dedicated
to family values, positive living and contemporary Christian music. I assume
they would have polite announcers too, very polite announcers.
849 On pages 22 and 23 of your supplementary brief you
provide lots of anecdotal evidence about why you think a station, a full service
station because you already provide some of this on CJMR, but why you think a
full service station would succeed in the Toronto market. You mention the
Buffalo station which garnered a .2 share.
850 I just wanted to try and understand a little better
what kinds of assumptions you used to project the revenues for the new Oakville
station. Did you base it -- I assume you based it partly on what you are
doing at CJMR. What proportion of your projected sales would that be and then
did you also base them on repatriation of listeners from the Buffalo
851 MR. CAINE: To some degree, yes. To a larger degree,
it's our historical experience with the format and what we expect to be able to
do, but I will ask Harry and Jacqui to finish that answer.
852 COMMISSIONER WILSON: I notice that -- I mean the
results on CJMR are better than the results for CHWL. I'm wondering how much of
that has to do with this family oriented programming that you are doing on
853 MR. McDONALD: At the current time on CJMR we are
running the family oriented programming from 8:30 to 6:00 p.m. five days a week.
The rest of the time is taken up by fulfilling our mandate as far as ethnic
programming is concerned. That 8:30 to six o'clock plus two or three hours on
Sunday morning accounts for approximately 50 hours of programming
854 COMMISSIONER WILSON: Considering that you have to
(technical difficulty) ads, it's spoken word or are you playing (technical
difficulty) Go right ahead. I'm sorry.
855 MR. McDONALD: Once again, from 8:30 to six o'clock
there was approximately two and a half hours a day that is the Christian
contemporary music. The other times, that would be then about the five and a
half hours a day, that would then be spoken word.
856 COMMISSIONER WILSON: Okay. So I hope you had a chance
to figure out what percentage of the revenues will come from CJMR under the
approval scenario, under the JOY 1250 statement. What percentage of those, let's
say the year one revenues, move over?
857 MS GERRARD: The year one revenue transfer over will be
about 70 per cent.
858 COMMISSIONER WILSON: Seventy per cent of this number
that's showing under the column labelled here "one" in the JOY 1250 statement
comes from the other station.
859 MS GERRARD: Yes.
860 COMMISSIONER WILSON: Okay. What's your listenership
like for the programming, family line programming on CJMR?
861 MR. McDONALD: It's not measured under traditional
terms as is PBM, being under a specialized format with Christian and ethnic.
There's just no way of measuring it. We tried to do a comparison with Vancouver
when Vancouver were running their Christian station a couple of years back and
we figured we had about 60,000 listeners weekly. That would only be for the
Christian programming, not the ethnic. The ethnic is even more difficult to
862 COMMISSIONER WILSON: You mentioned that there were
maybe only a handful of stations like this in Canada, one of which is in Barrie.
I guess if they're not measured then it's pretty hard for you to compare
863 MR. McDONALD: I think again when we were doing these
numbers and Barrie wasn't on the air -- it only went on the air last August
I recollect -- and once again it's a full time Christian station where
we're not. You just can't make any comparison.
864 MR. CAINE: If I could throw a few cents in here. The
advantage that this is giving us in this application in the approval scenario
is, of course, that we are able to maximize the audience in the respective
formats that we are serving, so we will be able to maximize too the returns on
865 By the 50 plus on AM 740, the family oriented
programming that is successful but locked in right now to the ethnic format, the
ethnic licence of CJMR and can't expand, will give it and there is a demand for
it. There's not a lot of audience figures about it unfortunately because we
only -- well, Jim Leek back here, the host of "Celebrate" and others just
managed to convince the Junos to create a category for contemporary Christian
music and convince them that there is a market for it.
866 There is a lot of research and a lot of information
that needs to be done, but there's certainly a lot of examples. Seventy thousand
people who fill up the Air Canada Centre, and they are on page 23, the page of
reference, so that -- I'm just trying to give sort of the overall General
Manager's admin point of view of how this is all going to fit and be beneficial
to all the special interests that we are going to appeal to on the three
867 COMMISSIONER WILSON: I was really just curious to
understand how realistic the financial projections are in terms of when you are
moving a chunk from here over to here over to here, how well are all three
stations going to end up doing. It's quite a complicated package that you have
868 Would you still be carrying Amy Grant songs on your
family oriented radio station?
869 MR. CAINE: You bet we will, and a lot of
870 COMMISSIONER WILSON: It has been dropped by a few
stations in the States. You have to (technical difficulty) They just didn't fit
the image, I guess.
871 MR. CAINE: Because this is an exciting new area,
especially in Canada, of contemporary Christian music, we happen to think in
terms of new artists, new talent, there's going to be an explosion in this
country of this kind of music.
872 I would like to ask Jim Leek, who is the host of
"Celebrate" -- he is a performer himself. He is on the board of the
Canadian Gospel Music Association, their advisory board. I would like him to
tell you about some of those experiences with new CCM artists. Jim?
873 MR. LEEK: Yes. In reply to your question on Amy
874 COMMISSIONER WILSON: I was being facetious.
875 MR. LEEK: I know. (technical difficulty) embraces the
answer to that. But yes, I am on the advisory committee to the Juno Awards as
well as on the Board of Directors for the newly brought together chapter,
Canadian chapter, of the Gospel Music Association International, have previously
been on the board for the Canadian Gospel Music Association, been involved in
the Christian music industry for 20 plus years and found it very frustrating
because there was not the infrastructure in place to support Canadian Christian
artists. That's why I was so excited five years ago to join on with CJMR and
promote Canadian Christian artists.
876 It has been my experience in this past five years to
see a tremendous increase, a proliferation if you will, of new Canadian
Christian artists that are producing quality CDs that match up with anything
that is produced south of the border. We have a number of Canadian artists that
are doing well south of the border but aren't doing as well here in Canada
because we don't have the radio support for them.
877 It's something that has long been on my heart and
thousands of people that I have come in contact with over the past 20 years
desiring to see Christian radio that's meeting the needs specifically of
Canadians here in the Greater Toronto area.
878 All due credit to WDCX across the border, they do not
play Canadian artists. They do not give public service announcements that relate
to activities within the community here within the Golden Horseshoe area, so we
need something that's here that meets the needs of people residing here in
879 COMMISSIONER WILSON: So I guess when you are trying to
figure out how well a station like this is going to do and you don't really have
any measurements to base on it, it requires a bit of a leap of faith.
880 MR. LEEK: Thank you very much. It does indeed require
a certain amount of prognostication, if you will, and leaping in faith, but I
think there is sufficient evidence that there is a tremendous demand for
881 I have been involved in not only on air work, but a
lot of promotions, going to various Christian concerts, conferences, various
events and meeting the public, promoting CJMR and the Christian programming that
was there. They said "We love it. Can't you expand it to be 24 hours?" I said at
this point in time we can't, but now here's the opportunity.
882 I have also been involved in sales for CJMR and come
across many clients who are advertising across the border who said you need a 24
hour station to make it reasonable for us to invest in you.
883 COMMISSIONER WILSON: Thanks (technical
884 MR. CAINE: Commissioner, you keep opening doors, we
will keep walking in with answers for you.
885 COMMISSIONER WILSON: Thank you, Mr. Caine.
886 I just have a few more questions for you. I won't take
much longer. With respect to CJMR, the station is according to CRTC database
doing pretty well, but if we were to license an ethnic station -- yes, you
reference this in your supplementary brief -- if we were to license an
ethnic station on one of the available frequencies in Toronto, have you looked
at what kind of an impact it might have on, what kind of a financial impact it
might have on your station?
887 MR. McDONALD: Devastating. It really would. When you
look at what we are doing with our ethnic programming, once again we are
fulfilling our mandate from six o'clock to midnight five days a week, 6 a.m.
till 8:30 Monday through Friday, and then 18 hours each day on Saturday and
Sunday. If there were another licensee or another ethnic licence granted, this
would suddenly impact greatly on CJMR.
888 COMMISSIONER WILSON: That leads me actually to a
couple of questions that I want to ask you with respect to the programming. I
will start with CJMR.
889 As you know, we have issued a new ethnic broadcasting
policy and one of the elements of that policy is taking a slightly different
approach towards broad service rule in a market where there are multiple outlets
890 I'm wondering if, sort of in the lead up to all of
this, if they would have a devastating effect on that station if you have
considered changing your approach. I guess it would require maybe some
cooperation amongst the various ethnic broadcasters in the Toronto market in
terms of who would serve whom, but essentially the approach taken for a market
like Toronto where there are these multiple outlets that each broadcaster might
serve fewer groups, but give them more time and thereby provide a higher quality
891 Have you considered that at all, especially because
here -- I mean you are talking about adding 50 hours a week of programming
to that station now. Would you just continue on the way that you are going or
would you maybe try and take a slightly different approach in view of the new
892 MR. CAINE: Well, the new ethnic policy which we were
very pleased to be a part of in the consultative process and made presentations
on -- by the way, it's very good because we were very pleased with the 1986
policy. It's updated it very well.
893 In terms of the sort of a line or even fewer language
groups that, Commissioner, you talked about, to some degree that's exactly what
happened, at least in the Toronto market anyway. There are six stations, full
time ethnic stations, CJMR being one of them, that are serving the
894 COMMISSIONER WILSON: With television.
895 MR. CAINE: And there's television and always a few
publications. I would say that Toronto is extremely well served with the ethnic
services that it has. We have -- that was the point I was aiming at --
we have to some degree sort of aligned ourselves within certain, you are aware,
the number of -- the conditions of licence refer to the number of languages
you are going to produce, not the number of hours you are going to devote to
896 In great measure, for example, CHIN is already very
Italian. Fairchild is already very Chinese. In our case, we are South Asian. The
predominant languages on our station on CJMR are South Asian.
897 We have almost aligned ourselves, without even knowing
it to some degree, into the major language groups or cultural groups within the
898 COMMISSIONER WILSON: Some would say that's an example
of the policy following the market.
899 MR. CAINE: That may be true and, of course, it's the
changing face. It's difficult, I'm sure even with the policy, to keep up to date
when the face of the population changes so quickly and so much in a short
900 The demand of the 50 plus population -- I'm
sorry, of the ethnic population -- is being well served, I think, within
the six -- at least in radio, the six radio stations that are there
901 The addition of the approximately 50 hours of
programming that we will be adding I think can be added without any undue impact
on the existing broadcasters. In actual fact, of course, CJMR is already
entitled to do that to the 100 per cent ethnic. It's not a point that we
902 COMMISSIONER WILSON: Okay. Thank you.
903 How much third language programming is CJMR currently
904 MR. McDONALD: Seventy-five hours a week, 75.6 or
something like that, 75.6 or something like that, 75, 76 hours a week which is
60 per cent of the total week.
905 COMMISSIONER WILSON: Okay. Just a couple of quick
questions about JOY 1250. Are you familiar, and I would expect you to be, you
have been in this business for 30 years, but you are familiar with the
Commission's religious broadcasting policy.
906 MR. CAINE: Yes, we are.
907 COMMISSIONER WILSON: How do you ensure balance in your
programming and how do you deal with requests that you receive seeking
alternative viewpoint programming?
908 MR. CAINE: Jim, I'm going to let you answer this
909 MR. LEEK: Thank you. One would be through some open
air phone type programming to allow callers to phone in and give their alternate
view on situations.
910 COMMISSIONER WILSON: Good. My next question was if you
planned any live open line programming. You have already answered that one.
911 A quick question on your Canadian talent development.
There is just one of your commitments I wanted to ask you about and that's the
$6,000 contribution to Theatre Sheraton and I am just trying to understand the
connection between the musical theatre program -- I think I can probably
guess, but just for the record -- the musical theatre program and Canadian
talent development as it pertains to radio. Musical theatre hits would be the
kinds of things you would carry on your station. Is that it?
912 MR. CAINE: Yes. That's basically it. I am going to
answer that in just a second, but I would like to just sort of finish that point
with Jim in terms of the balance on CJMR.
913 It's the response to the audience that demands the
service that is important to take into account. That balance has always been
there and has been there for years in terms of the programming that we present.
The audience is going to demand the kind of balance that you are talking about,
Commissioner. We are ready to respond to that. In fact, we want the time to be
able to do it.
914 Theatre Sheraton. You happen to have touched on one of
the softest parts of my heart as the founding Chair of the Friends of Theatre
Sheraton. The Theatre Sheraton program is the third most successful program of
its kind in North America, after Hollywood and New York, in producing young
people on the musical stage.
915 It's an absolutely fabulous thing. I can sell you
tickets to it whenever you would like to come down.
916 COMMISSIONER WILSON: At least you didn't offer to give
them to me.
917 MR. CAINE: They are so strapped for money,
Commissioner, that we have to sell tickets wherever we can.
918 They are absolutely wonderful, talented young people.
The enthusiasm that we have for Theatre Sheraton and for Humber College for that
matter as opposed to, say, FACTOR. Although we are contributing to FACTOR, on
CHWO right now we have dropped our FACTOR contribution several years ago, not
that they are not doing a good job, but quite frankly, they were not producing
the kind of talent or promoting the kind of Canadian young talent in the genre
that we present on the station.
919 When we saw Bryan Adams getting contributions and that
kind of stuff, we thought no, these kids need the help. With government
cutbacks, they are unable to maintain the quality program and the technical
assistance for their program that they used to. Hence my involvement in them and
our station's commitment to the Theatre Sheraton program.
920 Of course, it's the kind of talent, musical talent,
that you get in virtually every theatre, not only in Toronto but throughout
Canada. I would be willing to bet you that there is a music program grad from
Sheraton in the cast of practically every major theatre in the
921 COMMISSIONER WILSON: Well, it's close to my heart too
because I used to be in musical theatre when I was in high school. I didn't make
my career there.
922 I'm going to ask you two quick technical questions,
both of which you have heard already if you were listening this morning. The
first one has to do with the fact that CBC when they vacated the frequency in
favour of FM claimed that the signal was not satisfactorily received in certain
areas of urban Toronto, primarily in the downtown core.
923 I'm just wondering if you have any concerns about that
or if you have looked at it, have you made (technical difficulty) to do anything
about improving signal reception problems as they occur? I guess you could say
anything would be better than what you have got now, but that's not what I'm
924 MR. CAINE: Thank you for the lead in because from our
standpoint, of course, in terms of coverage and reach, yes, 740 is obviously
much better than we have now.
925 Just a little bit of history. Commissioner, you may
know we were an applicant for 99.1 two years ago or three years ago. We were not
as convinced, shall we say, as the CBC engineers of the problems that the
corporation was saying they were having in downtown Toronto. We didn't think
that their reception problems were as great as they were trying to
926 As an AM broadcaster of two stations right now, I am
more than well aware of the problems of AM reception in built-up downtown areas.
I would submit to you that all AM broadcasters have problems in the canyons of
927 Fortunately, however, the vast majority of the people
that we are appealing to don't live in downtown Toronto, so this frequency is
extremely well suited for where the 50 plus are concentrated.
928 The other point to that is that we are and have
already invested in our financials and so on the investment into digital audio
broadcasting. We are expecting 740 to go DAB fairly -- as soon as possible
after we were granted the licence. That would certainly cover up -- I'm
being presumptuous -- that would certainly cover a number of the
929 COMMISSIONER WILSON: I didn't react.
930 MR. CAINE: Thank you. A number of the downtown core
problems there might be in reception.
931 COMMISSIONER WILSON: One of the other questions that
Commissioner Wylie asked this morning of YTV radio was about the appropriateness
of the AM band. I wonder if you would comment on that in terms of your
932 MR. CAINE: Kaan, do you want to say
933 MR. YIGIT: Yes. There's some reference to that in the
audience part provided for prime time radio and 61 per cent of the proportion of
listeners to the new station, Prime Time 740, are current AM listeners, so there
is a high correlation of the existing listenership to AM band versus, you know,
in comparison to the market on average.
934 MR. CAINE: Which is not surprising, Commissioner,
because they grew up with AM radio. They are well acquainted with it. As you
have noted, I suspect, in the application we call them AM-friendly.
935 COMMISSIONER WILSON: Just to wrap up, I would like to
offer you the same opportunity that was offered to the applicant this
936 Just sort of sum up and tell us what in your view are
the compelling reasons to grant you this frequency over the other applicants and
in what ways your proposal would constitute the best use of this frequency, and
any other questions I didn't ask I believe was the phrase that Commissioner
Wylie asked that you feel compelled to answer.
937 MR. CAINE: Commissioner, I think you have done a good
job at dissecting our application in asking most of the prudent and proper
questions. We would simply sum up by saying, as I was mentioning to a reporter
at the break, that the need for this service in a market like Toronto where
there are 23 stations, and I have mentioned this already before, where you have
the rock and the talk and all of the other formats, ethnic.
938 There is not one single station -- that doesn't
mean that the people over 50 aren't listening to other stations to some degree,
but there is not one single station devoted to the kind of music of their area
and interest. They are helping me. What? Devoted to their kind of music that
represents their genre and their generation, the kind of information
programming, the relative speaking.
939 That's an exciting program to me where you have got
three generations from the same family, where an older person is saying "Nobody
listens to me any more", a younger person says "Nobody ever listens to me" and
the poor parent in the middle is going "What do I do?".
940 Here's a program where they get to air their, whether
it's cleaning up your room or to the war in Bosnia, where all three get
together. It's sort of a throwback to the dining room table and everybody eating
941 The fact is that people over 50 take more day trips
and overnight trips than any other demographic group, so we will be able to work
with the Ministry of Tourism in Ontario and the Ontario Chamber of Commerce to
produce programs like "Freedom Bound" and "Prime Time Trips" and all that kind
of stuff, to become the authority on day tripping in Ontario.
942 The health and wellness, the financial affairs,
travel, dining out, theatre, did you know the people over 50 buy more tickets to
live theatre than any other demographic group? Nobody is advertising to them,
nobody is promoting to them.
943 We know the 50 plus market. We also know the demand
that they are creating, that they can't hear our existing signal and they want a
radio station of their own. As I mentioned to the reporter, this beautiful big
AM 740 frequency is in direct proportion and commensurate with the demand and
the need because there's people all over southern Ontario who are over the age
of 50 who want to have this.
944 We didn't supply you with that information, but I'm
sure it's very easy for you to check the number of adult standards that there
are in other communities across southern Ontario. I don't think there
945 This is a wonderful opportunity for the Commission, in
our humble opinion, to satisfy a huge need, 1.2 million people, a quarter of the
population of this city, that want this kind of service or are entitled to hear
this kind of service.
946 The Commission has the chance to license CHWO with
740. Fortunately, this time around too you can also license the needs of some
other special and niche interests in some of the areas that perhaps you were
talking about before in ethnic or multicultural and that sort of thing in the
other two frequencies.
947 The Commission does have a chance to kill a number of
birds with one stone this time around. We are simply grateful for the
opportunity to have made our case to you. We think it's a very strong one. Thank
you very much for the opportunity to have made the presentation to
948 COMMISSIONER WILSON: Thank you to you and your team,
949 THE CHAIRPERSON: Counsel.
950 MR. RHÉAUME: Thank you, Madam Chairperson.
951 I just have one question at this time. It has to do
with your business plan. In your pro forma projections you project total revenue
over five years of $13.4 million and then looking at your operating expenses in
programming as a percentage of your revenues.
952 I would like to know how you arrived at those
projected expenses in your programming. I will tell you why I'm asking. If I
look at your actual numbers in that regard for CHWO, and they are confidential
figures so I won't quote any of those, but it seems that there's a decrease in
the percentage at a time when you are entering what you describe as an extremely
953 There you are. You are applying to enter the Toronto
market and in your business plan you actually decrease your programming expenses
as a percentage of total revenues. I would like you to explain what your
business plan is in that regard.
954 MS GERRARD: One thing with percentages, it all depends
what they are based on sometimes. In this case, program expenses currently are
quite high percentagewise on average in comparison to the average station in our
955 When we go to the AM 740 projections, they average
anywhere from 42 down to 35, 33 per cent in year five. That's basically due to
the increase of sale over the projected costs.
956 MR. RHÉAUME: I'm not sure if I understand. Your
current figures, actually it's 1998, which are confidential, maybe the
percentage is not. If I look over the last four or five years, you can see the
range of the percentage of total revenues. But then if you go into your
projections, there's a significant drop. I'm not quite sure if I understood your
957 MS GERRARD: In our projections we do show an increase
of programming costs in year one and accordingly. The previous projections were
based on a lower sales level. It looks like they have done a percentage
958 MR. RHÉAUME: I understand that there is an increase
indeed in terms of programming expenses, but there isn't as a percentage of
total revenue. Just answer my question. If you look at the current operation and
the proposed operation, there's a decrease.
959 Again, my question turns on you are entering a very
competitive market, extremely competitive, I think Mr. Keen used that
expression, the most competitive market, but then in your business plan your
decrease your programming output as a percentage of inflowing money.
960 MR. CAINE: I wonder if this would help. It's not so
much that there is a decrease in the cost of programming as there is an increase
in the cost of -- and maybe this is what Jacqui was talking about in terms
of -- it depends what your percentage is based on.
961 We are already producing those programs and the cost
of producing those programs are pretty well existing. There are some, of course,
increases in the cost of our programming because we are entering a major market
situation, but we are already very familiar with the costs of talent and the
programs to produce.
962 The revenue, however, compared -- and again you
are in a confidential area, but the revenue increases are considerably more for
AM-740 prime time radio, so that there is a difference which makes it look like
the program costs have gone down, but they haven't really.
963 MR. RHEAUME: Okay. So, (technical difficulties) It's
that there is little relationship between revenues coming in and your actual
costs. They are going to remain stable regardless of the money that flows in. Is
that your answer?
964 MS GERRARD: Somewhat, yes. Yes, that would
965 I was curious also, you mentioned you have the '88
figures because I have the --
966 MR. RHEAUME: 1998.
967 MS GERRARD: 1998, sorry. I have the CAB stats for the
bench mark stats for AM radio in major markets. It shows about 40 per cent
programming costs. Did I get cut off? And that's for all AM stations and for AM
stations that show profits it's 39 per cent and that's for 1998.
968 Our program costs are about 42 percent, down to 33 per
cent of sales over the five years. With the number of programs that we have or
already in existence, we wouldn't need to constantly inject the high program
costs that perhaps other stations would require.
969 MR. RHEAUME: Thank you. I think you are answering my
question. The figures I have over five years, $4.3 million in terms of
programming expenses, I'd say projections, against $13.4 in terms of total sales
revenue, is that fair? Is that the figures you have?
970 MS GERRARD: I just don't have them.
971 MR. RHEAUME: If you have the blue page 105 you will
see the figures I am quoting from.
972 MS GERRARD: Was that 105?
973 MR. RHEAUME: The blue page 105.
974 MS GERRARD:
--- Technical difficulties / Problèmes techniques
975 We only have 109 to 114.
976 MR. RHEAUME:
--- Technical difficulties / Problèmes techniques
977 You have answered my question. Thank you.
978 THE CHAIRPERSON: Thank you, counsel.
979 Thank you, Mr. Caine, and your team.
980 We will give you a deserved break and we will take one
981 We will be back in 15 minutes. It will allow the
opportunity for the change in contour maps and parties, unless you want to stay
and help finish.
982 Alors nous reprendrons dans 15 minutes, at 3:25.
--- Recess at 1511 / Suspension à 1511
--- Upon resuming at 1534 / Reprise à 1534
983 THE CHAIRPERSON: Mr. Secretary.
984 MR. CUSSONS: Thank you, Madam Chairperson.
985 I would just like to make an announcement before I
introduce our next application. We have just been advised that Item 7 in our
agenda, the application by Erin McNulty, also known as Good News Broadcasting,
has been withdrawn from this hearing at the applicant's request.
986 This means that we can adjust our schedule later this
week. On Wednesday morning, instead of Good News Broadcasting, we would start
with Mr. de Brabant's application, followed by Mr. McNabb and Mr.
987 On Thursday we would review the applications by Mr.
Auguste, Fairchild Radio and St. Sava's Radio, and on Friday we would hear
Enfavi Radio, Radio 1540 and possibly Phase II of the competitive process, where
our applicants come back and comment on one another's applications.
988 So I would now like to introduce our next application
by Gary Farmer on behalf of an incorporated body to be known as Aboriginal
Voices Radio, for a broadcasting licence to carry on an English and
Aboriginal-language native (Type B) FM radio programming undertaking at Toronto.
The new station would operate on frequency 106.5 MHz (channel 293A) with an
effective radiated power of 305 watts, and with a transmitter at Toronto/Hornby
that would operate on frequency 740 kHz with a transmitter power of 50,000
989 The Commission notes that this application is
technically mutually exclusive with the other applications scheduled at this
hearing proposing use of the 106.3 MHz and 740 kHz frequencies.
990 Mr. Farmer.
--- PRESENTATION / PRÉSENTATION
991 MR. FARMER: (Aboriginal dialect)
992 Madam Chair, members of the Commission, (Aboriginal
993 THE CHAIRPERSON: (Native dialect)
994 MR. FARMER: Merci.
995 We are before you today with three intentions, to
offer you the vision which unifies our membership, to share the passion which
ignites our effort and to convey the wisdom that flows through our
996 This presentation to you is part of a circle of 80
volunteers working to realize the dream of an Aboriginal radio service for
Toronto. Our experience is both wide and deep in native radio and other kinds of
997 We came together in 1997 through a radio training and
production centre hosted by Aboriginal Voices magazine. We have produced and
distributed radio shows to native stations and networks across North America. We
have produced concerts, an arts festival, web casts and special event
broadcasting in Toronto.
998 Three years above reach to the community has shaped
our vision for an Aboriginal radio station. We based ABR's decision-making
process on consensus, the customary form of inclusive and respectful decision
making, the style of decision making reflecting indigenous community based
ethnics and this restores the values that have eroded by
999 We are incorporating ABR as a non-profit organization
with predominantly Aboriginal ownership/membership. Our radio is controlled and
produced predominantly by Aboriginal people for the benefit of Aboriginal people
in particular, and for all people of Toronto as well.
1000 MS PODEMSKI: It has been difficult for Aboriginal
people to trust in Canada's institutions after years of betrayal and, more often
than not, institutions have turned their backs on what Aboriginal people have to
offer. One of the brighter spots in our dealing with Canadian institutions has
been the CRTC, from the Native Radio Policy to the licensing of TVNC and ABTN,
the Commission has provided a foundation for Aboriginal broadcasting, but now is
not the time to stop. By licensing ABR the Commission can support our continuing
efforts to build a media infrastructure.
1001 Over 30 radio services are received in the Toronto
market. No current Toronto radio service reflects Aboriginal culture.
1002 Moreover, of the roughly 5,000 hours of radio
programming available here, we know of only five programs with a consistent
Aboriginal focus. Not one single station among 30-plus stations and only five
hours of 5,000.
1003 And defining our audience isn't as easy as might be
expected. Toronto is a cosmopolitan city, embracing people from many
backgrounds. Aboriginal people are a part of this city and we have so much to
offer and to contribute to its cultural and civic life.
1004 While you might think that only Indian people would
be interested in our station, market surveys have shown an overwhelmingly
favourable response from all Canadians. Our programming includes and welcomes
people, all people, and is an offering to all of Toronto, and it is attentive to
Aboriginal lives, experiences, aspirations and connecting to non-Aboriginal
1005 We can offer a new, unique perspective to the issues
of the day, a perspective rooted in our relationship with history and the
natural world. Aboriginal artists will have the opportunity to break through and
present their many styles of music, whether it be Inuit throat singing, country,
folk, jazz or the blues, and you can't get a more distinctively Canadian culture
1006 Our programming will help our audiences better
understand the Aboriginal perspective on our common history and heritage,
whether it is about the great peace, the treaties, the War of 1812, Louis Riel
and the rebellion, our perspective is a new and fresh one for
1007 Think of ABR as the station of Toronto's Aboriginal
people for everybody.
1008 MR. FARMER: Toronto's Aboriginal population is
growing and our youth have special needs. Aboriginal people are restoring and
reclaiming our communities through personal and collective healing journeys.
Aboriginal people want to take part in the discourse which will shape the future
of our lives. We need a radio voice to promote the struggle of a healthy
community and build understanding between Aboriginal people and other Canadians,
explore the ignorance of history and of the Aboriginal experience, provide role
models and balance negative media stereotypes.
1009 Our programming will specifically show respect for
all people through special initiatives for women, the elders and youth. Today
you have the opportunity to licence a new and unique service. All the necessary
elements have come together.
1010 One, we have identified a demand in Toronto for a
high quality Aboriginal service that will entertain and inform.
1011 Two, there is a passion amongst Aboriginal people to
share with all Canadians a wealth of indigenous knowledge, culture and positive
1012 Three, by consulting the community we have come up
with a unique service that complements what is already available. We have
designed a strong program schedule to serve a variety of needs and
1013 Four, we have secured the funding and developed a
well through out business plan.
1014 Five, we have identified the frequencies which permit
the required coverage, and;
1015 Six, we are the team that can put it all together,
experienced, confidence, knowledgeable and up to the challenge, an Aboriginal
non-profit group drawing from its membership and from the community.
1016 We envision that our station will become a flagship,
producing programs for distribution throughout Canada and supporting native and
Aboriginal stations across the country.
1017 Mme OBOMSAWIN: Il faut savoir qu'à peu
près 60 000 personnes autochtones vivent dans la ville de Toronto, ainsi
que plus de 100 000 personnes autochtones de l'Amérique latine. Parmi
elles, il existe une riche communauté artistique qui s'est développée dans les
1018 Cependant, dans les rues de la ville on peut voir bon
nombre d'autochtones errants, perdus, le visage triste, se demandant où trouver
un abri pour se réchauffer ou dormir.
1019 D'autres viennent à Toronto pour étudier et un grand
nombre de familles s'y sont établies et y vivent convenablement. Tous ces gens
possèdent une culture riche et la plupart d'entre eux parlent encore leur langue
1020 Ce que tous ces gens ont en commun c'est le silence
de leur histoire.
--- difficultés techniques / technical difficulties
1021 ... l'attention du reste des citoyens de notre pays
et de nos gouvernements à leur égard. La Radio autochtone donnera la voix à nos
peuples dans la ville, une place pour raconter leur histoire et entendre les
nouvelles des autres peuples à travers le pays.
1022 Également, les derniers développements de toutes les
négociations concernant l'avenir de nos futures générations et bien d'autres
choses encore. Les langues autochtones, l'espagnol ainsi que le français auront
enfin leur place. Les citoyens de notre pays pourront ainsi mieux comprendre
notre côté de l'histoire vécue depuis les derniers 500 ans.
1023 MS PODEMSKI: We used a variety of community
consultation and market research methods to identify community needs and
interests. Two studies at major Aboriginal public events, three Aboriginal focus
groups, two of which were used in students, and a broad market research study of
Toronto residents aged 18 to 54 by Peter Doering. This gave us crucial
information about the radio listening habits and interests of natives and
non-native people. It established our programming plans and proved that an
Aboriginal centred radio station is viable and integral to the community
1024 In June of 1999 we provided a special event FM
station to cover the Aboriginal Voices Festival. The feedback that we received
there confirmed the interest shown in our market research. We also consulted the
community at customary gatherings like the Toronto Powwow. These research
methods demonstrate our commitment to reflect the Aboriginal community and led
to our unique programming plans.
1025 Our proposals reflect the needs and aspirations that
the community expressed to us and complement the radio services already
available in the market.
1026 MS OBOMSAWIN: The community's interest guided our
development of spoken word and music programming. The Aboriginal people of
Toronto are representative of indigenous culture from around the world. ABR's
commitment is to welcome and include them and make them all feel at home. The
programming will reflect the diverse spectrum of everyone in our
1027 We will use targeted recruitment, volunteer training
and various languages; French, Spanish, Aboriginal languages to reach out and
ensure diverse representation on the air.
1028 Our Spanish-language programming will reach out to
the Latin American people of both Aboriginal and mixed origin. Our
French-language programming is reflective of both Canadian francophone
Aboriginal people and indigenous francophone from around the world.
1029 Indigenous languages will be woven into the
programming according to the community's needs and as we find resources. We plan
to combine English and other languages on the same program to appeal to the
young listeners in an urban setting.
1030 This approach worked well to attract young listeners
to the Auckland, New Zealand Maori station.
1031 We will honour indigenous languages by including them
throughout our programming and we will promote language retention and
revitalization efforts to the community.
1032 Our news and public affairs shows will be as diverse
as the interests of the many people and cultures in our circle. Our staff will
work with up to 75 motivated volunteers to produce cutting-edge news, public
affairs, profiles and features on subjects as varied as car repairs, comedy,
respect for elders, Aboriginal cuisine, storytellers and the concerns of our
1033 MS BOMBERRY: We will provide a diverse range of music
programming not currently available on Toronto's radio dial. Our central focus
will be Aboriginal and a minimum of 25 per cent of the music in each program we
will air will be by Aboriginal artists.
1034 While much of this music will be in English French
and Spanish, we will easily exceed the minimum of 2 per cent of all musical
selections in Aboriginal languages.
1035 Your new music category system allows us to describe
our music programming much more precisely. As seen in our music list in our
application, we will be playing at least 40 per cent world music. So using your
new categories, we would reduce the amount of pop rock and dance to a maximum of
45 per cent and provide a minimum of 30 per cent world beat and international
1036 Diversity will be ensured by our low repeat factor
and low level of hits. We will exceed the Commission's regulatory requirements
of 35 per cent Canadian content in Category 2 and 12 per cent in Category
1037 We will feature both Aboriginal and non-Aboriginal
Canadian artists through regular air play, special feature programs, in studio
appearances, live concerts and other initiatives as funds become
1038 Aboriginal music is at the heart of our programming.
ABR will provide a platform for local and regional talent, urban and rural
talent, both prerecorded and live from our studios.
1039 MR. MANESS: Our revenue projections are based on
conservative assumptions. The Doering study estimated that ABR would reach 10 to
13 per cent of Toronto, which would give us a 3 per cent market
1040 We have estimated selling one-fifth of our
advertising maximum. We will bring in $380,000 in year one. Thus, estimated
accounts for a potentially lower advertising demand for niche programming and
uncertainty about the extent of our coverage.
1041 We also sought three estimates from national sales
rep houses. Our projected revenue was 20 per cent lower than their lowest
estimate. Furthermore, both advertising and fundraising revenue projections
start low and grow slowly in subsequent years. This modest approach will ensure
that we can easily afford the staff levels needed to exceed the minimum
1042 At least seven full time and six part time creative
positions will be filled by Aboriginal people. These people will provide
training for up to 150 volunteers a year.
1043 The amount of high quality spoken word programming
will depend on the available resources. Canadian talent development will play an
important role here.
1044 Our minimum programming commitments were just as
conservative as our revenue projections. That's why we can talk of exceeding
1045 To sum it up, we have a solid plan based on years of
experience in the not for profit native and community radio and backed up by a
reserve fund of $750,000 and the expertise of our advisor's circle.
1046 Our technical plans flow from our need to reach the
people of Toronto. CBC moved off 740 because apart from the limited AM fidelity,
the coverage in downtown Toronto was deficient.
1047 We have a solution to that problem. By adding 106.5
we have proposed complementary AM and FM coverage areas. Alternately, 106.5
could be expanded to reach our goal of almost all of the CMA population with a
directional antenna and waivers from a couple of out of market stations. So we
have given you the details on how your decision could support
1048 We would prefer an expanded 106.5 because it's a
better match for the reach and quality we need.
1049 MR. FARMER: We could talk about millions of
listeners, but we know we need to win them one by one. Let's take a look at what
people have to say about us.
--- Video presentation / Présentation vidéo
1050 MR. FARMER: There is no current Toronto radio service
reflecting Aboriginal culture and there is a demonstrated market demand for
Aboriginal radio. ABR is proposing a quality service with great programming. ABR
has funding in a feasible business plan. This is the last chance until the
digital radio for a frequency. The service is non-competitive with black and
invisible minority applicants. Additional benefits arise for the Canadian system
as a whole.
1051 Members of the Commission, the time has come, (a) for
an Aboriginal radio service in Toronto; and (b) for the voice of the first
Canadians to be heard here in Canada's largest city.
1052 Just before replying to your questions, we would like
to thank all those who have helped us get us here today, our team, the members
of ABR, the community people who have supported us, the intervenors who will be
supporting us and those who will appear before you later in the hearing, CHER-FM
for its support and Newcap for its general financial backing. Thank
1053 THE CHAIRPERSON: Thank you, Mr. Tomson, Mr. Farmer
and your team.
1054 Commissioner Williams, Please.
1055 COMMISSIONER WILLIAMS: Good afternoon.
1056 I guess just to give you an overview of the process
that I am going to be spending the next hour and a half on, is I am going to
cover through approximately 55 question and then I will be exploring about three
or four basic themes, one being the financial viability and the high reliance on
fundraising and uncertain revenue sources will be one area.
1057 The fact that your service would be run mainly by
inexperienced volunteers would be another area. You may say they are experienced
volunteers, and how the format will appeal to the broader community and other
1058 After going through these series of questions, of
course we will have the opportunity to summarize with a closing statement
presentation that pulls it all together for your best benefit.
1059 I know from some of the research I have done into
your project, one of the things I read was your volunteers' vision statement and
there are some pretty good goals, if I can quote from it:
"We strive to be the first among Toronto's radio stations to be dedicated to
raising self-esteem and nurturing self-reliance among the first citizens of this
community. Hence their aspiration to be one jump ahead in community
1060 I guess that's where the JUMP! FM came
1061 So to begin the process I will start working my way
through the questions. I guess where I would like to start is Newcap
Broadcasting seems to play a very supportive role to your organization. In
recent radio applications to the Commission they have -- as part of their
Canadian Talent Development contributions they have made large financial
1062 If you could take a few minutes just to explain how
you view your relationship with Newcap Broadcasting; two, are there any formal
agreements between you and, if so, if you could discuss the nature of these
agreements, and I guess third, assuming there is such an agreement then we would
like a copy of the agreement to be filed with the Secretary.
1063 So just to recap, how do you view your relationship
with Newcap Broadcasting? Are there any formal agreements between you and what
is the nature of them?
1064 MR. FARMER: Thank you, and it's nice to be here among
you all again.
1065 First off, the agreements that we have with Newcap
are pretty well based on a verbal commitment, a handshake and we are in the
midst of negotiation with them. We would be happy to provide those papers for
you by the end of this hearing and we can hand those over to the lawyer at that
1066 Our relationship with them is like, basically, they
are like a bank. They have a certain amount of money that they have put up in
case that we can't raise enough funds on our own. We feel very confident with
our modest proposal that we will be able to raise more than enough funds to
operate our station as we have set forth in our application.
1067 They are simply there if we need them and our
relationship with them is as simple as that. We are working with them in part to
help with other applications throughout the country to supply dollars to our
infrastructure to help us with programming and training above and beyond what
our current business plan is as it's laid out in this application. All that is
gravy on your potatoes, as it were.
1068 The relationship is nothing more than that. There is
no -- all of our relationship with them over the past almost year has been
very wonderful. They are very generous people and there is no sign of any kind
of -- anything that they are asking from us other than we are the recipient
of their Canadian Talent Development Funds as they apply in markets across the
1069 I think that answers all your questions, I am not
1070 COMMISSIONER WILLIAMS: You say that the relationship
is similar to that with a banker. What are the fixed terms of repayment
1071 MR. FARMER: There is no repayment. There is no terms
per se. If we need the money, we simply request -- it's like any other
relationship with a banker I suppose. They need to see a business plan. They are
looking for some audited statements in regards to the funding that they do
supply to us.
1072 I guess that relationship is like the father
co-signing for a loan I guess, so they are helping us that way, but that is
simply the relationship.
1073 There is another part to that question, isn't
1074 COMMISSIONER WILLIAMS: Now, Newcap's loan is for
$750,000 to pay ABR, to cover capital and operating costs incurred during the
launch of your proposed station by way of a forgivable loan, but ABR will have
to repay this loan as it receives money from unrestricted sources. This is from
a letter between yourself and Newcap. How do you define unrestricted
1075 MR. FARMER: If we receive any funding from something
that is not restricted -- for instance, if we were to get a grant from the
Norman Jewison Foundation, if those monies came in it's unrestricted, just money
to help us in our effort for a broadcasting, that would be money that could go
1076 If we were to receive a large donation from someone
for our efforts, if indeed we used any of the funds, then we would repay them
anything that we used.
1077 If we got a grant from the government to produce
programming specifically for a training initiative, then that money is
restricted and it is specifically for that kind of program and we wouldn't be
able to pay back Newcap. There is no interest on these dollars and so they are
just there to help us in this big business with all the broadcasting to get on
our feet and get established.
1078 COMMISSIONER WILLIAMS: So my understanding is that if
monies that you receive are earmarked for a specific project, they would be
considered (technical difficulties) and they wouldn't be part of a
1079 MR. FARMER: That's true. And also we have a plan to
go ahead with this kind of operation for a couple of years, so that the other
markets that they apply in, if indeed we receive those licences, then those
dollars that are coming to us as Canadian Talent Development would be as well
applied toward what they have put forward to us currently.
1080 COMMISSIONER WILLIAMS: I am going to move into the
area of fundraising now. In your first year of operation fundraising activities
represent over half, in fact, close to 55 per cent of your projected revenues.
Can you spend a bit of time telling us about your fundraising strategy and plans
and how you will go about obtaining donations from individuals, corporations and
the government, and if you could be quite specific, even including in your
answer the methodology you plan to use to secure each type of funds.
1081 MR. FARMER: Yes. We have struck a relationship up
with something like Casino Rama, for instance, which is very supportive of our
effort, with the 740 service we would be broadcasting right to the market we
would be broadcasting right through the market that they are most interested in,
that's attracted to their initiative. It's an Aboriginally-owned business. They
have the dollars to support. They have committed a significant portion to
advertising on the one hand, yet they are also willing to put money towards us
as a charitable donation to do that kind of work.
1082 Our own ability is fundraising related to publishing.
We have gotten dollars from the Canada Council, the Ontario Arts Council and
many other foundations and corporate donors. We are finding that the corporate
area in Canada is opening up far more, picking up the slack where government
funding has somewhat fallen away, though we have a relationship the Department
of Indian Affairs supported our initiative for our temporary broadcast and our
festival. They are very excited by the possibility of reaching large numbers of
Aboriginal people throughout this market.
1083 We expect that there are many other government areas
in terms of training. Human Resources Development Canada is also -- we had
a program with them, "Visible Beak," where we do training initiatives. Training
is a big part of our development here and also there is a lot of other
government areas that I would certainly like to explore, especially Heritage
Canada. But there is a lot of opportunities for us to -- we don't feel that
creating the economy that we need to run this station will have any problem at
1084 Jennifer Podemski would like to give you some
1085 MS PODEMSKI: I just have a specific example of a
fundraising initiative. I own and am executive producer of an all Aboriginal
operated production company and am producing a television series on Aboriginal
youth role models. One of our main initiatives is to raise money for non-profit
organizations, such as ABR, which of course will be within the first portion of
our launch. We are looking at 1,000-plus people attending a fundraiser in
September. I think it's initiatives like this that can support and continue to
support a non-profit organization like ABR in the future.
1086 COMMISSIONER WILLIAMS: Are the revenues from your
fundraising activities indicated in your financial projections net of expenses?
Have the expenses been deducted from the revenues as expenses related to the
raising of these funds?
1087 MR. FARMER: Maybe Mark MacLeod can give you more
detail on the formula.
1088 MR. MacLEOD: It's nice to be able to give a one word
answer and that's they are. Well, it's not a one word answer. It is that there
are gross figures. So I was looking up the answer when you asked the question,
so it's either yes or no, depending on what you ask, but there are expenses in
the cost that relate to all the activities involved in fundraising, including a
full time development director who would be devoted to revenue generation. So it
isn't the case where all of our staff are going to be preoccupied with producing
programming and not able to focus on what it takes to fundraise.
1089 But I hope the Commission recognizes -- if
members of the Commission have experience in fundraising, you would probably
recognize, not only from watching the video, but just from appreciating the
media savvy that this particular team has that fundraising -- we expect it
will be a forte. It won't be an area that we will have to struggle in. We have a
lot of connections on this team that built this application and we expect that
we will be able to be very successful in fundraising.
1090 We have had a lot of interest expressed already in
the station but, of course, people want to contribute to something. There is
less interest in putting something into a development project than there is once
people can be connected to actual programming that's on the air. So it's our
intention to -- and we believe the fundraising figures are actually
conservative. Our numbers would have been a lot higher if we had of felt we
needed to push the figures higher, but we basically built our expenses and saw
that we had enough staff and then put the revenue figures to match
1091 Just on this team alone, there is experience in
fundraising with radio in Toronto. We have people who have been involved in over
the air fundraising and fundraising in the community with Toronto and non-profit
radio stations and we have a good idea how easy and difficult it is to raise
funds in this city for non-profit radio. We are confident that these numbers
reflect accurate estimates of how much we could raise.
1092 As was mentioned earlier, we have ramped those
numbers up slowly. It's like kind of a cup half full, cup half empty. Our
perspective is that the numbers are low and they ramp up slowly, rather than
being high and staying at that level. It's a reflection of our confidence in our
ability to fundraise.
1093 MR. FARMER: And lastly regarding that, we have a lot
of support from Canadian artists outside of our community, for instance, Neil
Young and the Crosby, Stills, Nash and Young tour that is about to take part in
Toronto March 30 and 31. There is a co-operative deal with Neil and myself and
our team to raise awareness and dollars at that time during those concerts, for
instance. So there is a lot of support out there for Aboriginal
1094 COMMISSIONER WILLIAMS: Okay. My next question was how
are you going to meet your targets without a full time person dedicated solely
to fundraising activities, but am I to understand that the development director
position you just spoke of would be dedicated towards fundraising?
1095 MR. MacLEOD: That person would actually be --
can I answer this Gary? That person would actually be dedicated to revenue
generation in all manners, that is grant applications and co-ordinating the
sponsorship and sales. So, in effect, part of their effort would be in going
after the minimal levels of advertising that we are looking at generating as
well. But they are in the revenue generation department of Aboriginal Voices
1096 COMMISSIONER WILLIAMS: There is a reason for that
question. It was that in your application and in the information I have here you
have four full-time employees; station manager, program director, news director
and music director. Are you saying this development director would be added to
that full time employee list?
1097 MR. FARMER:
--- Technical difficulties / Problèmes techniques ...had just employed
through our current situation. We have two companies, one is AVR, of course,
Aboriginal Voices Incorporated, which is the publisher, which is really the
mother to Aboriginal Voices Radio which is a separate organization, but had just
hired a fundraising consultant who is working full time for us in that regard
for Aboriginal Voices Incorporated.
--- Technical difficulties / Problèmes techniques
1098 ...until such a time when Aboriginal Voices Radio is
able to afford someone like that, but right now it's AVI that is carrying the
ball on the fundraising for both situations.
1099 MR. MacLEOD: I think I can just clarify that the
figures that you were mentioning for staff are in fact the programming staff,
not the staff for the whole station. Is that possible? I am not sure where you
are looking at the numbers.
1100 Our budget allows for seven full time and six
part-time staff, including four and three in the programming area. So if there
is a place where you saw it otherwise, I could check that out and see what was
meant by it.
1101 COMMISSIONER WILLIAMS: So AVI, an associated
organization, is going to be providing the development directors' contribution
to AVR until such time as AVR is financially able to attract and retain some
more positions. Is that what you are saying?
1102 MR. FARMER: That's the situation that is going on
right now, yes.
1103 COMMISSIONER WILLIAMS: Is there any expenses to AVR
as a result of that arrangement?
1104 MR. FARMER: You know, there has been some talk among
the Board to really pay back AVI at some point in its development, but they are
truly sister organizations and will continue to support each other.
1105 We hope that the radio empowers itself that it will
certainly bring an economy to us that we have never, ever had before to engage
and continue on publishing and other interests and media production.
1106 COMMISSIONER WILLIAMS: Okay. I am going to move into
the area of government grants. You have stated that government grants are
expected to be a significant source of funds, maybe the largest source. You have
identified some government departments and we would need a bit more information
on that, and agencies such as DIAND and Heritage and the Canada Council and
other levels of government, both provincial, municipal and even
1107 Have negotiations for any grants started? Is the
process under way and, if so, which departments are you negotiating and if you
are able can you give us an update on the status of those
1108 MR. FARMER: I don't believe that we put any
government funding into our proposal for this radio service. All the government
grants -- it's not in our fiscal plan, if I am not mistaken, in the
application that we put forth to you.
1109 Yes, we have had a relationship with federal
departments in all areas regarding financing of various projects that we have
undertaken in the arts and publishing areas over the years. We know, for
instance, the Department of Indian Affairs has special initiatives designed at
trying to better reach the people that they are trying to serve, so there is a
sincere interest and I spoke directly to the Minister of Indian Affairs at the
Assembly of First Nations and he gave me that they are waiting for the right
time to get ahead and talk about where their support could -- at what
level, et cetera, et cetera, but really there is a message that they are trying
to reach Aboriginal people and having trouble. So we certainly know that we will
be there to offer support and initiative in that regard.
1110 Outside of that, all the others we really haven't had
a chance to sit down with them. We know that there is a lot of interest on the
part of HRDC to empower people in the broadcast industry, both with the new
initiatives at APTN and, of course, what our service will be providing. We hope
that that will meet a favourable response from these people when we do have a
licence in hand. I am sure there is a lot of interest in our community and
people are just coming around to the concept that native people could have jobs
in the broadcast industry. It's something that is a brand new horizon for us and
we are all very excited about it. So we don't think that there is going to be
any trouble in securing the funds that we need to do what we want to do once we
get the licence.
1111 COMMISSIONER WILLIAMS: Okay. Another source of
revenue that you have listed is for brokered programs. What would be the source
of these brokered programs and do you have any producers interested in buying
time for the exhibition of brokered programs on AVR?
1112 MR. FARMER: I had discussions with Pomerex over time,
several other distributors of programming and several private broadcasters in
the commercial realm are very interested to put some spots of Aboriginal
programming in their cycles which they have never had. We are going to be at the
forefront of producing radio, so we expect that there is going to be a lot of
interest in trying to fulfil their CRTC commitments for a special place of
Aboriginal people in the Broadcast Act, and we expect that there will be a lot
1113 We also put that forth because of the subcarrier
possibilities of selling our subcarriers to communities that might be of
interest to -- that there is a lot of possibility there to generate some
income as well.
1114 MR. MANESS: Excuse me, I would like to add that we
haven't look at or figured into our planning structure now having to use
brokered programming because it has been our experience in our years of working
with non-profit organizations, it's very difficult to get any kind of funding
commitment from government unless you incorporate it. We are now in the process
of going through that incorporation.
1115 It is very difficult to do any kind of fundraising,
or do any kind of active fundraising. We can do all our planning. While plans
are in place, we have seriously looked at all kinds of options for increasing
our income over the next few years, but we have to wait until our organization
is incorporated and that will happen in the near future. We are going after a
1116 Until that happens, it is very difficult to put
together any kind of comprehensive planning based on going to speak to anybody
because we have always found in my years of working with organizations people
don't take you really that seriously until you say, "Yes, here's our letterhead.
Take us seriously. We have a bank account. Everything is set up. All we need
is -- we can fill in your applications. We are very clear on what the
objectives of our organization are. You can read what our mandate is. We can
forward to you what our objectives as they are registered with the Government of
1117 Until that happens it is very difficult to move
ahead. This is the point that we are at.
1118 We are going to go ahead. Our plan now is to go ahead
with the incorporation as soon as we can, which would even take place before we
find out if indeed we get the licence because it is very important for us to
start establishing a positive, concrete cash flow prior to the kind that would
go on here. But the critical point for us is to get our articles of
incorporation registered, so we can demonstrate that indeed the money we are
applying for is really within our organizational mandate.
1119 It is very difficult to go forward because of the way
that funding is given to organizations because they have to look to find out if
we are covered under our mandate in order to receive funding. If we have our
organization papers together and in order we can say, yes, this is well within
our mandate. So it's very difficult, except to keep those levels purely on the
level of discussion. To get anything concrete requires that incorporation to
1120 COMMISSIONER WILLIAMS: Thank you for that.
1121 I guess just coming back a bit to these brokered
programs. In that you listed them as a source of revenue, I was curious as to
what will be the source of these programs. Where will they come from?
1122 MR. FARMER: Well, we will produce them. We will
produce them ourselves for outside of area networks that want them. There is a
lot of need for Aboriginal programming right across the country. So we feel that
was a source of income for us, that the skills that we will develop as
broadcasters and the training that we will do among our community will create a
market demand for the materials that we are perpetuating in Toronto. We believe
that there will be a market for the materials right across the
1123 MR. MacLEOD: I would like to just make it clear
because we seem to be going a little bit on a track here, that there is no
inclusion in our funding plans for the first five years from any broker program
revenue, no money from government grants.
1124 I am not sure if we made a reference in our
application to these, you know, 100 per cent possible sources of funding, but
not source of funding that we have included in our plan. We basically only
wanted to project the absolute -- you know, the things that we felt we were
confident within our hands to be able to do.
1125 There was a temptation, of course, to want to put
together 25 employees, but you have to understand that there is non-profit radio
experience on this team and that for us -- I mean, for many non-profit
stations, and the Commission knows this, to have seven full-time employees and
six part-time employees is total luxury. I mean, you know, we will be the envy
of many other non-profits, if not all non-profits in this country.
1126 So you need to keep in mind that the level we are
talking about here is high-quality programming done by volunteers and a paid
staff mix, and that we very purposely left out SCMO rentals and all these other
sources of funding which would allow us to expand and build that
1127 Again, I just wanted to clarify that because you seem
to be on a track asking where we are going to -- more detail about how we
are going to get this funding, and it wasn't meant to be indicated that we are
looking for revenue from those sources. Thank you.
1128 COMMISSIONER WILLIAMS: No. I agree, your business
plan was put forward in a very conservative manner. In fact, some questions
further down will say that maybe in fact too conservative. So, we will start
exploring some of how you have just put in the absolutely confirmed areas in a
further set of questions.
1129 Further on this brokered programming, what do you
mean by a brokered programming?
1130 MR. FARMER: I don't know. What do you
1131 COMMISSIONER WILLIAMS: I think we are in a quandary
here. You go ahead first.
1132 THE CHAIRPERSON: Yes.
--- Technical difficulties / Problèmes techniques
1133 COMMISSIONER WILLIAMS:
--- Technical difficulties / Problèmes techniques
1134 MR. FARMER: Like Mike says, I didn't think that we
put that in our budget, but we believe that there is a hunger for Aboriginal
content. d We know that people who are in the private broadcasting arena haven't
turned, don't know where to turn for programming.
1135 We also know, I know that in order to get a licence
in this country you have to create a special place for Aboriginal people in the
Broadcast Act. So, I think you have created a demand in that regard, especially
to the private industry broadcasting issue in this country.
1136 I think that for the first time ever we will be in a
position to offer programming as a service to the private broadcasting arena and
possibly create an economy from that on the side, somewhere down the line, once
we get up to the level that we think we will be.
1137 COMMISSIONER WILLIAMS: Yes, I agree there is the
need. One of our earlier applications today was for a children's station and at
some time during their programming day they were going to explain to six to
eleven year olds the impact of the creation of the Nunavut, which was the
largest land claim I guess in Canadian history. I was just wondering how they
were going to do that. I didn't ask them the question, but maybe there is a way
they could buy that type of programming from someone who has already put it
1138 Anyway, back to the question, if for whatever reason
you fail to reach the advertising revenue target, I guess could and how would
you increase revenues or I guess through fundraising and fundraising activities.
How would you go about covering an advertising revenue shortfall if you didn't
achieve your target?
1139 MR. FARMER: Well, we have that covered simply with
the Newcap formula. Whereas, within the first five to seven years of operation
if we have any shortfalls regarding the business plan that we have put forth to
you that Newcap Broadcasting will be there to help us out, and certainly,
hopefully, by the end of the first year of our operations we hope to be
successful at least in some markets, so that that funding would be coming to us
is a possibility anyway.
1140 COMMISSIONER WILLIAMS: So the answer I guess is
Newcap will be there and this is based on your verbal handshake agreement with
them, or are there any details? Is there any cap on Newcap's ability to
1141 MR. FARMER: Well, $750,000 is there for us over the
first seven years of operation. So it's a significant body of dollars there for
us. Of course, our advertising budgets that we put forth to you are projections.
As was said in our opening statements, we really low balled it to give the worst
case scenario, but there really won't be much problem for us.
1142 That's how I started publishing was selling
advertising. We have a long term, seven years of publishing experience in the
advertising market, so we published the book which is also non-profit. So, if we
can survive in the publishing arena for seven years in this country, the
broadcasting is a bonus.
1143 I mean, coming from someone who is in the print
industry and the publishing, you know, radio is very sexy, so it is not going to
be any problem at all. We think we will exceed those numbers we have put forth
to you. Again, we came in to show you that the -- to low ball
1144 MR. MANESS: It has always been our position as an
organization working towards non-profit status, we are in the process now, we
have our plans in place to increase our membership.
1145 In the 25 years of experience I have had in working
with non-profit organizations nothing succeeds like success. The worst thing you
can do with a non-profit organization is set your standards, not necessarily
standards, but your budget so high that it is impossible to reach them, that
they drain the resources of your organization to the point where your product,
in our case our programming is going to suffer.
1146 Nothing motivates people to get involved with this
process. We are hoping to motivate volunteers. Not disheartens those people more
than if you were continually -- don't reach our fundraising targets. We
bring them on line to work and producing programs, and then before we produce
the programs, "I'm sorry, folks, we didn't reach that particular level of
fundraising," and they go away.
1147 What we are doing is we are boiling down our
experience as an organization, based on what it is to grow up in this particular
society, working with the federal government, working with corporations, going
after private grants, everything. We know we have to start low. It is not our
experience to start high. It is our experience to start low and grow because
that's how we work with our people. We have that commitment.
1148 The question if our budgets appear low compared to
other organizations, we are not trying to be a rock station. We are not trying
to do that. We are trying to put together a vehicle to empower people. The only
way we can do that with any kind of assurance is to put together a budget that's
low, that's easily achievable, extremely easy to achieve. Whatever money we make
above that is going to be focused as per our application on working on
developing high quality spoken word programming.
1149 The reason why we are sitting here is we are
extremely confident that our bases are covered. We can deliver quality
programming as a not for profit organization. Our budgets are low, which is
amazing as it may seem, but this is the way that we operate. We build first. We
build our foundation. We maximize our strength.
1150 After that, when we reach that level, we pour all the
money back into increasing the kind of content, spoken word. Will we have our
membership in place? Everything will work. Thank you.
1151 COMMISSIONER WILLIAMS: Well, I admire your
confidence. When you start off on a hard journey it is good to have the right
1152 In a letter dated to the Commission on November 5th
you stated that AVR would be able to offer a viable service with no funding
donation revenue whatsoever. Since the funding from the activities is a
significant part of your revenue base, as we discussed earlier, 55 per cent, we
are curious as to how you can make that claim.
1153 Maybe before you answer I will just speak a bit about
these questions. The nature of these questions is to help you present your case
as best possible and it is to bring out information that may not have shown up
in your application.
1154 So I guess just to repeat the question now, it says
AVR would be able to provide a viable service with no funding donation revenue
whatsoever, but since funding represents 55 per cent of your business plan how
can you make that claim?
1155 MR. FARMER: I will refer this to Mark
1156 MR. MacLEOD: I spent a fair amount of time thinking
about this and developing up my answer to you at the time, so I don't know if I
can really elaborate on it beyond that point.
1157 We originally felt that our September 20th
application that the small amount of money that we needed to actually get going,
$150,000, was really all we felt we needed to get to air was something we could
raise between the time we were awarded the licence and we hit the air. We
thought maybe three months at the most it would take to get that money, given
that people have already said, it's only verbal of course, but when you have a
lot of people saying, you show them a video, they say they will give you money,
we know we have a large number of clients perhaps to grab right away.
1158 So we felt that it was sufficient without having the
funding reserve from Newcap and it wasn't our intention in applying to even have
that reserve, but we had a number of things -- a number of people we had
spoken to and Newcap was really the only company that we spoke to that had
really come up and said, yes, we will put some money up because we think what
you guys are doing is so valuable.
1159 So after we got the Commission's response that having
no money up front, and thinking that you are going to be able to raise $150,000
after you get the licence is just not on for us. We need to know you have some
money in the bank. We went to Newcap and we said "We need some money. The
Commission is saying that they want to see something in a bank account for us,
even though we don't believe we need it. We believe our plan -- we can do
it without that money."
1160 So we worked out with them that surely three-quarter
of a million dollars would be enough to secure a start up. We look at that as
saying, okay, $150,000, that's -- if we go out and fundraise once you give
us the licence and we get zero, nobody, no people on the street and nobody wants
to give us any money, we have got $150,000 out of that Newcap money. If at the
end of the first year we are totally off and we are down $200,000, then we draw
down $200,000 from that Newcap reserve.
1161 But you should understand, it's our intention and we
have made this clear to Newcap that we don't intend on drawing on any of that
money. We don't think we need it. We think that we can operate this service
without drawing in that funds, but it's money that they have made available to
us and I guess that would be the main thing.
1162 I mean, the other side of that, I guess, besides
having that reserve, I guess there are two ways I tried to answer it before I
think. One is that we have that reserve, which is in a sense the easy way out.
The harder way out is if we have some flexibility, not that we want to go below
seven full-time staff and six part-time staff, but we could go lower than that
if we had to. We believe in not reduce our level of service such that we would
not be a high quality distinctive service in Toronto, but we picked seven
full-time and six part-time as kind of a minimum that we were certain we could
meet our language commitments.
1163 It's a lot that we are promising and I know you are
going to get to that when your questioning time comes, but our response to sum
up is that the reserve from Newcap and/or simply buckling down and saying "Okay,
we have got to get some more money here, let's get out on the street, get the
shoe leather going and find corporations, find individual donors to support
1164 COMMISSIONER WILLIAMS: Thank you.
1165 I guess the question was in a letter dated November
9th you said you could do with no funding donation revenue whatsoever and you
answer is because Newcap would cover that. But in your AM/FM combined and your
stand alone FM pro forma statement of revenues and expenses you have got
fundraising activities in both cases representing more than 50 per cent. In this
example $330,000 worth of fundraising as being the base part of your business
plan in year one in either scenario, the AM/FM or the FM stand alone.
1166 I guess that's where my question is directed, to the
November 5th letter and then your business plan. Your November 5th letter says
you don't need the money and you could do it without any funding whatsoever, but
then your actual pro forma income and expense portion of your business plan it
represents 55 per cent of what's needed to make it work and this bare bones,
most worst case scenario, most conservative type example budget it still does
represent 55 per cent.
1167 I guess I am just trying to get an understanding of
how that reconciles.
1168 MR. FARMER: If you could excuse me for one minute, I
also wanted to let you know that Alanis King is replacing Jennifer Podemski as
Jennifer has to rush off to an opportunity, so excuse me.
1169 COMMISSIONER WILLIAMS: Welcome, Alanis.
1170 MS KING: Thank you.
1171 MR. MacLEOD: I guess when we got the question from
the Commission we didn't really understand why the Commission would suggest that
we would not be able to raise funds.
1172 We have people on our staff who have successfully
raised $100,000, $200,000 a year at other non-profit stations that in a lot of
ways we believe are less attractive to donors than we think our service will
1173 So, I thought okay, a theoretical question is being
posed. Okay, I will give you an answer, but it seems like a stretch to suggest
that we would be that unsuccessful. There is nobody else across Canada at any
other non-profit station that try fundraising that don't raise at least $25,000,
1174 We have a great team. We have got people that are in
the media and we have got TV people, radio people on the team that know how to
speak in public, that can get on television, that can get on other radio
stations. We have got a good quality design team to produce excellent work. We
are really confident about these numbers, I guess that is all I could really
say. We believe we have the talent to raise that money.
1175 COMMISSIONER WILLIAMS: It sounds viable to me, but I
guess getting back to the question, in a letter that you wrote to the Commission
you said you would be able to offer a viable service with no funding donation
revenue. That's what you said in the letter. What you say in your business plan
is you have to get $330,000 a year and we want to know which one, do we believe
the financial projections, the letter or is there some reason that it is stated
differently in each of them? We are curious.
1176 MR. NacLEOD: I guess I'll -- you know, like I
said, I thought about this and I can quote you from the response that I put in
here. I put that if our fundraising projections fall short, I am paraphrasing,
that we could make an additional series of expenditure cutbacks or add new areas
of revenue which could replace the amount of fundraising revenues, additional
revenue, you know, we expect will come from a variety of other
1177 I guess my answer was that we could survive without
getting any fundraising at all, that we would be able to cut our programming
staff in half. We would be able to aggressively -- if funding was not an
avenue for us we would simply have to transfer our activity to another
1178 Our goal on this station is not to sell all of our
advertising time. We have picked an amount of advertising time which supports
our activities, but maybe we would look at more aggressively selling
1179 I am actually trying to give you an answer. I am just
not sure what you want to know. We could deal without any advertising revenue,
we could do it, by cutting and dipping into the Newcap reserve fund or by
getting other sources of revenue. The worst case scenario is more likely only
raise half the money we say we are going to raise. That would be a disaster
scenario for us and we were short by $150,000 or something. It doesn't seem
conceivable that we could be shorter than that.
1180 COMMISSIONER WILLIAMS: I think you have answered my
question and clarification re the letter. What I am hearing you say is that we
will go with the budget that is put forward in your pro formas and the business
plan, and that if something not very favourably financially happened to you then
you would adjust your business plan to meet the new financial reality. Is that
basically what you are saying?
1181 MR. FARMER: Yes, basically.
1182 COMMISSIONER WILLIAMS: Okay. We are moving to a new
1183 THE CHAIRPERSON: Is it possible that the person who
would get the business plan is not the person who wrote the November 5
1184 MR. FARMER: No, I think they are one and the same.
Mark and I worked together primarily on both the licence and the business plan
and all the letters.
1185 I am worried that there is -- the question that
you are bringing up I am not sure I understand totally what you are trying to
get at, so maybe with some clarity on that it might help us both. I think we are
a little in the dark here.
1186 COMMISSIONER WILLIAMS: I think we got the information
in the last response that was needed and that when he read from his response
back to a letter and how he detailed it it was a small part of his total
response and it wasn't really the main theme of the message is what I got from
1187 Based upon that we will go upon your financial
projections that you have put forward for the licence period, which you have
already said were very conservative and worse case type scenario, even though we
have heard in a "worser case" if I can use that word, you would find a way
of -- Martha will get me for this later -- will find a way of
adjusting your plan accordingly.
1188 MR. FARMER: Yes, I truly believe that if we win this
licence that fundraising will not be an issue. It will generate more than enough
dollars to operate this service above and beyond what we are actually committing
in this licence application.
1189 COMMISSIONER WILLIAMS: You have stated that if you
are not granted a licence for an FM and AM then perhaps the coverage area of
106.5 could be expanded to include most of the Toronto CMA. I have a couple of
questions in that area.
1190 Have your stand alone FM projections been based on
this expanded coverage area and, if yes, what is the population difference
between the current and the expanded area?
1191 MR. FARMER: I believe John Matthews would be the best
to answer for you.
1192 MR. MacLEOD: Just one moment, we need to pull that
page out of a licence.
1193 COMMISSIONER WILLIAMS: While you are doing that maybe
I will read off a couple extra and then when someone's answering -- what
service areas would be included with the expanded FM service and what proportion
of the Aboriginal population currently reside in the expanded area?
1194 So, one, we want to know if your financial
projections have been based upon this expanded coverage area and expanded FM
area and, if yes, what is the population difference between the current and the
1195 I understand from much of the material I have read
there are several different ways of estimating what is the Aboriginal
population. So, it isn't a test. We just want to know what your read on it is
because just from the provincial -- federal and common knowledge methods
there is a vast discrepancy in actual population data anyway.
1196 So did I give you enough time?
1197 MR. MATTHEWS: Yes.
1198 The stand alone FM revenue was based on a reduction
of 33 per cent and it was based as well on an estimate that we would be able to
reach between 75 and 90 per cent of the CMA population with the expanded FM
1199 MR. FARMER: Our population in the CMA that he speaks
of, the 90 per cent, sits around 75,000 people. Of course, with the 740 that
increases dramatically to approximately 200,000 Canadian Aboriginal people, and
then significantly beyond that if we include the Aboriginal people from Central
and South America.
1200 COMMISSIONER WILLIAMS: Okay. So the financial
projections have been upon the expanded coverage area? Is it an assumption in
your financial plans that the FM would be expanded or are you basing your plans
on the current coverage area?
1201 MR. MacLEOD: The answer to the question is our AM/FM
combination was the basis of all of our financial planning and we offered the
Commission a budget after being asked for it for what we thought would be a
budget if we had a stand alone FM, and you have that in our licence, one of our
additional question responses.
1202 As John just mentioned, that was a 33 per cent
reduction in advertising. Of course, without the AM we would not have to pay for
the AM transmitting plant which is a heavy expense, nearly a quarter of a
million dollars a year, and then a few other expenses, less than $10,000 would
change. But, essentially, all of the numbers that we have been talking about,
talking about how conservative those numbers are, they are all based on the
1203 COMMISSIONER WILLIAMS: Thank you.
1204 Your revenue assumptions assume that you will only
sell 21 per cent of your annual allotment of minutes of 504 weekly minutes in
year one, and then you rise to 33 per cent in year five. Is it fair to assume
from this that the current 504-minute limit does not affect your station,
including the six minutes per hour maximum?
1205 MR. MacLEOD: Go ahead, Gary.
1206 MR. FARMER: Again, we low balled, came in low on that
advertising for our first year just to present an honest appeal as to what
we -- we don't want to concentrate on sales. We want to concentrate on
programming. So we want to build our sales over the course of our first
seven-year period to a level where we think we can exist and yet be
1207 MR. MacLEOD: In fact, our projection is that we would
have advertising at about the amount of .8 minutes per hour in our first year,
rising to 1.3 minutes an hour by the fifth year. So, the answer is clearly no,
that the 504 minutes or four minutes an hour maximum does not harm us in any
1208 It is not our intention to run a service that has a
lot of commercials. We will be running sponsorships and advertising, but we will
be charging a reasonable rate on those, rather than doing a high volume of cheap
ads and that type of thing.
1209 We have talked about different sources of revenue. I
want to make sure that the Commission is clear that we have tried to diversify
our funding, so that in a sense there is some balance between getting money from
advertising and getting money from corporations in donation form and from
foundations and that type of thing. So we have tried to find some kind of
balance, so that if one varies in a given year based on a difference in
personnel or whatever it might be that we would be able to cover it on the other
side of that balance.
1210 COMMISSIONER WILLIAMS: Have you had the opportunity
to talk to our survey potential advertisers regarding their attitudes towards
advertising on Aboriginal Voices Radio? Do you have any idea how the market will
respond to your advertising sales pitch?
1211 MR. FARMER: Yes. We talked to all the major
advertising firms that handle radio advertising and presented our initiative to
them. They all responded very favourably toward the response.
1212 We know the federal government would be very
interested in terms of its initiatives to put commercials on our air
1213 And we have surveyed a lot of aboriginal business. We
are finding a lot of support in that area if we win the licence. Especially,
there are negotiations going on with several companies in Canada who are
interested to move into this major market. There are a lot of successful
businesses, like P-Sales Trust, for instance, a banking institution primarily in
the west who is moving this way and is very interested to see how this hearing
goes for us, besides the Business Development Bank, Nova Scotia, CIBC, Bank of
Montreal. All have aboriginal banking initiatives under way. They will all be
extremely interested in our results at this hearing.
1214 Business in Canada in general is moving toward the
native community, especially in the east, up in Nova Scotia and Newfoundland.
The oil industry seems to be moving out there. A lot of them are looking for
ways and means to do good things in our community in order to initiate business
relationships with native communities.
1215 There is an astounding market of alternative energy,
alternative building and development in native communities, and a lot of those
industrial and light industrial giants are interested in our -- my
discussions as well with -- Union Gas, people like that, who pull lots of
natural gas from native communities throughout this country, are also interested
in showing support in that regard.
1216 Outside of that, the casino situation, both in
Saskatchewan and Ontario, are also showing significant interest, especially in
our training initiatives and such.
1217 So we believe that the aboriginal people in this
country are moving ahead in the business world, and we want to be right there
with them. So the timing is very significant.
1218 MR. MacLEOD: There are just two points I would like
to add to that, and that is our team was well informed from the close sister
relationship with the magazine. Of course, Aboriginal Voices Magazine does a
wide sweep of all types of potential advertisers and has a good feeling of who
out there is sympathetic to aboriginal media in general, and in the course of
the last year or so, as we have been working on the radio, we have been in close
touch with the people handling advertising in the magazine, and have a fairly
good idea about how -- we haven't done official surveys, but a feeling of
how much interest there might be in the radio, and it is fairly universal in
1219 And, secondly, we are expecting that our split of
advertising would be approximately a third to a half in government money, like
kind of problem-solving type ad campaigns and that type of thing, that about a
third to a half will come from large corporations, like banks and other
sympathetic institutions like Benneton or progressive organizations that want
the image associated with a goodwill endeavour like ours.
1220 And the other third will come from retail, and that
would be aboriginal businesses and other businesses that would see, you know, a
1 to 3 per cent audience as an audience they would want to get their advertising
1221 We clearly believe we will attract a sophisticated
audience in a cosmopolitan city like Toronto and that there will be a --
you know, the advertising demographic, as it were, will be attractive to some
companies despite our non-profit format.
1222 COMMISSIONER WILLIAMS: These financial targets for
advertising, you expect to achieve these without dedicated full-time sales
personnel? Who is going to be selling these ads?
1223 MR. FARMER: We sell the ads, we always have, and we
will continue to. We have a sales force built into the seven/six,
part-time/full-time scenario. So that sales force has been --
1224 Also, the magazine has worked off of commission
sales. People as well, for the large part, work off of commission
1225 MR. MacLEOD: I will just give you the facts and
1226 The sales team is planned to be two full-time people
selling ads and a development -- a revenue generation person on top of
that, so there will be three people involved. But their costs are to be netted
out of the expenses -- out of the revenue, I should say, so they will be
covered in the actual operating of that.
1227 MR. FARMER: Another significant contribution would
come from the Aboriginal Peoples Television Network, which will be appearing
before you as well on our behalf, with of course the combo of having a national
service for television in the largest market like Toronto, and we would be able
to service them significantly, which also is very interesting to us because they
would offer as well language diversity in aboriginal languages in the case of
ads in support of programming that is going on on the television. That radio-TV
combo will also work to our advantage, especially as the service is presenting
itself to Canadians. So there is a big interest in us with APTN as
1228 COMMISSIONER WILLIAMS: In your proposal, where you
are calling for four full-time and four part-time paid employees, how much of
your expense budget is represented?
1229 MR. FARMER: That is a question again for
1230 MR. MacLEOD: Closing in on 50 per cent of our
total operating budget is dedicated to personnel -- about 48 per
1231 COMMISSIONER WILLIAMS: Does that include all employee
benefits and expenses?
1232 MR. MacLEOD: Yes.
1233 COMMISSIONER WILLIAMS: What is your annual projected
1234 MR. MacLEOD: Approximately $33,000 for (technical
difficulties / problèmes techniques) and media materials.
1235 COMMISSIONER WILLIAMS: You talked earlier about
incorporating your organization. Do you anticipate having to use professional
consultants, such as accountants, lawyers and engineers, and, if so, how much of
your annual expense budget does this represent?
1236 MR. FARMER: We have accountants and lawyers who have
been working with Aboriginal Voices Incorporated for a number of years. We have
a lot of aboriginal talent in these areas and many of them have been helping us
along all along. I don't have an exact budget figure, but maybe Mark can help
you with that.
1237 MR. MacLEOD: We had approximately $25,000 dedicated
to engineering services. I can look it up, but we had, you know, a fee for an
annual audit and a retainer fee for a legal firm, although we have had a lot of
interest in pro bono work in that area, but it is included in the
1238 COMMISSIONER WILLIAMS: Okay.
1239 How many hours a day are you going to work these four
full-time paid positions? Is it pay plus volunteer or is it pay for a certain
period of time?
1240 MR. FARMER: No. You know, we have regular work hours.
You know, we are not going to abuse any labour laws. We are going to play along
with the situation there. That is how we are planning to operate.
1241 COMMISSIONER WILLIAMS: Good.
1242 Your financial projections -- as we spent much
time on earlier -- refer to a bare-bones operating expense. You talked
briefly about where you would cut back in the event, say, that funding wasn't
received. How would that affect programming and operations as a whole if you
started cutting back from a pretty bare-bones operation?
1243 MR. FARMER: Well, it is going to affect it fairly
significantly. It just means, I guess, I will dig in deeper myself.
1244 I have worked for AVR pro bono for seven years. I'm
moving to this whole application process on my own. I'm totally committed to it.
I would be more than happy to pick up the slack on the situation and work the
rest of my life, as it were, to get this operation up and operating. I believe a
lot of people in my community, if it is necessary, will do the same.
1245 All of our commitment to the board movement in the
past year has all been voluntary and the native community has learned to exist
with very little resources. We have had to. There has been very little support
for much of the endeavours that we have undertaken in the cultural area in this
country over the years. Now that is starting to turn around a bit, so we feel
more confident than ever that we will be able to step in these shoes and create
the kind of service that we will be all proud of. If certainly the magazine is
any indication, we will be very successful at it.
1246 COMMISSIONER WILLIAMS: The administrative function
within AVR, is that performed 100 per cent by volunteer staff? Who in your
full-time staff will be responsible for overseeing the day-to-day stuff like
banking, bill payments, invoicing, accounts receivable, Receiver General, just
the normal day-to-day administrative stuff?
1247 MR. FARMER: Yes. We have put staff in there, the
station management, program management. Also, administrative support. We have
administrative support staff included in this budget. We believe that the
outline of seven and six will accommodate all of the necessary staff in that
administrative level to take care of that.
1248 MR. MacLEOD: I can offer some specifics on that.
Perhaps we should have done an overhead that just laid out our staffing
commitment -- that was perhaps an oversight -- because we could have
clarified that earlier when you asked your first question about staffing, but I
will clarify it for you now.
1249 We are looking at having, in general in
administration, one full-time and one part-time person, an operations manager or
a station manager with basically an assistant in the area of programming having,
as we mentioned earlier, three full-time people. The plan was for a program
director overseeing all programming, somebody overseeing music and another
person overseeing spoken word and, then, below them, in part-time positions, a
volunteer co-ordinator, a production director and a couple of program
1250 Then the remaining salaries are in the sales and
revenue generation area, as we mentioned, which will be three full time and one
1251 That total is seven full time and six part time, not
including contracted engineering or legal help or accounting help. So that is
the real breakdown. So when we say bare bones, that is our idea of bare
1252 COMMISSIONER WILLIAMS: Okay.
1253 My next question deals with the AM/FM or standalone
FM. Your advertising seems to indicate FM, on a jump to FM, but you do have two
proposals before the Commission today. The first proposal is for a combined
AM/FM frequency, and the second is for a standalone FM frequency.
1254 You have provided financial projections for both of
these undertakings. When comparing the revenue and expense projections of the
standalone FM compared to the AM/FM, we note the AM frequency will incur
operating losses during the first five years of operation. Given these projected
losses, why are you including the AM frequency in your request?
1255 MR. MacLEOD: I'm not sure what you are referring to
in the way of operating losses.
1256 We actually propose in our financial plan to have a
very small -- because we are non-profit, obviously we spend all the money
that we pull in and put it into programming. In our first year we project a
very, very small surplus. And with the advertising and fundraising figures that
we have projected we show an increasing surplus every year.
1257 The idea would be that at the end of each year the
board of directors would, depending on whether that surplus was realized, then
turn it into increasing the staff component. So we would add another -- you
know, we would make some of the part-time positions full time or add another
1258 But right from our first year, there is no plan for
any operating loss, and that includes the very expensive cost of operating the
740 plant out at Hornby that is included in the budget. That shows no
1259 COMMISSIONER WILLIAMS: Great. Thank you.
1260 You have a projected audience share of 3 to 5 per
cent among the 18 to 54 age group of the Toronto market. Are these projections
based on combined frequencies or just the FM?
1261 MR. FARMER: They are based on the combination right
now. We did present a budget as well, a figure, on the FM alone.
--- Pause / Pause
1262 MR. MacLEOD: Just one moment. We are just trying to
figure out who can best answer this question.
--- Pause / Pause
1263 MR. MacLEOD: Yes. We need to just get a recap of that
question, if we could.
1264 COMMISSIONER WILLIAMS: I'm sorry. I was guilty of
conferring with one of my fellow Commissioners. What did you say?
1265 MR. MacLEOD: You just made my point. I was talking
when you were previously asking the question, and now we were talking and now we
can't remember exactly what your question was.
1266 If it is about a coverage area, then it will probably
be John. If it is about how that coverage area relates to revenue, then I will
try and answer.
1267 COMMISSIONER WILLIAMS: All right. I will repeat the
1268 You have projected an audience share of 3 to 5 per
cent among the 18 to 54 age group in the Toronto market.
1269 Here is the question. Are these audience projections
based on the combined frequencies, AM/FM, or just the FM frequency?
1270 MR. MacLEOD: It's based on the tandem of the two
frequencies. All of the business planning is based on the tandem of the two
frequencies except for the information we provided the Commission in November
after the submission of the application.
1271 COMMISSIONER WILLIAMS: In terms of your projected
audience, what is the composition of the projected audience? What percentage
aboriginal, what percentage non-aboriginal? Who makes up your audience? What
demographic is the audience?
1272 MR. FARMER: Well, we believe that -- well,
because I believe that Canadian aboriginal people are at the centre of Canada
and that everything that we face, whether it be taxation, dealing with the
government in terms of land claims, in terms of the whole economy, of Indian
reservations and the resources, and the fact that 50 per cent of Canada is still
on land claim in regards to the situation out in British Columbia, we believe
that we are at the thermometer of the Canadian population.
1273 Our market surveys that we did with Peter Doering
show that we will definitely get our audience share, because there is sincere
interest in the lives and the future of aboriginal people in this country and
the role that we play within the Canadian culture and the Canadian psyche, so
that we believe that our audience will be all Canadians.
1274 We also believe very much in our music format. The
kind of music that we are going to present is a unique genre new to the Toronto
market, world aboriginal music or world beat music, for which there is currently
no -- at that level that we are going to be playing. It is going to attract
a considerable share, enough to allow us to create the kind of programming that
we think is going to be beneficial to all Canadians, so that we don't have
any -- we think that we are going to be a popular station in the Toronto
1275 I draw this a lot from the experience of MY-FM in
Auckland, New Zealand, who launched an urban network about 12 years ago playing
much of the same music and the formats that we are suggesting and raced off to
be number one in the market very fast. We believe that the time has come where
people really are interested and anxious to hear the music that we are going to
bring forth to the audiences. So we don't have any -- my interest and our
interest is just to be a popular listening station.
1276 We believe that the nature of aboriginal people, and
also the fact that we would like to operate the station from a nature-based
society where nature, natural law or the essence -- that Mother Earth lays
down the laws as opposed to man-made law and the essence that the world that we
face and the environmental degradation that is all around us, that we are going
to be a welcomed voice in the Toronto market.
1277 MR. HIGHWAY: I would like to add to that, if I
1278 My name is Thompson Highway. I am Cree from northern
Manitoba. I'm a playwright, a professional playwright here in the city, and a
novelist as well. I work within the context of a very national aboriginal
literary community, a literary community that has made serious inroads onto the
national and international literary scene, particularly in the last decade, that
has made quite an impression, so that I can say with complete confidence, after
having worked for the past 15, 20 years in the field, having been a cultural
activist after my own fashion in the field of literature, namely Cree-speaking
and English-speaking literature in the form of poetry, drama and fiction --
non-fiction as well I suppose -- there is a high -- increasingly every
year a high level of interest and fascination on the part of the Canadian
population as a whole in what is happening in Canadian drama, Canadian
aboriginal drama, literature, and literature in general.
1279 And the ideas that are propagated through our
increasingly skilled literary craftspeople is something that is of growing
fascination for the Canadian population at large, as well as -- and even
more so for the City of Toronto itself. It is like a remarkable, remarkable
phenomenon but it happened in literature. And Canadian literature as a
whole -- as you probably are aware, we have Canadian literature and we have
international -- a powerful, exciting, passionate international profile.
The aboriginal portion of that effort certainly has not gone
1280 It is very, very exciting to be working in the field
today and promises to be even more so in the future, particularly with the
existence of a radio station that will assist in the dissemination of this
extraordinary form, not only in the English language, as I say, not only in the
French language, but in the Spanish language, when we happened to, in
the -- the very considerable Latin-American native aboriginal community
here in the city, but also on top of that in the various aboriginal languages
that are still active today -- Cree, for instance, in my case.
1281 MR. FARMER: The other part of our service that I
think will attract audiences is that most of the service in Toronto, the other
30 stations, the multicultural and multiethnic, has been working east and west.
Our service is very interested to work north and south so that we reach out and
literally affect our brothers and sisters to the south who are very related to
us. So that we think that there is a huge audience of new immigration into this
country that is going to be interested, and we believe that that is really going
to establish us as a number one radio station in Toronto.
1282 MR. DOERING: And the research does support that the
audience will reflect the Toronto population as a whole. The people who are
interested in the market closely match the demographics of Toronto overall in
terms of gender and age, and there is above-average interest among visible
minorities in the community.
1283 MR. MacLEOD: One more anecdotal piece of information,
if possible -- actually, an example is more appropriate.
1284 We found that when we did our survey at the Toronto
International Powwow to try and get an idea about how aboriginal people or
people that were interested in aboriginal culture might respond to the station,
we found that 90 per cent of those people seemed like they would be very active
listeners to the station, and 70 per cent of the people we surveyed were
aboriginal in there. So our expectation is that we will get a high percentage of
the aboriginal population, whatever we decide that that number actually
1285 Of course, it is difficult to nail that down but, as
Peter said, the interest was across the whole spectrum in the idea of finding
out about aboriginal cultures.
1286 MR. MANESS: I would just like to make one
1287 COMMISSIONER WILLIAMS: Sure.
1288 MR. MANESS: When you start talking about identifying
aboriginal people and trying to base them within a specific geographical
situation, you will have a very difficult time doing that because that
information does not exist at this point in time. Perhaps maybe in 10 years you
1289 This was a difficulty that I had when I first started
working with -- sitting down with this organization, because I knew we
would be facing those kinds of questions because of the type of -- the
industrial focus of radio was going towards a demographic, you are focusing on
numbers, the potential of numbers of people who are listening to your station,
and I pondered a way of: How do we communicate interest in our culture? How do
you quantify that? I have no idea.
1290 The only thing we can do is if you ask numbers and
numbers and numbers of people in any kind of situation. You can ask them through
survey questionnaires. You can do any kind of scientific data gathering you
wish. You will come up with the same answer that, yes, they are interested in
aboriginal culture, in learning about it. It has come to a point where it's a
generalized question where you can assume a large proportion of people are
interested in aboriginal culture, in aboriginal people.
1291 I know it must be very frustrating if you try to
categorize using structures like what exists in the radio industry in Canada
now, or in any industry, because those kinds of demographics, although we can
say, yes, they fit, we have to accept the fact they really don't. They really
don't have the same kind of meaning when you start talking about financial
projections. You can't do that because your numbers -- because a basic
assumption of statistics is your numbers have to be relevant on one side. Where
you base your projections are they have to be solid, known. All the beans have
to be there. Some of the beans will be orange, some of the beans will be blue.
Out of that you make projections.
1292 When you start talking about the kind of market we
are going after, and we are talking about the kind of information and content,
you don't have any beans -- it doesn't matter what colour they are --
to gauge the projections. The only thing you have is the assumption, hopefully,
the sensitivity that people have, that indeed people are interested in
aboriginal culture because we have always, as aboriginal people, been put in the
position of trying to come up with some kind of a definition, a statistical
answer, of who we are, where we live. The federal government has yet to do it,
StatsCanada has yet to do it, but everybody says you have to come up with
something. Whatever we come up with, the powers that be say, "This isn't right",
1293 I'm not trying to make a large issue of it. I'm just
trying to relate to you the facts of the kind of world that we have to live in.
We can come up with the submission to identify and fit within particular policy
parameters. We can fit within economic parameters. We can do all of those
things. We are really good at it. Our objective is not to make money. Our
objective is to generate income based -- to generate further programming.
That is what we want to do.
1294 I understand the question that started this whole
discussion off of how many people will be in the different coverage areas
depending on if we are going for an AM, FM or a combined AM and FM. We could
pretty well give you that idea right off the top of how many aboriginal people
live within Greater Metropolitan Toronto. We can give you the specific numbers
of how many people live on reserves within the coverage area of AM radio. We can
do that. Are you going to make decisions based on that number?
1295 Hey, those numbers don't mean a thing because it
doesn't consider the amount of non-stats people; it doesn't consider the amount
of Inuit people. It doesn't consider any of those things because that data does
not exist. But we can do it. We can pull a number out of a hat too, and your
substantiation of that being true is no greater than ours.
1296 The only thing we are trying to do -- we based
our submission on interest shown by people in this particular municipality. Of
that, we backtracked to come up and try to fit our substantiation within the
policy parameters of the Broadcast Act. We did. We have tried to fit within the
parameters of marketing. We have done that. We tried to keep it within the
realms and our experiences of working with a non-profit corporation. We can fit
within any kind of corporate act or corporate structure. We have no problem with
1297 But the difficulty that we face is the same
difficulty that you are going to face: the numbers when you are dealing with
aboriginal people outside of a specific community. If we were talking about a
small reserve in northwestern Ontario going for a radio licence, that's easy.
That number is known. It's very clean. When you start talking about people who
live in a large municipal area like Toronto, I'm sorry, folks, but it ain't easy
and it's not clean and those numbers are not known. We can give you our best
1298 So how many people live in an expanded coverage
1299 MR. FARMER: You know, just to augment what Sherman is
saying as well, there is an historical context of course which is -- you
know, I myself have never stood for a Statistics Canada -- I'm not counted
as an aboriginal person because -- you know, there is a whole historical
context to this, of course, the Twenty-three and the Indian Act and the takeover
of our communities. I'm listed in Indian Affairs as Oneida 642, but I'm actually
a Cayuga because of the paternalism of how the government has treated indigenous
people in this country.
1300 So it is very difficult the way this application is
based on numbers. It's something that is based on -- we believe, and our
audience surveys have shown, that there is a really great market demand for the
products, the cultural industries that we produce as indigenous people in this
country. We believe that we can correct -- you know, that we are the
solution to bringing aboriginal people to the forefront of the minds and hearts
of Canadian people, and that is why we are here today.
1301 COMMISSIONER WILLIAMS: Well, we spent the last hour
on numbers, either projections or demographic numbers. You know, AVR is applying
for a unique format radio licence in the most competitive market in the
marketplace in Canada. It is also the largest marketplace. Over a period of time
they have found that they need the numbers part of the broadcasting business to
convince advertisers to spend with them, to set the rates, to measure their
success or failure. So I don't think we can totally ignore numbers.
1302 Now, I see from your presentation that there is a
variety of ways, just population statistics can be presented. What you have
presented here, you are saying that according to Ontario Census there is 8,500,
according to Statistics Canada there are 16,000, according to the Indian
Registry there are almost 42,000, and then, according to conventional wisdom,
which includes students, transient population and non-reporting, there are
75,000 or, in your presentation, 2 per cent of Toronto's population, and
includes only Central South American aboriginal people, and then the Canadian
statistics only reflect North American or native American Métis and Inuit
people. So we will need numbers to make these decisions. Okay? It's a
1303 You have stated in your application that in the
city -- and maybe it is just your best guest, as Sherman said -- as
you have stated in your application that there are, in the City of Toronto
today, close to 200,000 aboriginal people of Amerindian origin. What ethnic
groups are -- who is covered by Amerindian origin?
1304 MR. FARMER: That is when we speak of all the --
well, I mean, if you look at the Spanish population, there are more
Spanish-speaking Indian people in Central and South America than the total
population of the U.S. and Canada put together.
1305 The Los Angeles population of Chicanos is 7 million
out of 11 million people. There is a significant force due to the Civil War
situation in Central America, and, in the last 15 years, a significant amount of
population has come into this country through immigration.
1306 That is why we believe that the
Spanish-French-English combo, along with the complement of aboriginal languages,
increases our population numbers to fairly significant -- and then when you
look at the AM market and you include the 24 native communities and the 20 urban
centres that we would hit with that, you know, we match -- you know, it's
250,000 Canadian aboriginal people in those urban regions. So, you know, it
covers southern Ontario pretty well.
1307 We have a significant population outside of Toronto
as well, in Hamilton and Fort Erie and Kitchener, Waterloo, and Kingston,
Belleville. You know, those are significant populations of indigenous people in
the southern Ontario region. In the end, we saw the value of that in our
application for this licence. That is why we set forth with those numbers and we
present those to you, that there is that number of indigenous people in this
southern Ontario region to fulfil those two applications for an AM/FM
1308 COMMISSIONER WILLIAMS: So from your presentation,
75,000 of these 200 are Canadian aboriginals, as I previously defined, and
100,000 are other aboriginals which are Central South American and North
1309 MR. FARMER: Yes. And that is not even -- that is
not including the Mestizo populations of Central South America, which we didn't
include in those numbers.
1310 The other situation we are dealing with here is you
have to look at the history once again, unfortunately, with the foster --
the residential school system. Many of our people aren't even -- I mean, if
you go around Toronto and you ask people -- I mean, there are so many
people who have indigenous blood in this country after the three, 400-year
relationship we have had we haven't even really -- there are so many other
people out there who are a part, since aboriginal people have been here since
the Confederation and beyond that for thousands of years. You know, our people
are all over the place. But that is just us.
1311 We are also talking about another situation there
that I know is difficult for you to comprehend enough to give us the licence,
but we are talking about our points of view as well, which is again based around
the natural world, and that is as well where we think we are going to have a
tremendous audience response to the service that we will be providing Canadians
that has never been the mainstay of any broadcast service.
1312 We believe that our aboriginal selves have a lot to
share with Canadians in general, and we believe truly that the time has come for
that message to be heard and those stories to be understood, in the context of
all the history that I bring before you today to be understood. The new
Canadians coming to this country, we find an extreme amount of support there.
The new Canadians are anxious to know the history of this country and they have
only been presented with one point of view.
1313 So we think it is really significant, especially in a
relationship that is about to endure with the kinds of negotiations that are
going around with that 50 per cent land claim, land base. There is a lot of
ignorance about native people and our history here.
1314 If that is not kind of dealt with and talked about at
a service like this -- that is what we are trying to provide is a service
that those kinds of stories can be discussed. If that context is not
established, I'm worried for my own survival as an indigenous person in this
country. I'm also, you know, worried about our youth and how -- we are the
fasted-growing population. After all the decimation that we have faced, native
people are the fastest-growing population in Canada. We are significant. If we
can use the Toronto marketplace to build a national service or a national
programming service for our people right across the country -- because this
is where the concentration of aboriginal artists are, is in the Toronto region,
that is why it makes so much sense for us.
1315 MR. HIGHWAY: Having had the privilege of teaching at
the University of Toronto in the recent past, in the field of Canadian studies,
and more specifically within the Canadian studies programs in such institutions
as the University of Toronto, there are specifically within that this thing
called Native Studies -- I taught aboriginal mythology, for
instance -- and I go and do lots of speaking at other universities and
colleges and high schools. Within this area that we are talking about, we are
talking about large educational institutions such as the University of Toronto,
Ryerson University, York University, McMaster, Guelph, and so on and so forth,
any number of institutions of post-secondary education, not to mention all the
high schools, most of which, to one extent or another, do try to introduce some
kind of aboriginal studies, native study programs.
1316 I can tell you, from having been an instructor and a
speaker and an activist in that area, that there was tremendous hunger within
the educational community alone for this kind of information, for the history of
native people of this country, for the languages of the native people of this
country, the political situation, and particularly as we go into the new
millennium on issues of environmental concern which lie at the very, very root
of native philosophy, which lie at the very root of the very structures of
aboriginal languages. There is a tremendous amount of hunger in a non-aboriginal
population for that kind of information for the students, for their children,
because, up to this point in time, there has been, I think, just too much
ignorance about the importance of the native people to the historical
development of this country, and I think that an opportunity such as this is a
very good time to rectify a shortcoming of that effect.
1317 Thank you.
1318 COMMISSIONER WILLIAMS: Okay.
1319 What is the source of your information? How did you
get to these numbers, 175, 75? It says "conventional wisdom", but where is the
source of that?
1320 MR. FARMER: The source for the 75,000 people on the
aboriginal is coming from the Ontario Federation of Indian Friendship Centres,
which operates approximately 40 friendship centres in Ontario and about 176 in
1321 The population of the indigenous people from the
south is coming from primarily the resources of the Food for Chiopies Campaign
in the Toronto market here who has had collective negotiations with all the
southern populations that are immigrating to Canada.
1322 That is where we got those numbers from. The numbers
that were presented to us are far larger than the ones we have actually
presented to you, but we have reduced them for you, especially the immigration
policies coming from the south in the Toronto area, in the southern Ontario
1323 COMMISSIONER WILLIAMS: Okay.
1324 You originally submitted an application for a
community radio licence and then later changed your application to a request for
a licence under the native broadcasting policy. I guess technically you could be
considered under either one, so we would like confirmation of your intentions in
this regard and explain why you prefer one over the other.
1325 MR. FARMER: The community or the native policy was
actually written during a time when that was -- there was an Act in 1977,
the Humlin Line cut the country in half, said that only three languages would
survive to the year 2000: Cree, Ojibway and Inuktitut. That policy was designed
for small native communities, the populations of 250 to 300, mostly in northern
1326 I have spent 25 years of my life trying to bring
recognition to the fact that southern situations in terms of language
development and retention and the ability to communicate to an audience was
necessary in the south. We are not disappearing; we are not going away. Again,
we are the fastest-growing population.
1327 So, initially, when we looked at the application we
thought that we fit the community radio application process best there to
understand the southern needs of aboriginal people, that the combination of the
native policy didn't really suit, but then we looked at the Broadcast Act and of
course all the signals that are to be set aside and the effort to be set aside
for native people and the special place of native people both in employment and
in terms of broadcasting signals. We decided to opt and go toward the native
policy and possibly set a brand new trend in terms of the southern situation of
other communities or other urban regions in Canada coming towards you for
operations in major urban markets like this.
1328 We also realized that we can't sustain the kind of
operation that we hope to do in small communities. In order to really get to the
essence of the programming, we need a large market in order to underwrite these
activities. So, hence, we were confused where to go.
1329 In the end, we chose to go to the native policy, and
we wrote that to you in a second letter after the question. And that is where we
are still sitting, within the native broadcast policy.
1330 MR. MacLEOD: I would just like to add that I think
the Commission should recognize that the native policy is far less restrictive
in what it requires of stations compared to the community radio policy. When we
were first putting this together, like Gary was saying, we had to figure out
whether we were a community station that was aboriginal centred or a native
station that was community focused. It could have been one or the other and we
picked one and realized later that perhaps there was a political or a strategic
advantage to be the other.
1331 But we never changed our substance of our
application, it is still the same, and it is just a question of the Commission
taking a look at -- you have a number of policies for community radio
stations and a specific one for if they are native community radio stations.
Like Gary said, we are hoping that by going under the native policy we will set
a new trend for urban aboriginal radio stations and the type of community that
they can pull together.
1332 MR. HIGHWAY: I just would like to say one thing,
maybe just a little tiny touch on the humorous side.
1333 The fact is that, you know, as much as we love the
fact that we have all these fabulous Canadians living here with us and people
whom we love dearly, whether our fellow Canadians have been living with us for
five years, for one generation or five generations, we find it just a little
tiny bit uncomfortable to realize that when they say -- when the average
Canadian says Saskatoon, Saskatchewan, Winnipeg, Manitoba, Chicoutimi, Quebec,
Toronto, Ontario, Canada, that they don't realize that they are actually
speaking Cree. I think maybe it is time we change the situation a slight
1334 Canada, that is -- you know, like the average
Canadian doesn't even know what that means, and that is kind of
1335 COMMISSIONER WILLIAMS: Just to remark on that, it
(technical difficulties / problèmes techniques) aboriginal tradition is not
always written down, it is an oral history that is handed down from generation
to generation, and maybe there is an opportunity, if you are successful in
getting this radio station, to develop something like the syndicated Paul Harvey
column -- I don't know if you are familiar with it -- it is called
"The Rest of the Story" from an aboriginal point of view programming
1336 MR. HIGHWAY: Like "Dear Abbey" is short for
--- Laughter / Rires
1337 COMMISSIONER WILLIAMS: Well, it could be hard to get
back to the dry questioning after that.
1338 What advantages do you perceive as being available
under the native broadcasting policy as compared to the community radio policy?
What are the main advantages/disadvantages?
1339 MS OBOMSAWIN: I think if we look at our experience
with the radio stations in the Indian communities and reservations and Métis
communities, the fact that they did acquire a radio station has changed their
lives, not just in communicating with the people but for information, for the
language that is being spoken at the local station, for the social meetings for
people. You go into a reserve, you go into a community, and all the houses have
that radio station on.
1340 For instance, I was in one of the communities one day
and somebody on the radio said, "Hey, this man is beating his wife at such a
house", and it took about 10 minutes and all the women were there and they beat
him up. I don't think he was going to do that again, you know.
--- Laughter / Rires
1341 MS OBOMSAWIN: But it is a community kind of life, and
the city has been totally forgotten, especially in a city like this. A lot of
people that are living here live a very difficult life and are not really
represented in the media as such. I really believe that a radio station here in
this community, where the population is so high -- not only that, when you
look at the -- it is known all over the country that Toronto is the place
where you have the heart of the artists and all disciplines here. People come
here from different communities or from different cities because they feel that
it is easier to get into the art world.
1342 So a radio station here, for me, is not a luxury. It
is going to be very good for our people, but also the teaching that it will do
for the rest of the country I think is very important.
1343 When we talk about the land issues -- everybody
talks about the land issues and aboriginal people right now. I have been with
the Film Board for 31 years and I have been making films there and I cover
social issues and injustices and land issues. Everywhere I go people ask me
questions, questions, questions. You would think I was a dictionary.
1344 There is a need -- people don't understand what
is going on in this country concerning the land. It is not explaining to the
outside -- people are negotiating in secret, so people are wondering, "Hey,
I live here in this municipality. Is this Indian going to come and take my
land?" And there is no real human communication to relay and to respect and to
understand the beginning of the relation with the people.
1345 All those things could be done on the a radio station
such as this, because there is much a need for all people to really understand
what that is about.
1346 MR. FARMER: I guess that is why we wanted to go with
the native policy end, because we are native people and we wanted to take
advantage of the situation, of course, the outlines in the Broadcast Act and the
directive that came from Cabinet to you. So, in the end, that is the advantage
for us, of course.
1347 MR. MANESS: I would like to add something.
1348 When we looked at the policies, like, probably
summing it up in as few words as you can, policy for community radio is
community ownership of community radio. If we switched over to the native
policy, it is native control over native radio.
1349 Perhaps you can look at it as a semantic issue or you
can look at it from quite a variety of points of view, but we prefer to be
recognized as aboriginal people in control of our aboriginal institutions.
Although we could fit under the whole notion of a community radio station,
controlled and answerable to a board of directors made up of community members,
that to us is not precise to us. For us, we almost insist on being recognized as
aboriginal people. Hence, our choice was to pursue a licence under the native
policy, which is native control of a native radio station.
1350 It comes down to what Al Niece said, what other
people here have said. In summary, that is probably as concise as you want. We
understand policy. We understand the whole notion of Acts and what they mean,
and we know that there is a certain flux in how they can be interpreted, and we
hope that the interpretation would fall in our favour because we understand what
the notion of native radio was in the past.
1351 But what we are saying is it is time that that idea
be defined as an aboriginal community living in an urban area. It may be a
quantum leap but it is time for that leap to happen. Unless that leap happens,
the same gulf will exist between our culture and the other people who live in
Toronto. We feel very strongly about that. We want to really define who we
1352 We ask the people of Toronto, we ask the people of
Canada to accept us as we are: aboriginal people who are developing an
aboriginal institution answerable to the aboriginal people who live in this
1353 Thank you.
1354 COMMISSIONER WILLIAMS: Okay. I guess that is a good
opening to the next question.
1355 AVR is applying for a unique format radio licence in,
as we have said, the largest and the most competitive marketplace in this
country. If the service is licensed, the Commission would like to ensure the
integrity of the application process and to make certain that the service
proposed will actually be the one that is offered.
1356 So what conditions of licence would you consider to
be appropriate to ensure that AVR maintains its program orientation, and maybe
just give us some thoughts on your background on how you think you would --
if economic necessity caused you, would you stray from your goals and vision and
change or modify the station, or would you stay with what you were licensed
1357 MR. FARMER: No. We put forth that program schedule to
represent our legitimate goals for reaching, you know, 25 per cent spoken-word
programming, which we feel would exceed that. In our schedule, it is currently
about 38.5 per cent spoken word, but we would like to stand by the 25 per cent.
That is more than anyone else is doing in the Toronto market.
1358 We also believe in the 25 per cent Canadian --
35 per cent Canadian content regulation of course, like everyone else. That is
not an issue for us at all. We would like to stand by that.
1359 I realize that probably the biggest issue for you
will be our native language or aboriginal language content, which we have
suggested to be at 2 per cent with no regulation put on us about upping
that. We want to stand by that, the 2 per cent. And we certainly have a really
good argument for that, so we would like to present that to you, if you would
1360 But I guess the ones that we have put forth to you,
we feel very positive that we are able to do that, and exceed those numbers very
well, very easily. That is what our goal is to present.
1361 The other aspect of course is that the aboriginal
music is, with the development of the Juno categories as such, at the height of
its production and we believe that the music that aboriginal people create, even
beyond our own communities -- and if we look at the world aboriginal
community, there are services much like ours throughout the world that have
existed for 40, 50 years: the Sammi populations in Sweden and Finland, or for 15
years with the Mauri populations in New Zealand. We believe that the human
rights issues that we face are necessary for us to have those kinds of
1362 That is our goal for getting the licence, so we
certainly feel that we will be able to fulfil the commitments that we have
outlined to you in our application.
1363 MR. MANESS: I would like to add something to that,
1364 Basically, the conditions that we would like to have
included in any licence we receive are the same conditions which we stated that
we would fulfil in our application.
1365 COMMISSIONER WILLIAMS: Okay.
1366 MR. MANESS: Maybe there is another side to that: How
can we provide you the assurances that we will fulfil those minimum standards
that for us are defined in our licence?
1367 Let me tell you something. The CRTC's minimum
standards are a tremendous amount lower than the community standards of the
people who live in the city. They are going to make the kind of demands on us
for the quality programming that is relevant to them. Their standards are
exceedingly high. They have great expectations of what we can do, and it will be
some discussion that we have when we get into our community meetings. Through a
corporate structure, we will have to do some talking. We have to explain to them
what our limitations are.
1368 Our limitations will be based on finance, will be
based on human resources, all the normal kind of things that every organization
has to face, but the expectations of our performance and our programming will be
extremely high. They wouldn't let us get away with anything less than
excellence, because that is the community standards of this particular community
in the realm of media, and we set those standards. We would not be
representative of a community unless we strive for the highest level of
performance we possibly could.
1369 Included in that excellence is fundraising, avoiding
that situation where we are in dire straits and the finances and the income
compromises our ability to fulfil the standards of our community. I can only
provide you the kind of assurances that the organization, of what you see here,
will not get themselves into that particular position any more than any other
person who is going after this licence can. None of us can.
1370 None of us knows what is going to happen down the
road. We can guess real good. And if we guess in the same wavelength as the
policies of the Broadcast Act, everything is fine. We can assure you of that. We
will not get ourselves into a position where finances compromise our integrity
in the programming that we are going to produce. That will not occur.
1371 COMMISSIONER WILLIAMS: Very good.
1372 The next area we are going to go into is going to
deal with the volunteers and some of the programming issues.
1373 As I was listening to your presentation on getting a
radio station licence and that sort of thing -- I'm from a small urban
community. It is about 20,000. We are served in radio there by CBC, a commercial
radio station and an aboriginal broadcaster. That is in spite of the fact that
90 per cent of the population is non-aboriginal, but that is still the
make-up of the broadcast community, as well as it was one of the birth places of
PVNC, which is the APN of today. So it is interesting to hear all of your
arguments from a personal perspective as well as a business
1374 THE CHAIRPERSON: This may be a good time to give
Commissioner Williams a break as well as you.
1375 Mr. Farmer, there must be someone -- so that you
keep working during the break -- is there someone responsible for financial
affairs or financial responses on this panel?
--- Off microphone / Sans microphone
1376 THE CHAIRPERSON: Is it Mr. MacLeod?
1377 MR. FARMER: No. I can handle --
--- Off microphone / Sans microphone
1378 MR. FARMER: Right.
1379 THE CHAIRPERSON: I just want to forewarn you that I
will go back to the material you have filed with regard to your financial
1380 I mentioned this morning before we started that this
is a very competitive process and therefore we have a responsibility to have
some comfort as to whether the proposals that are put before us will be the
proposals that will be the ones that will be heard, at least for some time, to
add diversity to the city, and that requires that they be viable.
1381 If you have the application before you, there is a
Schedule 7 where you have assumptions which do speak of fundraising and the
importance of the amount. Then you have filed pro forma statements of revenue
and expenses for both the combination and the standalone FM. A very simple
exercise would show that if fundraising was not successful your operating
margins would be very seriously affected, so we need better comfort than we have
now about how successful you are likely to be at that.
1382 Also, I would like to know what your intentions are
with the $750,000 that will be made available to you. The letter says it will be
made available for the launch. Does that mean you can draw it all down in year
one? I heard you say $150,000 over the five years. Because if fundraising is not
successful, let's say -- never mind the 5th of November letter, just take
these assumptions, these projections that this is -- what we have before
us, if fundraising was not successful, even with the drawdown of $150,000 a
year, you would be carrying not an operating margin but an operating loss, which
may -- I would like Mr. MacLeod to speak to how this is going to be
managed, based on what we have before us, without the fundraising or fundraising
that is lower than it is and what you will do with the $750,000. Am I making
1383 MR. FARMER: Yes.
1384 THE CHAIRPERSON: I would like you to have a chance to
look at that and come back.
1385 So look at your Schedule 7 where you give your
assumptions. Under "Revenues" there are two sections: one is "Advertising" and
the other one is "Fundraising". That tells us that you are not looking at
grants, but you are factoring in fundraising to the extent that Commissioner
Williams suggested. So, in all honesty, you have to clarify this and explain to
us how your financial viability will be, at least, assured for a launch of what
you propose for 740, because we have other proposals as well.
1386 So when we come back, Commissioner Williams will
finish his questioning and then, hopefully, at some point, you will give us some
more comfort at that level. Mr. MacLeod, agreed?
1387 So we will take a 15-minute break until around
--- Recess at 1801 / Suspension à 1801
--- Upon resuming at 1825 / Reprise à 1825
1388 COMMISSIONER WILLIAMS: Is the rest of your panel
1389 MR. FARMER: Yes. They are upstairs. They are just on
their way down. But we can proceed if you would like.
1390 COMMISSIONER WILLIAMS: Okay.
1391 I know it is your financial people that are away, so
I will avoid questions of that nature until they return.
1392 I guess I have a couple of questions in the area of
your volunteers. I recognize we have covered much of this ground early on so we
may not need as much detail in the answers, it is just to cover off the
1393 You mentioned that you would dedicate 30 per
cent of your first year exclusively to youth-based programs and programmers. How
will you go about finding and recruiting these people?
1394 MR. FARMER: There are several organizations that are
affiliated with them. Some of them have sent letters of support for our
application to the hearing. Youth movements in this country, like I mentioned
earlier, is the fastest-growing population, and these organizations are such
that they are truly committed to developing programming.
1395 Most of the people that we are dealing with in the
aboriginal community in Toronto are under the age of 30 years old, so that the
youth force is the biggest force, population, that we have in the community. It
is people around my age and above that are the lesser numbers. So the youth
represent the majority population that we have in our community. It is simply
through the training initiatives that we are undertaking, and we will be
offering training situations in our communities, that we will attract the youth
because they realize that media production is an interesting form.
1396 Also, all of the media training operations it seems
that are affiliated with colleges that are specifically for native people have
been cut back and are no longer existing. So, for the most part, there is a real
lack of training going on in terms of media production, so we don't believe that
we will have any problem attracting students to this potentially, you know, rich
organization compared to what the situation is around the country. So Toronto
will become the centre for youth in terms of media development
1397 And we believe that media development, especially in
radio production, is key even prior to the development of television. I mean, I
argued with my cohorts with APTN that radio should be the first because it is
the best training ground in that area.
1398 So we feel very confident that the youth will adjust
well to the oral medium, and that is where we are going to be pulling our
workforce from, it's all in Toronto.
1399 With the work we have done over the last three years,
we have a collective of 80 people currently right now with the average mean age
around 28 years old. So it is a very youthful workforce that we have and they
are really committed to this licence.
1400 MS BOMBERRY: I would also like to add that the major
post-secondary institutions in Toronto -- George Brown College, York
University, the University of Toronto and Ryerson Polytechnic University --
all have very active aboriginal student associations who have all expressed
interest in the viability of Aboriginal Voices Radio.
1401 Thank you.
1402 MR. FARMER: Actually, the University of Toronto has a
240 member aboriginal student association.
1403 MR. HIGHWAY: Not to mention such colleges as George
Brown and the Ontario College of Art and Design, which has a significant
1404 MR. FARMER: And we are currently in negotiations with
Centennial College and the Bell Communications Centre there to begin training
very shortly in that regard, because our events we have been broadcasting on the
Web off and on experimentally for about one year and we are getting a lot of
support from other major -- well, for instance, NewCap, you know, as well
acquired Iceberg Media, which is probably the largest -- virtually largest
Canadian operator of Web casting in the country. So there is some gel going
there, too, in terms of our ability to access the high end in the operations for
access and for training.
1405 MR. MANESS: If I could just add something.
1406 We are considering the training component, but
generally the staffing, not about recruiting of just going out -- because
we have access to all of the other aboriginal media to circulate jobs that are
available, if so, if we need to go that route and because we have to have
somebody to train, to keep training those people, and we always like to have a
backup, and we want to build up the highest quality staff that we can possibly
have and that we can possibly afford, we want to get high-quality people, we are
going to train our own and import them, if we have to, from other parts of
1407 Thank you.
1408 COMMISSIONER WILLIAMS: Okay. One more question on
1409 It is a pretty ambitious program, the schedule that
you have pulled together. I guess we are questioning to some extent: Can
volunteers pull off this project? Certainly they can in the short term, but day
in and day out, over several years, maybe volunteers will develop other
interests or go elsewhere.
1410 So I guess what we would like to know is: What
experience do you have co-ordinating and working with volunteers and recruiting
and replacing them as they tend to drift off over a period of time?
1411 MR. FARMER: For seven years I have published
Aboriginal Voices Magazine totally training every staff member that exists
there. We didn't have any experience in publishing when we started, and we went
from a quarterly magazine after four years to a bimonthly magazine, and we are
about to launch a monthly publication. It is all done with no experienced staff
except for two of us who had any experience in publishing prior to undertaking
1412 What I find is that our people, once they adapt
themselves and understand the realm of the work, have absolutely no trouble in
raising and rising to the occasion to produce high-quality, informative,
entertaining material, and we have a very creative community.
1413 MR. HIGHWAY: Can I just add to that quickly? Bear
1414 As recently as 15 years ago there was virtually no
such thing as a professional native actor in this country. As recently as 15
years ago there was virtually no such thing as a professional native writer in
this country, like a novelist, a playwright or otherwise. Fifteen years later we
have an entire community of professional native actors, writers, novelists,
playwrights that stretches right across the country from Halifax to Whitehorse,
and it has been a -- we have seen this amazing growth in the face
of -- like in what were seemingly insurmountable challenges, but the growth
happened and it continues to happen. It is, like, an incredibly exciting
privilege to be a part of that wave of talent, and the future appears to hold
nothing but more of the same in the medium of radio.
1415 MR. MANESS: This goes with the whole notion of
volunteers. It is really important that within our organization we are going to
really value those people, and you really respect. Through a corporate structure
we will have on staff a person whose responsibility it is to manage and direct
those kinds of -- the volunteers. We want to take it almost to the point
where each person has a job description. The only thing is they won't be paid
for it, but at least they will be able to fit that into their life, fit that
into their busy schedule so we know that specific tasks will be done. It is just
a question of working with those people and respecting them as human beings and
they will keep coming back for more, to do more work for us.
1416 COMMISSIONER WILLIAMS: I think that is really
important. I owned a cable company for almost 20 years and we had a
volunteer-driven community access channel with 50 volunteers, and they tend
to -- it is a revolving door kind of thing. But the job description and the
person dedicated to co-ordinate them is extremely important because people get
really gung ho, in our marketplace anyway, in the fall, but by springtime they
want to do something else, particularly through the summer months, and that is
when you really find that you need -- it is a big challenge to get people,
because if you have already made a commitment to do a series of weekly programs
you have to -- you can't threaten to fire them because they are working for
free, right? So you have to find other ways to motivate, retain and keep
1417 Anyway, I think that is probably enough on the
1418 I guess we want to look at commitment to programming
and the languages of aboriginal peoples. You know, you have a goal of
broadcasting 5 per cent of aboriginal languages in year one, an increase of 2
per cent over the first five years of programming in the languages of aboriginal
peoples of Canada. Tell us a bit about those plans. Maybe you can give us a
thumbnail sketch of what the plan is in that area of this business.
1419 MR. FARMER: You can look at our program schedule. The
first thing here is an opening address which is done in a language each day from
6:15 to 6:30. That takes care of our total commitment of 2 per cent right
1420 Much of our language is going to be coming through
the music and the sounds that we create as artists. As you heard with Thompson,
he is one of our significant playwrights in the community. His work will be
heard on our radio station, which is a blend of Cree and English and
1421 Our languages will be coming, incidentally, through
the programmers. We hope to offer -- it is detailed in there, but we have
money set aside that we will actually be doing instructional training with our
staff so that they will all be studying aboriginal languages as part of their
employment term with us.
1422 You have to appreciate that in my community, which is
only 60 miles from Toronto, of the 17,000 people living there, we -- the
Sweetgrass Language Institute did a study where there was only eight people
under the age of 40 that spoke any one of the six languages that exist in my
1423 So language development is something that we are
going to spend a lot of time doing in terms of sensitizing our staff to the
languages, and then slowly begin to -- bringing the language forth in our
programming as creative ways and as the resources of course increase for our
operations. Then we will be able to develop the programming at a pace much
faster than, you know, we are outlining to you.
1424 Just with that program that we are offering first
thing in the morning complements the commitment that we would like to make for
that, but incidental programming in regards to language will be coming from all
angles of our broadcast day.
1425 There are other people here who would like to speak
on that topic as well.
1426 MS OBOMSAWIN: Coming back to that previous
discussion, I just wanted to say that if you look at our history and if you
think of 25 years ago, 30 years ago -- you could even go to 20 years
ago -- whenever we heard that a young person was becoming a professional
out of university, we didn't even know his name and we used to hear -- and
they used to call it moccasin telegraph -- everybody would know across the
country and it would become a very important conversation: Did you know that
there is an Indian doctor from such and such a reserve? And without never seeing
him we imagined all kinds of things because that is how rare it was.
1427 Our people were not even allowed in university until
1952, but now the progress has been enormous. When you count the people that are
at the university level and that are coming out of there, you are talking 30,000
people at the university level right now in this country, more than that. All
those people that have come out of there and are professional people, there is a
lot of people that are very interested in radio broadcasting and in filmmaking,
video productions. We get calls every day about people who want to come and be a
trainee of the Film Board without pay. That is how interested they
1428 So we are full of wonderful young people that are so
talented, and it will be a place for them to come either to be a worker there on
paid salary or to start as a trainee. And there will be a rotation. Eventually,
they would be on salary and another trainee will come in. It will be wonderful.
It is a very different time.
1429 COMMISSIONER WILLIAMS: Good. Thank you.
1430 MR. HIGHWAY: And up in northern Manitoba where I come
from, every time they read the weather forecast in Cree, guaranteed we get
1431 MR. FARMER: The whole issue around language is very
critical to us and we realize that while the Commission had asked us to --
if we would take a higher commitment with that, we always felt really strongly
that we actually knew best how to handle the situation with language and how to
regenerate our languages in a situation that is desperate is the one we are
faced in terms of language retention.
1432 We find in the Toronto community there are a number
of families and individuals that do speak the language, so we are going to take
full access and full complement with that and utilize those language speakers
and develop -- who are not often used to the radio realm of broadcasting.
So it is going to be a period, in the first seven-year term, to really get our
hearts around that issue and to work at it to the fullest of our
1433 MS BOMBERRY: If I could add as well.
1434 I know we say in our application that 2 per cent of
our musical selections will be in aboriginal languages. In fact, it is much
higher than that when we look at the amount of aboriginal music that will be
played, not only Canadian aboriginal music but aboriginal music as well from the
United States and other parts of the world. The traditional music is sung in the
various languages, so that 2 per cent that we said is low and we will be going
over that number quite a bit.
1435 Thank you.
1436 COMMISSIONER WILLIAMS: Okay.
1437 I guess, given that you are applying for a licence
under the CRTC's native broadcast policy, it would be expected that there be a
greater commitment to Canadian aboriginal languages. What I am hearing you say
is, "Yeah, we know that. Trust us and we will deliver."
1438 MR. FARMER: Yes.
1439 COMMISSIONER WILLIAMS: Okay.
1440 In your promise of performance you commit to
broadcasting a minimum of 25 per cent spoken word per week. Would you accept
this commitment as a conditional licence?
1441 MR. FARMER: Yes, we would.
1442 COMMISSIONER WILLIAMS: How do you define "aboriginal
1443 MR. FARMER: Elaine.
1444 MS BOMBERRY: Okay.
1445 There is all kinds of aboriginal music that is being
created all over Turtle Island, which also is North America. Traditional
aboriginal music consists of social dance songs of the Iroquois people; social
powwow music from many nations -- I will mention a few -- the Sioux,
the Assiniboine, Cree, Ojibway, Blackfoot, et cetera; all hand drums including
Inuit, Danais, Cree, M'kmaq, and all the nations on the west coast, et cetera;
Inuit throat singing; traditional flute; Métis, Cree and M'kmaq
1446 As well, there is contemporary aboriginal music which
is being created which often fuses a lot of the traditional recordings and as
well reflects a unique aboriginal experience in Canada by virtue of its lyrics
and its music. And we have got lots of it.
1447 COMMISSIONER WILLIAMS: Thank you.
1448 What kind of mechanisms will you put in place while
your having open-line type programming to make sure you don't experience any
problems with abusive comments, balance of programming, and, you know, program
of a high standard? Like, the Commission has a certain set of rules for a
1449 MR. FARMER: We will have the standard delay on
open-mic programmings that will allow us to monitor and ensure that we are
keeping the Broadcast Act and upholding the sensitivity of the
1450 COMMISSIONER WILLIAMS: Okay. The next question is
similar. I may even end up with a similar answer.
1451 Do you propose to put in place internal guidelines or
other control mechanisms for your open-line programming to ensure that your
regulatory obligations and responsibilities are met at all times?
1452 MR. FARMER: Yes. We fully intend on in fact
participating in a full manner in this regard, especially, you know, in other
1453 For example, we would like to be a full participant
in the SOCAN arrangement to ensure that the artists are paid their rightful
funds that are coming to them. That is not the case. Many of our artists don't
even have acceptance within that organization because there is little or no air
play for them. So it is going to be pretty astounding for us to actually begin
to create some kind of economy for the artists, which we believe will create a
real dynamic in the work and begin to perpetuate the work that the people are
1454 MR. MANESS: I would like to add something.
1455 The safeguards or the points that Gary raised will be
what is seen by a board of directors who will receive reports from the program
manager and will assume the responsibility of ongoing monitoring and compliance
with any conditions of the licence and compliance with the standards and the
editorial policy of our organization and the laws of the land. So it will be
basically board responsibilities and it will be part of the policies of our
corporate structure. They will be very clear, very concise, and people won't
be -- the person who supervises that activity, from a staff point of view,
will be very clear in what those regulations are.
1456 COMMISSIONER WILLIAMS: Thank you.
1457 The next couple of sets of questions I will give you
a bit of a heads up on.
1458 The first one we are going to talk about is your CD
project for aboriginal artists.
1459 The next one, which we will give some of you people
the time to think about, is, you know, your application is competitively and
technically mutually exclusive with seven other applications for the use of the
frequency. Under this type of scenario the Commission seeks the competitors'
views to assist it in deciding which applicant has proposed the best use for the
coveted frequency. What we would be looking for there is what, in your view, are
the compelling reasons to grant you the requested frequency and how is your
proposal the best use of the frequency?
1460 So you can think about that and I will go into these
other questions now.
1461 Tell me a bit about your producing the CD of local
aboriginal artists. How are you going to select the artist and how many do you
plan on producing over your licence term? Have you put together a budget of
sorts for achieving this and, if so, how much?
1462 So how many and how much, as far as the CD project
--- Pause / Pause
1463 MR. FARMER: As funds become available of course. As,
in the past, as funds become available, we would be producing CDs as we see
1464 But I think, primarily, from fundraising purposes, as
compilations to introduce new talent -- it's part of our commitment of
course to develop talent in this arena. In the past we have used CDs again as
compilations to present -- of course, you know, during the Aboriginal
Voices Festival we produced a compilation but exclusively for the media
because -- and that is part of our mandate, I suppose, to start bringing
talent to this particular market. Of course the radio will augment the marketing
ability of our ability to really begin to forge talent into this market and
across the country.
1465 But there really is no planned particular CD
development per se over the course of our licence as producers for -- we
would simply be broadcasting the material.
1466 COMMISSIONER WILLIAMS: The information that I have
been provided with suggests that, as part of your contribution to talent
development, you would be producing a CD. I guess that was the one I was
questioning on specifically and then just seeing if there was much
1467 MR. MacLEOD: Perhaps I can just clarify
1468 As Gary mentioned with Aboriginal Voices, it costs
nothing these days to have a CD burner and to be able to, with the approval of
artists that we gather together and that we promote on the station, be able to
produce a number of CDs to send out to other media and to help those bands with
their promotions. But of course to actually help stations put a product on the
record shelf would be a funding project that we would work together with FACTOR
or some other organization.
1469 So we did not project actual -- you know, a
large expense item to do that, but the capability with technology these days is
that, you know, you can do 25 or 30 CDs to get to major stations that might play
this music and therefore have a dramatic impact. Our role would be simply to be
a centre point where all these people are coming together, where there is
finally a station that would play aboriginal music in a major market in
1470 MR. MANESS: I would like to make a
1471 I believe this is part of one of the -- part of
the vision of Aboriginal Voices Radio. It is to stimulate the whole idea of
aboriginal people, documenting their music through recording. We believe that as
long as -- as soon as we have a place, a station that is ongoing, that will
promote them, play their music on air, it will stimulate them. It will give them
something to work for, which I really think is greatly needed, an essential
place for all aboriginal musicians in Canada to send their demo tapes, demo CDs
and give them some air play, to get the people in the market or in the industry
interested in what they are doing, which will in turn generate more music for
1472 So it is just a whole little system we hope to build
up, and hopefully for other people it will have some sort of an economic gain
which native musicians desperately need.
1473 MR. FARMER: As the (technical difficulties /
problèmes techniques) to Aboriginal Voices, we have been at the forefront of the
development of new talent and new artists to the Canadian and American scenes.
We are the only publication that actually brings forth, like Entertainment
Weekly, the statistics as to what the radio stations around the country are
playing, what artists and what music. So we will continue that
1474 And that is why all the music comes to us already. We
are well informed about the music contemporary situation and also we are well
informed about all the historical recordings that have gone on before. So we
will actively take a part in presenting that music to a large market like
Toronto, which has really revolutionalized the whole movement of cultural
initiatives and cultural products.
1475 COMMISSIONER WILLIAMS: Okay.
1476 We will move on now to: What are the compelling
reasons that you should be granted this frequency and in what ways does your
proposal constitute the best use of the proposed frequency?
1477 MR. FARMER: I would like to start off by giving that
question to Alanis King, if she will take it.
1478 MS KING: (Native language spoken / language
autochtone). Manitoulin Island is where I'm from and the story behind Manitoulin
is that when the world was created the creator looked for a final resting place
and chose my special home. It is these types of things that can come to take
part in a big way in Toronto here.
1479 As artists, for a long time we have been listening to
our own storytellers and our own people, and so we really see all of our
experience in theatre just simply transferring to what we know is our oral
tradition. And I can't see Canada any more without recognizing this.
1480 Every single culture here of the dominant society has
a motherland to go back to, but my six-year old boy, he has nothing; he has only
Canada. So when you talk about the best use or the most, you know, deserving
need or blaring omission, you know, all you really have to do is look at the
Broadcast Act, you know, and that becomes a political arena.
1481 The world really hasn't been expressed in a way that
is truthful. It has never been of any meaning to any of us because it is not our
world view. Our world view doesn't exclude people. In fact, it includes
1482 In terms of women and in terms of the men who support
native women, that is what is going to help us is when native women are able to
stand up in Canada, because it is all the non-native women in Canada who are
coming to us and looking for some sort of spiritual reason and, "What's ahead?
What's going on?" You know, industry is destroying the very mother that --
you know, you would never do that to your own mother.
1483 So I think we are appealing to that, to the child you
once were and how important is that child. You have to let us grow now. We can
use this one final medium to tell the truth because we don't have anything left.
The only thing we have left is the truth.
1484 All the money in the world and mainstream radio, you
know, that's not what we are about. This is about life. You are going to give us
women the ability to carry life, and that is what we are. We are the
1485 Those are my words. (Native language spoken /
1486 MR. MANESS: I would like to add something.
1487 As we talked about in our introduction, right now
there is five hours of native programming in Toronto out of 5,000. We don't
exist. We exist at the whim of others. It is important that we have the
institution, that we do it, that we are given that means of communicating our
culture because our culture is growing; it grows every day. We share what went
on in the past. Hopefully, we will use that to continue on in the future. Radio
is a perfect vehicle for that.
1488 But, in summary, our format and programming proposals
are diverse and they are unique, and they are based on our research. This is
what the audience of this city wants. They want what we have. They want what
other stations are not delivering. They are not doing a bad job, they are doing
what they do, and they do a very, very good job of it, the rest of the stations
in this city.
1489 We will provide an exposure for a wide range of
Canadian artists and, in particular, aboriginal artists who are not being heard
at the present. We want to introduce them into the mainstream, introduce them to
the rest of the city. That is not happening now. If you grant us the licence,
that will happen.
1490 Our spoken-word proposals will reflect the issues and
concerns that touch all Torontonians from the perspective of aboriginal people.
That is not happening now. Given a licence, that will occur.
1491 I could go on and on and on about the way the other
people who spoke before me have articulated from their perspective. Their
perspective is also true. You cannot deny that our presence does not exist in
the media, in radio in this city. There are enough of us here. If our population
was 70,000 -- you could take a city like Belleville, which has 70,000
people. That community has two FM stations and one AM station. What's wrong with
1492 If it's 40,000, maybe we could get by on one FM
transmitter, but when you have such a huge number of people who have such a huge
amount of information to share, and that passion, that burning passion to share
it, 40,000 of them, 70,000 of them -- every other municipality that has
that scope and that population in this country has at least one radio station
devoted just to it, and it's really important that those kind of considerations
are well noted and referred to.
1493 I don't think any other of the applicants will be
able to say that to you because their focus and their energy is elsewhere, which
is good, and we wish them well. I even listen to them every night because I
don't have our station and our music to listen to.
1494 Thank you.
1495 MR. FARMER: I just wanted to say that I have learned
that our languages are the true study of nature based on observation over
centuries of time, and they are not spoken anywhere else in the world except for
here, and they tell us how to live in this world forever.
1496 Our leadership used to make decisions based on that
knowledge of 200 years. It affected seven generations of our people. But in
today's society, decisions are made at whims, in political terms of two and four
years, and now we are feeling the effects of those decisions.
1497 I think the native community in this city has so much
integrity and so much to share at that level that it is going to warm the hearts
of every Canadian that ever hears it, and I truly believe it is going to be a
popular service that is going to enable our community, not only in radio
broadcasting but in all kinds of cultural activities that service the whole
1498 COMMISSIONER WILLIAMS: Okay. Thank you.
1499 We are going to spend a minute just on some technical
areas. Then we will come up with your opportunity to summarize the benefits of
your applications, and then Chairman Wylie has a few other questions in the
1500 Maybe you will want to do those -- maybe I have
the order wrong. I will ask my financial questions, she will do her financial
questions, and then you can do your wrap-up and summary.
1501 THE CHAIRPERSON: No. I have no questions. I'm just
waiting for answers.
1502 COMMISSIONER WILLIAMS: All right.
1503 I guess what she is saying is she asked the questions
before the break and we can hear those answers in a minute or so. I just have
one question before that.
1504 There is a variety of questions here that deal with
coverage on, "106.5 FM is hampered by strong co-channel interference" and "The
CRTC must instruct the maximum hour." I guess what these questions are
indicating to us is that there seems to be a little bit of misunderstanding on
the technical side of your application in that these types of questions are best
dealt with through the Broadcasting Technical Advisory Committee, it's known as
BTAC, or, you know, directly with Industry Canada. They are not things that the
CRTC deals with. Your engineering consultant would have filed a brief detailing
your technical proposal, so engineering and technical issues are probably best
dealt with with them.
1505 So that concludes my list of questions.
1506 If you have the reply to Chairman Wylie's earlier
questions, we will hear them now.
1507 MR. MacLEOD: Yes.
1508 I was taken away to a room and pummelled until I came
to understand that you had serious doubts about our fundraising.
1509 I must say that, because fundraising in a non-profit
radio setting is probably my greatest area of expertise, I was perhaps deluded
into thinking that these numbers would be conservative to anybody just because
they seem conservative to me. In fact, I was prepared to answer questions about
the advertising revenue, but I conceded the fundraising would probably seem
acceptable and reasonable and you wouldn't have a lot of questions about
1510 So I will attempt, in a very brief time, to convince
you that I have the answers you are looking for.
1511 I want to clarify that you should understand that I
mentioned earlier we wanted to have diversified funding so we picked what we
thought would be a balance between advertising and fundraising, both numbers
very reasonable, very understated, very attainable -- no danger in our
first year of coming short of funding.
1512 I just want to touch briefly on the advertising
before I go to fundraising, because I want you to appreciate that we use three
different methods to come up with our advertising projections.
1513 We put those numbers as low as we possibly could by
looking at the total -- the annual market revenue in Toronto, and, based on
our projection from Peter Doering of 3 per cent, we looked at a possible revenue
of about $5 million if we were a normal station that had a 3 per cent
share. We then reduced that by 75 per cent to take into effect the fact that we
are a niche market, and that gave a number of $1.3 million. So we are saying,
okay, $1.3 million might be a reasonable goal for us to shoot for.
1514 We looked at how much advertising we actually wanted
to sell on the air and we decided that in years one to five we wanted to end up
in year five at 30 per cent of our total maximum of four minutes. So we
basically picked a number that seemed reasonable and 21 per cent was it. That
ends up being 30 per cent of what might normally be predicted that we would get
according to what we thought was very conservative figures.
1515 That number was substantiated by talking to national
rep houses. We got a number of figures from $1.5 million a year to as low
as half a million dollars a year. Our number starts at basically $400,000 a year
and goes to $600,000 a year. So I want you to appreciate that our ad revenue
projections, we believe, are very conservative.
1516 So that takes us to the fundraising.
1517 I have the same confidence in fundraising when I'm
trying to put that across to you. I want you to understand a number of
1518 One is that one of the first people we will hire when
we get the licence will be a development director. So there will be somebody on
the ground working right away to fundraise, basically from day one. So it is a
1519 We indicated in our initial business plan we were
going to be fundraising as soon as we had the licence, and that is how we were
going to fund our start-up. Whether we end up having to use other funds or not,
we are definitely fundraising from day one.
1520 Now, there are a variety of sources that we were
looking to take our fundraising from, basically, three main ones: from corporate
contributions, from individual contributions, and from benefit
1521 So let's go perhaps from the least controversial to
the most controversial.
1522 I'm assuming that our projection of about $24,000 a
year in benefit events is not controversial. I'm assuming that our projection of
somewhere between sixty-six and up in year five, it's just over $100,000 in
individual contributions, is not controversial because other stations in this
market, including university-based stations, raise that much already and there
is no reason to think that we can't match what they are doing. There are cases,
there are examples like CJRT, a jazz station in town, whose numbers are
up -- like $1.5 million is what they get when they are doing on-air
1523 I want you to appreciate that that money is going to
be coming through the course of the regular operations of each of the hosts. It
will be the type of fundraising where the host says, you know, "If you support
my show, call this phone number and make a donation." We think that projecting
from $66,000 to $100,000 by year five is totally, totally conservative in that
measure. And our targets, when we announce our campaigns on the air, I assure
you they will be much higher than that. You know, we might start out at a
quarter of a million dollars in our first year as our goal. We are going to be
aggressive on that, but we went with very low numbers.
1524 On that same note, we only planned on running one
campaign a year because most stations in Toronto and most stations do that. But
if we find for instance that our first campaign falls short, we would simply add
a second campaign and, you know, go to a two-campaign system. That is hard on
listeners, but it is not uncommon, and we would do it if we were falling short
in our fundraising projections for the on-air component.
1525 The third component is the corporate contributions.
We feel that, and I imagine the Commission feels that, our proposal for our
service is a totally attractive destination for donated monies. Aboriginal
causes already get a lot of support and we believe that our first urban
aboriginal station with such a wide listening audience, where we can thank
people over the air for their donations, would be a highly attractive place for
corporate contributions to come in.
1526 So, from those three areas, I do not want to concede
that those numbers are not totally conservative. I don't want to give that up to
you. But let's just say that either you have been told or from your own
experience those numbers sound really high, so let's go to a simple calculation
which I hope will convince you that there is no danger the station will be
unviable without fundraising.
1527 So you can make these notes if you want. These are
1528 If we raise no dollars -- in other words, we
don't raise a single dollar -- basically over five years we will be short
about $1.7 million. That is where we will end up if we don't raise
1529 Now, we projected over our first five years a certain
amount of surplus every year. Obviously, that surplus would be gone if we didn't
raise funds, so you can deduct that surplus of $.6 million off of
1530 If we had to -- in other words, if we weren't
fundraising, if we weren't bringing in the revenue that we wanted -- we
would cut expenses. We mentioned that. If we cut our expenses by only
15 per cent, which would not harm our programming -- you know, it's a
cut but it's not the kind of cut that would drastically affect what we
do -- over five years that would give us another half million dollars in
1531 So you would end up between the surpluses and the cut
in our expenses of $1.1 million. So that would still leave us with a
shortfall of $.6 million to cover, and there is where the NewCap money
would come in if we needed it.
1532 If we used $150,000 of the NewCap money to get the
station off the air, which I don't think we will need to do, then, you know, you
are looking at a break-even budget over five years with zero dollars of
1533 So I had to get beat up in order to produce those
numbers, but when I answered in my deficiency question that we would be viable
without any fundraising, you know, clearly that is the answer that I should have
given you, but instead I talked about how unreasonable it was that we would be
short. I mean, to even think of only raising half of that money seemed
inconceivable to me, but to suggest we would raise no money at
1534 So my disbelief has been unsuspended and I hope I
have given you an answer in those simple numbers that show you that with zero
dollars we are still a viable service in that five-year business
1535 THE CHAIRPERSON: Thank you,
1537 MR. RHÉAUME: Thank you, Madam Chairperson. Very
briefly. It is after 7:00 after all.
1538 The NewCap commitment, is that essentially a line of
credit? Does that work like a line of credit?
1539 MR. FARMER: Yes. It's basically like a bank extending
us a line of credit for the seven-year term.
1540 MR. RHÉAUME: The NewCap and the letters we have in
front of us are very brief. Is it a phone call? In practical terms, how does it
1541 You want to launch a station. Let's say you have a
licence tomorrow morning. You want to launch a station. Where do you
1542 MR. FARMER: Where do we start?
1543 MR. RHÉAUME: Yes.
1544 MR. FARMER: We start in our offices. We already have
a studio assembled. We are already broadcasting, as it were, on the
1545 MR. RHÉAUME: Where would you get the money to launch
a new station?
1546 MR. FARMER: We can probably get a significant amount
of money from any number of sources, including some of the ones I outlined
earlier to you, whether it be, you know, turn to the government in terms of
training and development for the broadcast industry, for HRDC. We could get the
money to purchase the kind of equipment -- we don't need a lot of money in
terms of the equipment that we need to actually broadcast. I think it is in the
neighbourhood of around fifty or $75,000 to upstart our -- there are four
of the casinos who are really behind us.
1547 I have been negotiating with a number of casinos, not
only in Ontario and Saskatchewan but all over North America, who have a special
interest in what we are doing here. It is very exciting. There is 147 casinos in
North America owned by native people. You know, I have been involved with
projects where native casinos have outlaid $900,000 to make a movie. Our
community has wealth.
1548 I don't understand why, you know, it would be a big
issue to raise $150,000 if we had a licence like 740 AM, 106.5, that is worth
millions of dollars. Our community is not -- we are very smart
1549 MR. RHÉAUME: I don't dispute that for one second, but
we keep hearing "We would not have to go to NewCap." After all, the letter you
have from NewCap is for capital expenditures and launch costs and we keep
hearing, "Don't worry about NewCap. We don't need their money." Now you are
suggesting that there is, what, some other sources of funds to start up,
$150,000 or -- I don't know how much to start up, to start up the
1550 MR. FARMER: Our start-up funds are about
approximately $150,000 to $180,000 on the expanded FM, and if we need that money
from NewCap, and we can't raise any money anywhere, then that money is --
we can go to NewCap and if we post our business plan and our financial
predictions for the operation of our launch, then that money is not a problem to
come to us.
--- Technical difficulties / Problèmes techniques
1551 MR. MANESS: Just to finish up, as I understand, we
have -- from the time that a licence is granted until the time we go on the
air we have one year. I can't see much of a problem in doing corporate
fundraising -- even if we had zero, zero commitment to raise $100,000 or
$150,000 in one year -- if we had a CRTC licence in our hand. That is an
impossibility that we couldn't do that within a one-year time frame. Even if we
had nothing and just walked around with a licence, we would phone our contacts
up in government and we would have that money fairly quickly.
1552 MR. RHÉAUME: Thank you. Thank you for
1553 I guess I should explain where we are coming from, or
I'm coming from at least.
1554 Rightly or wrongly, when somebody applies for a
licence, the Commission traditionally has asked for evidence up front that the
money is there to build and launch that station. So that is why, to some extent,
we, at the Commission, relied heavily on the NewCap commitment to provide you
with funds because it seems right now that is the only clear indication that we
have. I could be wrong, I could have missed something, but I think that is the
only clear indication that we have that there are funds available to launch that
1555 So that was the sense of my question and I thank
1556 THE CHAIRPERSON: Thank you, counsel, and thank you,
1557 Was there anything else you wanted to add in the next
1558 MR. FARMER: You know, I simply want to say that,
again, there is no current Toronto radio service reflecting the aboriginal
culture, and there is a demonstrated market demand for the products that we
create as indigenous people and that AVR is proposing a quality service based on
the artists that are before me. There are 80 more behind us right now ready to
go to work.
1559 We are going to produce great programming for this
city. We have a feasible business plan, contrary to popular belief. This is
really the last chance for us here in this market, and this market means so much
to aboriginal people, not only in the Toronto market -- and I know you
don't want to hear this Commissioner -- but it is a huge influence right
across the whole country.
1560 I truly believe that Toronto is such a renowned bad
place. The Big Smoke is really always looked at as the big, nasty, ugly person
that gobbles up all the resources in this country. Here is a chance for Toronto
to give something back to the country. So I think that is really
1561 We have also been very sensitive to the other
applicants in this market and our brothers and sisters who have come to this
hearing for licences, and we are willing to work with them to find our place in
this radio society.
1562 Again, I just want to say that the benefits that we
have as a community I think are so large that I just think it is such a great
thing, especially in this year 2000.
1563 We are really excited by this possibility and this
opportunity that you gave us today. I want to thank you very much and give also
my comrades and friends and brothers and sisters a chance to respond as well in
the five-minute period.
1564 Thank you.
1565 THE CHAIRPERSON: Thank you, Mr. Farmer, and your
team. And do take Mr. MacLeod to dinner.
--- Laughter / Rires
1566 MR. HIGHWAY: Seeing as we started our presentation
off in Cree I would like to end it off in Cree: Saskatoon, Saskatchewan,
Winnipeg, Manitoba, Chicoutimi, Quebec, Toronto, Ontario, Canada, (native
language spoken / language autochtone).
1567 COMMISSIONER WILLIAMS: Mr. Highway, you have inspired
me to remember one of the first aboriginal broadcasters I met. Her name was
Nellie Cornier. She used to be a broadcaster in 1960 up in the MacKenzie Delta
and she used to end all of her radio programs with "(native language
spoken / language autochtone) good listening", which was four different
languages of saying good listening and thank you for tuning in.
1568 So it has been an enjoyable listen today and thank
you very much for your presentation.
1569 THE CHAIRPERSON: Mr. Highway, by the reply stage I
will know one more sentence for you.
--- Laughter / Rires
1570 THE CHAIRPERSON: Good night.
1571 We will resume at nine o'clock tomorrow morning with
the next applicant.
1572 Nous reprendrons à neuf heures demain matin.
--- Whereupon the hearing adjourned at 1921,
to resume on Tuesday, February 1, 2000 at 0900 /
L'audience est ajournée à 1921, pour reprendre
le mardi 1er février 2000 à 0900