ARCHIVÉ -  Transcription

HELD AT: TENUE À:

World Trade and World Trade and

Convention Centre Convention Centre

1800 Argyle Street 1800, rue Argyle

Halifax, Nova Scotia Halifax (Nouvelle-Écosse)

9 March 2004 9 mars 2004

Transcripts

In order to meet the requirements of the Official Languages

Act, transcripts of proceedings before the Commission will be

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

and staff attending the public hearings, and the Table of

Contents.

However, the aforementioned publication is the recorded

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

either of the official languages, depending on the language

spoken by the participant at the public hearing.

Transcription

Afin de rencontrer les exigences de la Loi sur les langues

officielles, les procès-verbaux pour le Conseil seront

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

membres et du personnel du CRTC participant à l'audience

publique ainsi que la table des matières.

Toutefois, la publication susmentionnée est un compte rendu

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

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

officielles, compte tenu de la langue utilisée par le

participant à l'audience publique.

BEFORE / DEVANT:

David Colville Chairperson

Vice-Chair of

Telecommunications

Barbara Cram Regional Commissioner for

Manitoba and Saskatchewan

Ron Williams Regional Commissioner for

Alberta and the Northwest

Territories

Jean-Marc Demers National Commissioner

Stuart Langford National Commissioner

ALSO PRESENT / AUSSI PRÉSENTS:

Pierre LeBel Hearing Secretary / Secrétaire

d'audience

Peter McCallum Senior Legal Counsel /

Conseiller juridique

principal

Sylvie Jones Conseillère / Counsel

HELD AT: TENUE À:

World Trade and World Trade and

Convention Centre Convention Centre

1800 Argyle Street 1800, rue Argyle

Halifax, Nova Scotia Halifax (Nouvelle-Écosse)

9 March 2004 9 mars 2004

PAGE / PARA NO.

PHASE I (cont'd)

PRESENTATION BY / PRÉSENTATION PAR

Joy FM Network Inc. 1577 / 8861

PHASE II

INTERVENTION BY / INTERVENTION PAR

Acadia Broadcasting Ltd. 1656 / 9285

Ross Ingram 1658 / 9301

Joy FM Network Inc. 1660 / 9314

PHASE III

INTERVENTION BY / INTERVENTION PAR

Aboriginal Voice Radio Inc. 1661 / 9324

Astral Radio Atlantic Inc. 1700 / 9519

Brad Woodside 1719 / 9622

Tony Currie 1729 / 9676

National Campus and Community

Radio Association 1734 / 9700

PAGE / PARA NO.

PHASE IV

REPLY BY / RÉPLIQUE PAR

Joy FM Network Inc. 1744 / 9756

Ross Ingram 1749 / 9783

Maritime Broadcast System Ltd. 1751 / 9796

Newcap Inc. 1754 / 9816

Halifax, Nova Scotia / (Nouvelle-Écosse)

--- Upon resuming on Tuesday, March 9, 2004

at 0902 / L'audience reprend le mardi

9 mars 2004 à 0902

8856 THE CHAIRPERSON: Order please, ladies and gentlemen. We will return to our proceeding now, hearing applications for Halifax, Moncton, Saint John and Fredericton. We are hearing the last of the applications of all of those, in particular the last one for Fredericton.

8857 Mr. Secretary.

8858 MR. LEBEL: Thank you, Mr. Chairman. That is an application by the Joy FM Network Incorporated for a licence to operate an English-language low power commercial specialty FM radio programming undertaking in Fredericton.

8859 The new station would operate on frequency 104.5 MHz on channel 283LP with an effective radiated power of 25 watts.

8860 Mr. Garth McCrea will introduce his colleagues. You have 20 minutes to make your presentation.

PRESENTATION / PRÉSENTATION

8861 MR. McCREA: Thank you, Mr. Secretary.

8862 Good morning, Mr. Colville, Members of the Panel and Commission staff. My name is Garth McCrea, and I am the General Manager of Joy FM Network, Inc. I have been involved with the radio station since before it went on the air in April 2001, first as the Sales Manager and then in the role as General Manager.

8863 Before we begin, I would like to introduce our panel.

8864 On my far right is John Evans, who is the Secretary of the Joy FM. John is retired from a 27-year career in the Public Service of the Province of New Brunswick, initially as a Crown prosecutor and latterly as Chief Coroner and Chief Sheriff for the province. John continues to be a member of the New Brunswick Bar.

8865 On my immediate right is Reverend Doug Hapeman. Mr. Hapeman is the Vice-President of Joy FM Board. He has been involved with Joy FM since its conception. He is responsible for the radio station's development and will make today's presentation to the Commission.

8866 On my left is Brian Chesley. Brian is President of Chescom Ltd. He is Joy FM's engineer, responsible for the studio and transmitter site. Brian is a digital and computer systems technician, radar technician, certified rigger, and a certified fibre optics technologist.

8867 We also would like to bring regrets from Ms Carol Reimer. She planned to be with us today to present to you the panel, but due to unseen circumstances she is unable to be here.

8868 I will not take time to read them, but brief bios of the Directors of Joy FM are attached to the presentation of which you have a copy.

8869 If you would, please, I would ask you to turn to page 3. I will now call on Mr. Doug Hapeman to bring our presentation.

8870 MR. HAPEMAN: Thank you, Garth.

8871 Good morning, Mr. Colville, Members of the Panel and Commission staff.

8872 I understand this is your last day or you are at the end of your journey, hopefully the last day. I hope you have appreciated your stay in the Halifax region. I can imagine that you have spent some long days during the past week and number of days.

8873 Over the next few minutes, we will outline a proposal that, if approved by the CRTC, will bring a new radio station to Fredericton that will reach a segment of the religious community not adequately served by Joy FM; a station that will provide opportunities for local and Canadian musical artists, and a station that will be financially sound.

8874 Our presentation today will cover four areas. We want to begin with the target audience and market and then move to speaking to balance in religious programming. Third we want to touch on our initiatives with Canadian Talent Development and, finally, some remarks about our business plan.

8875 We know that you have much more comprehensive material in your hands from our application, but please allow us to touch on these areas.

8876 Joy FM's proposed station will be oriented towards the 50-plus aged listeners in the market. It will play music from the non-classic religious category, particularly of the inspirational, southern and country gospel genres.

8877 First, let me explain why we are seeking a second station in our market and why the existing station cannot adequately meet the need we are attempting to address. We are faced with a programming tension that is difficult to meet satisfactorily.

8878 From its inception, Joy FM has targeted the 25 to 49 age demographic, using a music format focused on adult contemporary genre. The station has been a welcome addition to the Fredericton radio market, providing distinctive, positive-life music not available in any other local radio format. In less than three years, Joy FM has become the communication conduit for the Fredericton area Christian community.

8879 During the first year of operation, Joy FM surveyed a cross-section of local churches and found that among the older listening audience, that is 50-plus age group, there was a strong voice for music from the inspirational, southern and country gospel music genres.

8880 The number one request from the 50-plus audience was to have more of this style of music in the format throughout the week. The second was a desire for more spoken-word programming.

8881 In an effort to address the 50-plus audience, Joy FM provides country and southern gospel programming on Saturday evenings from 6:00 p.m. to midnight. Response indicates that we have an entirely different listening audience on Saturday evenings than we do on the weekday audience. But this block programming approach has not met the market need adequately.

8882 Today's listening audience is accustomed to a focused music format. As you can appreciate, there is a bipolar difference between adult contemporary and southern country gospel. Religious music is as varied in style as mainstream music, running from rap and Christian rock to country gospel.

8883 The success Joy FM has enjoyed to this point, to a large extent, we believe is because it has maintained a consistent sound with the adult contemporary format. We cannot effectively mix inspirational, southern, and country gospel music and more spoken-word programming throughout the weekday without jeopardizing our current audience, the 25 to 49 age bracket. The best solution will be to provide a second FM station with programming dedicated to the 50-plus audience and its particular music interest.

8884 With the scarcity of FM frequencies available, we realize the CRTC must approach these matters with prudence and discretion. We respectfully request your consideration, trusting you will see our dilemma and provide us with what we believe will be the most satisfactory solution.

8885 Permit me to speak with reference to the CRTC's policy with respect to balance and religious programming. There is a matter in our deficiency process that we would like to explore and negotiate when we come to the Q&A time, but here I want to emphasize our commitment to the spirit and the aims of this policy.

8886 Joy FM's music is distinctively Christian, as is the spoken-word programming. We share the values that have prompted the CRTC to establish a Religious Broadcasting Policy and, in particular, the understanding that religious intolerance can be the root of social, cultural, and racial intolerance.

8887 It has not been the practice currently, nor will it be with the proposed station, to call into question the beliefs and practices of any Christian group or those of other religious faiths, such as our Jewish and Islamic friends. We appreciate the integrity of our friends in other faith groups and will respect their freedom of religious practice.

8888 Joy FM has attempted to build respect, understanding and tolerance toward all denominations of the Christian faith. The Directors, staff and volunteers of Joy FM, do not represent any particular sect of the Christian faith, but come from a variety of religious denominations.

8889 Now permit me to speak to our Canadian Talent Development initiatives.

8890 As has been the case with Joy FM since its beginning, the proposed station will be committed to the development of local and Canadian artists. The religious community is a talented and resourceful pool of musical people. In our Joy FM library there are more than 64 regional artists, with 311 songs that are a part of our music library, representing New Brunswick and the Maritime area. We have indicated we will spend $500 annually in direct contributions on Canadian Talent Development initiatives. In addition, we will make contributions in kind.

8891 We will take the initiative to sponsor and arrange two concerts per year featuring local and Canadian artists. These events will be in cooperation with local congregations, in order to facilitate both an audience and a low to no-cost venue. Contributions will be both of direct and indirect nature, including production costs for posters and tickets, prizes and giveaways, on-air promotion and interviews with the participating artists.

8892 The proposed station will provide free promotional announcements for local concerts and talent showcases, which are held either at no charge to the public or on a free-will offering basis. On-air interviews with the event organizers and artists will be provided. There will be interviews and features of local artists producing and releasing new CD recordings.

8893 Joy FM has a proven financial track record, assuring the community that it has the capacity to keep its commitments. Largely because of the economies resulting from complementary operations, this additional service will be provided with only a modest increase to Joy FM's current operating budget.

8894 The success of Joy FM is due, in a large part, to the growing pool of talented volunteers who have brought their expertise to Joy FM, as on-air hosts as well as in areas of technical and administrative support. We couldn't do it without this pool of volunteers.

8895 Initially, we will have to hire two new employees and install additional broadcast equipment in a studio already set aside in our current facilities in anticipation of this new station. An additional transmitter and modifications to our antenna will be made to accommodate the second signal. The proposed studio and staff will be complemented with the infrastructure of the present facilities, staff and volunteers.

8896 We have projected an increase in expenses to the current Joy FM budget of $55,000 for the first year, increasing modestly each year until year five, when expenses jump to approximately $82,600 per year. This reflects the hiring of a third additional employee for the proposed station at that time.

8897 The new stream of revenue needed to finance the proposed expansion will be generated through an increase of our three sources of revenue: advertising sales, charitable donations and brokered programming revenue.

8898 Commercial sales have increased each year and, with a two-station draw reaching a wider audience, advertising spots will have more appeal to advertisers. We believe the modest increase in budgeted sales will be achieved.

8899 With respect to the solicitation of donations, Joy FM conducts a two-day on-air Sharathon once a year, which will be carried out cooperatively with the proposed station. This annual appeal places no undue pressure on listeners. Joy FM is committed to the CRTC policy of not placing undue responsibility on the listener to respond to a financial appeal, not to be alarmist or exaggerate positive results of responding to financial appeals and not to intimidate the listener in any way.

8900 People in the 50-plus age category have expressed an interest in supporting a station devoted wholly to a southern and country gospel music format. We have a clearly defined target audience, 50-plus aged church-attending people. Joy FM's positive relationship with the community's churches will enable its fund-raising efforts to achieve the proposed modest increase in donations.

8901 Our research among the 50-plus age audience has indicated they want more spoken-word programming to be available. The modest increase we are projecting for brokered programming will be achieved through the addition of new spoken-word programs.

8902 The new station will be built on stable, financial ground. The anticipated increase of audience and revenues will enhance its contribution to the Fredericton area community. Permit us to note that Joy FM's current operation and the proposed growth will have no adverse impact on the competitive balance in the market.

8903 In many ways the other applications that you have been listening to this week in the commercial arena, I don't think we appear on their radar screen and we have no effect on their competitive balance in the market.

8904 My concluding remarks.

8905 Joy FM has been committed to fulfil five objectives that we have summarized in the acronym "MUSIC":

8906 "M" stands for "Music". In this radio station you will hear everything from the top songs on the current Christian music charts to timeless, classic favourites.

8907 "U" stands for "Unity". Joy FM exists to encourage unity, fellowship and respect among the churches in Fredericton. The goal is to remind us not of the things that set us apart, but of what we have in common.

8908 "S" is our commitment to be a "Showcase". We are committed to a being a unique forum for local and Canadian Christian talent: Groups and individuals who do not have the opportunity in traditional broadcasting venues to have their message heard is the forum that we are providing.

8909 "I" is for "Inspiration". Teaching will be provided on a level unmatched by any other local broadcast forum.

8910 "C" is for "Community". This radio forum will create an interactive link with the community, providing information and awareness regarding civic and church issues and events.

8911 In summary, we have addressed:

8912 One, the need in the market for this proposed station;

8913 Two, our commitment to maintaining balance in religious programming;

8914 Three, our commitment to Canadian Talent Development;

8915 Fourth, a realistic business plan to accomplish this objective.

8916 This application is a step toward fulfilling Joy FM's vision to provide encouragement to the religious community through Christian music. The addition of a station that provides programming for the 50-plus audience will enable Joy FM to reach a broader spectrum of the age demographics represented in the religious community.

8917 The proposed station has a format the religious market is asking for. We cannot proceed without your approval and we are here today respectfully submitting our request to you.

8918 Thank you. We are prepared to answer any questions you may have.

8919 THE CHAIRPERSON: Thank you very much, Mr. Hapeman, gentlemen. I will be doing the questioning this morning.

8920 I want to cover off really, I guess, three of the four areas that you have noted on page 3 of your presentation this morning and then again towards the end when you summarized. The one I won't cover, because I think it is adequately dealt with, is Canadian Talent Development. The other three I would like to touch on briefly and let's take them in order.

8921 The first one is the issue of target audience. I had a number of questions that were sort of based on your original submission, but we can perhaps pick it up from your presentation here this morning as well.

8922 Under your heading "Target Audience and Market", the fourth paragraph below that, you said:

"During the first year of operation, Joy FM surveyed a cross-section of local churches and found that among the older listening audience ... there was a strong voice..."

8923 I guess I would like to get a better sense from you about this market research, if you could describe for us in a bit of detail how you went about this.

8924 I guess really what is underlying this is really an attempt to convince us that there really is a need for a separate station rather than satisfying this demographic. We have been hearing a lot about various demographics over the past seven days, six days before today, about different demographics, and so on, and whether or not you can carve small niches out or whether you can have varieties of music across.

8925 I guess what I would like to get and what we would like to know better are some of the details behind this research you have done.

8926 MR. HAPEMAN: Thank you, Mr. Colville.

8927 As you can imagine, in the church population it is an aging population in many of our congregations in the life of our communities. When Joy FM came on the air which music, contemporary Christian music targeted toward the 25 to 44 or 49 age bracket, it is a genre of music that has not been a part of our regular church communities, in fact a genre of music that has not been broadly a part of the Canadian culture because our history in terms of providing religious music stations is rather brief in Canada.

8928 We had reactions immediately from church-attending people who found that the music was not what they thought a Christian radio station was going to be. We didn't have to even solicit the reaction or the response. It came to us from people who had a great desire to see the station established and then were a little disappointed that the music was not to what they had expected.

8929 We had decidedly targeted the 25 to 49 for several different reasons but, to direct my answer to your question, we did a cross-section of a number of churches in the city. We had an insert that was distributed in the bulletins of those churches asking them to tick off some questions or responses to indicate their comments and suggestions. It was from the collection of those inserts that were provided to the congregations that we gleaned the very clear message that the 50-plus audience had these two desired needs. One, they would like more inspirational, traditional southern and country gospel music and they did prefer more spoken-word programming.

8930 THE CHAIRPERSON: Can you give us some kind of indication about the numbers of people who -- how many surveys did you put out? How many responded? What the rough sort of percentages were of those who were satisfied with the music as you were playing and those who weren't?

8931 I guess I'm also having a little difficulty necessarily understanding how the different demographics break down in terms of music. I just think of this in terms of my own music listening habits. It is not largely Christian, we don't have any Christian music stations here, but just in the sense of depending on the mood you are in on a given day you may want to listen to jazz or classical or good old rock 'n roll or whatever.

8932 But let's go back to the survey itself.

8933 How many questionnaires may you have distributed? How many people responded? What would be the breakdown between those who were satisfied with what you were playing and those who weren't.

8934 MR. HAPEMAN: Permit me to consult with my colleagues, please.

--- Pause

8935 MR. McCREA: Permit me, if you will. We surveyed six larger churches in the Greater Fredericton area. We received back probably close to 300 surveys which we compiled and extrapolated information. The most glaring, or I should say the highest number of "What don't you like?" or "What would you like to see changed?" was from the 50-plus crowd, indicating that they would like to hear more traditional/gospel, southern gospel music, as Mr. Hapeman indicated earlier, they are more familiar with.

8936 Again, contemporary Christian music really targets the 25 to 50 or 45, if you will, male/female. When Joy FM hit the airwaves, once again, there were an awful lot of people in our church community who responded to the survey just to tell us that that is not the kind of music they were expecting. They were expecting Gaither -- I can list the names for you if you would like, but they were expecting a different style of music, if you will.

8937 When it comes to the survey, again the overwhelming response was "What would you like to see changed on Joy FM?" and that was the fact that they wanted more gospel music.

8938 THE CHAIRPERSON: So when you say "overwhelming", what is it about the 300 responses that led you to conclude that this demand is overwhelming? That is what we are trying to get a sense of.

8939 MR. McCREA: We had a number of questions, probably about 20 to 30 questions on the survey, everything from "Do you like the weather?" "Do you like the morning guy?" "Do you like the way we have the day set up?", things like that.

8940 All the responses indicated just minimal yes, 1 to 2 per cent. But when it came to "What would you like to see changed?", again overwhelming, it was like 13 per cent I believe, responded back and said "We would like to see more country gospel, more southern gospel, more inspirational music." So that one number, one line item jumped right off the page.

8941 MR. HAPEMAN: Mr. Colville, if I may speak to this also, it certainly was not a scientific research survey that was done. We don't have the finances, as you can imaging, to do that type of approach to the market. But we do have with the church communities a clearly defined target or market out there, so we were able, through the church bulletins, to distribute this rather casual survey and gleaned some very helpful information to us.

8942 THE CHAIRPERSON: But are you satisfied in your own mind that -- this is 13 per cent of 300, I take it. Is that how I would interpret what you are saying the answer would be?

8943 MR. McCREA: Yes.

8944 THE CHAIRPERSON: That may be the audience for this music. You really don't have any way of knowing whether that is the entire demand because, as you say, it is not a statistically random sample of the potential audience. This could be the very people who want this and it is a very small group.

8945 You could interpret the survey to tell you that, could you not?

8946 Feel free, either one of you. Whoever wants to speak to it.

8947 MR. McCREA: That was just the initial survey that was done sort of to get a feel. It wasn't directed at "Would you like to see the music change?", or anything like that. For us it was to sort of get a feel to the church community and if they were liking what they were hearing on the air so that we could sort of tweak it and tailor our sound.

8948 Since then, the last few years on Saturday evenings we leave our regular format altogether. So from 6:00 p.m. on to midnight is just completely southern gospel and with a local show thrown in there with a southern gospel flavour.

8949 What we have experienced over the last three years is that a tremendous amount of people will only listen to Joy FM on a Saturday evening. It is the only time they are interested in our music is when we play the southern gospel on a Saturday evening.

8950 As a Christian radio station as well, myself, the staff and volunteers are called on quite often to go to a variety of different churches throughout the community, of which in the Greater Fredericton area I believe there are about 60 to 80 churches. We are asked to come and speak about Joy FM.

8951 Every time the most prominent question is "What about southern gospel?" "What about country gospel?" What about more Gaither?" What about more "Golden Covenant?" They are asking specifically for the artists and for the genre of music.

8952 So rather than a statistical it is more of a combination over the last few years of the need being brought to us here at the station.

8953 THE CHAIRPERSON: So what do you project your audience to be for the existing station now? What do you estimate your audience to be?

8954 MR. HAPEMAN: One of the things we have appreciated about these hearings is that there is a competing intervention on the commercial markets by John Eddy, a colleague in the community. On the last page of his intervention he has the chart of the BBM statistics.

8955 We of course can't afford to enter the BBM, but was it ever encouraging to us to see that page in his intervention letter because it showed us precisely where we are in the Fredericton community.

8956 Joy FM in the community is fifth behind CBC, The Fox, Capital FM, KHJ and then Joy FM was next with just less than 5 per cent share of the market.

8957 We were elated to see some actual scientific figures and that is what we have gleaned out of this hearing, to help us see just where our station is.

8958 THE CHAIRPERSON: Given that, which is kind of a remarkable success really for a station of this nature, what would you expect your audience share to be for the 50-plus demographic then?

8959 MR. HAPEMAN: Currently very little, unless they choose to tune in on Saturday night. I don't think we keep them through the weekend

8960 THE CHAIRPERSON: Assuming you got the new licence, what would you expect the audience share to be for that demographic?

8961 MR. HAPEMAN: We were talking about this, and of course this is armchair speculation, but we thought if we could double our share of the market moving up close to 8 per cent --

8962 THE CHAIRPERSON: Total across the both stations?

8963 MR. HAPEMAN: Yes, that is correct, across the both stations -- that we would be elated.

8964 THE CHAIRPERSON: So you would expect the new station to have about a same share as the existing one then?

8965 MR. HAPEMAN: Looking at the population of our churches, I think we have a bigger target there in terms of the numbers of people.

8966 THE CHAIRPERSON: Is it conceivable, then, that your share for the 50-plus would be even greater than the share for the existing more contemporary music?

8967 MR. HAPEMAN: That is speculative at this point, but we hope that it would be at least equal to it.

8968 I understand you have -- is there a market there?

8969 THE CHAIRPERSON: It's kind of going through my mind, I'm wondering whether you picked the right demographic in the first place for the existing station.

8970 I don't mean to sound critical in asking that question, it's just potentially this 50-plus audience is in fact bigger than the audience that you have now. Is that the demographic you perhaps really should have gone after in the first place?

8971 MR. McCREA: If you have a look at record sales for Christian music, under the heading of "Christian Music" there are six different genres of that particular music.

8972 Christian music has enjoyed -- the only format of music in North America to enjoy growth. Last year, in fact, it grew by 10 per cent in record sales in North America where a lot of formats or genres of music lost, they slip or they just remain flat.

8973 As far as the record companies -- and I'm using EMI Music as an example because I have had most of the communication through them -- they are very excited in anticipating the coming years due to the increase in the popularity and the growth of Christian music.

8974 Unfortunately, in Canada Christian music is a whole lot newer than it is State-side, so a lot of the information that we have we extrapolate from the U.S. For instance, BBM doesn't really research, to my knowledge -- and I certainly could be wrong on this, but they don't research that genre or how many people are listening to southern gospel music -- the same way that Arbitron would in the United States. Arbitron measures not only southern gospel but Christian music. So we don't have the history here in Canada.

8975 What we do have is, as Doug said, armchair speculation. We do know that there are a lot of southern gospel music fans who listen to other radio stations for southern gospel. In our area it would be from an American station that has been in existence for many years. They try to tune it even if it is scratchy and they barely can get the signal. They will still listen.

8976 Again, as I said before, it is just a lot of people coming forward and saying "This is the type of music that we enjoy. We would like to hear more of it. If you are going to go for a second radio station, we think it should be southern gospel."

8977 You take that input, couple it with what you see happening with our American friends in radio, and it gives you -- it gave us a pretty good sense that this would be the new format to chase down.

8978 MR. HAPEMAN: We are very committed to the format we have, Mr. Colville. It was the direction of choice. It is the future. It is targeting the younger demographic. That was a very clear choice on our part.

8979 If there was any perhaps approaching this and not having an experience in Christian radio in the background, if we thought the older population would welcome it and receive it and be a part of it, we were mistaken in that. They have a preferred style of music that they would like.

8980 So to reach the entire demographic of the religious community, we don't feel that it can be met with a single station, that people prefer their style of music. That has certainly been made obvious to us during these three years.

8981 THE CHAIRPERSON: What kind of music are we talking about? Is this sort of "Old Rugged Cross" and "I Saw the Light" and "Will the Circle be Unbroken"? Is this the kind of southern gospel, or am I way off my mark here?

8982 MR. McCREA: Gaither Homecoming series, Gaither vocal band, the Easters, the Hoppers, Gold City, the Isaacs, Crabb Family, the Cathedrals. That is mainly what southern gospel is.

8983 What you are referencing would be more of an inspirational style music, traditional hymn sing.

8984 THE CHAIRPERSON: Your proposal would be both, inspirational and --

8985 MR. McCREA: Correct. We are going to do a mix. Primarily we will be the southern/country gospel, which is more recognizable, but our intention is to mix in inspirational music as well.

8986 Why? Simply because that is what we have been asked for by our listeners.

8987 THE CHAIRPERSON: How is it that you come to the conclusion that these two types of music can't co-exist on the same station or that when the 50-plus age group was saying "We would like to hear more of this sort of music" -- because you used the phrase, I think, Mr. McCrea, a minute ago, that people said to you, "If you are going to go for a second station do this." Did they actually say if you are going to a second station, or "We would just like you to play more of this kind of music on the existing station?" How do you necessarily come to the conclusion that that is detrimental to the other audience that likes the more contemporary music?

8988 MR. HAPEMAN: Very, very excellent question. I can only think of an illustration.

8989 When I go to a Coke machine and I press the button expecting a Coke to come out and it comes out, I'm happy. When I go back the next time and press the button and a Coke comes, I'm pleased. But one day when I go up and I push the button and a Sprite comes out and I was expecting a Coke, I scratch my head and I think "Well, that's not what I wanted, but I will come back another time and push that button and if a Sprite comes out again and I was expecting a Coke, I might decide I'm not going to that machine any more, I'm going to go somewhere else where it is what I want and I know I'm going to get what I want.

8990 I think in a radio listening audience today there is much of that idea. When people push that button they want that sound that is so familiar to them and when something is radically different from that sound they might absorb a song, but when they push that button repeatedly and they get not what they are wanting and what they are looking for, I think they are going to go elsewhere.

8991 THE CHAIRPERSON: At the risk of seeming to be argumentative, it is interesting that you use that analogy, because the Coke machine has Coke, Coke Classic, Diet Coke, Sprite, whatever. The one machine has all of those and one day I may feel like a Coke and the next day I may feel like a Sprite and I can have my choice.

8992 I take your point in the general sense. What I'm asking you is: How is it that you know for your station that you couldn't provide more of the music that you are proposing for the second station on the first one and not jeopardize -- satisfy the 50-plus audience and not jeopardize the other audience base? How is that you came to the conclusion that in order to do this we need a second station and can't do it on our existing station?

8993 MR. HAPEMAN: A valid question. Would you give me a moment, please?

8994 THE CHAIRPERSON: Yes.

--- Pause

8995 MR. EVANS: Mr. Colville, it would appear that, as for example the competing application that we are facing for this particular genre of music, a radio station, is indicative of the fact that the radio industry is moving to more specialty focused target groups and music genres. Mixing them is not their preferred course for the very reasons that we have expressed. Market preferences are to go to a station that they become comfortable with and to stay with that station rather than jumping around the dial.

8996 Without overdoing it, in searching the Web for example, for the very question -- some guidance, if you wish, on the issue that you have raised about why our current station couldn't accommodate the second southern gospel inspirational genre in a more comprehensive way throughout the week, I guess it is basically that the experience of the broadcasting industry seems to be that specialty stations are the way to proceed, that that is the choice for the market.

8997 Just to quote here from, for example this researcher in the U.S., Bob Harper and Company, format boundaries -- this is from his Website. Just a quick quote from it:

"Winning radio stations match-up their music programming exactly to the tastes of the target audience ... the music format is a mirror image of the likes and dislikes of their biggest fans. The Winners aren't weaving all over the road. They're focused and travelling in the best lane for their target listeners."

8998 That sort of captures the essence of why we feel it would not be to the benefit of Joy FM's existing broadcasting format to increase significantly, if you wish, the southern gospel and inspirational component of its music broadcast.

8999 I guess that's all that we can say.

9000 THE CHAIRPERSON: That's fine. So would it be fair to say, then, that this assessment is based on your general radio experience, these sorts of general surveys and kind of intuition more than -- as you said earlier, it is not a scientific survey that you have undertaken -- in the sense of surveying your existing audience and potential audience if you wanted to grow that 50-plus audience.

9001 It is not based on any kind of statistical survey of the audience as much as it is kind of an intuitive feel, if you will, that this is the best approach to satisfy the audience.

9002 MR. HAPEMAN: Absolutely. It would be more on that side of intuition and response that we see out there as opposed to scientific market research.

9003 But the fact that there is a competing application for this same sort of format I think is indicative of the strong voice that is out there.

9004 THE CHAIRPERSON: Did you want to jump in there, Mr. Evans?

9005 MR. HAPEMAN: One final remark in relation to this, and this is material that we have had from Salem Radio Network which provides -- they have a network of stations across America that I think are 1,500 stations -- I'm sorry, I can't quote the number of markets that they are in. Forgive me.

9006 But they have done a complete demographic research related to several different Christian formats of music. And there are not just two but there are about six or seven specialty areas of Christian music. In the women 45 to 54 and 55 to 64, the inspirational music was the highest preferred style of music format. Among men 45 to 54 and men 55 to 64, southern gospel was the number one preferred choice, followed by inspirational music.

9007 These are statistics, again admittedly taken from the American market, but there is a much larger market and history there than there is Canada, and they are indicators to us also not that it is just intuition, but there is certainly scientific study out there that we have drawn our information from, though we haven't done that type of scientific study in Fredericton exclusively.

9008 THE CHAIRPERSON: I must say, after seven days of hearing it is interesting to hear there is actually a demographic out there that I would fit into, at least in terms of age group, whether it is musical style.

9009 MR. HAPEMAN: We could break into a quartet of "The Old Rugged Cross" if you like.

9010 THE CHAIRPERSON: No, we don't need to do that.

--- Laughter / Rires

9011 THE CHAIRPERSON: Just kind of capping off this discussion on this piece, then, again in your presentation on page 3, the second last paragraph, you say:

"As you can appreciate..."

9012 And I guess I haven't been able to and you are doing a job of trying to convince me:

"...there is a bipolar difference between adult contemporary and southern country gospel."

9013 I guess I would like to get a little better understanding of what you meant by that when you talk about this "bipolar difference".

9014 MR. HAPEMAN: Permit to say, Mr. Colville, your observations are typical of what we have found in the 50-plus audience, that they do not understand this music or identify with it.

--- Laughter / Rires

9015 MR. HAPEMAN: But we are speaking about artists like Amy Grant -- you have the list there, do you, Garth, of some of our core artists.

9016 THE CHAIRPERSON: But I guess the issue is, from your point of view the people who like adult contemporary absolutely don't like southern country gospel on the same station and vice versa.

9017 That is your position?

9018 MR. HAPEMAN: Yes, that is our position.

9019 MR. EVANS: We know many folks who simply do not listen to Joy FM on Saturday evening because we are playing southern gospel. They just simply won't listen to it, because they don't relate to it, they are not into the country music sort of interest group. Even members within the station itself on the Board that basically feel quite strongly that way too.

9020 It is based on demographics more than anything. The age group, the older folks tend to like the more traditional music of the sort that you referred to, which is very different, very different from the more contemporary younger audience targeted music that sounds quite similar to secular music but of course has a much different lyric to it let's say.

9021 THE CHAIRPERSON: I'm sorry?

9022 MR. McCREA: I'm sorry, permit me.

9023 To capsulize the difference is quite simply: We are all very familiar with conventional AC sounding, like light rock station, easy rock, that sort of thing. That would be the closest to what Joy FM is. Then if you could think of a country station and the type of music, Shania Twain mixed in with Leanne Rimes traditional country. That is a very good analogy of the two types of music that we are talking about here.

9024 THE CHAIRPERSON: I understand the difference.

9025 MR. EVANS: Okay.

9026 THE CHAIRPERSON: What I didn't really understand was: Is it the case when you have a particularly niche market like Christian music, that the people who like classic southern gospel Christian music do not want to hear adult contemporary Christian music on the same station? It is your position that they don't.

9027 MR. McCREA: Very much so. Actually, again according to Arbitron out of the States at the IRB conference this past January or February, they define Christian radio as no longer a niche format because of the growth of the Christian music industry, the specific genres of Christian music, again adult contemporary, contemporary versus southern gospel to versus urban, if you will. There has been a lot of discussion over the last week about urban format.

9028 So yes, that is our contention.

9029 THE CHAIRPERSON: Let's switch away from music for a bit then and, as you said again in your fourth paragraph under the "Target Audience and Market", right at the end of that you say the second was -- oh, before we go there.

9030 You mentioned a couple of times about the competing application. How would the music you propose to play differ from what you understand the proposed station to be?

9031 MR. HAPEMAN: Frankly, we don't see a difference.

9032 That is the two proposed stations? I think both proposed stations are --

9033 THE CHAIRPERSON: Let's clarify this. When you say "the proposed station" -- and you used that term earlier several times -- what station were you referring to?

9034 MR. HAPEMAN: The proposed station for Joy FM would be the inspirational southern country gospel format. There is a competing application for that same genre of music. I think those two are aimed at the same target audience.

9035 THE CHAIRPERSON: This is the Ingram application?

9036 MR. HAPEMAN: Yes, correct.

9037 THE CHAIRPERSON: They are virtually the same, then. In your opinion, the music you would play would be virtually the same?

9038 MR. HAPEMAN: Oh, yes. Musically, there might be subtle differences, but yes, certainly aimed at the same target audience and using the same music format.

9039 THE CHAIRPERSON: This is a question I usually save for then, but I guess since we are here and given that, why should we license you over them or you and them?

9040 MR. HAPEMAN: Permit me a moment, because we would like to have a quality answer to this question.

--- Pause

9041 MR. HAPEMAN: With all due respect to our colleagues, we do find it difficult to believe that the market can sustain two additional stations aimed a the same target with the same music.

9042 We do have a proven track record and it is a complementary step for us that would have economies of scale to a small degree. It is not a large step for us in terms of finances to use our existing staff and hiring new staff, using our current facilities. We already have the music library pretty much in place because we use it on Saturday evenings.

9043 There is an aspect, as a clergyman myself, churches in a community are not competitive like, say, businesses or even other radio stations in the market. In my own heart it is important to me that we not be perceived as competitive voices, but that there is a unified, cooperative voice in the community.

9044 THE CHAIRPERSON: Let's move on to the other area that I wanted to start on then.

9045 At the end of the paragraph, I referred you to the fourth paragraph under "Target Audience and Market", you talked about the second reason for wanting to have this other station, which was what you understood this 50-plus audience was wanting more of was:

"...a desire for more spoken-word programming."

9046 I wonder if you could indicate for us what you understand the nature of this desire to be and how much more spoken word programming are we talking about? What sort of spoken word are we talking about? How would it differ from the spoken word programming that you have on your existing station?

9047 MR. HAPEMAN: We currently have -- I believe is it five spoken word programs that would be of a variety of approaches.

9048 There are family related programs; there are children's programs that we have brokered, spoken word programs on Saturday such as PAWS & Tales or Adventures in Odyssey that are dramatizations and yet they are teaching values and instilling faith values in children.

9049 The Bible teaching ministries that we have presently would be people such as Charles Stanley, internationally known for InTouch Ministries; Chuck Swindoll, Insights for Living.

9050 A very popular program in the Maritime area has been Back to the Bible because it has been on many of the commercial stations through the years.

9051 This would be the type of program that we have that is of interest and even more interest perhaps in the 50-plus audience.

9052 In my presentation I said I wanted to speak at this point to the balance area in spoken word programming.

9053 THE CHAIRPERSON: Could we just hold off on the balance, because I want to come to that.

9054 MR. HAPEMAN: All right.

9055 THE CHAIRPERSON: I just want to get a sense right now on the nature of the spoken word programming.

9056 MR. HAPEMAN: Okay. That would be it pretty much, other than, as I say, there are some family related ones, such as we have had Family Life Today, Focus on the Family, that deal with parenting, family issues, along with others.

9057 Most of those programs are sort of discussion format. They are people who are -- rather a teaching style it is a panel of people who are talking about a particular subject related to the family.

9058 THE CHAIRPERSON: Most of these programs, would they be what is generally characterized as brokered programs, programs which are prerecorded, they pay you to put the program on?

9059 MR. HAPEMAN: Absolutely.

9060 THE CHAIRPERSON: Are there any non-brokered spoken word programs that you offer that are station-originated or station-produced?

9061 MR. HAPEMAN: Yes. We have a rotation among the churches, a Church of the Week sort of feature. We have more than 60 churches who are a part of the rotation. Each week we have the pastor of that church bring several power points, 60-second devotional thoughts that are mixed in through the weekdays.

9062 Then on Sunday that pastor will bring a passages program, which is a 15-minute teaching program. It is our way of holding up each of the churches to the listening audience, appreciating their presence in our community, encouraging the listening audience as well as the staff make focused prayers on that particular congregation for the week. These would be, I guess, spoken word programs of a local nature produced right in the facility itself.

9063 THE CHAIRPERSON: Is that an example of or is that it in terms of -- I'm not trying to minimize it -- in terms of most of the other spoken word or all of the rest of it would be the brokered programs?

9064 MR. HAPEMAN: By and large, yes. Our rotation with the church of the week would be pretty much the local approach.

9065 THE CHAIRPERSON: Okay. That's fine.

9066 So what you have described is largely what you are doing now on the existing station. So how would the new station -- you talked about this desire on the part of the 50-plus audience for more spoken word programming.

9067 Are you going to have more spoken word programming on the new station and how would it differ from what you are doing on the existing station?

9068 MR. HAPEMAN: We have requested more hours in the new station. We have requested 35 hours of spoken word program weekly, which is more than what we have presently in Joy FM.

9069 Permit to consult for one moment with the manager.

9070 THE CHAIRPERSON: Yes.

--- Pause

9071 MR. McCREA: Our intention with spoken word is, we will develop more features and vignettes, as Mr. Hapeman was speaking of. We also have a lady who is local -- I won't get into too much detail, but again it features her every day.

9072 Our talk time will be longer with this format with the second station just because the format of the music lends itself more to longer stop downs and longer talk time.

9073 Thirdly, the brokered programming on Joy FM may be scaled back, if you will, and shifted to the new station, the southern gospel station, simply because it fits -- it is just simply a better fit with that format of station.

9074 THE CHAIRPERSON: So the sense I'm getting is it may not be all that different. It will provide you with more time for this programming, mainly more time for brokered programming and some of it will appear on one station and some would appear on the other. Is that right?

9075 MR. McCREA: Our definite intention with the southern gospel station is to explore more features. We have found with the contemporary format, that type of listener, they want music. They want music. They don't want to stop down for a half hour. Whereas with the southern gospel, it lends itself more to us exploring how to do -- they bring more local programming, more features, more shows.

9076 THE CHAIRPERSON: Am I understanding that there would be, in terms of a ratio, less of the brokered and more of the local station-produced spoken word, talk sorts of programming that you would actually originate rather than brokered on the new station?

9077 MR. McCREA: No, I wouldn't say that, sir. No. There would be increase on both actually. There would be an increase in the brokered programming, there would also be an increase in the locally produced spoken word programming, if you are using Joy FM as the comparison.

9078 THE CHAIRPERSON: Yes, I am.

9079 MR. McCREA: Yes.

9080 THE CHAIRPERSON: I am just trying to get a sense of how much more non-brokered station-produced spoken word programming we would hear. I guess if it is going to be more on both, then how much more? What sort of programming are we talking about?

9081 MR. McCREA: As far as locally produced spoken word, we would be looking at probably a 50 per cent increase over Joy FM.

9082 THE CHAIRPERSON: How many hours do you have right now of spoken word? You said you are increasing to 35 on the new station.

9083 MR. McCREA: Correct. Just in the brokered programming in Joy FM we have 12 and a quarter hours per week. That would be the same amount on the new station. It would be 12 and a quarter hours a week of brokered programming.

9084 Then on the spoken word we have about an hour, an hour and a quarter a week local. That is our produced in the station. We would like to see that double on the new station.

9085 I guess what I'm trying to say is, on Joy FM there are a lot of 60-second features and vignettes. We would like to see more of that on the new station.

9086 THE CHAIRPERSON: Can you give us a sense of what those 60-second features and vignettes are?

9087 MR. McCREA: For example, one right now would be the power point passages that Mr. Hapeman referred to. The power points are five day, Monday to Friday, 60-second inspirational feature, rapping up the week on a Saturday evening with a 13 to 15-minute passage by that pastor. So he is the pastor of the week, so to speak.

9088 Another example, we have a lady by the name of Evangeline Inman. She is in the process of writing a book, a children's book. To bring more awareness to her in that respect, she is providing us with a daily 60-second again inspirational-styled feature.

9089 THE CHAIRPERSON: If we have 12 and a quarter hours of brokered and we have one and a quarter local, which is going to double to two and a half, how do I get from about 15 hours up to 35?

9090 MR. HAPEMAN: There is certainly a ceiling there. I don't know that we are intending right off the top to fill it right up with 35 hours per week, but we have rather arbitrarily taken that number to move toward that number. We will find the right balance of spoken word and music in that market as well.

9091 Some of the research that we gleaned from our colleagues in the community such as Capital FM, some material that I picked up from John Eddy was that the listening audience for adult contemporary is only about 20 minutes at a time.

9092 We find the 25 to 49 demographic really aren't ready to sit down to listen to a half an hour program.

9093 The 50-plus people who perhaps have the opportunity to sit and to listen to that and prefer that, but the younger audience, they hear the radio while they are in the car, the 10 minutes they are driving to the mall or they are picking their kids up and the radio is one. So it is difficult for them to focus for a 30-minute period. Even at home, if mothers have children, to be able to sit down and appreciate a full half hour.

9094 So on Joy FM we have focused on these shorter 60-second devotional features, inspirational features from business proverbs to -- we have the lifelines, these funny little 60-second stories that are very listenable but they all come through with a message at the end that have great impact.

9095 They work much better in the 25 to 49 demographic. The message is in and out, they heard it, they got it. The 50-plus is there they appreciate and would prefer to sit down on their couch or wherever, at the table, and to listen to a broadcast.

9096 THE CHAIRPERSON: Let's move from this into balance then. When we started to talk about spoken word you wanted to briefly chat about balance. Actually, in your presentation when you go to this you said you wanted to explore and negotiate with us.

9097 I must say, we are not here to negotiate. We want to hear what your application is and better understand it. That is the reason for the questions, not to negotiate with the parties.

9098 In particular when it is a competitive situation it would be inappropriate for us to be negotiating with the parties to perhaps craft a new application, if you will, in front of us while we go through this.

9099 What I would like to explore with you, though, is how you will achieve a balance here. You indicated in your presentation that you had gone back and that you have a good understanding of the Commission's policy on religious programming. I guess I note that you have underscored in your presentation and in the discussion that we have had about 60 churches in Fredericton. I gather those are Christian churches.

9100 MR. HAPEMAN: Yes.

9101 THE CHAIRPERSON: You have talked about the participation of Christian churches.

9102 I guess what we want to get a bit of an understanding in is: How do you now then propose to provide the balance that we expect which perhaps will go beyond just the Christian faith.

9103 MR. HAPEMAN: That is precisely what I would like to speak to, Mr. Colville.

9104 When we made the application for Joy FM we were not invited to a hearing, or not requested to come to a hearing, so we didn't have the benefit of the face-to-face dialogue that we have here and with some of the staff that has been helpful to us.

9105 When it comes to an understanding of balance in religious broadcasting, I guess we, as we had understood it, have thought of balance in terms of the wide spectrum of Christian denominations.

9106 Going back to the 1920s when the moratorium came upon religious broadcasting in Canada it was pretty much the Christian denominations attacking one another at that time, from T.T. Shields and Rutherford using their church radio stations to call down other Christian groups.

9107 But we know that times have changed and today our fabric as a nation in Canada is more multi-faith than it is multi-denominational and that the CRTC's concern at this point is that we respect the multi-faith fabric of our communities.

9108 I wanted to refer to something that we had put in our deficiency process. I don't know if you have the letter that was dated April 16th and our response that was dated April 21st, but I would like to read to you a paragraph of what we mentioned here and give the context of what we are thinking.

"We anticipate a minimum of 3 to 4 hours per week of locally produced balanced programming as we understand it to mean, and we are prepared to meet that as a condition of licence." (As read)

9109 Our understanding of balanced programming may be more clearly defined as a result of these meetings this week and the face-to-face dialogue that we have had in these sessions.

9110 Our understanding in putting that request in was the understanding that the 60-plus churches who are a part of the rotation of weekly services or speaking on the station was a part of that three to four hours of building respect, appreciation for the wide diversity of Christian denominations there.

9111 If what the CRTC is requesting is that it be this strictly applied to other faith groups, then we have shot way over what would be the kinds of time that would be reasonable or workable in this situation.

9112 In the community of Fredericton we have two other identifiable faith groups, our Jewish friends -- I am personally acquainted with Rabbi Kenneth Sisook. We are colleagues together and working in the Pastoral Care Advisory Program at the Dr. Everett Chalmers Hospital. We have a great working relationship and have done some things together. They have an identifiable group with the synagogue, albeit a small Jewish population.

9113 The second identifiable group would be a matter of our Islamic friends. There is an Islamic worship facility in our community. It wouldn't be workable to give them equal time with the wide spectrum of the other denominations, but if that is what we have committed ourselves to in this condition of licence, we would like to negotiate that.

9114 We appreciate the 1993-78 policy which has given the latitude not to require or insist on equal time, but basically the spirit of it, as we understand it, is effective time.

9115 Behind the policy is the commitment to discourage religious intolerance that gives rise to the social, the cultural and the racial intolerances that may exist in history and even yet exist today. We are committed with all our hearts to discourage that and to not allow it and don't want to cultivate it in any way.

9116 How we might be able to welcome our Jewish friends and Islamic friends yet remains to be identified. We certainly might be able to incorporate the Rabbi in the weekly rotation, should he choose to or be interested in this.

9117 I'm not sure if there is an Islamic Cleric with the Islamic community. We haven't had as close a contact with them, but I can say unequivocally that we would welcome interviews, discussions with them about their holy days. To commit to what would be a workable, reasonable time, I'm not sure that a half an hour a week would even be workable in that, but if we could commit ourselves to effective communication or effective time with the other religions, though they are a small community our greater context of the Christian community.

9118 So our anticipation of three to four hours per week of locally produced balance programming really takes in context the spectrum, in our minds, of the diversity of the Christian denominations. By and large that would be the major part of it.

9119 We do recognize that balance in programming not only touches on the other religions, but also the issues of moral and social or public concern.

9120 We have, as a Board of Directors with Joy FM, been deliberately -- not that we want to run away or escape facing these realities, but we have deliberately avoided issues such as capital punishment, gun control, war and peace, abortion or homosexuality, because many of them are political hotbeds and we do not want to become a lightening rod in our community. Then we have lost the community that we have tried to bring together with tolerance and understanding.

9121 We do have, from the Christian perspective, people who would like to have programs or like to have those issues raised, but we are reluctant to go there, like many of our commercial broadcasters in the mainstream, because controversy, in some stations that are talk-oriented, it may increase listener audience, but in music and inspiration-based stations we feel it could be detrimental to our message. So we have deliberately attempted to avoid going there because that is not our mandate or our mission and it might obscure that mission.

9122 We have one American brokered program supplier, Dr. James Dobson with "Focus on the Family", who from time to time deals with some of these issues from an American perspective. There have been times when we have pulled that program, the General Manager has said "We are not going to air it. We will go back and play a less controversial one", because the tone of the program does not fit in the Canadian context and we don't want to injure or incite people that fall on the various sides of these political issues.

9123 THE CHAIRPERSON: It is not for us to tell you what issues to pursue on your radio stations. It would appear that you have a somewhat more expansive view of the balance issue that we had intended in the spirit of the religious policy than perhaps you had if it was just inclusive of the Christian churches.

9124 I think it is fair to say that our view of that balance, and I think the point you raised earlier about tolerance and understanding, is a reflection of what I think the spirit of our policy was and is and that indeed it does go beyond simply the different Christian denominations to the other denominations, in particular the ones in the community.

9125 While the Islamic faith may not have a Cleric, I mean if there is a group that gathers at a place of worship or to worship in that community, presumably there is somebody there who could be a spokesman that would help facilitate this better understanding across the various religious denominations.

9126 Perhaps I will turn it around as a question: With this better understanding of what the policy is all about, I guess I could throw it back to you and ask what your plans would be with respect to dealing with that issue?

9127 MR. HAPEMAN: One of the Commission staff provided us with a copy of 1994 Notice from the CRTC that related to a religious situation, I believe in Lethbridge, Alberta. It underscored something that we are taking away from here that I think will help us in the future, and that is the importance to initiate contact. We may have an open door and welcome them to come if they wish to have a program or have an interview or some sort of information dispensed through our station, but the importance in that document that was given to us this morning is the importance of also taking the initiative as a station.

9128 Personally, I would love to see us take something like the Holocaust Memorial Day -- it is a Sunday in April and at many churches Christian friends join with our Jewish friends in remembering a horrible atrocity that happened in the world -- to have an interview relating to that with the Rabbi.

9129 Currently the Passion of the Christ is a controversial film in the communities today. I had the opportunity with our local Rabbit to join together with him and a Catholic priest in doing a two-hour class at St. Thomas University. We had two hours of invigorating discussion about the issues of anti-semitism and the issues of discrimination.

9130 What we are hearing here today and what has been given to us is the importance for us to initiate that by taking steps to invite them to be a part of this rather than an open door. Should they come, we will welcome them.

9131 THE CHAIRPERSON: In terms of spoken word programming and based on your understanding of the Ingram application, do you have a sense of -- in spoken word, not music just spoken word -- how you might distinguish yourselves with the new station from the Ingram application?

9132 MR. HAPEMAN: I think distinguishing a difference is going to be difficult because I believe the same sort of brokered or teaching or spoken word programs might be very similar, maybe different people involved in those brokered word programmings.

9133 Our distinguished colleague Mr. Ingram is a journalist and a very articulate man in terms of his editorial and newspaper work. I think he has, on that standpoint, his local news experience and expertise he might be a step ahead of us in terms of his journalistic strengths, in terms of local writing and local interviewing with people in the community.

9134 Mr. Ingram was a part of Joy FM's radio station and providing local news to us and we have had great camaraderie with him in his participation with us and appreciate his skills as a journalist.

9135 THE CHAIRPERSON: Just briefly let's turn to the financial operating issue. I guess I would just like a bit of clarification on what you see as the synergies that would be gained by having the two stations.

9136 You did refer in your presentation this morning I think -- for example:

"The proposed studio and staff will be complemented with the infrastructure of the present facilities, staff and volunteers."

9137 Are we essentially operating two stations on the infrastructure and employees of the existing operation?

9138 MR. HAPEMAN: We anticipate -- and I believe you would find this in the original material we submitted -- the hiring of one full-time and one part-time person, and complementing those new employees with some of the current staff who could do, say, a disc jockey shift on one station and then do a disc jockey shift, maybe voice-tracked shift on the other station as well.

9139 Not too dissimilar to what happens in Fredericton currently, where you can push the button and listen to KHJ and then later in the day you can push Capital FM and hear the same DJ who has done a voice-track or done a shift on both of those stations, utilizing the same staff to accomplish -- or in their instance three stations that are produced or programmed out of the same studios.

9140 We do see a combination of new staff and complementing them with current staff presently.

9141 THE CHAIRPERSON: So might I hear the same DJ on one station, perhaps with a little bit of a different tone on the adult contemporary, and then the same DJ may somehow get a twang in his or her voice --

--- Laughter / Rires

9142 THE CHAIRPERSON:  -- and be now doing the more southern gospel, inspirational?

9143 MR. HAPEMAN: Absolutely. It could happen.

9144 THE CHAIRPERSON: Okay.

9145 MR. HAPEMAN: We are very committed to the fact that both morning shows and afternoon shows, as is typical in the industry, need to be live, live-assisted. That live-assisted person in the morning might do, say, an evening shift that would be -- help me out with the word. I have forgotten it, when you use the computer to --

9146 THE CHAIRPERSON: Voice-tracked.

9147 MR. HAPEMAN: Voice-tracked. Forgive me.

9148 THE CHAIRPERSON: That wasn't a question I was going to pursue. There is always a danger in throwing out these terms because then you get asked a question that wasn't anticipated.

9149 How much voice-tracking do you propose to do or do you do now and propose to do?

9150 MR. McCREA: I thank Mr. Hapeman for opening that door.

9151 Right now with Joy FM we have a live morning show from 6:00 to 9:00 and we have a live drive-time from 3:30 to 6:00. So our mid-day from 9:00 a.m. until 10:00 is voice-tracked; from 10:00 to 11:00 is brokered programming -- do you want me to break the entire day down?

9152 THE CHAIRPERSON: You are on a roll here, just keep up.

9153 MR. McCREA: Okay. 11:00 to 3:30 is voice-tracked and from 6:00 p.m., evening and overnight is voice-tracked.

9154 THE CHAIRPERSON: 6:00 p.m. to 6:00 a.m. is voice-tracked?

9155 MR. McCREA: Yes, sir.

9156 THE CHAIRPERSON: So it is quite a lot of voice-tracked.

9157 MR. McCREA: In my opinion, no, it's not, compared to some other radio stations.

9158 I should add that Friday night we have a different show that occasionally goes live. Saturday night is voice-tracked by different jocks.

9159 There are different times throughout the week when we do open the microphone up. It could be at mid-day because we are going to run a new or different type of contest so we want the live assist. Perhaps on a Friday evening we are going to have one of our world-class, world-famous block parties, barbecue style. We open the station up as well as go live.

9160 So there is a lot of live assists at different points, but I would not say that we are voice-tracked a lot in comparison to other radio stations perhaps.

9161 THE CHAIRPERSON: Okay. Would you expect the new station to be about the same?

9162 MR. McCREA: Yes, sir.

9163 THE CHAIRPERSON: I noticed with respect to revenues, on your existing station almost 70 per cent of your revenue is from advertising and a little over 30 per cent is other, if I have the figures about right.

9164 Is that about right, 70:30 in favour of advertising?

9165 Let me get to the question. My question is: With the new station it is almost the flip of that, it is about 60:40; 40 ads, 60 other. I guess when I was going through I was kind of curious about why you would see that flipping around in terms of the balance and what was the basis of your projected advertising revenues?

9166 MR. HAPEMAN: The projections that we have really are based on the enlargement of those particular streams, the three streams of revenue. So the percentages may be a little skewed in terms of the new station, but when you look at them in terms of augmenting advertising sales, realistically how much advertising can we increase.

9167 So the percentages might be skewed now with the two station because the realities of how much can we increase in each of those respective areas. So to take just the additional amount that is added to the current operating budget does skew the percentages and they are not the same as Joy FM's percentage.

9168 We have been -- in anticipation from the beginning and it has been moving nicely this way -- to see less dependence upon donations and more dependence on advertising revenues. Our percentages the first year or so were skewed the other direction, that donations were high and advertising low. We have seen the advertising growing nicely over the three-year period and our revenue in terms of donation has been pretty much static for the two years following the first year.

9169 We would like to be able to get to the place where it is all supported by people who buy time and it doesn't depend upon the donations of people.

9170 I say that on the one hand, but on the other hand recognizing that there is a sense of ownership that exists in a station such as this and the listening audience is fiercely loyal to Joy FM and they feel a loyalty to that station. It is a mission to them that they are a part of with us in carrying it out.

9171 So I don't know that we would ever want to eliminate the charitable aspect of it because of the value that it is to the listening audience to feel that this is ours and this is our work.

9172 THE CHAIRPERSON: Actually I wasn't focusing on that as much as I was curious about the advertising sort of versus brokered. I assumed the other was largely brokered funds.

9173 Do you expect, on the advertising side, to get largely new advertisers advertising on the new station or will this largely be you will now be selling the same advertisers two stations?

9174 MR. McCREA: We don't expect an attraction of a lot of new clients. It will be an add on to their existing buy. So it will be now we offer them a two-station buy as opposed to a one-station buy, if that answers your question.

9175 THE CHAIRPERSON: So then what do you expect the impact to be on the existing station of the new station, both in terms of audience and revenues?

9176 MR. McCREA: In terms of revenue, complementary. We expect our advertising sales to increase because of the two-station sell and the ability to promote an advertiser to a different demographic. It may be good for their business or shopping their business.

9177 I'm not sure I'm clear on the first part in reference to the audience part of your question.

9178 THE CHAIRPERSON: Do you expect the audience for the existing station to go down or do I take it from the earlier discussion that we had that this is an audience that you don't really have except for Saturday night and so this is largely going to be an entirely new audience, perhaps with that bit that was on Saturday night?

9179 MR. McCREA: I would tend to agree with that.

9180 There is another side of the Christian radio that we haven't talked about so much in that there are a lot of people who listen to the radio station, believe it or not, and they can't stand the music. They don't like the music, but they just like the message in the music, if you will, or they want to support "a Christian radio station".

9181 There will be minimal, very minimal loss to Joy FM. There will be a sizeable pick-up of new listeners for the southern gospel station. Obviously the listeners that we have on Saturday night will start listening into the southern gospel station and more than likely that Saturday night on Joy FM will cease to be a southern gospel evening. It will join the regular format of Joy FM.

9182 THE CHAIRPERSON: Is this is largely a new audience, why wouldn't you expect new advertisers?

9183 MR. McCREA: We are trying to be modest and conservative in our expectations. We certainly realize that from a commercial standpoint we have significant competition, if you will, from the other radio organizations in the city. We have done very well at growing our advertising base in the last three years, but we want to remain conservative in our approach to this.

9184 We do believe we are going to have an increase in our advertising because of the second station sellers, if you will a tag-on to their existing buy.

9185 Sure, there are probably a lot of new businesses that are out there that we haven't tapped into that we could approach but, again, we just wanted to remain conservative in our goals here.

9186 THE CHAIRPERSON: The last question from me. I think Commissioner Cram may have a question or two.

9187 Earlier you mentioned that with all due respect to Mr. Ingram you feel there is probably only room in the market for one or other of these new stations, I take it the Christian ones, if I understood your comment earlier correctly.

9188 MR. HAPEMAN: Yes.

9189 THE CHAIRPERSON: If that is the case and if one of our objectives would be diversity of spoken word opinion, why would it be more desirable for us to license you rather than the other application?

--- Pause

9190 MR. HAPEMAN: I think, Mr. Colville, perhaps the greatest concern we would have is the viability to be able to sustain this radio station and the complementary station without dividing the finances that might jeopardize the viability of any or all in that market.

9191 It is a niche market in Fredericton, a small market, and that is probably at the top of our concerns: Can the community sustain financially what it would take to support all three of the stations?

9192 THE CHAIRPERSON: All three, but let's assume it is not three but it is two. One could be your existing station and the other could be the Ingram one. I guess the issue then is: Why should we license you instead of Ingram?

9193 Is it your opinion that the Ingram station cannot be financially viable on a standalone basis with your existing station in the market?

9194 MR. HAPEMAN: I am not prepared to speak to that with absolute certainty, but it is my fear that it would jeopardize the share that we have in terms of revenue.

9195 I know that in their station they have applied for a commercial station and they have not applied for a charitable status, but if they find -- they have indicated that they intend to raise it all by brokered -- or much of it by brokered programming.

9196 Our experience has shown that there is not a deep pool of brokered programming out there, revenues from brokered programming. They would all like to give us the programs to air, but they don't want to pay to be on the air. It might be the case that this competing application would have to then start to pursue the commercial market or file for a charitable status to search for donations.

9197 Should it come to that, then definitely it would have an adverse effect on our viability.

9198 THE CHAIRPERSON: Thank you, Mr. Hapeman.

9199 Commissioner Cram, did you --

9200 COMMISSIONER CRAM: Thank you.

9201 When was Joy 1 launched?

9202 MR. HAPEMAN: April 2001.

9203 COMMISSIONER CRAM: In those three years are you telling me that there was no non-Christian programming on your station?

9204 MR. HAPEMAN: In terms of spoken word programming? I think that is a fair statement. The music, all the lyrics of the music would be positive life, moral, Christian-related --

9205 COMMISSIONER CRAM: As well as the spoken word.

9206 MR. HAPEMAN:  -- as well as the spoken programming.

9207 COMMISSIONER CRAM: Are you also saying that you had a condition of licence that you would provide four to five hours per week of -- how much balance did you have in your original licence?

9208 MR. HAPEMAN: There wasn't a statement in the Promise of Performance for a committed number of hours for balance, not in Joy FM's application.

9209 COMMISSIONER CRAM: So you were subject to no condition of licence requiring you to do balance. You were just required by the policy to do balance programming?

9210 MR. HAPEMAN: That is correct.

9211 COMMISSIONER CRAM: In three and some years you did no non-Christian stuff?

9212 MR. HAPEMAN: Correct.

9213 When you say "did", you mean that we didn't initiate --

9214 COMMISSIONER CRAM: Provided no non-Christian balance programming.

9215 MR. HAPEMAN: We have had none come to us either, requesting a program or requesting time.

9216 COMMISSIONER CRAM: But you have a privilege in the broadcasting system. You have a rare frequency. Along with that comes an obligation, as in a policy, and you have not lived up to that.

9217 MR. HAPEMAN: Yes.

9218 COMMISSIONER CRAM: My question is: How do we then -- you said to Commissioner Colville that the reason you should get the licence is your "proven track record". When I look at your track record I see a negative in it, a very serious negative.

9219 So how do I balance that against the Ingram application, because frankly I can't see much about your track record in CRTC world, in the regulator's world, when there is non-compliance with a policy. I'm having a hard time seeing that as a good track record in our world.

9220 So how do I balance that against Mr. Ingram, who has no record, but it's not bad.

9221 MR. HAPEMAN: Absolutely. I appreciate your question. The challenge is well spoken and well taken.

9222 We have focused though, Ms Cram, on promoting tolerance, understanding and respect for the wide diversity in the Christian community. That in itself is a monumental task, that among churches that we appreciate what we have in common rather than focusing on what we have in difference.

9223 So certainly to the spirit of the policy we have had that to promote tolerance and understanding and respect. That has motivated everything that we have done in terms of the Christian community.

9224 But I hear what you are saying in relation to the other faiths.

9225 COMMISSIONER CRAM: Yes.

9226 MR. HAPEMAN: Thank you.

9227 COMMISSIONER CRAM: If I were a Hindu or if I were a Buddhist and I clicked onto your space and I see you as a Christian community communicating through Christian music, a Christian radio station -- are you planning on changing this now that you know you are a religious station, not a Christian station?

9228 It is very exclusionary and I have to say I don't think that is the Canada we want. So are you planning on changing this?

--- Pause

9229 MR. HAPEMAN: It is an enormous tension, Ms Cram, tension in terms of the music we have is Christian in lyric and in terms of the genre of music it is an identifiable music market, our genre.

9230 As we have understood here this week in the dialogues that we have had, in our condition of licence with the new station we are making a commitment to a balance in programming that incorporates other faiths. How we do that in terms of our music mix will be difficult.

9231 But we do have a resolution here among ourselves to be more proactive rather than be an open door policy that if our friends come that we will dialogue with them.

9232 I think we go away from here with a resolve that "Let's take the initiative". That has been presented to us quite clearly.

9233 THE CHAIRPERSON: Thank you for that, Mr. Hapeman. I guess the issue is -- I thought we had an understanding of the discussion we had a little earlier, I guess two things:

9234 One is, we understand your point about the music. It is largely spoken word that we are dealing with here, in fact it is spoken word we are dealing with.

9235 And it isn't just the new station, it is the existing one as well.

9236 Commissioner Langford, did you have --

9237 COMMISSIONER LANGFORD: Yes. Are you finished?

9238 COMMISSIONER CRAM: Yes.

9239 COMMISSIONER LANGFORD: I have a couple of questions.

9240 It is probably educational for you to know that we have some pretty heated discussions when we get in our little room too, so it's not -- it is my understanding, and I guess we will have a good debate about this afterwards, that the music portion of your programming does not have to make any effort to be balance. That is my understanding, but I'm sure Commissioner Cram and I will have a good discussion on that.

9241 But it is my understanding that the balance has to come into the spoken word program. Not every minute of it, but some of it. That can sometimes be difficult when you are brokering, but you have to watch that brokered stuff, as you have indicated you have, and pull it sometimes if it seems to be going down a road that is not compatible with our policies.

9242 What I want to understand, I want to understand two things:

9243 The record that Ms Cram has talked to you about, is the cause of your not carrying balance programming, inviting in for example the Rabbi or somebody from the Bahai faith, perhaps a religious professor from the University of New Brunswick who could talk intelligently on different viewpoints, is this a product of your misunderstanding the rules?

9244 MR. HAPEMAN: Absolutely. When we indicated in the deficiency process the three hours weekly, we were thinking that fulfilling that policy is the tolerance and the respect among Christian faiths, but we also believe that that incorporates other faith groups as well.

9245 I think the situation in our community is that there is a small but there is an identifiable community of other faith groups and that we have not in the past taken deliberate steps or the initiatives to invite them to be a part. But we would welcome.

9246 I know in the original deficiencies we had articulated there that we would welcome interviews or discussions with our friends from other faith about particular holy days, whether it is Ramadan or Hanukkah, or some of these other events that relate to their religions to hear their perspectives on these faith issues.

9247 I think the Islamic and Jewish that have the identifiable presence in Fredericton share very much in common with us in that we all worship the same God creator historically out of the traditions of those faiths.

9248 COMMISSIONER LANGFORD: I think it would be fair for me to suggest that you would have to go even a tiny bit farther than that.

9249 Though you are very careful about the issues you air, let's assume for a moment that you were going to do a show on abortion. You aren't, but let's put it out there because it's an easy one and there is lots on it.

9250 I think the policy would anticipate you inviting in other faith representatives or other faith experts. I mean, you could find someone who is a Catholic but who is an expert on the Bahai religion, because he or she is a professor at the University of New Brunswick, who could bring an intelligent perspective on that.

9251 I think the policy anticipates that type of reaching out and the type of, I think you said earlier not simply having an open door but actually initiating the joining of the different faiths around discussions, not simply educational.

9252 I may be wrong on that, but I don't think I am, that it anticipates just a little more than come in and tell us about your feast days or come in and tell us a little bit about why your church looks different than ours.

9253 Is it clear what I am suggesting to you?

--- Pause

9254 MR. HAPEMAN: Being small scale, as we are, it is difficult to do everything that can be envisioned, but yes we do recognize there are many things that we could do that would enhance this widening circle of other faiths.

--- Pause

9255 MR. McCREA: I leaned over to Mr. Hapeman and I said "That is a very good idea." I think the idea of having a multi-faith perspective on issues, whether they are faith or political issues, abortion being your example, I find that very interesting, I'm sure that the listener would as well, especially on a religious station.

9256 COMMISSIONER LANGFORD: I would like to give you notice -- I'm sorry. Go ahead.

9257 MR. HAPEMAN: May I interject, Mr. Langford.

9258 Joy FM in its focus has been predominantly a music-oriented station, though there has been spoken word programming incorporated in the mix. Yet the station itself in its style hasn't been conducive to interview or panel discussion type.

9259 But we do anticipate in the 50-plus target audience that that is something that they value and that they want to hear more and that we see in that station's format the opportunity to provide more of that, but it is also limited by the resources of people who are working to a great extent -- we don't have writing departments or research departments or program planning coordinators.

9260 COMMISSIONER LANGFORD: We appreciate that, but it doesn't need a writer to bring in somebody with a different view, as long as you are not looking to Ernst Zundel or somebody like that. You might have to do a little research on the people, but not much in a town like Fredericton I wouldn't think.

9261 I'm going to leave you with notice of something I want to ask both you and Mr. Ingram about. I don't want you to answer it now, but in Phase IV I'm going to ask you why you can't get together and do this together. You both have a history together and frequencies are very, very precious and there are very few of them. It seems to me you are both pulling in the same direction and you have all kinds of compatible expertise, in fact, as I understand it, Mr. Ingram's associate is the one who helped set up some of your technical stuff.

9262 It seems to me that if there has been some falling out or some disagreement or some focus that -- you guys are supposed to be experts at turning the other cheek and putting it back together.

9263 I don't want you to answer it now, but I see the other applicant in the hall and I intend to ask both of you about it then. I'm kind of interested to hear what you have to say.

9264 Thank you very much.

9265 MR. HAPEMAN: Thank you.

9266 THE CHAIRPERSON: Counsel.

9267 MR. McCALLUM: Just one more time on the balance programming and the non-Christian balance programming.

9268 As you may understand, from the Commission's perspective the only way that we can ensure things happen in the future is to impose conditions of licence. So I have to ask the question in the perspective of a condition of licence.

9269 In terms of non-Christian programming you stated earlier that even half an hour per week might be too much. I assume you answered that sort of in terms of a commitment or even a condition of licence.

9270 But then subsequent to that the discussion included mention that you might have to take some initiative.

9271 Of course in your deficiency answer you talked about three to four hours of locally produced balance programming. I think you understand that the requirement for balance does not necessarily require that it be local, that it could be from some other source other than local programming to provide the non-Christian type of balance.

9272 So if I can sort of ask the question again: Is there any minimum level that the Commission could impose by way of condition of licence of minimum number of hours per week of non-Christian balance programming that you could offer on a weekly basis in terms of spoken word?

9273 THE CHAIRPERSON: Mr. Hapeman, if you want to think about that you could respond in the next phase, if you wish. I appreciate we have gone through a lot of ground here right now and you may want to think about your answer before you --

9274 MR. HAPEMAN: Thank you.

9275 MR. McCALLUM: In fact, the other applicant has been given the chance to do that at the next phase as well, so that is perfectly satisfactory if that is for you.

9276 MR. HAPEMAN: Thank you, Mr. McCallum, because we really need to work that through, not even knowing what types of programs out there might be available to us in that area. Thank you for the time for us to reflect on that.

9277 COMMISSIONER LANGFORD: It might give you another opportunity to get together with them.

9278 THE CHAIRPERSON: On that point, I want to underscore -- I appreciate Commission Langford's question and I will be interested to hear your answer. I don't want you to think we are pushing you to getting together with anybody.

9279 MR. HAPEMAN: No.

9280 THE CHAIRPERSON: So that will conclude our questions, then, and we will take our late morning break.

--- Upon recessing at 1056 / Suspension à 1056

--- Upon resuming at 1115 / Reprise à 1115

9281 THE CHAIRPERSON: Order please, ladies and gentlemen. We will return to our proceeding now and commence Phase II.

9282 Mr. Secretary.

9283 MR. LEBEL: Thank you, Mr. Chairman.

9284 NewCap and Maritime already indicated they would not be appearing in Phase II so I will now ask Acadia Broadcasting Limited to intervene to competing applications at this point.

INTERVENTION / INTERVENTION

9285 MR. MacMULLIN: Mr. Secretary, we have no interventions at this time.

9286 THE CHAIRPERSON: Mr. MacMullin, I think Commissioner Langford has a question for you.

9287 MR. MacMULLIN: I'm very sorry.

9288 COMMISSIONER LANGFORD: It's all right. It's kind of a surprise question and it might have worked better with Phase IV, but at that point there is so little time left that if anybody needs any rethinking of something we have kind of lost them.

9289 There is going to be an intervention coming up on behalf of a campus station in Saint John, I'm sure you are aware of it, that is worried that if either you or NewCap are licensed the interference will be such with their signal that they will have to go and find a new station.

9290 I was wondering whether in circumstances like that, if you were to be successful, whether you had given any thought to perhaps assisting them, financially and --

9291 MR. MacMULLIN: Indeed we have.

9292 COMMISSIONER LANGFORD:  -- help them out. Because that is a pretty tough burden on a small operation like that.

9293 MR. MacMULLIN: We understand that and we have given it some consideration.

9294 In checking with our consulting engineer and our own technical people, the thought process from those experts is that with our 41,000 ERP out of Fredericton, that shouldn't be the big issue for the area that they serve. However, we will make technical assistance and some advice, and perhaps other assistance if it is required, if it is our fault.

9295 COMMISSIONER LANGFORD: Thank you very much. That is my question, Mr. Chairman.

9296 THE CHAIRPERSON: Thank you, Mr. MacMullin.

9297 MR. MacMULLIN: Thank you.

9298 THE CHAIRPERSON: Mr. Secretary.

9299 MR. LEBEL: Thank you, Mr. Chairman.

9300 I will now ask Ross Ingram to intervene to competing applications at this point.

INTERVENTION / INTERVENTION

9301 MR. INGRAM: You asked us basically two questions.

9302 The first concerns local programming. I want to apologize for the misunderstanding yesterday.

9303 We will commit to 90 hours a week of local programming.

9304 The other question concerned programming balance.

9305 In accordance with provisions of the Broadcasting Act and CRTC 1993-78, we will undertake to provide a minimum of one hour of programming weekly, produced by or provided by other religious faith groups. The principal faith groups in this regard in the Fredericton area, we mentioned earlier, are the Jewish and the Muslim communities.

9306 We further undertake to appoint an advisory board of four members plus a chairperson representing four different faiths, three Christian and one non-Christian.

9307 Their purpose, Mr. Chairman, would be to help cultivate a respect for a diversity of religious beliefs and monitor the activities of the radio station to assure a religious balance in the operation of the station and to guide against any program content or music content that might be offensive to any one religious group. We see that advisory board meeting on a regular basis every four to six weeks.

9308 THE CHAIRPERSON: Thank you, Mr. Ingram. Would I take that commitment of the one hour, that you would accept that as a condition of licence?

9309 MR. INGRAM: We would.

9310 THE CHAIRPERSON: Thank you very much.

9311 MR. INGRAM: Thank you.

9312 THE CHAIRPERSON: Mr. Secretary.

9313 MR. LEBEL: Thank you, Mr. Chairman. I will now ask the Joy FM Network Incorporated to intervene at this point.

INTERVENTION / INTERVENTION

9314 THE CHAIRPERSON: You probably thought you would have a little longer break.

9315 MR. HAPEMAN: Yes. We were in the hall and so we have missed the preliminary or the introduction to this, but we had not intended to make any interventions at this point.

9316 Mr. LeBel, as you have called us up, we are here and unless there is an agenda that you want us to speak to, we had nothing to --

9317 MR. McCALLUM: I take it you will attempt to respond to the outstanding question in Phase IV. Is that the idea?

9318 MR. HAPEMAN: Yes.

9319 THE CHAIRPERSON: Fine. Thank you.

9320 Mr. Secretary, that then takes us to Phase III.

9321 MR. LEBEL: Indeed it does, Mr. Chairman.

9322 The first appearing interventions will be presented by Aboriginal Voices Radio Incorporated.

9323 You have 10 minutes to make your intervention.

INTERVENTION / INTERVENTION

9324 MME ST-LOUIS: K'we, Pjila'si. Monsieur le président de l'assemblée, membres de la commission, conseillers, représentants de l'industrie radiophonique ainsi qu'aux membres du public.

9325 Avant de commencer notre présentation, nous souhaitons reconnaître et honorer les peubles Maliseet et Mi'kmaq de l'Atlantique du Canada. Nous sommes heureux que cette rencontre se fasse sur leur territoire, précisément à Halifax, aussi connue comme Chebucto qui se traduit PREMIER PORT.

9326 Mon collègue et moi sommes honorés d'être ici devant vous aujourd'hui, représentant la voix radiophonique autochtone et soutien des l'applications de NewCap Inc., a Frédéricton et Saint John, Nouveau-Brunswick.

9327 Je me nomme Nadine St-Louis et je suis la directrice des communications pour la voix radiophonique autochtone.

9328 Ma famille est originaire de Restigouche. Je suis métisse de descendance Mi'kmaq et Acadienne.

9329 Mon expérience académique m'a conduit vers le domaine des communications. Mon sujet de thèse à l'université de Montréal est sur la représentation de la culture autochtone dans les médias, ainsi que de son absence.

9330 J'apporte 15 ans d'expertises incluant l'expérience en gestion des revenus au sein du Canadien National. À la radio, je suis directement responsable du succès du Marketing et de la gérance des revenues.

9331 À ma gauche se trouve le directeur des licenses et développement de la voix radiophonique autochtone, M. Mark MacLeod.

9332 Mark s'est déjà présenté devant vous plusieurs fois, et en surplus de son travail régulier; Mark travaille avec moi sur une myriad de plans en marketing et revenues.

9333 MR. MACLEOD: The revenue initiatives meet and pass a very special test: They enable a step forward for the entire Canadian broadcasting system through direct financial support for an aboriginal radio infrastructure that can meet the cultural, economic and social objectives set out by the Broadcasting Act.

9334 Specifically, the Act declares that:

"...the Canadian broadcasting system should, through its programming and the employment opportunities arising out of its operations, serve the needs and interests, and reflect the circumstances and aspirations, of ... the special place of aboriginal people within that society."

9335 In their two applications, NewCap have committed a total of over a half a million dollars to further advance the development of the Aboriginal Voices Radio Network.

9336 Before we look at the potential beneficial impact of this funding, let's look at the success of similar funding delivered by NewCap to AVR.

9337 MS ST-LOUIS: NewCap recognized the exceptional opportunity to direct public benefits funding to the development of Aboriginal radio in Canada as early as 1999. Through a series of Commission approvals since 2000, NewCap has committed nearly $3.4 million to AVR for various projects through to 2009. The Commission has permitted over 70 per cent of this funding to be used by AVR for overall development of a new radio infrastructure, while the remainder has been restricted specifically to talent development initiatives as traditionally defined by the Commission.

9338 With NewCap as the biggest single, and most essential funder, AVR has worked through initial licensing stages, to emerge in early 2004 as an important new force in the Canadian Broadcast system. The installation of AVR's new Toronto antenna system, which began last week, will double potential reach, to over 3.3 million. The addition of Calgary and Ottawa services in June will increase AVR's reach to 5 million.

9339 Canadian Aboriginal artists now have access to a totally supportive new voice to broaden their exposure and inspire their pursuit of a much greater performing career.

9340 Young Aboriginal broadcasters are now taking advantage of a new opportunity to develop and hone their media skills in Canada's largest media market. AVR already employs 10 such emerging broadcasters.

9341 Since January, existing native broadcasters across Canada are able to carry a new daily national package of new. Three Ontario stations are already doing so.

9342 Let us share with you a compilation of what AVR listeners are hearing right now.

--- Audio clip / Clip audio

9343 MR. MacLEOD: AVR has been broadcasting at low power in Toronto since December 2002, with a relatively poor signal reaching a potential 1.7 million people. Even with such limited coverage, the response to AVR in Toronto has far exceeded any of our expectations.

9344 Listeners are communicating their delight with AVR's programming, and their complaints about the signal quality. Community organizations and leaders have used AVR to promote their activities, and performers from across Canada have appeared live in the studio to promote their appearances and their new releases. The only concern we have is with the number of listeners who have said how much they appreciate that they hear so few commercials on AVR.

9345 MS ST-LOUIS: NewCap has proposed to provide a total of $525,000 to AVR:

9346 $350,000 from the proposed Fredericton service, and

9347 $175,000 from a proposed Saint John service.

9348 AVR will use the funding primarily for three initiatives.

9349 First, AVR will dramatically increase exposure for New Brunswick and Atlantic region performing artists by employing a part-time Atlantic Aboriginal Talent Director.

9350 A central mission of AVR is to develop Canadian aboriginal talent, and our national Talent Development Office is intensely focused on finding and connecting with every aboriginal performer in Canada.

9351 The Atlantic Director will work closely with the national Director and will be responsible for ensuring that performers from Atlantic Canada gains access to AVRN. If an appropriate person is available in the local area, the Director would be based in either Fredericton or Saint John.

9352 MR. MacLEOD: Second, AVR will use the NewCap funding to support the production, broadcast and wider national distribution of a new program entitled "Eastern Greetings", a regionally focused cultural and news program.

9353 If the Commission approves NewCap's applications, AVR will pursue other sources of funding to provide the additional funds necessary to establishment a full-time Atlantic News Bureau. Until such time as this News Bureau is fully funded, programming will be produced by existing New Brunswick native broadcasters or otherwise produced by AVR elsewhere.

9354 Finally, AVR will use a portion of the NewCap funding to accelerate the development of AVR's national programming service by covering the associated costs of reciprocal distribution of programming between AVR and Atlantic regional native broadcasters. This would include expanding AVR's capabilities to send and receive programming via high speed Internet to and from Atlantic native broadcasters. If possible, this would also include funding to support efforts to license new native radio services in Atlantic Canada.

9355 MS ST-LOUIS: We would like to close with a quote from a letter we received last week from a listener. I quote:

"Most important though I would like to congratulate all the people who are responsible for bringing (the) AVR station to life. I listen to it everyday and always tell my friends and strangers to check it out. I find the station fresh, inspiring, cool and entertaining. Keep up the good work."

9356 It is important that this congratulation be conveyed to you, the Members of the Commission, as well as to NewCap. NewCap's public benefits funding, as approved by the Commission, has brought AVR to life. We urge the Commission to continue to support NewCap's ground-breaking Aboriginal initiatives by approving new radio services for NewCap in Fredericton and Saint John in this hearing process.

9357 Wela'lin. Thank you for the opportunity to appear here today. We would be pleased to answer any questions that you may have.

9358 THE CHAIRPERSON: Thank you for your presentation this morning. I just have a couple of questions.

9359 First, it has obviously been a struggle for AVR to get going, get the original station on the air and then it was a poor signal to start with and there have been struggles to get that going. Obviously it is going and has been improved.

9360 I wonder if you could just give a sense of -- you did make a reference here I think to Calgary and Ottawa -- just sort of where AVR is at in terms of getting the other station on the air.

9361 Are either one you able to kind of bring us up to date in that respect?

9362 MR. MacLEOD: We will probably trade back and forth on any comments we would have --

9363 THE CHAIRPERSON: Sure. Feel free.

9364 MR. MacLEOD:  -- but I will start because I am certainly more knowledgeable about the long-term development than my colleague is. Nadine joined us in July, so she has come up to speed incredibly fast and she is a tremendously valuable member of our team.

9365 I guess to really appreciate where AVR has come you have to look back to the original business plan, which was that we always envisioned that in order to be economically viable as a network, as more than one station -- in fact, given that we started out with such a poor signal in Toronto, to even survive in Toronto we had to be in multiple markets and have a certain threshold of coverage, be able to reach a certain number of people, because our service was always going to be a niche service. So we needed to have a certain reach.

9366 We always expected -- and as you alluded earlier, we faced tremendous challenges in getting a Toronto service up. Just even at the level that it is at now was a great challenge. Toronto isn't brimming with towers that anybody can stick an antenna on. We were held up for almost a year just by the fact that we had no aperture to put a tower on.

9367 So the question always came up for us: Should we proceed now with Calgary? Should we proceed now with Ottawa? Or should wait initially until we had a service up and then, now, that we have full power.

9368 When we look back at it, we always balanced off how much revenue are we likely to generate by putting the new service on the air versus how much added expense we would have to the network. Of course in that factor we always looked to the Commission. How much pressure are we going to face from the Commission that we have to get this service up.

9369 As you know, we have applied for a number of extensions for those services. We have always in the position that if the Commission will give us the latitude to take the extra six months, the extra year to put those services on the air, then we will take it. Because until the Toronto service was up at proper power, our economic model didn't work.

9370 Like I said, we have reviewed it a number of times. We have reviewed our business plan numerous times and we have always come to that conclusion.

9371 I'm proud that we are here today and able to play you the programming that you just heard in that promo because we are happening now. We don't have to talk about the future AVR, because even though the programming we are actually producing now is not everything that we intend to do, it is such a superior service and a valuable asset to Toronto right now that we are entirely proud of it and we are looking forward to within 30 days being more widely available in Toronto.

9372 But relevant to your question, getting the Toronto service up to 3.3 million and being able to expand out of revenue really was a precursor to getting any other service up in any other market. If the Commission had of up until now said "You have to use it or lose it", ten we would have been forced to do it, but it wouldn't have been the right decision I am convinced. Up until now it would not have been the right decision to start those other services.

9373 Now it is all kind of in a series of dominoes and we are always waiting for that first domino. Even though we have been broadcasting for over a year in Toronto, our first domino is really about to go right now, which is where we have full power coverage.

9374 The Dean can certainly tell you from her revenue-generation side of things to go and meet with funders, with advertisers, with anybody in Toronto, even now it is frustrating for us because she has to show them the map and explain to them "Well, you are not going to be able to get us at a certain point on your way home, but don't worry, in a couple of months you will be able to. So we feel very positive.

9375 I'm not sure if you are going to ask about revenue, so I think maybe it is relevant, Nadine, if you can just mention how we are doing, even in our limited power, with our sales at this point.

9376 Is that okay?

9377 THE CHAIRPERSON: Sure, you can do that. In my first question I was really just trying to get a sense -- and I take your point about the model, and so on -- is given that it is starting to go, and from what we heard it certainly sounds good, what is your expectation in terms of Calgary and Ottawa?

9378 You indicated some times here in your presentation. Do you expect to be able to stick with those? I can't find it here right away. You said:

"The addition of Calgary and Ottawa services in June..."

9379 Do you still expect that, given what is happening?

9380 I want to underscore: We are not trying to push you into a situation that is going to make this fail. We want to see it succeed.

9381 MR. MacLEOD: I do want to make clear that we actually feel more pressure from those communities than we do from the Commission. Clearly they are the reason we applied in those markets and they are the ones that we have to answer to. We get calls all the time from Vancouver, from Calgary saying "How is it going now?" and we say "Oh, did you read our latest newsletter? We are facing this."

9382 So those dominoes are poised and those communities are really looking forward to us moving forward on that.

9383 Do you have a comment on that?

9384 MS ST-LOUIS: I do. I have already started contacting the big corporations in Calgary, started doing my networking on my end with the aboriginal communities in Calgary and also the corporate bodies in Calgary, starting to share with them our marketing strategies, sharing with them the programming, sending promos, getting the groundwork ready because I would like to launch on First Nations Day in June, which would be a great day to launch an Aboriginal Voice Network out west and at the national centre of Canada.

9385 THE CHAIRPERSON: Does that imply that with your focus on Calgary that Ottawa may have to wait or be pushed back a bit?

9386 MS ST-LOUIS: I would like to do both at the same time so we have the three cities.

9387 THE CHAIRPERSON: Okay. Let me then turn my focus to one of the issues, this issue of the funding from NewCap. As you may know, there has been some concern about whether that fits within our talent development framework, if I can use that term.

9388 I was actually struck by the language that you used near the end of your presentation this morning, page 7, second last paragraph, when you referred to NewCap's "public benefits funding", which I guess we take as being somewhat different from Canadian Talent Development.

9389 With that in mind I wanted to go back to page 5 where you started to list the three initiatives that you would use this funding for.

9390 I guess what I would like to get from you is a sense of for each of these how much money would go into each one; what they actually would be for; and how in your opinion that would fit within the Talent Development initiative.

9391 Let's take the first one, when we talk about:

"...employing a part-time Atlantic Aboriginal Talent Director."

9392 How much of the funding of the $525,000 would you expect to go into that?

9393 MR. MacLEOD: As you imagine, it is slightly complicated because we are talking about two separate applications and you may approve both, one or the other, or neither. So in our figuring out how we would use the money, for our own internal purposes it has been a bit complicated because there are a variety of different figures.

9394 But as a generality, we are looking at spending about 50 per cent of -- let's talk about approving the two, because I'm sure that is the way NewCap would like us to talk about it.

9395 THE CHAIRPERSON: Let's assume your fondest hopes were real.

9396 MR. MacLEOD: Yes, let's assume both are approved.

9397 Approximately 50 per cent of that funding would go to the first initiative we are talking about, which is really adding a whole focused element to our current aboriginal talent office operations. We have a full-time director in Toronto who is already responsible for trying to solicit every aboriginal artist in the Atlantic region. That is already on their job description, but it includes every artist in Canada. So that is difficult.

9398 It is worth noting that our experience -- and if you know the history of native broadcasting in the Atlantic region, it is far underdeveloped compared to elsewhere in Canada. So it has proven to be more difficult for our national office to really connect with the Atlantic region because we don't have the same level of networks here that already kind of interconnected with those artists.

9399 So we are looking at 50 per cent approximately of that being spent on that kind of assistance to our aboriginal talent office; and then about another 25 -- you are going to go through them one at a time?

9400 THE CHAIRPERSON: Yes.

9401 MR. MacLEOD: Okay. So 50 per cent.

9402 THE CHAIRPERSON: We are talking about in excess of $260,000. Right?

9403 MR. MacLEOD: Yes.

9404 THE CHAIRPERSON: NewCap has proposed a total of $525,000?

9405 MR. MacLEOD: Yes. About 30 -- I have it in per year because that is the easiest way for me to budget the operation.

9406 THE CHAIRPERSON: Okay.

9407 MR. MacLEOD: So yes, you are correct. It is thirty-seven fifty a year.

9408 THE CHAIRPERSON: For this initiative?

9409 MR. MacLEOD: Yes. That would be 50 per cent, yes.

9410 THE CHAIRPERSON: What exactly would it be spent on? Is that the salary for this person, this talent director who essentially goes out and finds talent? Is that what the money is for?

9411 MR. MacLEOD: I know that things are less expensive here than in Toronto, but I think that a salary -- that that is not enough really to cover a salary. We didn't look at that.

9412 We more looked -- I think I mentioned in our submission letter, which wasn't in our presentation today, that there is a likelihood we would simply contract the services of one of the existing organizations like the Music -- Eskasoni -- what is it?

9413 MS ST-LOUIS: The Eskasoni Mi'kmaq Music Association presently have some aboriginal artists there and it would make sense to me to already contract an existing organization to work with AVR for this aboriginal talent development.

9414 MR. MacLEOD: In the --

9415 THE CHAIRPERSON: That is what I'm trying -- I'm sorry to interrupt.

9416 What I'm trying to get a sense of, does the money go to the activity of the talent director and seeking out the talent, or does the money end up going to the talent?

9417 MR. MacLEOD: The intention of that part of the initiative is that the money goes to support labour costs of somebody who is going to go out there and actively solicit artists, people who haven't produced anything yet but are known to be performing; people who have a demo tape but haven't produced a real CD.

9418 Our aboriginal talent office already has a certain level of package of information we provide to artists about phone numbers for FACTOR for SOCAN, for all these various things, because the aboriginal music industry is more under-developed than the industry in general.

9419 There is a labour cost of that solicitation, there is a labour cost of talking to artists. We have taken on the responsibility, which nobody put upon us, to actually when the deadline is coming up for the Juno Awards or for the East Coast Music Awards to actually do a phone out to everybody we know saying "Do you have your tape in?" Of course even more notoriously than AVR launching its services late, artists are notorious for not getting their CD product in on time. So we always phone people the last day before these deadlines.

9420 Is that money that is going directly to those artists? No. But is there anybody else out there that is really focused on that, because that is incredibly important for those artists, for them to move in their industry careers, to know about awards that are available and to push those things.

9421 The short answer to your question is that it could primarily be considered to be labour costs for somebody to liaise with artists, to find them, to provide them information, to encourage them, not to actually write a cheque to them to go into the studio and produce a CD.

9422 THE CHAIRPERSON: Okay. All right. Then let's move on to the second one.

9423 How much money, I suppose per year, the second one you have characterized here is:

"...support the production, broadcast and wider national distribution of a new program entitled `Eastern Greetings', a regionally focused cultural and news program."

9424 MS ST-LOUIS: I would like to maybe elaborate on that.

9425 Canada is a big country and there have been divisions in sections, with the Maritimes who have sort of been isolated on their own and western Canada and central Canada. Even for music coming out of east coast Canada, it is harder for those musicians to make it to mainstream music. For aboriginal talent it is even harder.

9426 The East Coast Canadian Music Awards have been going on for 15 years and 2003 was the first time they had an aboriginal music category. So it is almost like it is even harder for aboriginal talent to come forward with their music and to find a catalyst to distribute their stuff.

9427 If we have a program that focuses on east coast musicians that are aboriginal musicians, we can create like a compilation of different artists, talk about their biographies, the making of. We can have talk shows including the life of aboriginal musicians of the east coast along with their music once a week. It creates awareness, it reduces the gap of the communities from one section of the country to another.

9428 There is a lot of aboriginal talent out west and it is very successful because the native broadcasters have been there in a stronger -- I don't know, a stronger presence I would imagine than the east coast.

9429 So it would be to give them life in central Canada and western Canada. Otherwise they wouldn't be able to reach that community as easily. I don't say they wouldn't be able to reach it at all, but it would be a harder thing to do.

9430 THE CHAIRPERSON: So how much of the money would you expect to go towards this program?

9431 MR. MacLEOD: That would be about 25 per cent for both the second one and the third one. So about 50 per cent for the first initiative and then a split between the second -- again, the exact budget will change depending on how the Commission rules on this.

9432 THE CHAIRPERSON: This program "Eastern Greetings", would this be kind of a once a year thing, once a week, once a month?

9433 MR. MacLEOD: Actually, we were just talking about this the very last thing before we came up. We were thinking: Well, we had better tell them that if they don't approve both licences it is probably going to be a monthly show rather than a weekly show, but our intention would be that it would be a weekly program.

9434 THE CHAIRPERSON: A weekly show.

9435 MR. MacLEOD: Again, it is not necessarily a program. Because of the aboriginal talent kind of idea, it is not just for our own airing, although we intend to air it on all of our stations, but to make it available to the existing New Brunswick broadcasters and make it available, for that matter, to any commercial radio station that wants to play it. If the quality of the show is high enough, I would assume they would consider in some markets putting it on, if it qualifies as their local talent production.

9436 Again, the intention of the show, as Nadine was just saying, is very much to be focused on the objectives of the talent benefits program, which is really to push artists to a place where they are producing music that can be useful to the radio industry. So that is the focus of that program.

9437 THE CHAIRPERSON: Would this be what, a half hour or an hour show? A half hour?

9438 It is characterized here as a "cultural and news program". Would this be largely spoken word or would it be largely music?

9439 MR. MacLEOD: I think our expectation would be that it would be somewhere in the 60:40 range one way or the other as far as music. If the person is -- not every artist has a lot to say and other artists they talk considerably. So it would be somewhere in the 50:50, 60:40 range as far as being spoken word.

9440 But there would be a current affairs kind of element to it where it is a countdown of performances that are coming up, it would be something that mentions developments in royalties and copyright. It would be really focused like an artist-centred kind of program.

9441 THE CHAIRPERSON: So this would be kind of what is happening in the aboriginal entertainment world kind of program?

9442 MR. MacLEOD: Yes. The thing is, I guess what you should understand is this kind of comes out of an idea we have for a show that we would like to do anyway on a national level, but the fact of the matter is a lot of the information this show would do isn't that important anywhere outside of the Atlantic region because things are more developed elsewhere. This show is going to be a very basic, fundamental level of looking at promoting artists that aren't exposed anywhere else.

9443 So while we may eventually have a program very similar to this -- I think it would be valuable -- that covers things on a national or on a western scale, it is most important in Canada right now that a focus like this come to the New Brunswick and Atlantic region.

9444 THE CHAIRPERSON: In the next paragraph you refer to the establishment of a full-time Atlantic news bureau. This is a separate initiative under this second category, is it?

9445 MR. MacLEOD: Yes. I will comment and Nadine can add.

9446 If the funding was sufficient to allow a full-time we would be saying that is how we would spend the money, but clearly there is not enough funding in this initiative by itself to be able to do proper justice to a news bureau. So we would look at, in a sense, spending part of this money on the kind of -- how do you say it -- low overhead aspects of getting material out and distributing it.

9447 If this funding initiative is approved, our commitment is that we will seek funding from other sources -- and we may in fact have it by the time your decision comes in -- to be able to do this.

9448 Again, that would be in partnership with Eskasoni Music Association or with some other organization already in existence. We wouldn't look to do this in isolation. We would do it in partnership with existing.

9449 Because it is not just the artists. We are also supportive of the industry associations that exist out here. For the aboriginal music industry they are also very primordial and just at the basic level of development.

9450 THE CHAIRPERSON: I guess what I am trying to get a sense of, on the second initiative, as I read this, I am understanding there are two sub initiatives: one is the production of this program "Eastern Greetings" which we have just talked about; and the second is the establishment of the news bureau. You indicated 25 per cent of the total funding would go to this second initiative.

9451 So I'm trying to understand how much of that funding would go to support the production of "Eastern Greetings" and how much of it would go to the news bureau, or are you saying most of it would go to "Eastern Greetings", if there is any left over after we do that it would go to the news bureau?

9452 MR. MacLEOD: No, I think that it is not possible in this funding alone to be able to realistically promise a news bureau. We are talking about $18,000 a year, around that. So we are not saying that we would partially do a news bureau and then look for funding. We would say we will produce this show which has a lot of the same effects of having a news bureau, though it is not like hard news -- in fact, saying "a news bureau" is a little bit iffy because it is more like a bureau. It will be helping to produce news, but it will be something that will be a conduit for information out of the Atlantic region.

9453 So we will do the program and what happens in running this program will be the foundation for operating a news bureau. It will be a person and a production that will really connect and set out that web, like connect everybody.

9454 In the process of producing the show it will establish all those connections that if enough funding is made available could be an actual bureau where you actually have a reporter, perhaps part-time or full-time, where you have somebody who is serving these other roles.

9455 So I would say that you could -- we could have described it a like a part-time bureau, but in effect it just seemed more sense to make it as a radio production, as a single program rather than as bits of programming coming out with only this much money. That was the way we looked at it.

9456 THE CHAIRPERSON: The third initiative then, you have described it as:

"...development of AVR's national programming service by covering the associated costs of reciprocal distribution of programming between AVR and Atlantic regional native broadcasters."

9457 I'm not quite sure I understand what that is.

9458 MS ST-LOUIS: All right. There are community radios on reserve, I know Restigouche has one because my family is still living there, and I believe that the distribution -- AVR's job is to distribute these artists, because no matter how amazing the aboriginal artists are, they are severely limited to distribution if AVR is not there to play them or if their community radio is not there to play them.

9459 So it is important for us to assign someone to ensure that this distribution is done with other First Nation broadcasters so their music gets aired, gets played.

9460 THE CHAIRPERSON: The programming we are talking about here, is this then music programming?

9461 MS ST-LOUIS: I was thinking --

9462 THE CHAIRPERSON: This is recordings by various native artists?

9463 MS ST-LOUIS: I think it is eastern aboriginal talent people that show that we would do -- that would cover the news. Okay, are they playing at a local club in eastern Canada and if we have an interview with them, that program can easily be distributed to the eastern aboriginal broadcasters.

9464 THE CHAIRPERSON: Okay.

9465 MR. MacLEOD: I know that we are straying off kind of into category busters again, but you should appreciate as well that there is a great network of storytellers here in the Atlantic region that are performers, that have recordings.

9466 You mentioned are these going to be primarily music-oriented. It is definitely our intention to look for that spoken word element of things too, the performers. Nadine has a list of various people that we have either been in contact with or know of their existence. While that is a bit around the edges of Canadian Talent Development and your traditional definitions, it is our intention, whoever is performing, whether they are performing poets, playwrights, elders who are fantastic storytellers, to use that. So these would be elements of these programs as well.

9467 It is not just going to be young rock guys. It is going to be more of a full cultural Mi'kmaq and Maliseet cultural program. That is the intention.

9468 You asked about the distribution of it. It ties back to the idea that programming is needed here. The existing aboriginal stations here in the Atlantic region are far under-developed compared to their compatriots in the west and they are in need of programming. All of the stations, we have a relationship with them and they have an interest in carrying our programming generally.

9469 It isn't just about the Atlantic region. This is clearly whatever we are doing here we want to make sure we can feed it to them. So if we are doing a profile, a one-hour profile once a month on an artist that happens to be an Atlantic artist this time, we want to make sure that programming can get to them.

9470 With most of the stations here, they are fairly technically competent to be able to handle receiving MP3, you know, programs by high speed Internet or by other methods. So it doesn't have to be satellite-delivered or anything that is too expensive, but there are some challenges there technologically that would have to be overcome.

9471 The other thing is that we can't count on stability. In other words, stations go up and down as well. Obviously there is a situation right now in Fredericton with a native broadcaster.

9472 We may sit here today and say "Okay, we know that we can do this with the station at Eskasoni; we know we can do this with the station at Big Cove", but we can't necessarily depend that when it comes time to actually make this a reality when you have approved these applications that they are going to have the same computer infrastructure, that we might need to help them.

9473 So it is not a lot of -- it is 25 per cent of the funding, but we wanted to make sure that in our figuring of how we would use this money that we had enough set aside to be able to deal with helping the broadcasters here to be able to technically handle this stuff. Because we are not going to be able to afford to pay for a satellite service or something like that, there has to be an easier way to do it.

9474 I think we mentioned in our presentation that we are already just entering into a fairly successful mode now of having our news package get delivered to native broadcasters in Ontario right now, but I think it will be across the country. So we feel comfortable that that is the way to go.

9475 The costs of that are kind of unknown. Prices are going up and down as far as computers, as far as what it might cost on a monthly basis to put in high speed Internet if they don't have it. So it is that kind of level.

9476 That third one is a bit of the slush money to make sure that whatever else we are doing in this initiatives does benefit the local broadcasters.

9477 THE CHAIRPERSON: These days don't use that term "slush money".

--- Laughter / Rires

9478 THE CHAIRPERSON: Let me just close, then, by asking this question: Ms St-Louis, you mentioned about the fact that ECMAs have just established this category for aboriginal music, and I guess what I'm wondering is whether you thought about using this money to actually more directly help with the development of aboriginal native musicians that might more squarely fit with the talent development objectives of the CTD initiatives that the Commission has talked about in the past, whether you thought about that and came to the conclusion, No, there is a better way to spend this money in terms of developing AVR and the mission that AVR has adopted for itself?

9479 MS ST-LOUIS: I will be right back.

--- Pause

9480 MS ST-LOUIS: I was consulting with Mark because my feeling -- right now we are present at the Grammy Awards, we are present at the Canadian Music, we are present at the Juno Awards, we are present at North by Northeast Music Festival and now we are collaborating with the Canadian Aboriginal Music Awards in Toronto. I think it would be maybe a good idea, now that you mention it, to be present at the East Coast Music Awards as part of the industry event and to present a panel discussing aboriginal talent and bring awareness to the music industry at large about aboriginal talent development and the up and coming people.

9481 THE CHAIRPERSON: I guess what I was wondering more was whether you thought about actually spending the money on the musicians themselves, to help them develop their skills, get recorded so we might --

9482 MR. MacLEOD: We are, out of our aboriginal talent national office, going to be producing two compilation CDs this year, one by June to launch, hopefully, on National Aboriginal Day; and then one in November for the Canadian Aboriginal Festival, which is the largest event.

9483 So we did look at -- again, when we looked at this funding, we though, "Okay, should we look at putting some funding in here specifically to produce an Atlantic regional compilation CD since we are going down that road?"

9484 Again, producing a compilation CD in itself, there is not a great expense really involved in that, especially if you are not going to try to sell it in stores. It doesn't really make -- it is more of a labour-intensive thing, you know, getting the approvals and organizing it all than it is actually spending money on producing something. But it is an important thing that we can do for aboriginal artists.

9485 I would say it is not a problem for us, if the Commission thought that was an extremely valuable thing and it kind of turned the edge of whether this was more realistic as your traditional definitions, we could say that we would do it. It is certainly our intention to do it.

9486 In a sense we have been wrestling with the whole idea of should we come to you and look to simply say to you "Look, we will spend this all. If you want us, we will spend this all on exactly the things that meet your definition." We don't want you to not give it to us because we are looking to spend it in ways we think is more effective. We want it. So if you have to go to NewCap and say "You can't give it them for anything but traditional things", then we would take it in that form and we would -- we would give it to the artists before we would see it go somewhere else.

9487 But we have always tried to make the case to the Commission, and in fact to NewCap or other parties that are interested in working with us, that there are more effective ways, right now especially, for that money.

9488 We tell aboriginal artists about FACTOR. We promote that to them. They can go to FACTOR and get money to produce CDs. They don't have to come to us for that. But FACTOR isn't giving us any money to actually work towards getting stations up; FACTOR is not giving us any money to go and actually find artists and help them to get their first demo out. We are the ones who are doing that.

9489 So we have always felt like the wiser choice for the industry, for the Commission, for the aboriginal artists themselves is to see this money go towards building the radio infrastructure in whatever general way is useful. It is a non-profit organization so we are very mission-driven in that regard.

9490 Again, the thing is, if we were here arguing about $2 million in benefits, something that would make a huge, tremendous difference to the national network, if we were saying, "Okay, if you approve these licences we can get Calgary, we can get" -- pick something a little further -- "we can get Kitchener/Waterloo up tomorrow", then we would have a different level of argument here.

9491 But this money isn't in our business plan. If you approve it we are not going to see it for a year anyway. So it's not like whether you give this to us for our general use it is going to make a huge difference to our organization, except that if you do agree that it is that way, when this time comes this will be a better way of spending the money.

9492 If we write cheques to artists so they can produce CDs but we are not doing this other stuff, then three or four artists may benefit but we won't have the money to be able to try to work hard to contact the 30 other artists that are out there.

9493 MS ST-LOUIS: I would just like to add. To answer your question: If that is what we needed to do, we would do it. What Mark is arguing is that the long-term effect of giving the artist the money versus investing the money in AVR infrastructure are two different things.

9494 It doesn't do any good for -- this year actually the EMCA winner was Red Suga. He is from Restigouche. It doesn't do this young man any good to be sitting in his basement and looking at his 25,000 CDs and know where to distribute them. It doesn't do him any good as an aboriginal artist, even if he has $5,000 more to produce a second CD, if there is no one that is a network to distribute his music.

9495 So we feel, as AVR team here, that investing the money in the infrastructure would benefit the artist in the long term, and if we can help them produce that demo to distribute them nationally, then that has an even greater long-term life.

9496 I feel, in the same way -- I have put a little note here: In the same way that AVR has brought increased visibility to Dene artists from the west, like Lila Gilday, we can expect that the funding from NewCap will allow Mi'kmaq and Maliseet artists from the east to gain as much exposure on the national scene. I think we have to bring it back down to that.

9497 It is about creating exposure on a national level, not just on a regional and just not on a recording level. For the life of an artist to exist as an artist for the next 20 years he needs to be able to distribute and produce.

9498 THE CHAIRPERSON: Okay. I think your position is pretty clear now.

9499 Counsel.

9500 MR. McCALLUM: I just wondered if I could give you the opportunity to complete, I guess, the answer that you were giving to the Chair.

9501 Reading from page 5 of your presentation again: If the Commission -- again, you were looking at it in terms of the different scenarios, and if you were to be proceeding with the proposed NewCap funding, how would you proceed if the Commission approved one of the two and not both of them, in particular, given that Fredericton is twice the size of Saint John, supposing the Commission said no to Fredericton and yes to Saint John.

9502 How would you proceed?

9503 MR. MacLEOD: I have, like I think I mentioned earlier, you are right, we kind of partially answered that. We have a budget ut we have kind of had to figure out how the budget might go in three different versions. So we laid it out to you in a general kind of way.

9504 The reality is, unless you wanted to somehow restrict it so that we have to do initiatives one, two and three, if you only approved one or the other we would probably look within those initiatives at figuring out what we could best do.

9505 Unless you are going to require us to nail that down, we would leave it at that.

9506 It is our hope that you approve both licences, that we have this full money. I didn't mean to play it down earlier, because this amount of money, even at this level, can revolutionize the ability of aboriginal artists in Atlantic Canada to be able to get exposure and get out. It really can make a big difference. I didn't want to play it down.

9507 But if you only give us a certain portion of that, we would still take a look at the time, what is the most effective way of doing. Again, that will have to do with what kind of arrangements can we make with existing organizations, et cetera. It is a best of intentions situation.

9508 So really your issue is whether you require for us to spend it in that chart of exact CTD things or whether you give us some more flexibility to do the kinds of things that we think is actually a more valuable way of spending the money.

9509 MR. McCALLUM: In terms of prioritizing amongst the three initiatives, have you established any priorities?

9510 MR. MacLEOD: I think we see the first priority as being the most important, in other words to have what would in effect be a regional assistant to our national office. Our national office is well functioning, it is accomplishing tremendous things, so some of these other things, if we put the money in them, you might not get kind of the same bang for the buck as you can adding something to something that is already successfully operating.

9511 So we would see the first one as being the one we probably would not stray away from. We would probably do that and maybe not do the other two.

9512 MS ST-LOUIS: I would just simply like to add on your question, if we only receive Saint John versus Fredericton, I think the plan would be the same. It would probably be a longer time line. Instead of being full time it would probably be cut to half time. Instead of a weekly show it might just be a monthly show. We would keep our objectives, but we would give ourselves a longer life to do it.

9513 MR. McCALLUM: Thank you, Mr. Chair.

9514 THE CHAIRPERSON: Thank you, counsel. Thank you, Ms St-Louis, Mr. MacLeod. Those are all our questions.

9515 Mr. Secretary.

9516 MR. LEBEL: Thank you, Mr. Chairman.

9517 The next appearing intervention will be presented by Astral Radio Atlantic Incorporated. You have 10 minutes to make your presentation.

9518 THE CHAIRPERSON: Welcome, Mr. Eddy. Please proceed when you are ready.

INTERVENTION / INTERVENTION

9519 MR. EDDY: Thank you, Mr. Chairman.

9520 Members of the Commission, I think you know us by now, but I will provide introductions for the record. My name is John Eddy and I am the Executive Vice-President of Astral Radio Atlantic. With me today is Tom Blizzard, our Group Program Director.

9521 Astral Radio Atlantic is a regional broadcaster with eight stations in Nova Scotia and New Brunswick. We operate the three private radio stations now serving Fredericton.

9522 With respect to the non-commercial applications for Fredericton, we take no position.

9523 With respect to the competing commercial applications, we are very disappointed with their format choices. From our point of view, they fail the diversity test. For that reason we are asking that you to deny them.

9524 We should however be clear up front. We are not saying that there is no room in the Fredericton market for an additional commercial station. The market can absorb one additional commercial station. It could also absorb the impact of Rogers on national revenues, assuming that Rogers has no impact on local revenues, but it cannot absorb more than that.

9525 The difficulty here is that the formats proposed are not new to the market. More to the point, they all propose to serve the same demographic as our existing stations with relatively minor format variations which, as has been pointed out on several occasions during this hearing, the Commission no longer regulates.

9526 To highlight the problem, the key demographic data for our stations are as follows:

9527 74 per cent of tuning to CFXY, The Fox, is 25-54;

9528 76 per cent of tuning to CIBX, Capital FM, is 25-54;

9529 46 per cent of tuning to CKHJ is 25-54.

9530 We have seen that each of these applicants targets the same 25-54 demographic. But to be fair, it is clear from yesterday's presentations that Acadia Broadcasting proposal is the least duplicating format because of their stated commitment to stay away from music of the '90s and today. Hence they will be, to use their term, mining the upper end of the 25-54 demographic. Of the three commercial applicants Acadia would therefore have the least negative impact on our operations.

9531 While NewCap and Acadia propose rock variations, MBS's application is a straight duplication of our country service. MBS has made no attempt to provide format diversity. They targeted our AM country station from the start.

9532 Up against FM, our AM is an easy target. That raises the question about why we moved country from FM to AM when we did in 2000? There are several reasons:

9533 First, country has been a declining format for some time. That decline is continuing. Between 1998 and 2002 country music lost more than a quarter of its market share. Country music now commands less than 10 per cent of total radio listening nationwide.

9534 BBM Fall 2003 ranks country the number six format, behind the mainstream music formats and also behind news talk and top 40 CHR.

9535 Second, as everyone knows, AM appeals more to upper demographic audiences. They grew up with AM. And, of course, country is an upper demographic format. So there is greater compatibility than would otherwise be the case.

9536 At the same time, the upper demographic audience is disproportionately interested in news and information. That presented us with an opportunity for us to combine country music with increased news and information programming and brand our AM as Fredericton's news leader. In that way we could differentiate it from our music stations on FM.

9537 By the way, we believe that the factors I have just cited were among the main reasons MBS itself shifted country from FM to AM in several of its markets, including Moncton, Charlottetown and Sydney. And I note, that despite what Mr. Ferguson said yesterday about MBS's hope or expectation of resurgent popularity of country music, MBS hasn't shifted country back to FM in any of these markets.

9538 To the contrary, following the Moncton hearing in 2000 when MBS was given the opportunity to compete head-to-head with NewCap in country format on FM in Moncton, it declined, opting instead for a younger demo hot AC. And bear in mind, Moncton, with a population of 112,360, is a much larger market than Fredericton with 90,356.

9539 Given that country is the number six format nationwide, and continuing to decline so that it now commands less than 10 per cent of tuning nationwide, does it make sense that there would be room for two in Fredericton? Clearly the answer is no.

9540 By the way, MBS said yesterday that Prince George B.C., a market of 76,500 people had two country stations. It does not. It has only one, CJCI FM.

9541 In a market the size of Fredericton, which is slightly bigger than Prince George and significantly smaller than Moncton or Saint John, the fate of an AM country station facing an FM country service is a foregone conclusion: CKHJ would not survive.

9542 At that same Moncton hearing, MBS argued that a small market could not support two country stations. MBS President, Merv Russell, spoke against the licensing of a second country station in Moncton. His comments on that occasion are reproduced in full in our written intervention so we won't repeat them here, but he stated unequivocally that a second country station would decimate their country AM and would have profound negative repercussions even if they were granted an FM flip. We agree.

9543 Further, as recently as last week during presentation of its application for Halifax, MBS argued strongly that the Commission should consider the impact of new licences and, in particular the impact of the proposed Global Easy Listening station, on their oldies AM station. Mr. Russell stated:

"...the impact on AM stations simply cannot be ignored."

9544 We feel the same way in Fredericton, except more so, given the direct targeting by MBS of our AM station.

9545 Much of MBS's justification for targeting our AM station is based on alleged high levels of listener dissatisfaction ascertained from out-of-market tuning to stations in Saint John, Moncton and a U.S. border station.

9546 The truth is that for Fredericton such tuning has far less to do with listener dissatisfaction than with geography. Signals from Saint John radio stations broadcasting from the top of Mount Champlain completely envelope Fredericton. That is as true of existing Saint John stations as it is of Rogers proposed station. That is why Rogers did not apply for a licence in Fredericton. As Mr. Miles candidly said: If they get Saint John, they get Fredericton for free.

9547 The same is true of Moncton stations and of U.S. border stations, ut the reverse is not true at all. Fredericton stations do not penetrate Saint John, Moncton or border areas. Fredericton is a beautiful town on a lovely river valley. Unfortunately, we have no mountain to call our own.

9548 The compelling fact, the real story about out of market tuning, is that for the 25-54 demographic it is 16.7 per cent, whereas for the 12-24 demographic it is 28.9 per cent. In other words, the level of "dissatisfaction" -- if I can use that word in quotes -- in the younger demographic is double that of the well-served upper demographic.

9549 On the positive side, there are very compelling reasons not to threaten CHJ with extinction. CHJ is not just another declining AM station. CHJ's average hours tuned per week is 13.7, which is the highest of all stations in Fredericton. KHJ is financially viable, if not robust.

9550 Tom.

9551 MR. BLIZZARD: I would like to add that a large part of the reason for KHJ's survival is the very special role it plays in Fredericton, Commissioners.

9552 First, it is the top news station in the market, and all of the news is locally produced. It provides more news, and substantially more locally produced news than proposed by MBS.

9553 Second, CKHJ is a vital community partner. I want to give you an overview of some of the things that we have done at the station over the past year.

9554 We are a major media partner of local initiatives to raise awareness, funds and food for the Fredericton Food Bank. These initiatives include the annual Tim Horton's Food Drive which last year raised over $100,000 worth of food.

9555 For the sake of brevity I will just go over these points quickly.

9556 KHJ is a gold sponsor of the Canadian Cancer Society's Relay for Life which last year raised over $100,000. Again we provided lots of on-air promotion and coverage of the event. Many of our personalities served as MC's.

9557 KHJ provided airtime and personnel -- as a matter of fact the station's morning host was the prime organizer of this -- for a fund-raiser to assist singer Denise Murray during at the onset of her health crisis. The event raised in the vicinity of $3,000.

9558 Here is a story about Brian Stewart. His day job is the principal of Alexander Gibson Memorial School on Fredericton's north side in Marysville, but Brian is an old rock 'n roller. He still sings in a band on weekends. Last year he recorded a CD as a fund-raiser for his elementary school. KHJ featured a morning show interview, provided extensive airtime for this project and they ended up raising -- Brian's CD sold out, raising more than $20,00, which sure beats selling chocolate bars for the school.

9559 Some other things. Sure, we can be involved with the big ones like the United Way, the SPCA or Hospathon for our local hospital, but it is not all about the high profile ones in Fredericton proper. We also go out to the outlying areas. It could be to Prince William, a fund-raiser to establish Meals on Wheels in that community; or a talent show in Durham Bridge that is designed to raise money for the local volunteer fire department to help them equip; lots of on-air support at the radio station and quite often sending a personality out as an MC.

9560 Something else I would like to touch on is our local talent development. We are especially proud of that at KHJ. One-third CHJ's regular Canadian content is Atlantic artists. That is about the same as MBS's much touted proposed commitment.

9561 KHJ has a 20-year heritage of supporting emerging Canadian country talent. Over those years we have become especially proud of Joan Kennedy, Julian Austin, J.R. Vautour, among others, who received their first spins on CKHJ in Fredericton before going on to national recognition.

9562 We sponsor an all-day country music festival or a showcase at Fredericton's Canada Day Block Party. This features local and regional country artists. We also broadcast that live on the air.

9563 As well, we are a major sponsor of the Fredericton Exhibition Country Showcase featuring local country artists. We broadcast this Saturday Night Jamboree live-to-air as well on KHJ.

9564 MR. EDDY: MBS's proposal would duplicate our country service in an uneven FM-to-AM head-to-head battle and decimate this valuable service to our listeners, our community and our music partners. Licensing MBS's application is not in the public interest, and does not meet the criteria established by the Commission. It should be denied.

9565 Obviously the MBS proposal is our greatest concern but, as we said at the outset, none of the Fredericton applications does much for diversity in Fredericton, although Acadia comes closest. We think Fredericton deserves better. We think the Commission should wait until there are more worthy and responsive applications before it licenses a new station in Fredericton.

9566 Thank you very much for the opportunity to submit our views. We would be pleased to answer any questions you might have.

9567 THE CHAIRPERSON: Thank you, Mr. Eddy, Mr. Blizzard.

9568 Commissioner Cram.

9569 COMMISSIONER CRAM: Thank you. I just wanted to start off with, you were talking about the Fredericton market at paragraph 4 here. So you think that there is room for one other additional station in Fredericton and then, if Rogers gets licensed, the hit you would take in Fredericton is the impact on the national advertising that Rogers would be getting from that coverage?

9570 MR. EDDY: Yes, Commissioner. We understood Mr. Miles' position to be that he would commit not to solicit local advertising from the Fredericton market, although I guess he didn't go as far as to say he wouldn't accept any.

9571 We understood him to be positioning the network so that he would be expecting to garner national business that would otherwise fall to local radio stations in Fredericton. As you know from the numbers, the national component of Fredericton revenues is approximately 20 per cent, so it is a substantial amount of money.

9572 COMMISSIONER CRAM: Then I take it what you are suggesting we should be doing is denying all of the applications because they fail the diversity test because their formats are not diverse.

9573 Is that what you are saying?

9574 MR. EDDY: Yes. Essentially what we are saying is, we are just echoing comments that have been made almost consistently throughout these proceedings, which is -- it is really striking to us that in all of these other communities you have applications where the focus has been -- including our own the focus has been on this tremendous void in these markets for a youth service. That void is obvious in the Fredericton market. It was pointed out by Acadia's research as well.

9575 Yet what these applicants have proposed to do is essentially just mine where they think the most money to be made is. You can't blame them for that, but it just doesn't do much for format diversity in Fredericton.

9576 So what we are saying is that is disappointing and what we are arguing is that is really just not good enough for Fredericton. We just don't need that.

9577 COMMISSIONER CRAM: Format and format diversity is a bit of a mugs game for us to make a decision on though.

9578 MR. EDDY: Sure.

9579 COMMISSIONER CRAM: Because you just talked about MBS in Moncton, saying initially that they would go for country and going in in CHR and modern rock.

9580 MR. EDDY: Right, exactly. But I think that supports our case. It is not the other way around.

9581 COMMISSIONER CRAM: But you see it goes both ways, because you can always change your format and you can serve that younger demographic also. There is that flexibility because we don't regulate formats.

9582 MR. EDDY: Sure.

9583 COMMISSIONER CRAM: So that would be available to you if somebody did come in striking at the core of one of your services.

9584 MR. EDDY: Sure. But two points about that.

9585 One, we are long-term players in the market with a tremendous investment that we have made in branding these radio stations and doing all the audience development work associated with them. So to abandon all that and go to a youth format would be to kiss off some of that investment, which we would be reluctant to do. So you would normally expect a new entrant coming into the market would be prepared to make that investment and do that development work.

9586 COMMISSIONER CRAM: You said there were two points. I thought I only heard one, the development costs.

9587 MR. EDDY: Yes. I have forgotten what the second one was.

9588 COMMISSIONER CRAM: Is it that the younger demographic is a smaller target group than the target group that everybody is targeting, the older target group.

9589 MR. EDDY: I think the perception is that the key advertising buying demographic is 25-54. I don't think it is so much a case of the audience not being there.

9590 COMMISSIONER CRAM: Thank you very much.

9591 THE CHAIRPERSON: Commissioner Langford?

9592 COMMISSIONER LANGFORD: Just one question while I have your expertise here.

9593 I note that you indicated that of all of the applicants targeting the 25-54 demo the Acadia application was perhaps the least threatening because of their format.

9594 But as I saw the Acadia format, it didn't seem to be really very different than the NewCap one, so perhaps you can just lend me your expertise and tell me why it is a little different?

9595 MR. EDDY: The key, key reason on the music side is the clear, unequivocal commitment that Jim MacMullin made yesterday that differentiating their proposed format from NewCap is that they would not go anywhere near music of the '90's or music more current than that, 2000 and beyond. They clearly committed to restricting themselves to '80's and before.

9596 That means, in effect, that they are not going to be playing new rock music. NewCap proposes to do that. That overlaps our rock station. That puts us in far greater jeopardy and provides far less diversity.

9597 Music to one side -- I think at least what I heard -- we had great initial concern about the implications of an Acadia proposal coming into our market in circumstances where their parent company owns all of the newspaper assets in town, big and small, including the newspaper assets at the army base. So it is really three papers, not two. It is the Northside News, The Gleaner, and the Post Intelligencer.

9598 We thought that that posed real serious problems or risks for us because they might combine somehow. Again, Mr. MacMullin said yesterday that there was going to be a concrete, very high Chinese wall between these operations and that there would be absolutely no leakage between them. He gave that commitment and that is good enough for us.

9599 COMMISSIONER LANGFORD: He also indicated, though, that he might exercise a little bit of price cutting when it came to rate structures, talking about cutting as much as 20 per cent as a first go around.

9600 Does that distress you at all?

9601 MR. EDDY: Sure. Although I would have to say, Mr. Langford, that I listened with a great deal of interest to that discussion about Saint John yesterday as somebody who is not in that market.

9602 My perception is that the approach to selling -- the unfortunate approach, I guess, to selling that has occurred in the Saint John market -- is really not about style as much as it is a reflection of the fact that the Saint John market has and has had an oversupply of inventory. We in a supply/demand business and so when there is an oversupply it sells for less.

9603 I think if I could -- I am not in the Saint John market and I am not an advocate for the incumbents in that market, but our observation is too much inventory, price collapse. Do I want that situation in Fredericton? Absolutely not.

9604 So I am jumping up and down here saying "Don't do two", and that is why.

9605 COMMISSIONER LANGFORD: Thank you very much. Those are my questions, Mr. Chairman.

9606 THE CHAIRPERSON: Thank you, Commissioner Langford.

9607 Counsel has no questions.

9608 Thank you very much, gentlemen. Those are our questions.

9609 I think we will take a short break at this point. Our intention was to complete Phase III and then Phase IV without a lunch break and kind of finish the proceeding, but I think we will take a short break at this point, just 10 minutes, and then we will continue on with the Phase III and go into Phase IV.

--- Upon recessing at 1232 / Suspension à 1232

--- Upon resuming at 1241 / Reprise à 1241

9610 THE CHAIRPERSON: Order, please ladies and gentlemen. We will return to our proceeding now.

9611 Mr. Secretary.

9612 MR. LEBEL: Thank you, Mr. Chairman.

9613 The next appearing intervention will be presented by the National Campus and Community Radio Association.

--- Pause

9614 THE CHAIRPERSON: Is one of the other three here?

9615 MR. LEBEL: I shall verify.

9616 Is Mr. Brad Woodside in attendance?

9617 MR. WOODSIDE: Yes.

9618 MR. LEBEL: I should point out for the record that the next appearing intervention, the Music/Musique Nouveau-Brunswick Incorporated, will not be appearing.

--- Pause

9619 THE CHAIRPERSON: Are you Mr. Brad Woodside?

9620 MR. WOODSIDE: Yes, sir.

9621 THE CHAIRPERSON: Please go ahead when you are ready.

INTERVENTION / INTERVENTION

9622 MR. WOODSIDE: Thank you very much, Mr. Chairman, for allowing me this opportunity to be here today to speak in favour of the application by Maritime Broadcasting for an FM country station in Fredericton.

9623 My presentation may be a little unorthodox insofar as I haven't been asked to be here today. I asked if I could be here today to make this presentation.

9624 I would like to begin by laying a foundation as to why I feel that I should be here to speak to this matter. It all begins a long time ago when I started a band in Fredericton in junior high school -- long time ago I might add. During the course of those years we covered all of the southern half of the province. The format that we played in the band was 70 per cent country, Buck Owens, Johnny Cash, Merle Haggard, that kind of dance music.

9625 I'm going to go through this very quickly.

9626 Then I got involved in competitive speaking with the Junior Chamber of Commerce and Toastmasters and had a lot of people saying to me and coming up to me, "Are you in radio? You should be in radio".

9627 I had a real love for music so I went to CFNB at the time and I told them that I would like to be involved in radio. After they were through laughing, I made them an offer that I didn't think they could refuse and that is, let me come in and learn the business on my own and then you test me.

9628 Because my problem was, there were always so many people being brought in from outside that were on the radio that really didn't have a vested interest in the community and could pick up and leave for another $10 a week to go some place else. I implored them to look at their own local talent in their own community.

9629 Eventually I did work at CFNB. I started part time. I did the all night show, which was my favourite; I worked midmornings, worked afternoon drive, eventually finishing up doing the morning show in Fredericton and doing a talk show. I enjoyed it very, very much.

9630 As a matter of fact, I remember quite vividly -- and CFNB had it all. They are 50,000 watts at the bottom of the dial, second radio station in the country, second to CFCF in Montreal. I remember when there was another application for a radio station in Fredericton and there was quite a panic that this was going happen.

9631 I, for one, was not panicking. I think I am the only person that called the other radio station the day they went on the air to congratulate them, because I knew that CFNB had to change and I knew that this would prompt change. I viewed this as a good thing for CFNB, to have somebody out there that is going to compete against us. It did turn out, at least in the short term, that that is the case.

9632 So I was involved in it. To hear the arguments today, the same arguments that I heard, and I would expect, Mr. Chairman, that if anybody could have the market all to themselves that that is the way they would want to have it. I don't feel that that is necessary.

9633 Getting back to the application for a country FM station, we talked about people dialling out into other communities and it is happening in Fredericton. I'm not sure of the numbers but I know that it is happening in Fredericton. There are a lot of people listening to radio in Saint John and Moncton and in Presque Isle, that has been stated. The reason for that is they are going for the type of music that they want to hear. In a good many instances it is country music.

9634 Although they do have the AM country music station in Fredericton, they have really eliminated and sort of turned their back, I feel, on a tremendous amount of listeners in the southern New Brunswick listening area, in their listening area, that are now going to Saint John and to Moncton.

9635 It is not just a matter of music. When you do switch over and, say, go to Saint John or go to Moncton or Presque Isle, it is the news. It is the local news that you have to have and you don't get that.

9636 When I travel I'm listening to local radio -- regardless of where I am -- every morning because I want to find out what is going on in my community, not what is happening in Port Coquitlam. Not that that is not important, but I have to be connected and I have to get the news locally.

9637 All of that being said, I do believe, Mr. Chairman, that there is a need for an FM country station in Fredericton to serve the people that are no longer being served. Those people would be, a lot of them, in the outlying areas that have no other choice but to go to Saint John or to Moncton.

9638 The other thing is about radio today and that is the news aspect of it. That has been mentioned briefly.

9639 Something I have against radio today, as it was when I was involved in it, that is the fact that there is too much live-to-tape that is done, where you don't have actual people in the radio station.

9640 I remember when we had the great earthquake back in Fredericton, Jack Fenerty was on Saturday morning at 10 after 9:00 on his program "Fact and Fancy". That was one of the biggest listening audiences that he ever had, and he had a big listening audience, because people wanted to know what was going on. They had never experienced this before. What is an earthquake? What causes it to happen? All of those things and people wanted the information.

9641 Well, now if there is an emergency situation, or for sure a lost dog, which we don't pay attention to any more, but a lot of times there are not live bodies in the station that react to this. That is something that I have against most of the radio applications and most people that are in business today.

9642 I really don't feel this is going to be -- is going cause, in a detrimental way, anything to the people that are doing business now in Fredericton.

9643 I disagree somewhat with the comment that was made that country music is declining. We have a country music club in Fredericton and one in Moncton. They are both doing very, very well. The type of country music that they are playing today is a little bit different than Buck Owens and his Buckaroos or Merle Haggard, or Johnny Cash, or the people that I spoke of when I was in the band and playing radio.

9644 But you know the other interesting thing about radio when I was in it, I played my own music. I selected my own music, I played my own music, answered the telephone, did the logs, did all of that. I guess that is what private radio is all about. But things have changed and awful lot. There is no doubt about that.

9645 But I go back to what I said. First of all, you have to know your community. You have to know your constituents -- and I say "constituents" because I got involved in politics while I was in radio and I was in municipal politics in Fredericton for 19 years, elected seven times consecutively, five of those times as Mayor, which put me in the history books as the longest serving mayor in the over 200-year history of the City of Fredericton.

9646 Why I say all of that is because I think it is important that an individual is very familiar with their market, very familiar with their constituents. If they are not, they will not be successful in politics, nor will the be successful in radio.

9647 That being said, Mr. Chairman, that is why I am here, that is why I have wanted to tell you all of this about myself, because I think I am a credible voice in what happens in the City of Fredericton and surrounding areas when it comes to entertainment and news, because I have been there and done that.

9648 That is my presentation, Mr. Chairman, if you have any questions.

9649 THE CHAIRPERSON: Just one. I take it, although you didn't say it directly, by inference when you refer to the format -- and you made the point at the outset that you weren't invited to come and speak on anybody's behalf, you came here on your own --

9650 MR. WOODSIDE: Yes.

9651 THE CHAIRPERSON:  -- that by inference at least you are supporting the Maritime application?

9652 MR. WOODSIDE: Yes, I am, sir. Yes.

9653 THE CHAIRPERSON: Thank you. You wouldn't have had to tell us, I don't think, that you actually worked in radio. There is just something about that voice that different parties have that appear in front of us that you can tell they have been on the radio at one time or another.

9654 MR. WOODSIDE: You know, and I did get that an awful lot. I got it so much that I really started thinking about getting into the radio business and had no idea how to do it or how to go about it. That is another very interesting story. It's a long story. I can't get into that today.

9655 THE CHAIRPERSON: Leave that for another time.

9656 MR. WOODSIDE: Okay. But I must say I have heard a lot about the CRTC over the years and it is nice to see a human face on the CRTC and to actually be here.

9657 I was in the room last night thinking about what I would like to say and there is so much that I would like to say to the CRTC about what is happening in radio, television and news -- I do a newspaper column in Fredericton as well -- but I won't do that today.

9658 THE CHAIRPERSON: Sometime over a beer. I think Commissioner Langford has a question.

9659 MR. WOODSIDE: Right.

--- Laughter / Rires

9660 COMMISSIONER LANGFORD: The question I have is: Assuming that we follow your advice and we license Maritime's country FM, what advice would you have, then, for Astral's AM? What should they do?

9661 MR. WOODSIDE: I think they made the decision to go AM to begin with, and if they were aware of their listeners and where they were and where the dedicated listeners were, then I'm sure that they would realize that by going AM they were going to in fact cause those people to have to go to Saint John and Moncton to hear what they want to hear, and do that without hearing local news, which is very important.

9662 COMMISSIONER LANGFORD: Well, they have a bit of a problem. They can't change that AM to an FM. They have the maximum number of FM's I think.

9663 Don't they, Mr. Chairman? They have two FM's -- help me here. I have lawyers. Yes, they are all nodding. I got something right.

9664 They have two FM's in the market, that is all they can have, so they are maintaining an AM that has been around since -- I don't know, a long time. So they are going to have to find a new format. Wouldn't you agree? You have been in radio?

9665 So what do you do with an AM radio station that has lots of news, but what else do you do with it?

9666 MR. WOODSIDE: I feel the same way about that as I did when I was at CFNB and somebody else was trying to get into the market. Everybody was worried that it was going to be the end of CFNB as they knew it.

9667 I felt it was good. I felt it was good for the competition and I thought changes had to be made and we would make those changes that really would respond to what the consumer was looking for, what they were asking for. If you have the market all to yourself you don't have to do that.

9668 I'm not saying that they don't that. I'm not down here speaking against Astral or anybody else that is doing business right now in the City of Fredericton. I am down here saying that an FM application for country music is not only needed, but I think will be very successful.

9669 Any of the players in the market are going to have to do what they have to do to maintain their listenership, which will include their format, but it will be dictated by the people who live in the area.

9670 COMMISSIONER LANGFORD: But is there another format in your mind, from your experience, that still works for AM, assuming they lose their competition, they lose their listeners?

9671 MR. WOODSIDE: You know something, I enjoy all kinds of music and all formats. I really do. My preference is country. My preference is to hear country on the FM dial where it is a lot cleaner, a lot clearer, a lot more crisp and there are a lot of people that are not getting that service right now. They are not being serviced by an AM country music station and I think that is unfortunate.

9672 COMMISSIONER LANGFORD: Thanks very much. Thank you, Mr. Chair.

9673 THE CHAIRPERSON: Thank you, Mr. Woodside.

9674 MR. WOODSIDE: My pleasure. Thank you.

9675 THE CHAIRPERSON: Mr. Secretary.

9676 MR. LEBEL: Thank you, Mr. Chairman. The next appearing intervention will be presented by Mr. Tony Currie.

INTERVENTION / INTERVENTION

9677 MR. CURRIE: Good morning, Mr. Chairman. Unlike my predecessor, I don't possess a radio voice so bear with me on that.

9678 I will spend a little bit of time on myself and then I will take you back to the reason that I'm here in support of the MBS application for FM in Fredericton.

9679 I am currently Vice-President of Provident Corporation, which is an on-line training company with offices in Fredericton, Charlottetown and Toronto. I have been a resident of Fredericton, New Brunswick for just about 20 years. I was born in Sydney Mines, Nova Scotia and am a military kid by background. In actuality I have spent a lot more time, I have been in Gagetown a number of times as well. So roughly 30 years I guess in essence.

9680 Growing up in -- excuse me, I can't believe I am this nervous. I do an awful lot of -- I said to someone on the way in, "I speak to an awful lot of corporate people, but I rarely speak to someone that is an unknown audience to me", so I apologize.

9681 Growing up in Oromocto, at an early age I got involved in hockey so my background is really in that. I spent 14 years in professional hockey, 10 in the NHL, St. Louis, Vancouver, Hartford. During that time I actually had an opportunity to come back to Fredericton to play in the American League, which is at the point in time when I made the decision to bring my family and reside. It was a great decision. It is a great place to raise a family, watch my kids grow up. I never regretted it for a single moment.

9682 I think the reason I'm here is really to maybe lend some credits on the community involvement and my dealings with Maritime Broadcasting over the years.

9683 I first came into contact with Maritime Broadcasting while playing in the Digby Golf Classic a number of years ago -- 18 to be exact. It has been described, I think in those days by the Globe and Mail, as the Cadillac of charity events and has raised well over $1 million and at the same time bringing business and sports and charities together. The money goes back into amateur sports and youth and I consider that a great way for MBS to be giving back to the community.

9684 Merv Russell in actuality helped Maritime Broadcasting -- helped put this event together some 18 years ago with business associates of his and, as I said, that event has been a continuing success 18 straight years. In actuality, it has been sold out.

9685 Roughly I guess four years ago while at the Golf Classic, Rick Lohnes -- who is a current coach in the NHL -- Errol Thompson and myself thought about what we could do similar back here in the Atlantic. We dreamed up and brought into fruition an even called Maritime NHL Oldtimers For Needy Kids. We felt that it was a great way for us as players to have an opportunity to give back to kids in this day and age of single parents who just don't have access to funds that can get them into the game that we so dearly loved.

9686 I would say the first person on the block to help support that event was Maritime Broadcasting and Merv Russell. He signed up for the term. This event is a tremendous event here in Atlantic Canada because we see it going to perpetuity. We rotate through all the Maritime provinces on an annual basis. It has been in Fredericton, it has been in Halifax, Charlottetown, this year actually in Cape Breton, and we continue to rotate it. Again Maritime Broadcasting is going to be with us every step of the way.

9687 So to speak to their community involvement, I have seen nothing but the very best on their behalf. We have raised well over $500,000 in that event to date.

9688 That is why I am here supporting MBS's application for country FM radio in my home town. They are a local Maritime company, they make decisions that are pretty well in tune with our local Maritime population.

9689 I am familiar with the Fredericton business community and I know firsthand another station would be welcome in the city.

9690 I guess the other real qualifier for me is that I have two kids, 17 and 20, who are very musically orientated and they definitely like country. I listen to it quite a lot and I'm a country lover.

9691 That is all I have to say. If you have any questions, I would be glad to answer them.

9692 THE CHAIRPERSON: Thank you very much, Mr. Currie. I'm sorry we are so intimidating in our arena. Given my stature, I sure as hell wouldn't want to meet you in your arena.

--- Laughter / Rires

9693 THE CHAIRPERSON: Thank you for your presentation here today.

9694 MR. CURRIE: All right.

9695 THE CHAIRPERSON: Mr. Secretary.

9696 MR. LEBEL: Thank you, Mr. Chairman.

9697 The last appearing intervention will be presented by the National Campus and Community Radio Association.

9698 MS GRAHAM: Apologies for not being here when you called us first. I just ran out to get a coffee.

9699 THE CHAIRPERSON: That's okay.

9700 MR. LEBEL: Please introduce yourself. You have 10 minutes to make your presentation.

INTERVENTION / INTERVENTION

9701 MS GRAHAM: Good morning. My name is Janna Graham and I am here on behalf of the National Campus and Community Radio Association. Robert Schmidt submitted the letter and, as he is in Winnipeg, I am here for him.

9702 The National Campus and Community Radio's Association, or the NCRA, is a non-profit organization committed to volunteer-based community and campus radio broadcasting in Canada. The NCRA is dedicated to advancing the role and increasing the effectiveness of community access broadcasting in Canada. It provides information and networking services to its members, representing the interests of the sector and promoting public awareness in appreciation for community and campus radio in Canada and abroad.

9703 The NCRA filed letters on February 4, 2004 to the CRTC concerning the applications of Acadia Broadcasting Limited and NewCap Incorporated.

9704 Although we are not directly opposed to either of these applicants receiving a frequency, we do have serious concerns with their possible interference and impact on CFMH, a low power community-based campus radio station in Saint John.

9705 CFMH is a member station of the NCRA and were the recipients of our 2001 Small Station Award. In the past three years the NCRA has offered CFMH assistance and advice as the station prepared to go FM, which they did so in 2000 at 49 watts

9706 We have been very impressed with their structural development, despite having few resources. They have put an immense amount of work into building a community access station that represents the area they serve.

9707 As CFMH has developed in organizational structure, community support and a strong volunteer base, they are planning to eventually apply for protected frequency, yet setting aside funds immediately for this increase in power is extremely difficult for a non-profit organization such as CFMH.

9708 The NCRA feels that community-based radio stations such as CFMH should be regarded as a legitimate and essential contribution to Canadian broadcasting and supported accordingly.

9709 I would now like to introduce the station manager of CFMH, Linda Pelletier, to speak on their behalf.

9710 MS PELLETIER: Thank you. I would like you thank all of you for letting us speak today. I am just going to tell you a little bit about CFMH.

9711 Campus Radio Saint John began in the '70's as a closed circuit radio station. In 1982 they got studio space and received donated gear from the CBC and CHSR, another community station in Fredericton, New Brunswick. Engineers from the CBC donated their time to hook everything up and lots of fund-raisers were done. Old CBC programmers and local engineers helped start this campus community radio station. It was 10 years from when the radio club of UMVSJ was incorporated until it actually broadcasted on the air. In those 10 years it broadcasted closed circuit on the campus.

9712 In 1991, CFMH first tried for am FM license. In 1991 a group of students got a car donated to the station and were selling raffle tickets to get enough money to get a licence for this station, but this particular group of volunteers burned out before they could raise enough money.

9713 They tried again in 1995, but still couldn't make enough money. It took about three years in the development of a plan and application. It was a struggle to get enough volunteers and money was a big problem. CFMH went to the community to get community involvement.

9714 The licence was granted in October of 1999 and went on-air in January of 2000. They had to go purchase equipment and get the antenna. They waited until they were approved for licence before they got everything, because they wanted to make sure they were approved. The antenna and transmitter cost them about $20,000. A volunteer engineer donated his time to do the work, which would have been another $20,000.

9715 The reason why CFMH applied for a low power opposed to high power FM licence is because of costs. CFMH is located on a small campus with about 2,000 full-time students. Start-up costs came from the student council and a loan from the university and lots of fund-raising.

9716 In 2001 CFMH won the National Campus Radio Station's Best Small Station Award in Canada.

9717 These applicants will impact us because of the terrain and the size of Saint John. We are going to need to increase our power or to move on the dial to be heard, but we currently do not have the funds to do this.

9718 A local engineer estimates -- his name is Gordie Miller -- of approximately how much it would cost to increase our power. I couldn't receive an engineering brief from him because we could not afford that, but Gordie said that the antenna and transmitter would be about $30,000, plus an engineering brief which would be about $10,000. For us to increase our power it would be about $40,000. We would have to move the tower from the location where it is presently and we would have to purchase a 100 watt transmitter. This entails a fair bit of work from the engineer.

9719 We understand that we are not protected by the CRTC because we are a low powered FM station, but we are a not-for-profit public access radio station. We are here for the campus and community of Saint John so that they can be heard on the airwaves.

9720 We have no problem with what NewCap and Acadia Broadcasting are doing, it is just where they want to be on the dial that would affect us. If these licences are granted, an engineer and Industry Canada told me that they could affect us in our Grand Bay/Welsford area, but NewCap will affect us more than Acadia would.

9721 If these licences are granted, we would ask these stations to consider contributing to help us and compensate us for a move. We are not asking to go up to 200 watts to cover more people, but we just want to protect what we already have.

9722 As I said, we are the only public access, volunteer, multicultural radio station in Saint John and it is so important that low powered FM community radio stations are protected.

9723 We have a talent development mandate which we need to fulfil and we do very well. We give local musicians and artists in Saint John an opportunity to be heard somewhere where they would not be otherwise heard.

9724 We cater to a wide audience from the age of about seven years old to 75 years old.

9725 We have children's, international, political, women's issues, gay and lesbian rights, community, local talent programming, also religious issues, aboriginal issues.

9726 We play diverse amounts of music, like world, hip hop, local; we have a songwriters circle. We have all kinds. We do whatever we can to help the community.

9727 But we need to cover our community and we need to cover our community in full. If these stations cause us interference, we will not be able to do that properly. Thank you.

9728 MS GRAHAM: The NCRA believes that the broadcasting policy for Canada, as described in the Broadcasting Act, is currently enacted and fulfilled by the efforts of campus and community broadcasters. These small stations, ranging from 10,000 to 18,000 watts, in both mandate and legislation, epitomize many of the defining aspects of the Act.

9729 We feel strongly that not-for-profit community access radio stations are providing an essential service not provided by commercial stations, and that jeopardizing the coverage of these stations in effect jeopardizes the legislated mandate for the Canadian broadcasting spectrum.

9730 It is absolutely essential to address the role of community and campus stations such as CFMH in the Canadian broadcasting spectrum and the need to support these stations. Campus and community stations play an essential role as local community-based services that provide airtime to multicultural, francophone, and aboriginal groups, promote Canadian talent and offer highly diverse programs not heard anywhere else.

9731 The CRTC has indicated in various ways over the years that it recognizes the importance of independent community-based and student-oriented radio stations. Now the CRTC needs to protect these unprotected stations.

9732 There must be a mechanism in place to prevent unprotected secondary stations from the possible loss or decrease of coverage. This may be accomplished by a one-time donation to be made by a commercial station on acquiring a licence or amending a licence to increase power in any market. This donation should be made not only to stations within the market, but also to any not-for-profit community access station whose signal is affected by the increase. This is to specifically address the situation as presented here, where a community access station in another market faces potential interference from an applicant.

9733 Also, the creation and implementation of a CRTC-mandated commercial radio fee that supports small, non-profit stations.

9734 And the continuing development of the constructive relationship between for profit and not-for-profit radio stations requires that for-profit stations must recognize the important role of campus and community radio stations in providing diversity in the Canadian broadcasting system.

9735 In closing, I ask the Commission to consider CFMH's request for the protection of their frequency and coverage in the interest of their community listenership and irreplaceable service.

9736 I also ask the Commission to consider the creation of a mechanism to protect not-for-profit community access stations from interference from commercial stations in the interest of a diverse, multicultural and strong Canadian broadcasting system. Thanks.

9737 THE CHAIRPERSON: Thank you. Ms Brown is it?

9738 MS GRAHAM: I'm Graham.

9739 THE CHAIRPERSON: Graham, sorry. Ms Graham and Ms Pelletier.

9740 Commissioner Langford.

9741 COMMISSIONER LANGFORD: Well, we hear you. It is very clear. Thank you for that.

9742 Obviously we can't mount a complete policy and statutory review at the drop of a hat, but these records get acted on. As you know, radio policies are reviewed regularly. I'm not sure how far we are from the next one, but I suspect it is not very far actually. You have made some very good points and we will put them in.

9743 That's not just -- I'm not kissing you off here, as my kids would say. We get information in these hearings. That is why we have them. They are not only for handing out licences. We hear what you are saying and they are very important points.

9744 We have made changes recently in advertising minutes to community radio and campus radio. So we do listen to you and we do act on what you say.

9745 If you were here earlier, I leaned a little bit on Acadia wondering whether they might give you some help. I will lean on them a little more for you in Phase IV and maybe I will lean on NewCap a little bit too and see whether they might be able to help you out and work this out.

9746 Nobody wants to lose a station. That's not why we are here. We are here to keep everybody healthy and wealthy and wise, if we can. So maybe they will have something to say.

9747 MS PELLETIER: I just wanted to add too, we have no problem with these stations opening, it is just the fact that they are by our frequency.

9748 COMMISSIONER LANGFORD: No. You have said that. You were very, very clear. You were very clear that you understand the pecking order of the present rules. I appreciate that you do. We all know the box you are in. Nobody wants you to shut down and nobody wants you to be in any way marginalized.

9749 So we have heard you. Thank you very, very much.

9750 MS PELLETIER: Thank you.

9751 THE CHAIRPERSON: Thank you very much, ladies.

9752 Mr. Secretary, I understand that completes Phase III?

9753 MR. LEBEL: It does, Mr. Chairman.

9754 THE CHAIRPERSON: We will move to Phase IV.

9755 MR. LEBEL: I will ask the Joy FM Network to respond to the intervention at this point.

REPLY / RÉPLIQUE

9756 MR. HAPEMAN: Thank you, Mr. LeBel, Mr. Colville.

9757 I would like to address a couple of items that we have been asked to consider. It is always difficult to resolve things without having some good quality time to think through a strategy and a plan, so I hope you will appreciate the brevity with which we have looked at this here this morning.

9758 First of all, as to the question of balance and religious programming.

9759 Joy FM, as an incorporated body, has been and will continue to be committed to our internal board policy not to be a breeding ground of intolerance, which we believe is in the spirit and the aim of the CRTC policy for balance in religious programming.

9760 We have worked hard toward this goal. We realize that there is a circle or a fence outside which we have not crossed.

9761 We will continue, number two, our open-door policy toward the participation of other faiths, as we have to this point.

9762 In addition, number three, we will take the initiative to actively contact our friends in other faiths. We appreciate the challenge to do so and to be reminded of the responsibility under the Broadcasting Act to do so. We will work to find effective time to promote toleration among other religions in our community -- not tokenism, but effective communication and participation, with the understanding that the aim and the intent of the broadcasting policy is to eliminate social, cultural, and racial intolerance. To that end we will work actively.

9763 In the fourth place, we will commit, in our condition of licence, to provide a minimum of 30 minutes a week, whether it is locally produced or of a brokered nature in some sort of national or international provision.

9764 There is a practical sensibility here in terms of revenues when it comes to local programming, as we do with our passages and power points of which a church participates only once a year, there is no charge. On local programming of that sort we certainly would continue that.

9765 But our other brokered programming involves revenues that people pay and it is a challenge here for us. We can offer for them to be on air and yet there are rates that other brokered programs pay.

9766 I say that not as an excuse, but that is the practical sensibility that we face. To provide it free then challenges our other program providers who would just be glad to send us the program and not have to pay for it.

9767 In spite of that, this may seem a small step at this point, but we do not want to be in a place where we cannot fulfil our promise of performance. We will begin at this stage and we will see where it goes.

9768 I would like to come to the question, Mr. Langford, that you raised, the question of reconciliation, getting together with the competing application by Mr. Ingram and Mr. Dixon.

9769 Though this time here is perhaps maybe not the most conducive time and place to carry on that dialogue, we have approached our colleagues.

9770 We cannot speak to the reason why they, subsequent to our application, made a competing application for the same licence. We will have to leave that to Mr. Dixon and Mr. Ingram for their explanation. All I can say is that our door for dialogue is open.

9771 Finally, Joy FM, as a new radio station in a new area of religious broadcasting on radio, is learning and is growing. We believe that we have made a welcome introduction to the Fredericton community and have been welcomed by our listening audience.

9772 We understand and appreciate the roll that the CRTC plays in the matters of public concern. You have been entrusted with a sacred trust to protect the peoples of our nation and we appreciate the role that you have and how you carry it out with prudence and discretion.

9773 We are working ourselves very hard to carry out the spirit and the aims of the Broadcasting Act as we understand it.

9774 Finally, we want to reiterate our conviction that we believe there is a legitimate need in the market for a religious station targeted at the 50-plus age segment of the religious community. Thank you very much.

9775 THE CHAIRPERSON: Thank you, Mr. Hapeman. Just perhaps a clarification.

9776 When you have indicated this proposed half an hour, would you be proposing -- well, your existing station is not here for licence renewal. In view of the, shall we say, better understanding of the policy that you have gathered over the last few days, and more particularly today, would that also apply to your existing station?

9777 MR. HAPEMAN: Absolutely.

9778 THE CHAIRPERSON: Okay.

9779 MR. HAPEMAN: Yes, we have heard that message and have appreciated it immensely and it had motivated us. Thank you.

9780 THE CHAIRPERSON: Thank you very much. Those are our questions.

9781 Mr. Secretary.

9782 MR. LEBEL: Thank you, Mr. Chairman.

9783 I will now ask Ross Ingram to respond to the intervention at this point.

REPLY / RÉPLIQUE

9784 MR. INGRAM: In answer to Commissioner Langford's question earlier about cooperating with the Joy FM Network application, based on a great number of years in broadcasting, a lot of experience in broadcasting, we have what amounts to a philosophical difference with the Joy FM Network.

9785 We see our station as, first of all, a community station. That includes local news and other news, weather, sports, public affairs, which is interviews with people who are newsmakers and others. The news and public affairs would include, from time to time, faith news and faith items. Something that no one has touched on here to date in this case is native religion, native spirituality. That would also be part of this. We have some background in that.

9786 The coverage of local events in the realm of news would include news reporting, live on the spot coverage of events, your blood donor clinic, the United Way events and other drives.

9787 I guess what we are saying is, ours would be a full-service community station that happens to have a gospel and praise format.

9788 Our philosophical difference with the Joy FM Network is that their radio station is a music operation that tends to have a few of these things appended to it. I think we would differ in that regard.

9789 We would also differ in this regard -- and we have already spoken with other religious broadcasters about this -- a program exchange, an exchange of technical expertise if it is required, with other Christian broadcasters I think would augment the station that we have applied for.

9790 Basically, Commissioner Langford, it is a philosophical difference and that's the difference.

9791 THE CHAIRPERSON: Those are your comments?

9792 MR. HAPEMAN: Yes.

9793 THE CHAIRPERSON: Okay. That's great. Thank you very much. No further questions.

9794 Mr. Secretary.

9795 MR. LEBEL: Thank you, Mr. Chairman.

9796 Acadia Broadcasting Limited will not be appearing in Phase IV, so I will now ask Maritime Broadcasting System Limited to respond to the intervention at this point.

REPLY / RÉPLIQUE

9797 MR. RUSSELL: Mr. Chairman and Members of the Commission and staff, we promise to be very brief. It has been a long nine days and a full seven days of hearings. We have had an opportunity in the competitive environment to put our thoughts forward. We have heard some great ideas, some innovative ideas and we have come away from this hearing a great deal richer.

9798 When we were getting together with our team, they looked to the old guy for the advice on how to deal upfront with the CRTC, because as we got together and got discussing the issue over half of our team had never appeared before the CRTC before and they were suggesting that it had the perception of a tad of intimidation. I assured them at that time that it was fundamental that we know our file, we know our competitor's file, and we thank you for the environment that you set, Mr. Chairman and Commissioners, that they had that opportunity to express themselves accordingly.

9799 To staff, thank you very much. All during the process you have been very, very helpful to us.

9800 I just have one final thought. The weather wasn't conducive to having a good look at Nova Scotia while you were all here. This summer promises to be perfect weather for the whole summer and we have two great events. We have Tall Ships this year, which is going to be magnificent, and of course we will all be celebrating the 400th anniversary of the Acadian culture. We certainly welcome you back and thank you very much.

9801 THE CHAIRPERSON: Just a minute, I think counsel has --

9802 I think counsel and Commissioner Langford have to have a little caucus here.

9803 COMMISSIONER LANGFORD: I don't want to have a caucus with anybody. It's like the O.J. Simpson trial here, we are going to have a sidebar.

9804 MR. McCALLUM: I'm sorry, Mr. Chairman.

--- Pause

9805 MR. McCALLUM: Thank you, Mr. Chair. There are no questions.

9806 COMMISSIONER LANGFORD: Thank you again.

9807 THE CHAIRPERSON: I think you might want to get out of here while the going is good.

9808 MR. RUSSELL: Lunch time.

--- Laughter / Rires

9809 MR. PACE: Mr. Chairman, the only comment that I will make, because it is close to the hour, my daughter at Carleton University is listening to all these hearings. She has a class at two o'clock.

--- Laughter / Rires

9810 MR. PACE: Rebecca, I will talk to you tonight and hopefully in some time to come that she may appear before you and be better at it than I am. Thank you.

9811 THE CHAIRPERSON: There is a long distance phone call Alliant didn't get.

--- Laughter / Rires

9812 THE CHAIRPERSON: Mr. Secretary.

9813 MR. LEBEL: Thank you, Mr. Chairman.

9814 I will now ask NewCap Incorporated to respond to interventions at this time.

--- Pause

9815 THE CHAIRPERSON: So Mr. Steele, as is often the case, you are standing between everybody here and lunch.

--- Laughter / Rires

9816 THE CHAIRPERSON: The microphone is yours.

REPLY / RÉPLIQUE

9817 MR. STEELE: I hear you and I realize we are at the bottom of the ninth, so we will try to be brief.

9818 Good afternoon, Mr. Chairman, Members of the Commission and Commission staff. I am Rob Steele. With me for this phase of the hearing, in the front row, to your left, are Steve Jones and Mark Maheu. On my left are Hilary Montbourquette and Mark Kassof.

9819 At the second table, starting from your left, are Dave Murray, Gerry Phelan and Audrey Whelan.

9820 At the third table are Pete and John Steele.

9821 MR. MAHEU: We are here to reply to the written and oral interventions to our application for Fredericton.

9822 Before replying to the negative interventions from Astral and MBS, I would like to take the time to thank the supporting interveners. Their letters demonstrate clearly the commitment that NewCap Radio brings, both to community reflection and service and to the support of Canadian music.

9823 At this time we would also like to acknowledge the intervention and concern expressed by the folks from the National Campus and Community Radio. We would also like to inform the Commission that since their appearance before you intervening with concerns about the use of the frequency 92.3 impeding on 92.5, we have had a discussion and NewCap Radio has committed to this group that we will do whatever it takes financially, technically and otherwise, to make sure that their signal does not suffer any degradation should we be licensed in Fredericton. They have agreed to that.

9824 As indicated in our reply to the Saint John application, CIRPA raised several points in its intervention that we would like to comment upon.

9825 First, CIRPA indicated that it believed that a substantial portion of Canadian Talent Development monies should be allocated to FACTOR. Our application allocates $350,000 to FACTOR. Compare this to the $21,000 proposed by Maritime and the $7,000 allocated by Acadia.

9826 MR. JONES: In its intervention Astral argues two points: that our application seeks to serve a market segment that is already well served; and that we will duplicate the format they currently offer on their station CFXY FM.

9827 With regard to the format duplication, we examined BDS reports, comparing the music currently played on CFXY FM with that on our classic rock station in Edmonton, CIRK FM. We found that less than 20 per cent of the music presently heard on CFXY would be heard on 92.3 K-Rock, our proposed classic rock station.

9828 To further investigate potential format overlap, we looked at the eras of the music that each station plays. We discovered that 70 per cent of the music played on CFXY FM comes from 1990 to 2004. In fact, 50 per cent of their music comes from the past four years. In contrast, our classic rock station draws about 5 per cent of music from that era, primarily to support emerging Canadian talent. 95 per cent of our music comes from before 1990. These two radio stations have very different sounds and very different appeals.

9829 Mr. Chair, classic rock and more contemporary rock stations like CFXY co-exist in many markets across Canada. While they have some small overlap, they provide distinct sounds and distinct audiences.

9830 Astral states that 25 to 54 year olds are well served in Fredericton, arguing that all three of their stations provide service to this group, along with the CBC. With this level of service, one would think that 25 to 54 year old listeners would therefore listen to radio more than people in the rest of Canada. But in fact when we looked at the average hours tuned per week in Fredericton and compared that to the averages Canada-wide and the province of New Brunswick, we found that they don't listen to radio nearly as much. Across Canada, 25 to 54 year olds listen to radio an average of 21.7 hours per week. That average for New Brunswick is 22 hours. However, in Fredericton it is just 18.3 hours per week, according to the Fall BBM figures from 2003.

9831 Astral claims that all three of their stations are targeted 25 to 54. As we noted in our Reply to Interventions in Saint John, stations seldom aim to serve 25 to 54 year olds as a group, but attempt instead to super-serve a subgroup of that broad audience. For example, CFXY isn't really a 25 to 54 radio station. 60 per cent of their audience is 12 to 44. With a playlist that ranges from Audioslave to ZZ Top, it is a broad rock station able to reach a wide audience group because they are the only rock station in town.

9832 Among Astral's other stations, CIBX FM appeals mainly to a female audience, as does country station CKHJ AM and FM, and one-third of the country station's listening is 55-plus.

9833 With such broad formats it is no wonder that almost a quarter of radio tuning is done to out-of-market stations and that radio listening is lower than the national average.

9834 Our proposed station doesn't seek to draw from such a wide audience base, but aims at super-serving one group, those fans of classic rock. This will increase hours tuned in the market and we anticipate it will repatriate some out-of-market tuning.

9835 MR. KASSOF: MBS raised the same objections to my research in Fredericton as they did in Saint John. Our responses are the same here as well: the sample size is more than adequate to give reliable statistics. In fact, the margin of error of our study is plus or minus 6 per cent, whereas their study has a plus or minus 5 per cent margin of error.

9836 We did ask respondents whether they would listen to a station playing each kind of music we tested.

9837 What we did not do is ask the leading question that MBS used in their research to ask if people would listen to their proposed station. The MBS research question was:

"In addition to providing a fresh mix of music, this station will provide listeners with essential news headlines from around the world, across Canada, throughout the Maritimes and from the city of Fredericton. As well as weather and traffic highlights, the station will provide sports headlines that will include what is happening with Fredericton teams and all major league play. Business reports and event information will round out an information package designed to meet the needs of an active lifestyle. This local focus will be combined with a new music mix not found anywhere else on radio in Fredericton. If this new station played the music selection you most liked from the two played for you earlier, how likely would you be to listen to this service? Would you definitely listen to it, probably listen to it, probably not listen to it or definitely not listen to it?"

9838 Frankly, who would say no to this question? No wonder they concluded that they could add a country station to a market that already has one.

9839 You will not find questions like that in our research questionnaire. We did not try to hype or sell any format to respondents. The purpose of our research was not to prove the need of any particular format to you. Instead, it was designed to determine the biggest unserved need among 18 to 54's in Fredericton. The biggest unserved need is classic rock.

9840 MR. MAHEU: Maritime also suggests that somehow our Canadian Talent Development funding will not be directed to local Fredericton artists since a portion has been earmarked for AVRN.

9841 In NewCap Radio's reply to deficiency, we indicated quite clearly that if the Commission found that our proposal did not meet the requirements, the funding could be redirected to aboriginal artists or to FACTOR.

9842 MBS has seized upon this letter to conclude that there is no guarantee that this money will find its way to local musicians.

9843 MBS has seemed to ignore a couple of key facts in this matter.

9844 In addition to the funding in our AVRN proposal, NewCap also commits that every dollar of our $350,000 commitment to FACTOR will be reserved exclusively for the support and development of Fredericton musicians. FACTOR has agreed to this earmarking in writing.

9845 Mr. Chair, it is clear that Fredericton can easily support a new radio service. In fact, MBS agrees, although it then proceeds to oppose all other commercial applicants even though there are several frequencies available.

9846 NewCap Radio believes the market can support two additional radio stations and our business plan takes this into account. NewCap Radio will provide a new music choice to the market, a choice that our research and that of Acadia Broadcasting shows to be in demand by the listeners of Fredericton.

9847 NewCap Radio has proposed more money for the development of Canadian talent than any other applicant, fully $700,000, including $350,000 specifically to support Fredericton musicians.

9848 NewCap Radio also knows that our endorsement and on air-support of new, emerging artists is extremely important. For this reason NewCap Radio has committed an additional quarter of a million dollars in indirect support for these artists by way of promotional announcements, supporting the sale of their recordings and promotion of their live performances.

9849 NewCap Radio's program "Atlantic Exposure" goes a step further in support of Atlantic musicians, by providing an on-air platform whereby listeners can hear the music and stories of new music artists throughout the region.

9850 Of course, NewCap Radio will provide a new, independent editorial voice to Fredericton. We have no radio stations, newspapers or TV stations in Fredericton. Our five new journalists will provide a comprehensive local news service in Fredericton. In addition, they will feed our proposed program "Capital Report", providing listeners in Fredericton a new regional news source connecting them with other listeners in Capital cities throughout Atlantic Canada.

9851 Finally, NewCap Radio will provide much needed competition in the Fredericton market, giving the citizens and listeners a new, local radio choice. Having more than one company service the radio market will re-invigorate and re-energize the airwaves, giving listeners in Fredericton a new level of service and quality.

9852 NewCap Radio very much wants to play a significant role for the citizens of Fredericton and we would appreciate your approval to do so. Thank you. We would welcome any questions you may have.

9853 THE CHAIRPERSON: I don't think we have any questions, gentlemen. Thank you very much for your presentation today.

9854 MR. STEELE: Thank you.

9855 THE CHAIRPERSON: Mr. Secretary, that concludes.

9856 MR. LEBEL: This concludes Phase IV for the Fredericton market.

9857 Mr. Chairman, before you pull the plug I would like to indicate that there are 14 non-appearing applications on the agenda of this public hearing. Interventions were received for some of these applications. The panel will also consider these applications and decisions will be issued at a later date.

9858 This, Mr. Chairman, completes the agenda of this public hearing. Thank you, Mr. Chairman.

9859 THE CHAIRPERSON: Yes, Mr. Secretary. I'm sure lots of people are interested in knowing. Usually the question I get from reporters is: So now that you have had the hearing when will the decisions be released?" From time to time people have noted that the acronym "CRTC" perhaps stands for "Can't Reply 'Til Christmas".

--- Laughter / Rires

9860 THE CHAIRPERSON: So given the length of time it takes to analyze the issues and get the decisions drafted and translated and released, it is difficult to say when it would be. I certainly hope it will be well before Christmas, certainly well before the end of the year, which my term runs out in any event.

9861 I just want to take this opportunity to -- it is not very often actually we have this many people left in the room at the end of a hearing. We usually have the last applicant and they are running for the door, so I appreciate people here.

9862 I want to thank my colleagues on the panel for their work in preparing for and conducting themselves through the hearing, and our staff for the excellent work they have done, our court reporter and our translators.

9863 Without diminishing any of that, I want to particularly thank all of the applicants and the intervenors for the way they have conducted themselves through the course of this hearing.

9864 Certainly from my perspective this has been, I think, one of the most competitive broadcasting hearings I have ever sat through. We have had a mix of strong national players, strong regional players, strong local players and new players to the market here, or wanting to enter the market, all who have done an excellent job of preparing their presentations, in doing a presentation and engaging in a discussion with us and answering the questions. Also the intervenors, not withstanding Mr. Currie's point of being somewhat intimidating. We try not to be intimidating and make people feel comfortable in answering the questions.

9865 It has been a remarkable hearing. It is going to be a difficult challenge for us to wrestle with all of what we have in front of us now for the four markets in question, to decide how many licences to grant and to who and all of the various issues and concerns that you have all raised that we have to take into careful consideration.

9866 So I want to really sincerely thank you all. It has been an excellent hearing and I really appreciate the cooperation of everybody.

9867 With that, we will declare this phase of this proceeding done. The hearing is over, but our work will continue on and we will have plenty to think about over the next few months.

9868 Thank you all very much.

--- Whereupon the hearing concluded at 1340 /

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