ARCHIVÉ -  Transcription

 

 

 

 

 

 

 

              TRANSCRIPT OF PROCEEDINGS BEFORE

             THE CANADIAN RADIO‑TELEVISION AND

               TELECOMMUNICATIONS COMMISSION

 

 

 

 

             TRANSCRIPTION DES AUDIENCES DEVANT

              LE CONSEIL DE LA RADIODIFFUSION

           ET DES TÉLÉCOMMUNICATIONS CANADIENNES

 

 

                      SUBJECT / SUJET:

 

 

 

 

 

 

 

Various broadcasting applications /

Diverses demandes de radiodiffusion

 

 

 

 

 

 

 

 

 

 

 

HELD AT:                              TENUE À:

 

Quartz Ballroom                       Quartz Ballroom

Matrix Hotel                          Matrix Hôtel

10001-107th Street                    10001-107th Street

Edmonton, Alberta                     Edmonton (Alberta)

 

May 27, 2008                          Le 27 mai 2008

 

 

 

 

 

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.

               Canadian Radio‑television and

               Telecommunications Commission

 

            Conseil de la radiodiffusion et des

               télécommunications canadiennes

 

 

                 Transcript / Transcription

 

 

 

 

Various broadcasting applications /

Diverses demandes de radiodiffusion

 

 

 

 

 

BEFORE / DEVANT:

 

Elizabeth Duncan                  Chairperson / Présidente

Rita Cugini                       Commissioner / Conseillère

Candice Molnar                    Commissioner / Conseillère

Peter Menzies                     Commissioner / Conseiller

Marc Patrone                      Commissioner / Conseiller

 

 

 

ALSO PRESENT / AUSSI PRÉSENTS:

 

Cindy Ventura                     Secretary / Sécretaire

Lyne Cape                         Hearing Manager /

                                  Gérante de l'audience

Regan Morris                      Legal Counsel

                                  Conseiller Juridique

 

 

 

 

HELD AT:                          TENUE À:

 

Quartz Ballroom                   Quartz Ballroom

Matrix Hotel                      Matrix Hôtel

10001-107th Street                10001-107th Street

Edmonton, Alberta                 Edmonton (Alberta)

 

May 27, 2008                      Le 27 mai 2008

 

- iv -

 

           TABLE DES MATIÈRES / TABLE OF CONTENTS

 

 

                                                 PAGE / PARA

 

PHASE I

 

 

PRESENTATION BY / PRÉSENTATION PAR:

 

Newcap Inc.                                         4 /   23

 

Thomas Bolin (OBCI)                                94 /  586

 

Golden West Broadcasting Ltd.                     153 / 1045

 

 

 

PHASE II

 

 

INTERVENTION BY / INTERVENTION PAR:

 

Thomas Bolin (OBCI)                               223 / 1534

 

 

PHASE III

 

No interventions / Aucune intervention

 

 

 

PHASE IV

 

 

REPLY BY / RÉPLIQUE PAR:

 

Newcap Inc.                                       227 / 1568

 

 

 

 

 

 

 

 

 

 

               Edmonton, Alberta / Edmonton (Alberta)

‑‑‑ Upon commencing on Tuesday, May 27, 2008 at 0930 /

    L'audience débute le mardi 27 mai 2008 à 0930

1                THE CHAIRPERSON:  Good morning, ladies and gentlemen, and welcome to this public hearing.  My name is Elizabeth Duncan.  I am the CRTC Commissioner for the Atlantic Region, and I will be presiding over this hearing.

2                Joining me on the panel are my colleagues Rita Cugini, Regional Commissioner for Ontario; Candice Molnar, Regional Commissioner for Manitoba and Saskatchewan; Peter Menzies, Commissioner; and Marc Patrone, Commissioner.

3                The Commission team assisting us includes the Hearing Manager, Lyne Cape, who is also Manager of Radio Operations and Policy; Regan Morris, Legal Counsel; and Cindy Ventura, Hearing Secretary.

4                Please speak with Ms Ventura if you have any questions with regard to the procedures.

5                This hearing will be conducted in two parts.  We will start by considering the radio applications for the Drumheller and Red Deer markets this week.  We will then examine the radio applications for the Edmonton market during the week of June 2nd.

6                At the hearing, beginning today, the panel will look at three applications to operate a new English‑language FM commercial radio station in Drumheller.

7                Following this, the panel will study eight applications to operate a new English‑language FM commercial radio station in Red Deer.

8                We will also consider an application to change the authorized contours of Radio Station CJUV‑FM Lacombe, and to relocate its transmitter to Red Deer.

9                I will now invite the Hearing Secretary, Cindy Ventura, to explain the procedures that we will be following.

10               THE SECRETARY:  Thank you, Madam Chair.

11               Before beginning, I would like to go over a few housekeeping matters to ensure the proper conduct of the hearing.

12               Le service d'interprétation simultanée est disponible durant cette audience.  Vous pouvez vous procurer un récepteur auprès du technicien à l'arrière de la salle.  L'interprétation anglaise se trouve au canal 1 et l'interprétation française au canal 2.

13               When you are in the Hearing Room, we would ask that you please turn off your cell phones, beepers and BlackBerrys, as they are an unwelcome distraction and they cause interference on the internal communications system used by our translators.  We would appreciate your cooperation in this regard throughout the hearing.

14               We expect the entire hearing to take approximately nine days, starting today, until next Friday.  We will begin each morning this week at 9:30 a.m.  We will take an hour for lunch, a break in the morning and in the afternoon.  We will let you know of any schedule changes as they may occur.

15               The Amber B Room will serve as the Examination Room, where you can examine the public files of the applications being considered at this hearing.

16               As indicated in the agenda, the telephone number of the Examination Room is 780‑429‑7498.

17               There is a verbatim transcript of this hearing being taken by the court reporter sitting at the table in front of me.  If you have any questions on how to obtain all or part of this transcript, please approach the court reporter during a break.

18               Please note that the full transcript will be made available on the Commission's website shortly after the conclusion of the hearing.

19               Now, Madam Chair, we will proceed with Item 1 on the agenda, which is an application by Newcap Inc. for a licence to operate an English‑language FM commercial radio programming undertaking in Drumheller.

20               The new station would operate on Frequency 102.7 MHz, with an effective radiated power of 6,000 watts, non‑directional antenna, antenna height of 80.6 metres.

21               Appearing for the Applicant is Mr. Rob Steele.

22               Please introduce your colleagues.  You will have 20 minutes to make your presentation.

*PRESENTATION / PRÉSENTATION

23               MR. STEELE:  Thank you.

24               Good morning, Madam Chair and Commission Staff.  I am Rob Steele, President and Chief Executive Officer of Newcap Radio.

25               Before we begin our presentation, I would like to introduce our team.

26               Seated in the front row, farthest to my left, is Glenda Spenrath, Newcap's Director of Operations.

27               Next to Glenda is Ron Thompson, the General Manager of our Southern Alberta Radio Group, including our station in Drumheller.  Ron has over 45 years in radio, with the last 27 years in Alberta radio.

28               Next to Ron is Brent Young.  Brent is the Program Director for our existing Drumheller service, CKDQ‑AM.  He is a native Albertan, with over 20 years dedicated to the radio broadcast industry.

29               Brent also oversees the programming activity of our Alberta south group of stations.

30               Beside Brent is Sue Stevenson, News Director of CKDQ‑AM, as well as KG Country and Z99 in Red Deer.

31               Sue has almost 30 years of news experience in radio, with more than 20 of them in our newsroom in southern Alberta.

32               Beside Sue is Steve Jones, Vice‑President of Programming for Newcap.

33               And next to Steve is David Murray, Chief Operating Officer.

34               I would also like to note the presence in the audience of Rick Walters, our newly hired General Manager for our Drumheller country AM station, CKDQ.  Rick is literally on his way to Drumheller to start his new duties later this week.  He has a long background in radio programming and management, and if we are successful in this application, Rick will also be the General Manager of the new FM station.

35               We are here today to present our application to provide an additional programming option in Drumheller, a high‑quality alternative choice that will be viable because of its connection to the existing station in the market.

36               I would now like to call upon Ron Thompson to begin our presentation.

37               MR. THOMPSON:  Thanks, Rob, and good morning, Commissioners.

38               Drumheller is a small town in the Dinosaur Valley in the Alberta Badlands.  The population of the town is 7,800 people, and the economy is based upon three pillars:  agriculture, tourism, and oil and gas production.

39               The trading area of the town includes about 30,000 people, many of whom look to Drumheller for their shopping and other services.  But despite this extended market, the limitations of the frequencies available mean that none of the applicants can reach more than the population of the town itself.

40               All of the applications before you for this market are for small signals that, effectively, only reach the town and its immediate area.

41               The 3 millivolt contour of our proposed station would reach only 8,500 people, and, in fact, the other two applicants would reach fewer than 8,000 with their 3 millivolt contours.

42               Currently we provide a full‑service AM country music station in Drumheller, CKDQ‑AM, known as Q91.  With 50,000 watts and a clear signal, we are able to provide coverage to a much larger market, from the Rockies in the west to the Saskatchewan border in the east, and from Ponoka in the north to Brooks in the south.

43               We are the only radio station serving many of the smaller communities within our service area.  They include communities such as Hannah, Oyen, Rumsey, Bassano, Strathmore, Carbon, Veteran, and Coronation, to mention a few.

44               Madam Chair, we are able to sustain the rich service that our AM station provides to Drumheller for a number of reasons.  With our reach to the many small towns in rural areas, we actually have a market of about 30,000 people.  In fact, the Town of Drumheller represents less than 20 percent of our total revenues.

45               Q91 is part of our Alberta Radio Group.  The ARG allows us to share costs such as copy, traffic, engineering and other services, while at the same time enriching the programming services.

46               Being part of the ARG brings radio revenues to Q91 that it would not get as a stand‑alone local broadcaster.  Our coverage of southern Alberta allows us access to regional revenues from sources such as farm implement dealers and multi‑outlet retailers that would normally not buy a small radio station.

47               We are also able to aggregate audiences to make our group more attractive to national buyers.

48               And now, to tell you how we choose our music format, here is Steve Jones.

49               MR. JONES:  Thanks, Ron, and good morning.

50               While the country music format is very popular, especially here in Alberta, it remains a very polarizing format.  Those who like it, like it a lot, and devote long hours tuned to it.

51               In a small community like Drumheller, with only one station, everyone has to listen to the only station in town to get the local news and other community information, but they resent it when they are forced to listen to music they don't like to get the services they need.

52               As is our practice whenever we look at providing a new service to a market, we undertook consumer research to determine what Drumheller listeners want in a new radio station.

53               Mark Kasoff and Company interviewed 150 people between the ages of 25 and 64.  Not surprisingly, our local country station, Q91, has the largest audience of any station.

54               But as we looked deeper, a number of interesting trends emerged.

55               With only one local station, those who do not like country music often listen to out‑of‑market stations.  Although the community itself is located deep in a valley, making reliable reception of out‑of‑market stations difficult, the Kasoff research indicates that CJFM, 660 News, JACK FM and QR77, all from the Calgary market, attract substantial tuning in Drumheller.

56               Those who don't like country music must put up with poor signals, or use the internet or cable radio to get the music formats they want.  But when they want local news and community information, it is either our country station, Q91, or nothing at all.

57               Not surprisingly, as a result, satisfaction with existing radio choices in Drumheller is high with only one group of listeners, country music fans.  After all, these are the listeners who are well served by the existing station.

58               Men of all ages are generally less satisfied with the existing radio choices.  In fact, among male listeners, Calgary stations are the most listened to stations.

59               Among women, those under 45 were the least satisfied.  With 25 to 34‑year‑old female listeners, JACK FM from Calgary is the most listened to station.

60               Clearly, a format that attracts men across many age groups and women under 45 is the best choice.  So what did the research tell us was the appropriate format to meet this need?

61               Mr. Kasoff investigated the viability of nine different types of music:  active rock, CHR, classic hits, classic rock, country, hot AC, soft AC, sixties and seventies oldies, as well as eighties and nineties pop.

62               It became clear that one format in particular stood out ‑‑ that format is classic hits.

63               That conclusion was based on a calculation called "The Percent of Format Void", which is essentially a numerical representation of a format's potential for success, based on the popularity of the type of music and its present availability in the market.  Classic hits had the highest percent of format void, at 17 percent, followed by classic rock and CHR at 13 percent, and sixties and seventies oldies and eighties and nineties pop, each with 11 percent.

64               Classic hits, classic rock, sixties and seventies oldies, and eighties and nineties pop are often grouped together on radio stations to create broad‑based classic hits stations.

65               For example, our recently launched 96.3 Capital FM here in Edmonton brings together elements of each type of music to create a cohesive and popular format that could conceivably play everything from 1964's "I Want to Hold Your Hand" by The Beatles to 1992's "Courage" by The Tragically Hip.

66               The strong positive interest in all of these types of complementary musical styles led us to the conclusion that a station like this would be a tremendous success in Drumheller.

67               Now to give you a better idea of how this new station will sound, here is Brent Young.

68               MR. YOUNG:  Thanks, Steve, and good morning.

69               We have labelled the station T‑REX 102.7, after the famous dinosaur that once called the Drumheller area home.  It will be a rock‑based classic hit station, with its music coming from the sixties through the end of the nineties.

70               Approximately 35 percent of the station's sound will draw from the traditional classic hits repertoire of the eighties, nineties and now, from artists like Fleetwood Mac, Elton John, The Guess Who and John Mellencamp.

71               About 25 percent of the sound will come from classic rock artists like Arrowsmith, Rush and Led Zeppelin.

72               The spice on the meat and potatoes of classic hits and classic rock will come from two sources.  About 15 percent of the music will come from oldies from the sixties and seventies, with artists like The Beatles, The Beach Boys, Three Dog Night, and The Stampeders, with a further 15 percent from eighties and nineties artists like Bryan Adams, Huey Lewis and the News, R.E.M. and Glass Tiger.

73               The remaining 10 percent of our musical sound will come from compatible Canadian contemporary artists like Sam Roberts, The Trews, Tomi Swick, and Jim Cuddy.

74               At Newcap we have invested a significant amount of money in helping to create new stars through initiatives like "The Big Money Shot" in Ottawa and "Big Rock Star" in Calgary.

75               These result in strong albums from emerging artists like Ottawa's Sojourn and Loudlove, and Calgary's The Dudes.

76               We are committed to giving these artists exposure on all of our rock stations, from St. John's through the maritimes, Ontario and Alberta.

77               In Drumheller, a new rock‑based station could provide exposure for these artists.  They will be presented on our station as future classics.

78               While a larger market with numerous competitive signals may require a classic hits station to be more singular in focus, a smaller market like Drumheller demands a radio station with a broader appeal, allowing T‑REX 102.7 to include some newer music.

79               In addition to an around‑the‑clock supply of great music, we will provide some special interest programs, focusing on specific eras, some sub‑genres of music, and lots of listener interaction.

80               Here is a small sample of the kinds of music features we will run:

81               "Psychedelic Sundays" ‑‑ a look at the artists of the sixties and seventies, with a focus on the new rock sounds that were emerging then, from The Electric Prunes to Neil Young, and even some folk music that was part of that era, like Joni Mitchell or Bob Dylan.  We will help the Woodstock‑era audience remember their youth.

82               Every weekday at noon we will host "The Resurrection Lunch", where we will invite listeners to resurrect their favourite classic songs, from album tracks to one‑hit wonders.

83               Friday nights at eight we will celebrate the beginning of the weekend with the eighties, featuring the best hair bands of the eighties, like Quiet Riot, Poison, Toronto's Motley Crue, Triumph, and more.

84               We know from experience that classic hits, classic rock, and oldies' listeners love the music of the past, but they live in the here and now, and here to tell us about our news and spoken word commitment is Sue Stevenson.

85               MS STEVENSON:  In Drumheller, our existing station, Q91, has two full‑time newspeople, Kevin Wyonzek and Bob Brown.  Kevin has 17 years of experience in Drumheller, while Bob has 10.  They provide our regular local newscasts, with a total of over five hours a week, including in‑depth agricultural news.

86               They cover local news extensively, and with dedication.

87               For example, in June of 2005 the Town of Drumheller was faced with a major flood threat.  Q91 played a significant role in mobilizing a community response, and, in fact, broke away from regular weekend programming and went live for more than 24 hours, until that threat passed.

88               A letter from then Deputy Premier Shirley McClellan noted that the Q91 coverage led to the tremendous outpouring of support that the Drumheller Valley experienced during those tense hours and days.

89               The story was also an example of our regional news‑sharing capabilities, as the City of Red Deer also faced a major flood threat and our two newsrooms were able to share pertinent information with our listeners.

90               Kevin and Bob also feed their stories to our database in Red Deer, where a package of southern Alberta news stories is made available to all of our Alberta Newcap stations.

91               Here is a recent example of how this works.

92               In November, the RCMP issued an AMBER Alert about a kidnapped boy.  Within minutes of receiving that notification, we were on the air with the news.

93               At the same time, Q91 fed that story to Red Deer and to our regional and Alberta newsrooms.

94               The story ended well, when the boy was found unharmed, about half an hour after the story was broadcast.

95               This regional connection enables Kevin and Bob to concentrate on live local newscasts throughout the high audience parts of the day, and to do a full job of news gathering from our extended coverage area.

96               At the same time, in off‑peak hours we can provide a southern Alberta newscast from our hub in Red Deer, with input from all of the various markets we serve there.

97               Listeners receive a package of news focused on their hometown and their region, rather than a newscast packaged in Toronto.

98               The addition of T‑REX in Drumheller will allow us to expand our news operation there.  With three new people in the newsroom, we will ensure live local newscasts for the two stations throughout the day, but can also get out to our community and the area to a greater extent.

99               These additional resources will enable us to reach our ambitious plan for local news, which will include four‑minute newscasts on the hour in morning drive, at noon, and during afternoon drive, from Monday to Friday, with three minutes of pure news in each one.

100              On Saturday and Sunday we will provide newscasts between 6 a.m. and 5 p.m., and shorter two‑and‑a‑half minute news updates on the half‑hour during morning drive weekdays.

101              In all, there will be 4 hours and 46 minutes of newscasts each week.

102              While we will share news gathering between T‑REX and Q91, the newscasts will be tailored to the different audiences of the two stations.

103              For example, there will be a stronger emphasis on agriculture and agribusiness on Q91, given its country format and its extended coverage area, which includes many farms and ranches.

104              T‑REX will have a greater emphasis on town events, as well as on lifestyle issues affecting younger families.

105              Our reflection of the community will go beyond the news we carry, with a variety of information and features.  Apart from the regular weather and environmental updates that all listeners want, we will also provide a number of features, as outlined in our application.  These include "Community Action", "Crime Stoppers", employment information, and "What's On".

106              Q91 is heavily involved in the local community.  For example, the station recently received a provincial award for a series of programs aimed at reducing youth smoking, which aired on Q91.  The program was a collaboration between Q91, local school students, and the Alberta Alcohol and Drug Abuse Commission.  And we will bring the same involvement to T‑REX.

107              We will be live and local 10 hours every weekday, with a strong emphasis on the morning and afternoon drive periods.

108              In order to provide such service to a small community, we will use voice tracking in other periods.

109              With the expanded programming presence in our stations, we will have people in the station, or on call, at all times to ensure the timely broadcast of emergency information.

110              In all, we will provide approximately 17 hours of spoken word programming each week.

111              And, now, to discuss Canadian Content Development, and to sum up, here, once again, is Ron Thompson.

112              MR. THOMPSON:  Thanks, Sue.

113              Newcap will contribute $70,000 over the course of the seven‑year term of the licence to CCD initiatives.  That is above and beyond the required basic amount.  Fourteen thousand dollars, or 20 percent, will go to FACTOR, and the remainder will be directed to initiatives in the Drumheller District School Board.

114              The $56,000 will go to purchase musical instruments, provide music scholarships, and fund participation in music festivals.

115              Madam Chair and Members of the Commission, Newcap is able to provide a second service in Drumheller for two reasons:  the existing infrastructure of Q91 allows us to do this economically by sharing facilities and some functions, and the strong backbone that the ARG provides allows us to provide back office functions in a very cost‑effective manner.

116              When Newcap acquired the small market stations throughout Alberta, we developed a plan to make them viable ‑‑ upgrade the physical plant, including FM conversions where appropriate; research the needs of the community for programming services; and put the right people in place to deliver.

117              This has resulted in a substantial increase of local programming, and the elimination of province‑wide networking.

118              But we also knew that, despite the strong Alberta economy, these small markets had limits to what they could support.

119              We divided the province into three areas, with hub stations in the largest markets providing engineering, accounting, copywriting, and traffic, as well as other functions, while developing experts in various kinds of content, particularly agriculture.  This permits us to keep costs where they should be, in programming.  And we have been very successful at this approach.

120              Drumheller is a small community, with only one local radio station ‑‑ a very good country radio station, providing excellent service to the town, in a relatively large rural area, but the people can hear a variety of music formats from other markets; not necessarily well, but well enough to know that they would like additional local musical choice, and, of course, the FM quality.

121              We have the expertise and the resources in place to meet these needs.

122              Our proposal represents a significant increase in investment in Drumheller, but we are confident that we can provide a better service to the community we serve.

123              We are the only applicant that undertook comprehensive, independent research to identify the town's preferences, and have crafted a proposal that reflects what we found out.

124              We hope that you will give us the opportunity to deliver on our promises, and we would be pleased to reply to your questions.

125              THE CHAIRPERSON:  Thank you very much.

126              I will lead the questions.  I think you have answered some of them, at any rate, but maybe some I will ask just for clarification.

127              I was going to confirm your spoken word commitments, as outlined in your October 31st letter, but I see that I have a slightly different breakdown, and that the spoken word programming, the news element of it, actually ties in with your supplementary brief, the four minutes and 46 seconds.  So we will take the 17 minutes and 7 as the gospel.

128              MR. MURRAY:  That's right.

129              THE CHAIRPERSON:  The local news component ‑‑ what would the local news component be?

130              MS STEVENSON:  When you are asking for the local news component, are you asking for the time or an actual breakdown?

131              THE CHAIRPERSON:  I am actually asking for the amount of time, the four minutes and 46 seconds, but I would be interested in a breakdown, as well, if you have one.

132              MS STEVENSON:  That would include 79 newscasts per week, which would include, of course, sports and weather.

133              Are you asking for actual times or ‑‑

134              THE CHAIRPERSON:  I notice that weather you had indicated was 39.5 minutes, I think, per week, and weather and sports.

135              MS STEVENSON:  That's correct.

136              THE CHAIRPERSON:  So the news was the difference, which was 3 hours and 18 minutes.  But how much of that is pure local news?

137              MS STEVENSON:  We would have 75 percent local news content.

138              THE CHAIRPERSON:  I noticed in your brief, at page 15, that you refer to "Two extended news bulletins, which will represent a comprehensive news roundup and allow for considered examination of major local issues each day."

139              I am wondering where that appears in the information you have given us.

140              MS STEVENSON:  What we would do is, our 8 a.m. and noon newscasts would be major newscasts.  We would increase elements in there, and some of our "Community Action" and "Crime Stoppers" features would run in that time slot.

141              We would also allow time for extended interviews with community leaders, if we wanted to expand on a topic.  That would be going into the 8 a.m. and noon major newscasts.

142              THE CHAIRPERSON:  When you say extended news bulletins, that is not included in the four minutes.  Those newscasts are over and above.

143              MS STEVENSON:  It would be included in the newscast, so we would possibly have to extend the time of those newscasts, as warranted.

144              It would include extended interviews, plus a number of other features that would go into those newscasts.

145              THE CHAIRPERSON:  So this is the minimum, I guess.

146              MS STEVENSON:  That would be the minimum, yes.

147              THE CHAIRPERSON:  Okay.  Thank you.

148              The trend amongst broadcasters operating commercial music‑based formats is to offer considerably less spoken word programming than you are proposing, and I am wondering if you could elaborate on why you think your approach is going to be successful, given that your listeners, the ones that you are projecting to take over from CJAY in Calgary and JACK in Calgary, are conditioned to a less talk/more music radio environment.

149              MR. JONES:  There are probably a number of factors that go into answering that question.  One of them is the fact that Drumheller is a small market, and we would be the only FM service there.

150              When you are in a larger market and you can turn broadcasting into narrowcasting, you can start to eliminate different elements of your programming that might not appeal to that core group of listeners you are after.

151              But in a smaller market you are required to be a bit more broad, and that would probably account for a lot of what you see here as far as music format goes, and also as far as spoken word goes.

152              Also, of those Calgary stations that we noted are the most listened to, two of them are news talk stations.  There is a hunger for information in the market, a hunger for information because there is no other station there to provide it.

153              THE CHAIRPERSON:  Is JACK a news station?

154              MR. JONES:  No.  QR77 and 6620 News are news.  JACK and CJAY are music stations.

155              THE CHAIRPERSON:  I think that quite a substantial portion of your out‑of‑market tuning, or repatriation, you were expecting to come from JACK.

156              MR. JONES:  Yes, and that is more due to the fact that, musically, JACK is a radio station that plays a gold‑based library, as would our station.

157              THE CHAIRPERSON:  It is interesting, because I see from your sheet that you have better defined for me, or set it out more clearly for me what the broad base is going to encompass.

158              Your listeners, you expect, will stay tuned and be interested to the variety this gives them.  They are not just interested in classic rock, for example, they are going to stay and listen to the others.

159              MR. JONES:  What we have found in the past in other markets is that, if you put together format styles that are somewhat compatible, you can achieve that.  So classic hits and classic rock and elements of sixties/seventies oldies and eighties/nineties pop can fit together rather cohesively.

160              If you expand that too far, I think you begin to lose, as opposed to gain.

161              MR. MURRAY:  Madam Chair, if I could, I would like to expand a little bit on the answer to your question about why we are offering so much news.

162              This is a trend that you have seen in applications from Newcap, and from a lot of other broadcasters, quite frankly, because terrestrial radio realizes that it needs to expand its news.  It is the single most important element in competing with satellite and iPods and internet radio and other things of this nature.

163              We have taken a very aggressive approach to this in this application and in other applications, but also in our existing radio stations.

164              As you can see, we have 5 hours in CKDQ Drumheller.  So it's not something that we are just promising here at the Commission, it is something that we believe very strongly in, very deeply in, and it is very important to our long‑term success.

165              THE CHAIRPERSON:  That is very helpful.  Personally, I like a lot of news and information, so I am glad to hear that that's the way the pendulum is moving.

166              The Commercial Radio Policy, as you well know, states that local programming includes programming that originates with the station.  I have a few questions, and I would like to better understand your Alberta Radio Group.  You have quite a bit of it covered in here, so don't hesitate to repeat the answer.  This is just so I make sure that I clearly understand what is happening.

167              I am wondering how many hours of station‑produced programming you are proposing a week in Drumheller.

168              MR. MURRAY:  I think I will start off.

169              I am not sure what the question is.

170              THE CHAIRPERSON:  Let me add this, and maybe it will help because you can sort of roll probably all the answer into one.

171              I want to understand how the Alberta Radio Group works.  I had understood from some information that I was given ‑‑ and this was in regards to your Stats Can reports, your statistical information ‑‑ that it was eliminated, that the Alberta Radio Network had been eliminated.  So I'm incorrect in that, I gather, from what you said here.

172              MR. MURRAY:  Right, yes.

173              THE CHAIRPERSON:  So maybe you could just explain to me what role it plays in your programming.  So how much is actually local and customized to the community and how much is more regional.  I guess you would consider that regional.

174              MR. MURRAY:  Right, okay, fine.

175              The Alberta Radio Group ‑‑ the Alberta Radio Group exists and it is a number of stations and, as Ron said in the opening remarks, it's now broken up into three hubs.

176              The way it used to operate was an Alberta Radio Network broadcast out of Edmonton.  So in Edmonton after morning drive on all of these dozen or more stations, the same music, the same news, the same programming for the rest of the day all was exactly the same on all those stations, which is something we recognize as that's not the appropriate way to provide service to these small communities and it's not a successful model.

177              So what we have done we have broken it into three hubs, but every single station produces 100 percent local programming.  Some of that programming might be voice tracked but typically about half of the programming is live and produced in that market by people on the ground in those markets, depending on the size of the market.

178              So for example in this station it's exactly what we are proposing.  66 hours on this new station will be live produced by people in Drumheller on the new FM and the remaining will be voice tracked by people either in Drumheller working or in Red Deer which is our southern hub.

179              So that's how we have changed the Alberta Radio Group quite dramatically.  So it used to be called the Alberta Radio Network.  We took network away.

180              And when you are talking about the financial aspect of that, yes, there was some confusion with our financials in Drumheller and that was just sort of an unfortunate ‑‑ it was a mistake.  We were asked by Statistics Canada to look at the annual returns.  We used to file the Alberta Radio Network as a separate station.  It had no revenue and it had all expenses and they said, "We don't want you to do that anymore.  Please add it to your largest station in the group rather than breaking it down".  For whatever reason that's what they wanted.

181              So we added it to our largest market and then Drumheller became our largest market, and we moved it to Drumheller.  But what we reported back to the people that we were asking is that in 2008 all of those expenses have actually been ‑‑ they're gone but, you know, people still exist but they have been moved into these hubs and they will show up in different ways.  I don't know if that helps.

182              THE CHAIRPERSON:  All right.  So I am probably going to have a few questions falling out of that then.

183              So what year was the change with Stats Canada made?  Was that in ‑‑ was it eliminated in '07 or '06?

184              MR. MURRAY:  Well, the change to the hubs took place in '06 and '07 and were calendar years.  So that spanned '05, '06 and '07 for the broadcast calendar.  And like, I say now, in '08 there will be zero costs in what we used to call the Edmonton hub, the single hub.  So that will disappear in '08.

185              THE CHAIRPERSON:  Okay.  But now there is three hubs as you say and the hub that Drumheller would be in it falls in the Red River in the ‑‑

186              MR. MURRAY:  Red Deer.

187              THE CHAIRPERSON:  Red Deer hub; is that correct?

188              MR. MURRAY:  That's right but there is no allocation of costs.  You know if there is extra costs in Red Deer they are either in Red Deer or say if there is a person in Red Deer that most of their work is done for Drumheller, well, then they are charged 100 percent to Drumheller.

189              THE CHAIRPERSON:  Repeat that again.

190              MR. MURRAY:  Like say there could be a person who is in Red Deer because that's the best place for them to be because they get supervision and mentoring and backup and all these sort of things.  But if 80 percent of their work is for the CKDQ‑AM Drumheller station we just simply charge them to Drumheller.

191              THE CHAIRPERSON:  Okay.

192              MR. MURRAY:  We don't try to identify a hub cost and take 5 percent of this and 10 percent of that and 12 percent of this.  It's just that's just too confusing.

193              THE CHAIRPERSON:  So those decisions are made like once a year and the person if you designate them as a Drumheller person is in there for the charge for the whole year?

194              MR. MURRAY:  Correct.

195              THE CHAIRPERSON:  You know, do it by a time card or that type of thing?

196              MR. MURRAY:  That's correct, exactly.

197              THE CHAIRPERSON:  So the voice tracking ‑‑ so did I understand you to say 50 percent would be locally produced?  Did you say that?

198              MR. MURRAY:  Well, 100 percent would be locally produced and 52 percent would be live‑to‑air, people speaking through the mikes in Drumheller, and the other 48 percent would be voice tracked either by people in Drumheller ‑‑ you know, like the morning person probably would voice track the afternoon drive show at the end of ‑‑ you know they would do it during their morning shift.  When there is three songs playing they would start voice tracking 11 o'clock, kind of thing.  Or there may be some person in the Red Deer hub that might do some voice tracking for the Drumheller station.

199              THE CHAIRPERSON:  So then what percent do you think of the 48 percent that would be actually done ‑‑ I guess I'm trying to understand or appreciate is how much is truly reflective of the people in Drumheller?

200              So if I'm living in Red Deer ‑‑

201              MR. MURRAY:  Yes, I'll let ‑‑ Brent probably has ‑‑ it varies, I'm sure, day to day and such but Brent can give you a better ‑‑

202              MR. YOUNG:  Yes, our intent with this radio station is to have about 66 hours a week.  So that would give you a live local and interactive morning show in this market on this radio station.  Also, the same in an afternoon drive show from three until seven, two until six, and also an hour over the noon hour.

203              This is all live, local people in the market to the tune of about 52 percent of the broadcast week.

204              The remaining voice tracked hours would be accomplished by people who are already in the market, people charged to that station or perhaps the announcers who are already in place at Q91 in Drumheller.

205              There is a sort of buddy system out of Red Deer where we do have announcers that are specifically attached to specific markets in our hub.  So should there be an announcer sick or away we have one specific announcer or a backup behind him or her that's attached to that market.  Those people are fed information from the market, PSA information, weather information, local events, activities, but they are the synonymous voice in the market when needed.  Those are the people out of Red Deer who can voice track in the market, but typically it's all done locally by the people who are there.

206              THE CHAIRPERSON:  And the people ‑‑ did I understand you to say that the people doing the voice tracking in Red Deer are getting the information, so they are getting the information from Drumheller. So there is that focus.

207              MR. YOUNG:  Absolutely, yes, local information, information of the day.  So they are not just talking about random stuff, as the whole group used to be as a network out of Edmonton it was very vanilla and across the board whereas now it is very much spoken to the market by the announcers that are charged with it.

208              THE CHAIRPERSON:  So is this 66 hours then is that typical for your similar‑sized stations in these smaller Alberta stations?

209              MR. YOUNG:  It is.  The ARG south stations that are in place now all have live, local morning shows and afternoon drive shows as well and a similar template for the voice tracking.

210              THE CHAIRPERSON:  And I am taking it you don't do any syndicated programming?

211              MR. YOUNG:  We do not.

212              THE CHAIRPERSON:  No.  So the music then, is the music ‑‑

213              MR. YOUNG:  Now, let me correct that.  I'm sorry.  We do run a four hour Top 40 country countdown show currently as a syndicated show in weekend airplay on the existing stations.

214              THE CHAIRPERSON:  So who produces that?

215              MR. YOUNG:  That is produced through Radio Express.  It's a purchased program.

216              THE CHAIRPERSON:  Yes, okay.

217              So the music then that is played on the station T‑REX 102.7, is it programmed centrally or is it programmed in Drumheller?

218              MR. YOUNG:  That would likely remain to be seen but I would suspect it will be programmed locally in Drumheller.  Currently, they don't have the existing music scheduling software but they would have to produce it out of there and we have attached the library too there.

219              We do a lot of music support currently for our ARG stations only because we have an existing country station in Red Deer.  We don't have this library in Red Deer and we don't have a database.  So we would probably schedule it locally.

220              THE CHAIRPERSON:  So does the capital budget that you have allowed for this station allow for doing that locally?

221              MR. MURRAY:  Yes, we would be doing it locally.

222              THE CHAIRPERSON:  You would be?

223              MR. MURRAY:  Yes.

224              THE CHAIRPERSON:  I notice in your brief at page 8 you state, and I am quoting again:

"...will be supported that Drumheller FM or T‑REX will be supported in the production of locally‑focused programming and news targeted exclusively towards the station's own market."  (As read)

225              THE CHAIRPERSON:  So I just would like you to elaborate if you would on the nature and scope of the programming that they are going ‑‑ and the synergies between the new FM station and CKDQ.

226              MS STEVENSON:  Currently CKDQ covers the town of Drumheller itself.  It also has a very wide footprint in the surrounding area.  So they really have a focus on both aspects.

227              With the addition of three new news people for the news station that would bring our complement in that newsroom to five which is a significant commitment.  It would allow us not only to focus more on town events and perhaps get to some meetings and events that we haven't been able to cover.

228              It would also allow the synergy of allowing Q91 to cover more district news as well.  So really it would help in that focus as well, not just the town but the entire district and we would be able to serve those markets very well.

229              It would also allow us to extend the number of newscasts.  We go to six p.m. weekdays with our newscasts.  On Q91 currently we only go to five p.m. so we would be looking at increasing the news content on Q91 as well.  We would be able to expand our weekend news coverage.  Currently we have a regional newscast.  It comes out of Edmonton.  We would be able to go live, local, weekend newscasts in Drumheller and that would be, you know, a great benefit to the community.

230              One of the things that we would also be able to do is on a regional aspect the newsrooms here you are talking about the ARG south.  We have a regional hub in Red Deer and we really support each other a lot.  We provide a lot of stories to Drumheller.  They provide a lot of stories to us and it would allow Drumheller to expand their regional news sharing capabilities with us.

231              And actually, currently Drumheller actually provides some of our network regional newscasts that are tailored for that southern Alberta market.  Drumheller actually provides some of those newscasts now for our smaller communities.  So they would be able to expand on their regional news sharing capabilities as well.  So it would be of significant benefit not only to the community but also our regional ARG South hub.

232              THE CHAIRPERSON:  I can see that it makes good business sense to try to get these economies of scale working for you and the efficiencies.  But if I lived in Drumheller and I switched from AM to FM to listen to the different music would I hear the same newscast?

233              MS STEVENSON:  No.  There is a definite difference in the type of news offered from Q91.  It's a country station.  It's agriculture based.  There would be a lot of emphasis on agriculture in that ‑‑ on that station.  So you are not going to hear any of that on T‑REX.  Frankly, the listeners if they wanted that they would probably be listening to country music.

234              So there is going to be a different focus.  The town news, the community news, you are going to hear that on both stations but you have to make the distinction on what is important to the listeners of each station and tailor your newscast to that.

235              THE CHAIRPERSON:  Would it be verbatim like you just play it here and play it there or would it be customized for the other station?

236              MS STEVENSON:  It would have to be customized.

237              THE CHAIRPERSON:  Okay.  So the subject might be the same but it wouldn't be verbatim?

238              MS STEVENSON:  You are going to have a different style of newscast delivery on Q91.  It would probably be a lot more traditional.  Over on T‑REX you might liven it up a little bit and it's definitely a different style of news read on a station like that.  So you would have to rewrite your copy to reflect that.

239              MR. MURRAY:  I should add too that, you know, CKDQ AM is a 50,000 watt AM station.  It literally goes from the Saskatchewan border to Brooks up to Ponoka and over past Calgary where the T‑REX is only going to serve Drumheller, the 10,000 people down in the valley.

240              So CKDQ is going to gather stories from Hanna and Ponoka and Brooks.  And you know it's going to get fed stories because it covers those areas and we take that commitment to serve that whole area very seriously.  T‑REX isn't going to get there so we are not going to be speaking to those people.  We are simply going to be speaking to the people in Drumheller.

241              THE CHAIRPERSON:  Okay, that adds clarification.

242              Just as far as independence of the news, so you are going to have three news people for the new station.

243              MS STEVENSON:  That's correct.

244              THE CHAIRPERSON:  And there is going to be some sharing, I understand you to be saying but how ‑‑ will they operate independently?  You have introduced us to your new manager and we have met your current manager for the AM station.

245              Will they all act independently?

246              MS STEVENSON:  No, it would be a shared newsroom, similar to what we have in Red Deer where we have two stations.  We have one newsroom that services both stations.  I mean to do otherwise it just wouldn't make sense from a staffing point, a staffing standpoint.

247              So definitely there would be that sharing of resources and stories and with five news people, boy, you can get out to a lot of stuff.

248              THE CHAIRPERSON:  I noticed in your October 31st deficiency response to question 7 you indicated that:

"Day to day on air staff would for the most part be dedicated to one of the two stations."  (As read)

249              THE CHAIRPERSON:  And then you go on to say:

"Certain on air positions such as weekends and off prime periods may be handled by on air staff shared between the two stations."  (As read)

250              THE CHAIRPERSON:  So I was wondering ‑‑ you think I could keep my pages in order here ‑‑ I was wondering how you will ensure a distinctive sound for T‑REX and CKDQ if you have the same people shared on the weekend.

251              MR. JONES:  We have found in other experiences similar to this that if the announcers and news people understand who they are talking to and the purpose of the radio station that talented broadcasters can adapt and then easily tailor their content to meet the target of each station and that ‑‑ you know. back to what Dave said about CKDQ being a regional radio station, doing a shift on that station might involve talking about highway conditions 100 kilometres away but doing a shift on T‑REX would mean focusing on the area just of Drumheller.

252              THE CHAIRPERSON:  So now the station manager or the news director, who is supervised to make ‑‑ who supervises the on air people to make sure you maintain that flavour?

253              MR. JONES:  Well, we have ‑‑ Brent Young is our program director for Alberta south and oversees all of the programming staff in those markets.  So there is a program director to look after the on air staff.  There is a news director to oversee the news staff and a general manager at each market to make sure that all of that is happening as it should.

254              THE CHAIRPERSON:  So there would be two general managers as I understand it then.  Is that correct?

255              MR. JONES:  There is a general manager in Drumheller.

256              And Dave, feel free to jump in if you like.

257              MR. MURRAY:  No, no, you are doing great.

‑‑‑ Laughter / Rires

258              MR. JONES:  I like to focus on music.

259              But there is a general manager in Drumheller and then there is a regional manager that would oversee Alberta south and each of the three hubs would have a regional manager.

260              THE CHAIRPERSON:  I like music too but I find it easier to understand the music than I am understanding the news.  So here is the question because you know the focus is on diversity and news voices.

261              So can you just sort of sum up for me ‑‑ and I can appreciate the business, the economic sense of operating it this way and probably it's traditionally done this way across the country.  But I just want to know how will approving your FM application bring an equal or greater diversity of news voices to the market versus licensing a new player in the market?

262              MR. JONES:  I think to start with ‑‑ by licensing our radio station for Drumheller we would be able to increase the coverage that we provide on both radio stations.  This is a very, very small market.  I think we have addressed at numerous times in our presentation to you how difficult it is to provide service to markets that small and how you need work in economies of scale, and use the regional hubs for office functions and share those costs in order to make a station like this feasible.

263              So from a news perspective another broadcaster may not be able to provide that same level of service to all the different areas that Q91 does to Drumheller as this station would.

264              MR. MURRAY:  Yes, I think to add to that, you know, I think ourselves we feel that we can provide a second service in Drumheller, an FM service, but it would be very difficult to do that in a viable way if we did not have CKDQ with it's existing sales infrastructure and our existing client relationships and, you know, all the ‑‑ and the existing news, these 27 years experienced news people and the Red Deer hub, all the services that it provides in terms of copy and production and administrative things and human resource assistance, et cetera, supervision.

265              I think a new player going into Drumheller but only reaching 8,000 people will have a very difficult time.

266              THE CHAIRPERSON:  Thank you.

267              My colleagues might have some questions on that after but I think you have answered mine.  Thank you.

268              The percentage of revenues, I didn't see that in the information that we were given.  What percentage of your revenues do you expect will come from CKDQ?  I gather 2 percent audience share you are saying, but how much of your revenue and what percentage would come from out‑of‑market stations, new advertisers to radio or increased spending on the part of current advertisers?  Did you do a breakdown or anything of your revenue?

269              MR. MURRAY:  Yes, I think I will ask Ron to talk to our revenue projection.

270              MR. THOMPSON:  Yes, we have taken a very close look at that because our forecasting is very, very aggressive and what we have looked at is that from the national viewpoint this format will attract a significant amount of money and our synergies and relationships with agencies and clients will cement that in because we can go in as a combo.  Our national is about $200,000 that we are forecasting here.  The expanded budgets in the market would be about $150,000.

271              Some of the retailers don't have the option of really reaching with the country format that younger demo that they are looking for.  We are going to be getting a significant amount of money from new advertisers.

272              There is a lot of interest in reaching those people in Drumheller.  They are small but mighty and that's ‑‑ the breakdown is basically about ‑‑ the migration from Q91 will be about $200,000 to $250,000.  We realize that.

273              THE CHAIRPERSON:  Thank you.

274              Yes, I know that at other hearings we have asked this question, this next question, with regards to your projection of audience shares, you know the 21 percent flat over the seven years.  So now that I have heard it asked before I just am curious to know, is that your actual experience that that is what will happen, 21 percent in year one and then ‑‑

275              MR. JONES:  Yes, we have found in markets that are under serviced that a new station can sign on and make an immediate impact.  There are listeners out there who are hungry for the format and they will find this very quickly, especially in a smaller market.

276              There is very little doubt that once this radio station signs on there will be a tremendous buzz in the market because there is a huge group of people who don't have a radio station to serve them.  We wouldn't expect that to ramp up over time.  That will happen right away, and that's clear in our research that we did in looking at this market.

277              THE CHAIRPERSON:  Same answer I heard before, I think.

‑‑‑ Laughter / Rires

278              THE CHAIRPERSON:  Consistency counts for a lot.

279              I notice because we have some comparisons that compare your projections to similar‑sized markets that your sales and promotion costs and your admin in general costs as a percent of total revenue are lower than comparable sized markets.  And I am assuming ‑‑ I guess I shouldn't answer the question.  I will let you answer the question.

280              MR. MURRAY:  Yes, that's right.  I mean it's because of our Alberta south hub will provide some services to ‑‑ they do provide services to CKDQ AM now and they will also provide them to T‑REX and it's not ‑‑ they won't be charged to T‑REX.  We don't have to add a number of people in Red Deer to put T‑REX on the air but they can do some if they can do the same service as they are providing for the other stations in the southern hub.

281              MS SPENRATH:  And if I might add, actually, disbanding the ARG head office on January 1st, 2008 there is probably about another maybe $150,000 in costs that really do belong to the south and will be in ‑‑ you know, charged to them next year, primarily engineering; a little bit of sales and some administrative costs as well.

282              THE CHAIRPERSON:  So I understand from what was said earlier that it would probably end up showing up in Red Deer, not in Drumheller.

283              MS SPENRATH:  Well, this is over and above Red Deer.  This is what was left of what's coming out of Edmonton with ARG head office which was disbanded just on January 1st of '08.  So there will be some extra costs that really do belong to Drumheller that will be charged out at that time that you will see split partially in '08 and a full year's worth annualized in '09, 2009.

284              THE CHAIRPERSON:  And are those in the forecast that you have given us?  Are they in the projections that you have given us?  Are they allowed for in those?

285              MS SPENRATH:  Yes, they are.

286              THE CHAIRPERSON:  Okay, thank you.

287              I just wanted to switch to Canadian Content Development.  And I am just wondering if you are willing ‑‑ well, if Newcap is willing to accept the imposition of a transitionary Canadian Content Development condition of licence which will expire with the amendments to the ‑‑ when the amendments to the Radio Regulations come into force?

288              MR. MURRAY:  Yes, we do.

289              MS SPENRATH:  Yes.  Yes, we are.  Thank you.

290              THE CHAIRPERSON:  And with regards to the October 31st deficiency response to question six you indicate that you have received written confirmation from the Drumheller District School Board that they will comply with the policies.

291              MR. MURRAY:  Yes.

292              THE CHAIRPERSON:  Did you file that with the Commission or would you?

293              MR. MURRAY:  Yes, we can.

294              THE CHAIRPERSON:  You will, okay.  Thanks.

295              MR. MURRAY:  I will file it this week.

296              THE CHAIRPERSON:  Thank you.

297              And I'm just wondering what if any follow‑up measures you will have in place with the school board to monitor and ensure that the funding continues to be spent in accordance with the CCD eligibility criteria.

298              MS SPENRATH:  Yes, actually, part of my job is to follow up on all of the CCD spending to make sure that it's qualified.

299              We do normally speak to schools ahead of time, prior to disbursing the funds, and do get a letter from them confirming that it will be spent.  And I do talk to them and let them know what types of things qualify for a CCD.

300              THE CHAIRPERSON:  So do you do that like on an annual basis periodically, not just at the outset?

301              MS SPENRATH:  Depends on the decision, because some like Calgary and Ottawa are very detailed and ongoing.  So I am in constant conversations with the people.  On ones like this where it is an annual contribution it would be once a year.

302              THE CHAIRPERSON:  Okay.  So you would talk to them at least once a year?

303              MS SPENRATH:  Oh, yes.

304              THE CHAIRPERSON:  Okay.  No, that's fine then.

305              I noticed at page 13 of your brief, and maybe your plans have changed a bit ‑‑ you mention, and I am quoting again, that your CCD:

"...includes a significant component considered specifically to enhance opportunities for Aboriginal people."  (As read)

306              THE CHAIRPERSON:  But when I look at the table it's not obvious to me where that is.

307              MS SPENRATH:  Again, that's something where when we communicate ‑‑ because I spoke to two different principals in the two different school systems, Catholic and public, and we do communicate to them that we would like these opportunities made available, you know, at first to Aboriginal students if possible, if there is an opportunity in their school and then, you know, second to the general school population.

308              THE CHAIRPERSON:  I don't know what portion of the population in Drumheller would be Aboriginal, a very high percentage?

309              MS SPENRATH:  Yes, according to Stats Canada 2006 it's 5 percent.

310              THE CHAIRPERSON:  Thank you.

311              Now, I am interested in your emerging technologies and you named quite a few that you expect to be using.  And I'm wondering which ones you are currently using in systems of this size because I'm sure in your larger systems you are doing a lot of these things, but you had indicated internet streaming, podcasting, on demand streams to cellular phones.

312              MR. JONES:  Well, the on demand streams to cellular phones is ‑‑

313              THE CHAIRPERSON:  Coming?

314              MR. JONES:  ‑‑ certainly something for the future.

315              As it stands now, almost all of our stations coast to coast stream their live feed on the internet.  Numerous radio stations in our group podcast, put up specific programs for download.  Some of our radio stations offer large portions of their programming on demand, not specifically a podcast but an MP3 file that you can download for your iPod or MP3 player or on your computer.

316              A lot of our radio stations also have taken advantage of the Youtube phenomenon and created video streaming on their websites so when the radio station does a promotion or a stunt or something interesting they can actually provide video coverage.

317              Maybe Brent or Sue might like to elaborate a bit on Red Deer because that's been ‑‑our ARG south hub, Red Deer, has been one of the leading stations in our group to take advantage of that technology.

318              MR. YOUNG:  Yes, we offer quite a service on the two Red Deer properties.  One is called Z TV and the other KG TV and we actually have a professional shooter who comes from TV who now works independently.  And he sort of follows us around to different promotions, comes in and shoots our morning show just on a whim when they are doing interesting stuff or in the public at events.

319              You know, our Golf To Cure Kids cancer fundraiser, we'll shoot the golf tournament, compile a mini TV show, upload it to our website and people can watch it and we're talking about it on air.  And we direct them to the website so they can put a face to the name and that sort of stuff.

320              THE CHAIRPERSON:  So this is somebody you actually engaged?  You hire him to do that?  It's not like a volunteer.

321              MR. YOUNG:  Correct.  He is freelance and works alongside us.  This is his business.  He has many other projects and works with us exclusively in the radio market for our two stations.

322              THE CHAIRPERSON:  I'm curious to know how you are monetizing these opportunities at this point and how you see you will be able to do that in the future.

323              MR. JONES:  Monetizing the internet for radio stations is something that really just started in the last couple of years and we haven't derived a significant amount yet from these emerging technologies, although you know it definitely will grow into the future.

324              Right now the main purpose of what we do on the internet is to connect with the listener and connect with the community.  But definitely there are opportunities in terms of client sponsorships or videotaping or broadcasting events at client locations.  Web streams offer the opportunity to run video ads prior to your web audio feed starting, so there can be some opportunity there for revenue as well as SMS and text messaging.  That does generate some revenue.

325              At this point I don't know a percentage but it's very insignificant considering the entire revenue pool, but it's one that's going to grow in the future.

326              THE CHAIRPERSON:  Is it something that your sales force is putting an emphasis on or that you're directing them to explore?

327              MR. MURRAY:  We have more or less found that the existing radio sales force really don't understand the internet.  And what Steve is talking about is, you know, the way we ‑‑ we are interested in reaching out to the listeners in whatever ways we can to provide more service so that they have faith in us and et cetera.

328              So we do sell banner ads on our stations and more or less there would be a special person or a single person in Alberta that would sell all the websites because it is a different understanding of, you know, clicks, page views and all those sort of things.

329              THE CHAIRPERSON:  I'm sure as your listeners mature and become employees then you will realize more money and more revenue from it, I would think.

330              MR. MURRAY:  Yes, I would like to get more revenue from it.

331              THE CHAIRPERSON:  Yes, I am sure the potential is there.

332              MR. MURRAY:  If you have any ideas.

‑‑‑ Laughter / Rires

333              MR. JONES:  Just to summarize a bit of that, we have created too just this year a new media kind of taskforce within our company and have taken a lot of our younger employees who have grown up with all of this technology and recognized that they use it differently than some of us older folk do.

‑‑‑ Laughter / Rires

334              MR. JONES:  And so we have tried to tap into that knowledge base and that will help us as we grow, make sure that we are capitalizing both from a listener service point of view and potentially from a revenue point of view on these technologies.

335              THE CHAIRPERSON:  Excellent, thank you.

336              Now, I'm sort of winding down on my questions here, but I'm wondering how many new licensees you think the market could support.

337              MR. MURRAY:  Well, I think I have sort of tried to answer that a little bit before in saying that I think, you know, Drumheller itself with only ‑‑ and I notice our signal reaches 8,500 people, the other ones reach approximately 8,000 ‑‑ will be a very challenging market to produce a viable sustaining service.  We can do it.  You know we have an advantage because of our Alberta south hub and the existing CDKQ AM.

338              So you know, really, we just want you to licence us.

‑‑‑ Laughter / Rires

339              THE CHAIRPERSON:  That's clear.

340              MR. MURRAY:  But seriously, you know, we think we do have a leg up but we are comfortable with your decision if you think there is more.  There is obviously two frequencies.  The people of Drumheller deserve more service.  So we are pretty comfortable with whatever you do.

341              THE CHAIRPERSON:  Thank you very much.  Thank you.

342              Panel?

343              Commissioner Cugini will start.

344              COMMISSIONER CUGINI:  Thank you, Madam Chair.

345              Okay, Mr. Jones, now we are going to talk about music.

346              MR. JONES:  Excellent.

347              COMMISSIONER CUGINI:  I am looking at your playlist and I am just wondering, were you thinking about CCD when you wrote Cindi Lauper, Girls Just Want to Have Fund?

‑‑‑ Laughter / Rires

348              MR. JONES:  That may have been a subconscious kind of typo.

349              COMMISSIONER CUGINI:  That's okay.

350              I mean, I heard what you said in your opening presentation about how much people love country music and they listen to it a lot.  And there is in fact a lot of out‑of‑market tuning to the country stations in Calgary.

351              Where are your potential listeners getting this music that you have on your playlist today?

352              MR. JONES:  For the most part I think right now they are getting it from JACK‑FM in Calgary.  It's the most similar‑sounding radio station in the region and it's the nearest geographic radio station.  But Drumheller is in a valley that is very deep and when you go into that valley you lose reliable reception of almost any out‑of‑market signal.

353              So it does speak to the desire for this kind of music or for some kind of choice that there is the kind of out‑of‑market tuning there is because it's not a reliable reception.

354              I think JACK‑FM is the primary source.  They may also be hearing some of this on web streams from different radio stations and that we really don't know.

355              COMMISSIONER CUGINI:  Do you find that country music listeners are more adaptable in terms of a classic hits format as opposed to an alternative rock format for Drumheller?

356              MR. JONES:  Well, certainly there is a lot more crossover in tuning.  We find in many different experiences as we research the country that classic hits listeners, some rock listeners and country listeners do share a little bit in common, certainly more than they would with an alternative rock or a younger leaning radio station.  Country listeners tend to be a bit more conservative in their tastes and a lot more passionate about country music, at least a lot more passionate pro country music.

357              COMMISSIONER CUGINI:  I mean you don't have ‑‑ well, you might.  You might include some elements of classic rock in this format.  Do you find that that is more akin to country listeners as well?

358              MR. JONES:  Yes, there is definitely crossover between classic ‑‑ there is a generation of people who grew up on the Eagles and Linda Ronstadt and Fleetwood Mac and the Doobie Brothers and the Steve Miller Band and Guess Who, who got to an era in the eighties and nineties and found that their music ‑‑ the music that was being made didn't sound anything like what they grew up with.  And there is that new generation of country that emerged in the nineties that repatriated a lot of those people over to country music with Garth Brooks and a whole new country sound that emerged in the mid‑nineties.  So we do see some crossover between classic rock and country.

359              COMMISSIONER CUGINI:  And I know I have asked you guys this before but refresh my memory.

360              Again, on your playlist you have got the far right column "GRC" classification.  Is it current, recurrence ‑‑

361              MR. JONES:  And gold.

362              COMMISSIONER CUGINI:  And gold?

363              MR. JONES:  Yes.

364              COMMISSIONER CUGINI:  That's it, okay.

365              MR. JONES:  And we have ‑‑ we have included a few, you know, currents that if there were a different market, if this were a market where you had 20 signals we probably wouldn't be so inclined to include them.  But in a market like Drumheller where you need to be more broad we have included an element of new music in our format that you might not see if this were an application before you in Calgary.  You know we have included about 10 percent new music and of that we have committed 4 percent emerging artists.

366              We have a program in Ottawa and Calgary, our CCB programs there, the Big Money Shot in Ottawa, the Big Rock Star in Calgary that actively generate new music.  And seeing as Drumheller lives kind of in the shadow of Calgary I think there is a great synergy there for artists who enter the rock star program at CFUL‑FM in Calgary to either come from Drumheller or if they are not from Drumheller to receive exposure in the market.

367              COMMISSIONER CUGINI:  Would you put somebody like Crash Parallel on this station?

368              MR. JONES:  Yes.

369              COMMISSIONER CUGINI:  Okay, thank you.  That gives me a better idea what the station is going to sound like.

370              I just have one more question on the spoken word, and I'm not sure if Ms Stevenson or Mr. Murray, you want to answer this question.

371              When I look at what you have given to us this morning with your oral remarks, something like Community Action, Crime Stoppers, Drumheller Hobs, Business Report, Local Heroes, almost look like and sound like they could be vignettes on this station.

372              MS STEVENSON:  Some of them would be, especially the Community Action.  It would be like a one‑minute update where a local charity or group comes into the station and in their own voice would tell the community about their program or, you know, what they are proposing to do and things like that.  So that would be a vignette, so to speak.

373              Crime Stoppers very much along the same lines.  It would not just be your average, you know, the police come in and they are looking for this crime of the week.  It would also include crime prevention tips, block parents, anything like that; community tips on how to keep safe.  So that would also be a vignette.

374              What's On would probably be more like a PSA‑type thing that would be handled by the announcers.  The business report, again, would include both local business.  You might talk to ‑‑ it's a very big oil, energy service site in Drumheller, plus agriculture, so you may be talking to some local people but also having the Alberta and national business news included in that; so really a conglomeration of a bunch of different elements for those.

375              COMMISSIONER CUGINI:  And are these features available currently on your AM station?

376              MS STEVENSON:  Of course the PSAs are, and we would make those available to Q91 if they are not.  The current announcers on Q91 of course do a lot of community interviews already and, you know, so it's in a different format but it is there.

377              Crime Stoppers would be a new feature and The Business Report would also be new.

378              COMMISSIONER CUGINI:  And Local Heroes as well?

379              MS STEVENSON:  Yes, Local Heroes the same thing.  That already though is included, you know, in a more informal way on air on Q91, just not as a set program.

380              COMMISSIONER CUGINI:  So this would be additional spoken word available to the market?

381              MS STEVENSON:  It would be.

382              COMMISSIONER CUGINI:  And if your AM station wanted access to them, they could become available to them?

383              MS STEVENSON:  I think ‑‑

384              COMMISSIONER CUGINI:  And would that be in addition to their current level though ‑‑ to that station's current level of spoken word ‑‑

385              MS STEVENSON:  Yes.

386              COMMISSIONER CUGINI:  ‑‑ or in place of?

387              MS STEVENSON:  Maybe Brent would like to speak to that.

388              MR. YOUNG:  It obviously would be, but I think in more of a formal manner.  As to Sue's points, those elements are already there, but not so much in a formal manner listed in place.

389              They certainly could be.

390              COMMISSIONER CUGINI:  Okay.  Thank you very much.

391              Thank you, Madam Chair.  Those are my questions.

392              THE CHAIRPERSON:  Commissioner Menzies.

393              COMMISSIONER MENZIES:  Thanks.

394              I'll try to make it quick because you've been there for a while.

395              What's the margin of error on a survey of 150 people?

396              MR. JONES:  I would have to go back and check and submit that to you separately.  We don't have that with me.

397              However, a survey of 150 people in a market of 8,000, we know ‑‑ we were before the Commission in Vancouver with a survey in the 500 range I believe for a market of several million, so on a sliding scale 150 would be the kind of panel size we would look for.

398              If we were doing general strategic research in this market ourselves and, you know, it was for our own internal purposes, a panel of 150 in a market that size wouldn't be out of line with what we'd normally consider.

399              COMMISSIONER MENZIES:  Okay.  You don't need to get back with the exact number to me, I just wanted to ‑‑ you answered my question and that you were confident in the accuracy of your research.

400              MR. JONES:  Okay.

401              COMMISSIONER MENZIES:  Just at the start you touched on this a little bit earlier, but I just wanted to go back to it again.

402              News, you'd be adding three people ‑‑ there's already ‑‑ there's two at your AM, you'd be adding three people.

403              Give me some sort of ‑‑ and, again, this doesn't have to be a fixed thing, just a stronger ballpark idea.  How many new stories would be getting done as opposed to five people doing the same stories that two people are doing now?

404              MS STEVENSON:  We would not have the people working on the same story.  That just wouldn't make sense, you would be able to cover so many more    items, and the news people would be responsible for all these vignettes that we spoke about: the business report, you know, the community profiles, the local heroes.  So, perhaps one person may be dedicated to that area to expand on that.

405              We would be able to expand our sports coverage, the Drumheller Dragons of the Alberta Junior Hockey League, you know, from the local soccer teams.  So, we would be able to expand on that area as well.

406              COMMISSIONER MENZIES:  So, all the story assignments would be centrally coordinated, for instance?

407              MS STEVENSON:   Definitely out of Drumheller, they would do that.

408              COMMISSIONER MENZIES:  So, it's more like the expansion of a single newsroom than the addition of another newsroom?

409              MS STEVENSON:  That's correct.  It would be a cohesive unit acting together with a localized news director who would be handing out the assignments.

410              COMMISSIONER MENZIES:  Right.  Now, just in terms of economic growth for the area, what do you see in the future for the Drumheller area in terms of opportunities for economic growth?

411              What I'm trying to do is get a sense of, if you weren't already in this market, would you want to go into it because of its future?

412              MR. MURRAY:  I think we would because we're all around it, for sure.  So, you know, we're very excited to have ‑‑ possibly have an opportunity to provide this extra service.

413              Clearly the AM probably gives us an opportunity to actually make some money eight or nine years from now.

414              But clearly Drumheller is a small    community, you know, 10,000 people, it  ‑‑ I guess I answered.

415              We would be trying to get in here.

416              COMMISSIONER MENZIES:  Okay.  And are there any specific areas that you see the economy growing?  I mean, Alberta overall has a good economy, but the Drumheller area isn't necessarily at the heart of it and the conventional oil and gas industry.

417              MR. MURRAY:  Right.

418              COMMISSIONER MENZIES:  And the drilling activity is on a much different curve than the oil sands and new oil industry.

419              Agriculture is always questionable.

420              I'm just wondering where you see ‑‑ do you see the economy kind of staying as it is.

421              MR. MURRAY:  Yes.

422              COMMISSIONER MENZIES:  Or do you see it curving upwards?

423              MR. MURRAY:  Yeah.

424              COMMISSIONER MENZIES:  Or do you see it sliding down?

425              MR. MURRAY:  I think I'll ask Ron to comment because he's more in touch with southern Alberta than I would be.

426              MR. THOMPSON:  The local economy is going to be leaning heavier on the tourist industry and we're seeing that.  Like, there's some beautiful hotels there, it's a big part of what they do and they have one of the ‑‑ well, the only dinosaur museum in Canada type of a thing.

427              But we see growth there, but it's going to be steady.  It's a work horse not a race horse.

428              COMMISSIONER MENZIES:  Okay.

429              MR. THOMPSON:  But there's a tremendous amount of confidence in the market by the local people that are there and they do draw from around Drumheller, their services are good.

430              But the growth I believe, because of the cost of gas and so forth, it is a very attractive place to go to and they've got very great ‑‑ you know, good facilities.  So, I see tourism.

431              The oil and gas and agriculture is always going to be cyclical, but it's not going to die, it will just ‑‑ it won't be the major focus there.

432              COMMISSIONER MENZIES:  Okay.  And sort of last in this, and there's ‑‑ I don't have ‑‑ I'm just going to preface this by saying there's no right answer or no wrong answer, I think both of these strategies ‑‑ and there might be a different one ‑‑ but I think both of them are just fine, make a lot of business sense.

433              But what I'm just trying to get at overall in these last two questions is:  Is your strategy with this an offensive growth strategy in terms of expansion, or is it fundamentally a defensive strategy to make sure that if the market ‑‑ if there's going to be additional growth in the market that you have it and it protects your AM?

434              MR. MURRAY:  Right.  Clearly there's some of that, but when we purchased the Alberta Radio Group in 2002 we had a very specific plan.

435              Practically all of them were AM stations and we had a strong belief in Alberta and we had a strong belief in radio in Alberta.

436              So, what we've done, we've virtually upgraded every single studio location.  We've moved most of those facility into new facilities.  We've upgraded all the transmitter facilities which includes conversion of four of the AMs to FM already.

437              We have an additional three applications ready to file for additional conversions.

438              We've also been successful at applying for three new FM services in the Alberta Radio Group in these rural markets in Camrose, Wainwright and Brooks and at a cost of approximately $5‑million so far.

439              So, we're looking ‑‑ you know, we're very ‑‑ and I also mentioned already about, you know, eliminating that network programming and turning programming that used to be ‑‑ used to come out of Edmonton and it was exactly the same in every single market, after morning drive, is now 100 per cent local in every single market.

440              Some of that is voice track because you have to do that in these little markets in order to be viable and provide that excellent service.

441              So, I think ‑‑ I hope I'm answering your question, to say we're committed to Alberta and we would be applying in Drumheller, even if we weren't there, but we think it's a huge advantage because we're there.

442              COMMISSIONER MENZIES:  Okay.  Thank you very much.

443              THE CHAIRPERSON:  Commissioner Patrone has some questions.

444              COMMISSIONER PATRONE:  Thank you, Madam Chair.

445              I wanted to ask first off about your future classics program, that's your sort of venue for newer artists; is that correct?

446              Is that an hour‑long segment, and when does it air?

447              MR. JONES:  The positioning of these songs as future classics is not intended to be a program per se, but it's just a regular element of our programming.

448              So, if 10 percent of our music is new then, you know, one in every 10 songs would be positioned on the air as a future classic.

449              And it's a way of positioning these songs in the context of classic hits so they don't sound of place.  And the future classics supports us that opportunity again to feed from the big money shot and the big rock star programs.

450              And those are very ambitious programs in Calgary and Ottawa that have a tremendous output of new music and that was the whole purpose behind them, was to actually generate ‑‑ to put together a CCD initiative that actually generated new CDs, new MP3s, new bands who are getting recorded and distributed to radio.

451              By doing this in Drumheller, by including that 10 per cent new music and four per cent emerging artists as we've called them future classics, we really I think give a leg up to bands in that area.  And there is music being made even in a small town like Drumheller.

452              Nickelback, for example, came from Hanna, Alberta which is within the Q‑91 area and I can only imagine what a success they could have been had we already been there, but...

‑‑‑ Laughter / Rires

453              MR. JONES:  Of course, that's hindsight, but there's more to come and we can be part of that.

454              COMMISSIONER PATRONE:  On what basis are those songs chosen?

455              MR. JONES:  The 10 percent of our new music would be chosen by our local program director.  And generally what will happen is there will be a weekly meeting, music meeting with the on‑air staff and they'll go through the new music and decide which is format compatible.

456              In the case of the big money shot and the big rock star programs, those are probably the rare instances where we as a company will corporately say that these songs are priorities and should be given air play and there isn't a lot of, you know, local decision‑making on those songs, those are given air play.

457              The other ones, you know, whether or not to play the new Bruce Springsteen song right away or wait a few weeks is a local decision.

458              COMMISSIONER PATRONE:  Now, Psychedelic Sundays, that's produced ‑‑ is that produced locally or is that the same show that's     produced elsewhere then canned for all your stations?

459              MR. YOUNG:  Yeah, not correct.  No, all of those shows would be locally produced as they have to fit into the template that's designed for the market.

460              Currently we don't ‑‑ we have a lot of feature programming on existing radio stations, but nothing is made here, shipped there.

461              COMMISSIONER PATRONE:  And I know in your Halifax station you have ‑‑ your morning drive time, your morning announcer, one of the three also does their newscast.

462              Is that an approach that you're   considering here?

463              MS STEVENSON:  We would have dedicated news people.  They would not be in most circumstances involved in on‑air.

464              COMMISSIONER PATRONE:  Okay.

465              MS STEVENSON:  The exception to that would be when there is breaking news after hours.  Those news announcers are cross‑trained to be able to go on air and provide live and local coverage to any breaking news.

466              Basically right now we have news people in our stations between 4:00 a.m. and 6:00 p.m. on weekdays and, when they are not in the station, they are on call.

467              So, you know, so we would be breaking into local programming that way.

468              COMMISSIONER PATRONE:  And how much actual field reporting are your reporters going to do out of Drumheller?  I mean, are they going to be spending most of their time working the phones inside the newsroom, or are they going to get an opportunity to get out into the community and really file from out there?

469              MS STEVENSON:  They would ‑‑ and, you know, that changes every given day depending on what the news of that day is.  But generally you try and get out to the local school boards, the local hospital board meeting, the town hall, the Chamber of Commerce, because you are the face of that radio station.

470              So, the more that you can get out in the community and interact with them, it's just so much better than sitting in the radio station on the phone.

471              COMMISSIONER PATRONE:  And those reporters will be working the courts as well and town hall...?

472              MS STEVENSON:  They would be covering court cases, everything that's available, all the normal duties that you would cover, plus they would try and find smaller events, multicultural BBQs, that might be something that they would go to cover as well.

473              Given such a big news staff, you would have the opportunity to get to some of those smaller events that perhaps you just have to give a miss to now with a smaller news staff, so...

474              COMMISSIONER PATRONE:  Will it be subscribing to a news service like BN or will it be part of the ‑‑

475              MS STEVENSON:  Yeah.

476              COMMISSIONER PATRONE:  ‑‑ region‑wide system?

477              MS STEVENSON:  The station in Drumheller is hooked up to Canadian Press, so ‑‑ which is changed from BN now ‑‑ so, you know, they have the news wire and the audio from Canadian Press.

478              We also support them from Red Deer     with any provincial stories that we do out of Red Deer or that have a regional focus, we send down our newsroom program to them, so they have that extra  resource.

479              And, conversely, anything that they produce in Drumheller that is of a regional focus, they send to us.

480              COMMISSIONER PATRONE:  Will you be able to go live from the legislature or anything like that?

481              MS STEVENSON:  We do have a reporter here in Edmonton who covers like city hall and the legislature.  We have gone live with them during elections and, so, that capability would be there.

482              COMMISSIONER PATRONE:   A couple more.  Your agribusiness segment, that is a separate segment; is that correct, and how long does that run?

483              MS STEVENSON:  That is.  That runs ‑‑ we have an actual couple of elements to that.  It runs in the morning, there's about a two‑minute report that runs after the 6:30 and 7:30 news.

484              In the noon hour, that's expanded on Q‑91 and it runs about 25 minutes and includes market reports, in‑depth agriculture news, but it runs about 25 minutes after that noon hour news package.

485              COMMISSIONER PATRONE:  Is that a sponsored segment?

486              MS STEVENSON:  There are different sponsors.  You know, it could be anyone from a farm implement dealer to fertilizer, so definitely, you know.

487              But keep in mind that would not be travelling over to T‑Rex because that would stay on Q‑91 being agriculture based.

488              COMMISSIONER PATRONE:  Yes.  I ask about the sponsorship issue because, of course, there's always the issue of editorial fairness which I know, you know, you're obviously aware of.

489              I mean, if you're doing a segment that is supposed to be a news segment but it's sponsored by XYZ Fertilizer and you're doing a fertilizer story, I mean, it can blur the lines.

490              MS STEVENSON:  Yeah.  That doesn't    really come into play if it's news, it's basically on, and we don't ‑‑ you know, we're not pulling back because of who our sponsors are.

491              If that answers your question.

492              COMMISSIONER PATRONE:  Yeah.  What oversight do you have to ensure that that, in fact, takes place?

493              MS STEVENSON:  Twenty‑seven years of experience with the news people in the market.  So, you know, it's a common sense issue.

494              COMMISSIONER PATRONE:  Any plans to hire stringers, part‑timers, volunteer reporters, that sort of thing?

495              MS STEVENSON:  No.

496              COMMISSIONER PATRONE:  Those are my questions.  Thank you, Madam Chair.

497              THE CHAIRPERSON:  Thank you.

498              COMMISSIONER MOLNAR:  Thank you.

499              There's been a lot of information shared here and so many of my questions have been answered, but I have a couple.  One is simply a follow up to the discussion there was on new media, new distribution platforms.

500              You spoke of some of the initiatives you're taking in Red Deer, the YouTube and so on and you made the comment, and I'm sorry I forget which of you made the comment that the Internet allows you to connect with your listener and with your community.

501              And, you know, it was a very fulsome discussion, but I didn't leave with actual understanding of what your particular plans were to use new distribution platforms such as the Internet and, you know, streaming or podcasting or what as it relates particularly to the market of Drumheller.

502              MR. JONES:  Our plan in Drumheller would be similar to the plans we have in place across the country, and that is to provide ‑‑ we provide a    corporate platform for our local radio stations to provide all this content.

503              Our stations in Newfoundland have a weekly program that they do.  It's going to sound a little out of place because it's a very local context program, but every weekend they send a guy out to broadcast live in a shed and he goes to back yards and streets and parties and lakes and wherever he might go, and they had the premier, Premier Williams in the shed with them and they record that and put that up on their website for listeners to view and download.

504              If there's particular events, as Brent mentioned, the Run for Cancer, to have the finish line video taped and interviews with the winners and sponsors and to bring that up on our website.

505              Those are the kind of local‑based video webstreaming initiatives we would use.

506              Again, it really does provide ‑‑ it's a local ‑‑ it's a local decision what sort of events happen in the community and they can utilize audio and video on the Internet.  Those platforms are provided to them.

507              And, in addition, the very basic one is streaming our audio content.  The listeners in Drumheller will be able to listen to the radio station on air or online, and if they choose to travel and want to stay in touch with their favourite radio station, it will be available to them 24/7 on the Internet.

508              COMMISSIONER MOLNAR:  You said it was a local decision as to what goes on air.  So, if the Drumheller radio station wanted to have a fulsome, rich website to promote and cross‑promote and support the community, who in the market would be making those decisions?

509              MR. JONES:  We have local people making those decisions in the market.  Our program directors would generally do that.

510              If there's news implications, our news directors would have a say in that and they would work with our corporate web team based in Halifax who build these platforms for them, and all of our radio stations have very rich websites to serve their communities.

511              MR. MURRAY:  Yeah.  I think specifically to answer your question, they would have a website, they would be streaming, because we provide that corporately.  What they put on it in terms of specific content, they would make the decision, but they would have many examples from our other 50 some radio stations across the country.  They would have a access to those and, you know, Steve would have program director meetings and things of that nature.

512              So, they would be getting ideas from our stations plus many other sources of training and, you know, radio training programs related to programming around the world.

513              COMMISSIONER MOLNAR:  Okay.  Thank you.

514              My last question.  I wanted to speak of cultural diversity and I've heard a couple of comments about it.

515              I guess first, as the incumbent within Drumheller, perhaps you could help me in explaining to me what is the cultural make‑up of the market that you operate in?

516              MS SPENRATH:  Yes.  In Drumheller itself the representation of Aboriginal and visible minority peoples is five per cent each, which is slightly less than the provincial average in both cases.  And as far as Aboriginal communities, or First Nations communities, there aren't any really close, Bassano would be the closest.  They're all in sort of Treaty 7 area.  Most of them are in southern Alberta, so, most of those people would be right in the Drumheller...

517              COMMISSIONER MOLNAR:  So, a relatively small diverse ‑‑ from an ethnocultural or persons of Aboriginal descent or persons with disability, it's a relatively small percentage of the Drumheller marketplace?

518              MS SPENRATH:  Yes, relatively small in relation to Alberta.

519              COMMISSIONER MOLNAR:  Okay.

520              MS SPENRATH:  Probably on the Aboriginal side it is close to the national average, and certainly under the national and provincial average  for visible minority peoples and people with     disabilities.  There isn't detailed information by town or by city for that, we have to look to the provincial.

521              COMMISSIONER MOLNAR:  You say within your supplementary brief, and I'll just read it here, it says:

"In terms of programming, our music, news and spoken word will reinforce our commitment to both the presence and portrayal of Canada's cultural diversity."  (As read)

522              COMMISSIONER MOLNAR:  So, could you tell me what it is particularly in your plans that would reflect this within your on‑air programming?

523              MS SPENRATH:  Yes.  And even though the population in this particular community is less than the average, we certainly take it seriously and would devote the same efforts there as we do in all of our markets.

524              As far as programming goes, our cultural diversity initiatives include, you know, developing, building relationships with all the various communities that fall within our areas that we would broadcast, making sure that when we're doing ‑‑ bringing guests in on air that we're being representative of the community that we're serving and, I guess, just making sure that our staff is representative of the diversity of the area.

525              We do do workshops for our people to talk about, particularly people with recruiting responsibilities about what the requirements are for cultural diversity.  So, they've all been educated on what our responsibilities are as broadcasters to ensure that our product is culturally diverse and represents and is relevant to the people that we're broadcasting to.

526              MR. JONES:  We also, if I may, reach out in each market to groups and associations that exist and let them know that the radio station is available to them for public service, make sure that we're on their distribution list for news releases and press releases so that we can...

527              I think a lot of people, when English isn't your first language, will assume that the radio station, because it's in English, isn't open to you, and letting people know that their events matter and their news releases matter and making sure that we're available to them is important.

528              COMMISSIONER MOLNAR:  You know, I certainly agree, and I think particularly in small markets where there is only one or two radio stations there's a bit of a responsibility to ensure that you're, you know, relevant to all of the marketplace and all the different cultural...

529              So, from that end I'll just ask, are there any particular programs, any particular initiatives or, you know, structured parts of your operations of the radio station that would be directed particularly to any of the culturally diverse groups?

530              MS SPENRATH:  I'll maybe speak

corporately and then maybe I'll ask, you know ‑‑

531              COMMISSIONER MOLNAR:  And fair enough, I think I would speak about Drumheller.

532              MS SPENRATH:  Oh, okay.

533              COMMISSIONER MOLNAR:  If that's okay, you know, for this radio station that we're planning.

534              MS SPENRATH:  Sure.  I guess I can speak corporately and maybe I'll have either Brent or Steve talk ‑‑ or even Sue talk about specific features that may take that into consideration.

535              Corporately we do ask that each of our locations report monthly on any activities, any news stories, events that they may cover that do ‑‑ that would be of interest or relevant to a diverse audience member.

536              Sue...

537              MR. JONES:  On a local level, as far as structure, no, there's not ‑‑ outside of reporting what you're doing and having someone at the corporate level contacting you regularly saying, what are you    doing, how are you being responsible to your community?

538              That's probably the biggest structural initiative that we have, and that does exist on the local level even though it's a corporate initiative.

539              But back to ‑‑ I think it's worth going back to the point about reaching out and making sure that for our local heroes segment or for our what's on segment that we're celebrating the cultural diversity, the festivals, the meetings, the events that are important.

540              And then from a public service point of view, reaching out to the local community whether or not the particular events impact their particular ethnic group, things like the earthquake in China and the situation in Burma, and those things that happen around the world, having a radio station on a local level who can bring together to the community, to reach out and assist in those things is very important.

541              COMMISSIONER MOLNAR:  Thank you.  Those are my questions.

542              THE CHAIRPERSON:  Thank you.  Counsel has some questions for you.

543              MR. MORRIS:  Thanks.

544              Just a couple of small points of clarification.

545              In your sheet that you submitted today which breaks down the spoken word programming you've committed to news programming for four hours and 46 minutes.

546              I just wanted to ‑‑ does that include surveillance like weather and sports and traffic updates, or is that pure news?

547              MS SPENRATH:  That's a combination of news, weather and sports.  The weather surveillance that you're speaking of would fall into the next section in the six hour, 18 minute.

548              MR. MORRIS:  So, there's news, weather and sports in the news programming and then there's additional weather updates.

549              MS SPENRATH:  Yes, that's correct.

550              MR. MORRIS:  Is that how it works?

551              MR. JONES:  The additional weather updates are more the casual, you know, it's sunny and 25 today and here's Bruce Springsteen on T‑Rex.

552              MR. MORRIS:  Right.

553              MR. JONES:  What we're speaking of in the greater package is the structured weather forecast that would come from within the news package.

554              MR. MORRIS:  Okay.  The second point.  Someone mentioned ‑‑ I forget who it was ‑‑ that 10 per cent of your music was going to be devoted to new music.

555              I just wondered how you would define new music.

556              MR. JONES:  For the 10 per cent it's more of a broad look at what's gold, recurrent and   current.  And songs generally come out and have a life cycle to them that might be, you know, 16 or 20 weeks as a song is released and gains popularity and over time moves to a recurrent category where it generally spends, you know, a year or so and then moves to a gold as it ages.

557              So, for the purposes of what we're proposing here, that 10 per cent is a little bit more vague.  It's new songs that have been released that haven't gotten old yet.

558              The four per cent emerging artists would obviously fall under a different definition and would be dedicated to Canadian music.

559              MR. MORRIS:  So, new music would be broader than emerging artists, it would be...?

560              MR. JONES:  Well, new music could include a new song by Tom Petty or a new song by Neil Young that wouldn't fall under any emerging artist definition.

561              MR. MORRIS:  Okay.  So, something like in the last 12 months or the last two years?

562              MR. JONES:  Mm‑hmm.  I think the last six to 12 months is probably a fair definition of current music.

563              MR. MORRIS:  Okay.  Last thing.  I just want to confirm the letter from the district school board, you said you'd submit it by the end of this week.  Is Friday of this week okay?

564              MS SPENRATH:  Yes, Friday would be fine.

565              MR. MORRIS:  Great.  Thank you.

566              THE CHAIRPERSON:  Okay.  Mr. Steel, Mr. Murray, whoever, this is your two minutes to tell us why we should select your application if the licence is granted for Drumheller.

567              MR. MURRAY:  Okay.  Thank you very much.

568              As we've said several times, Drumheller is a very small community of only approximately 10,000 people, but it is a very important market for Newcap.

569              CKDQ‑AM has served Drumheller and the surrounding area for nearly 50 years now and since 2002, when Newcap purchased the station, Newcap has dramatically improved the service by eliminating network programming, we talked about a couple of times, and adding a hundred per cent local programming and this is what T‑Rex is going to be, a hundred per cent local programming as well.

570              But despite the quality of the service, a single station cannot be all things all people.  In order to be sure that we pick a musical format that, you know, the people want in Drumheller, you know, we undertook research, we were the only applicant that did that, and we chose a broad‑based classic hits stations based on what people were listening to from out‑of‑market tuning.

571              The presence of Q‑91, CKDQ‑AM as a big sister station and the southern Alberta Radio Group as a corporate resource will provide substantial benefits to T‑Rex 102.7, including things like being a credible sales organization with existing contacts in the community, being part of a provincial‑wide sales team with the ability to aggregate audience, to attract national and regional sales.  We're doing that now in all of our small market stations.

572              Association with an existing Drumheller news team with a combined 27 years of experience in Drumheller will greatly benefit T‑Rex.

573              Being part of a news sharing service that provides ready access to regional and provincial stories from all of our stations in Alberta through the KLZ system we have, all the stories go up on a board and they can be readily accessed by the local people and they take them and they can then tailor them to their market and re‑record them and fire them back up.

574              We plan to add three new people ‑‑ three new news people to the Drumheller operation, resulting in a strong local newsroom that will strengthen the regional service offered by Q‑91 and the local service of T‑Rex as well.

575              We're going to contribute $70,000 to CCD as we've outlined.

576              Finally, I should note that our choice of frequency reaches the most people of the two chosen.

577              We'd like to thank the Commissioners and staff for a thorough hearing, since we're fresh into it, and the courtesy that you've extended to us today.

578              Thank you very much.

579              THE CHAIRPERSON:  Thank you to you and your panel.

580              And we're going to take a 15‑minute break, so we'll be back at 11:25.

581              Thank you.

‑‑‑ Upon recessing at 1110 / Suspension à 1110

‑‑‑ Upon resuming at 1130 / Reprise à 1130

582              THE SECRETARY:  We will now proceed with Item 2, which is an application by Thomas Bolin, on behalf of a corporation to be incorporated, for a licence to operate a low‑power English‑language FM commercial radio programming undertaking in Drumheller.

583              The new station would operate on Frequency 99.5 MHz, with an effective radiated power of 43.7 watts, non‑directional antenna, antenna height of 30 metres.

584              Appearing for the applicant is Mr. Thomas Bolin.

585              Please introduce your colleague.  You will have 20 minutes for your presentation.

*PRESENTATION / PRÉSENTATION

586              MR. BOLIN:  Good morning.  I would like to say hello to the Commissioners, and I would like, first, to thank you for allowing us to present our application at this hearing.

587              At this time I would like to introduce our panel:  myself, Tom Bolin, and beside me, my wife and partner, Laurie Bolin.

588              We would like to present to you what Valley FM is about and why we think our application is the choice that the Commission should exclusively grant.

589              Being both born and raised as residents of Drumheller, we feel that we know and understand the wants and needs of our community.  I operate a construction company and a cabinet supply outlet, and have been in business for myself for more than 25 years.

590              Laurie has been in business as an administrator and a finance comptroller with the agricultural dealership in Drumheller for the past seven years.

591              Our involvement in the community includes, for myself, being a coach for girls' softball for five years, and a minor hockey coach for 15 years.

592              We have raised five children in the community of Drumheller, and have always been involved with their extracurricular activities.

593              I am currently an on‑ice official and a billet supporter for the Drumheller Dragons Junior "A" Hockey Team.

594              I have in the past been the President of the Drumheller Minor Hockey League, as well as Scout leader and a member of the Knights of Columbus.

595              As for Laurie, she will be in charge of our financial structure for Valley FM.

596              Her community involvement includes Governor of girls' softball, President and Treasurer for the Girl Guides of Canada, the Drumheller Group, and manager of teams in the minor hockey system.

597              We participate every year in local 4‑H calf shows and sales.

598              If you have been to our town, you may know the landscape of Drumheller and our location in the beautiful Red Deer River Valley.  If not, then, when you visit Drumheller, your trip will take you below the prairie plateau onto the Red Deer River Valley floor.

599              As to our location, this leaves us with the absence of quality commercial FM radio signals, and the absence of contemporary music from Calgary or Red Deer, both of which are over 130 kilometres away, and in no way contribute to the local aspects of our town.

600              For a period of time the residents of Drumheller could tune to out‑of‑market radio and listen to AM radio stations from Calgary for their music of sixties to today.  There has been an absence of contemporary music for a while, due to programming flips and the change from the AM to the FM band.

601              We receive FM radio signals from CKUA, as they have a transmitter in the Hand Hills, 40 kilometres from Drumheller.  They are an Alberta regional radio station and rarely have any local information about Drumheller in their broadcasts.

602              Our application started long before today.  Over the past four years we have asked and talked to many persons involved in broadcasting, along with current Drumheller business owners.  We discussed the lack of local information and, at that time, local content involving our community.

603              We found that most Drumhellerites wanted a radio station that was Drumheller‑specific and played a contemporary brand of music.

604              We decided that, if we involved our community and provided our neighbours with the information they need, along with the music they request, we would truly be a local radio station.

605              There are many businesses in the area that use radio for their promotions.  We believe that if we provide an affordable ad rate to non‑traditional radio users, we can get them on board to use radio as their advertising tool.

606              Most business persons informed us that they would support us if we were successful with our application.

607              As we are not the only applicants, and are not the seasoned broadcasters at this hearing, they, too, must see a viable market in Drumheller after the Call for Applications.

608              Valley FM plans to be the voice of Drumheller, as we will provide a total of 70 minutes of news and sports, 27 minutes of stock or business reports, 9 minutes of school reports, 18 minutes of special features, such as "Valley View" and "Tonight in the Valley", 24 minutes of weather, 30 minutes of a buy/trade/sell show, or "tradio", and a 5‑minute birthday show, for an estimated total of 183 minutes per broadcast weekday, from 6 to 6, of information programming, along with the numerous public service announcements on the many events that take place throughout the area.

609              We will broadcast 24/7.  Our broadcast day will begin with a 12‑hour block with our in‑studio announcers.  The remainder of the day will be computer automation, with the exception of sports broadcasts or community events.

610              To start, between 6 and 9:30 a.m. there will be news and sports reports twice an hour, three school reports, three business stock reports, and scheduled weather reports every hour throughout the day.  Also, there will be a birthday phone‑in show.

611              Between 9:30 and noon we will present a 30‑minute buy/trade/sell show.  This will be an opportunity for the public to be environmentally friendly by recycling their new and used items.

612              The next information set will be in the noon hour, with three news/sports reports and a business report.

613              At 4 p.m. we will start Drumheller's afternoon drive with four news/sports updates and three business reports.

614              We plan to use a news service for international and national news, so we can concentrate on providing our listeners with more local news coverage.

615              Valley FM has been in touch with the Alberta Emergency Public Warning System, and will be providing the Drumheller area with this service for weather advisories, flood warnings, and, sadly, as we had a few months ago, the AMBER Alert.

616              In the area of Canadian Talent Development and emerging artists, Drumheller has been blessed with exceptional talent exposure, first with the success of Nickelback, which grew up in our backyard, and which prompted many of the youth in the area to create and form alternative rock and folk groups.

617              Drumheller has been honoured to have a Top 10 and Top 2 finalist in "Canadian Idol" with Jenn Beaupré and Jaydee Bixby.

618              Here in Drumheller, the music scene is as diverse as anywhere, with numerous music events, like the East Coulee Spring Festival, Wayne Fest, the Drumheller and District Music Festival, the Rotary Club's "Beethoven and the Badlands", and the Canada Day Festival, where bands like Downtyme and Blind Army have performed, along with folk groups and artists like The TIPPLErs and Jenn Beaupré.  All of these groups have recently released CDs.

619              These venues are the major musical attractions in our area.

620              Also, Drumheller is dotted with clubs and community halls that also provide value with entertainment.

621              Valley FM will create a program called "Valley View", a one‑minute feature, where we will showcase the cultural events happening in and around Drumheller, focusing on people involved not exclusive to the music arts, but persons with skills in art or a special talent, such as ceramics or gardening, or even perhaps a Christmas light display.  This program will air 10 times a week.

622              "Tonight in the Valley" will focus on evening performances, which will be at no charge to the artist.  This program will air once every two hours over the broadcast day.

623              "Valley Performances" will feature an interview of an emerging musical artist from the valley or area, and a selection of their work, if available.  This 15‑minute program will air twice over the weekend.

624              Our choice of musical selections will be the popular songs from the sixties to today.

625              We realize that the Canadian content portion of the regulations of 35 percent is only the minimum, and will be treated that way, as we plan to feature all‑Canadian days or weekends.

626              Our contribution to the Canadian Development Fund is the minimum, but we are also helping to promote talent development at home, where we will see the results and have a positive effect on local artists.

627              We, as the concerned citizens of Drumheller, believe that an educated listener can only have a positive effect on the community as a whole.  We, as a Condition of Licence, will create and broadcast a program called "You and the Law", where we will solicit the local police and highway patrol to do vignettes on correct driving laws and proper conduct as a citizen.  This program will be broadcast six times, randomly, throughout the day.

628              The workforce for Valley FM will start with two full‑time on‑air personnel, a news person, a traffic/reception/accounting person, and an account executive, for a total of five full‑time employees.

629              Along with this will be one part‑time employee for weekends, vacations or swing shifts.

630              We have negotiated lease space with IP Plus for availability on their tower, and at their site near Drumheller for our transmitter and antenna.

631              We are in the process of finding affordable studio accommodations that will be the home of Valley FM.

632              We asked the community to contribute to the public process in our application, and they responded overwhelmingly.

633              We must have more than 100 letters of support, and many from persons who are and have been in the radio industry.

634              This shows that our neighbours believe that our application is the one the Commission should approve.

635              Thank you for your time, and if you have any questions, we will answer them now.

636              THE CHAIRPERSON:  Thank you, Mr. Bolin.  Commissioner Cugini will lead the questioning.

637              COMMISSIONER CUGINI:  Thank you, Madam Chair.

638              Mr. Bolin and Ms Bolin, good morning, and welcome to these proceedings.  I have a few questions for you.

639              You haven't appeared before us before, but you should know that I always like to start with format questions, because that does form the basis of what the radio station will sound like to the listeners, and, of course, it forms the basis of your business plan.

640              In your application you describe your format as rock, pop and dance, but I didn't hear much today in your oral presentation elaborating further on that format.  Is it still your intention to offer those three genres of music?

641              MR. BOLIN:  Drumheller is a small community, and like I said before, we don't have access to a lot of music, due to the fact that a lot of AM stations now have gone to talk or news, or whatever, and rock/pop/dance would give us an opportunity to provide a bigger variety of music for the area.

642              We plan on having a request line, and phone‑ins, so that people can request songs and we can get a feel for the market and what we should be playing to make them happy as listeners.

643              The rock/pop/dance gives us a bigger area.  We want to play a variety of music, and we want to contribute to what the youth want to listen to, as well.  So, to get a wider scope, or a bigger scope of the market, we would like to stay with that.

644              COMMISSIONER CUGINI:  Do you intend on dedicating a certain percentage of your playlist to rock, a certain percentage to pop, and then a certain percentage to dance?

645              MR. BOLIN:  I guess so.  We were planning on a Saturday night dance party in our programming, and a Friday night bush party, which would be a little heavier rock, and during the day just play the hits from the sixties to today, with a splattering of new music, maybe the Top 20, once an hour, as we go through the broadcast day and the weekend.

646              COMMISSIONER CUGINI:  One of the difficulties we have with this is, if you read what that category of music entails, what it encompasses, according to our regs, it is this:

"Pop, rock and dance includes music from the entire pop, rock and dance spectrum.  This includes all types of rock music, including soft rock, hard rock, classic rock, heavy metal, modern rock, alternative rock, jazz rock, folk rock, and blues rock.  It also includes pop, rock and roll, rhythm and blues from the fifties and sixties, soul, dance, techno, rap, hip hop, urban, and contemporary rhythm and blues.  This includes musical selections listed in charts compiled and published by music trade publications."  (As read)

647              That is the definition of the format you are proposing.

648              Are you intending on including all of those formats?

649              Because in other markets where we have heard applications ‑‑ and you heard Newcap today, where they have honed it to just classic hits, which would come from those sub‑categories of pop, rock and dance.

650              We are really trying to get a handle on what the station will sound like.

651              I read that verbatim to you to get a clearer sense from you as to whether or not you intend on including all of that.

652              MR. BOLIN:  Well, I guess we wouldn't include all of it.

653              The popular hits from the sixties to today don't include a lot of heavy metal.  They don't include, probably, any jazz or anything like that.

654              The business people we talked to and the people who supported us wanted a contemporary hit station.

655              I was talking with the CRTC, and they asked me that same question, because when I made my application I had specified "rock/pop/dance", and I came back to them ‑‑ they asked me that question, and I came back to them and I told them that we were going to play hits from the sixties to today, and on the website it came out as "rock/pop/dance".

656              So I was confused at that point, but we are going to be playing contemporary hits from the sixties to today, in the rock area.

657              We are going to stay away from country and folk.

658              COMMISSIONER CUGINI:  Would this be more properly defined as a classic hits or a classic rock station, or an adult contemporary station?

659              MR. BOLIN:  I am having trouble with pigeonholing a variety of music for 8,000 people in one town, when you are trying to provide them with a service.

660              We are going to get people who are going to want to hear The Beatles all day, or we are going to get people who are going to want to hear Finger Eleven all day.  And we are going to have a smattering, probably, of requests for each one of those songs, and we will be playing each of those genres.

661              So I guess we would just say that it will be a classic hits station, or a classic hits format that we will be going with.

662              COMMISSIONER CUGINI:  At which point would you, therefore, run the risk of being something for everyone and nothing for no one?

663              MR. BOLIN:  At what point?

664              COMMISSIONER CUGINI:  Yes.

665              Because one of the things you say in your application ‑‑ and in your supplementary brief, specifically, you say:  "Successful with listeners from 18 to 55."

666              That is a huge age group to satisfy.

667              MR. BOLIN:  Yes.  A 55‑year‑old will be watching "Survivor" when the 18‑year‑old is listening to the radio at night.

668              And an 18‑year‑old should be in school, or at work, or whatever ‑‑ doing something ‑‑ I am not saying 18 or 12 or 16 ‑‑ they would not be available when a 55‑year‑old would be listening to the radio.

669              At different times of the day there will be different demographics listening to the radio.

670              COMMISSIONER CUGINI:  I will get into more specific questions regarding advertising, but how will you describe that to your potential advertisers, in terms of a demographic group that an advertiser would want to target?

671              MR. BOLIN:  Like I said, Drumheller is small.  We are not a city like Calgary or Red Deer, where you have a group of people that would categorize themselves with one ‑‑

672              I don't know.  It's tough to say.

673              You are going to go to a community event, and there will be 80‑year‑olds there and there will be 6‑year‑olds there, and they will all be at the community event.

674              If you are going to play music, you are going to play music that makes everybody a little bit happy.

675              At what point would I say that I am going to be a radio station for everybody or nobody?  When the advertisers start telling me that it is not working.  They don't see any results because nobody is listening to my station, because we are not playing what their purchasers, or whoever, who are going to go to their stores and buy, want.

676              If they are not happy, we won't be happy.

677              COMMISSIONER CUGINI:  One of the other things you say in your application is that you will be taking a fresh look at the 12 to 18‑year‑old group, and in previous hearings, such as these, we are constantly told that it is the most difficult group to reach.  It is the group that is going to legal and illegal sites for their music.  They are simply not listening to the radio.

678              So how are you going to take a fresh look at this young group?

679              MR. BOLIN:  We had planned on doing an evening ‑‑ although in our programming it says that our day stops at six o'clock, if we can get some interest in that evening group, where you have kids and they are texting and they are on the internet, they are going to want to hear about what is happening in their community, too.  If we can get that group on the radio, to broadcast to that same group, you know, as a high school student or a young person from the community, to provide them with their type of music at that time, that is what we meant about what you had mentioned.

680              COMMISSIONER CUGINI:  So it would be through your spoken word programming?

681              And, in particular, through someone from that demographic group?

682              MR. BOLIN:  Yes.  Yes, we would actually have an on‑air person, probably, doing a program there.

683              That's where we went with that.  We want to be able to go to the community and say:  Look, we know that you guys listen to this music, and if we are not playing this music, it is not going to be hit music in the future.  We are not going to have classic hits in the future if we don't listen to your music today.

684              That's where we were going with that.

685              COMMISSIONER CUGINI:  Okay.  I know that you had some correspondence with our staff regarding the number of hits that you would be playing, and I believe that in your application you did say that you would commit to a maximum of 15 percent hits per broadcast week.

686              MR. BOLIN:  I am not privy to that percentage.

687              Is that what you have there?

688              COMMISSIONER CUGINI:  That is what I have here in terms of what you committed to in your application.

689              MR. BOLIN:  Yes, we will go with that.  We will play the 15 percent hits.

690              COMMISSIONER CUGINI:  And you would accept that as a Condition of Licence?

691              MR. BOLIN:  Sure.

692              COMMISSIONER CUGINI:  Our legal team may have more questions on that, so be prepared.

693              In your application you also mentioned a music survey and research that led you to conclude that a pop/rock/dance format would serve Drumheller, and I looked through your application and I didn't find any evidence of formal market research.

694              You heard Newcap today mention that they engaged Mark Kassof & Company to do their market research.  Could you elaborate a little bit on the kind of research you did?

695              MR. BOLIN:  My research was my personal research, by talking to business people and the citizens of Drumheller, and mentioning that I had made an application for an FM radio station.  They said, "Yeah," and they said, "What kind of music?"  I told them what kind of music we would have, and they said, "Well, could you play this?" ‑‑ you know, a certain band, or something like that ‑‑ and I said, "Yes, we will be playing hits from the sixties to today."

696              And there was a lot of positive feedback on it.

697              Actually, I never got any negative feedback on any of this.

698              COMMISSIONER CUGINI:  Can you tell  us, approximately, how many people you spoke with?

699              MR. BOLIN:  Oh, probably 500 people.

700              COMMISSIONER CUGINI:  And these were business people in the Drumheller market?

701              MR. BOLIN:  Business people, community leaders, employees, friends, teammates ‑‑ everybody that I mentioned it to, they all had some focus that this is what we need in Drumheller and it would be good to have.

702              COMMISSIONER CUGINI:  Of those 500 people, nobody said, "Well, you know, I would rather listen to this other kind of radio station"?  They all agreed with what you were proposing?

703              MR. BOLIN:  No, one person didn't.  She said, "Tom, you've got another pipe dream."  And she is a CKUA supporter.  And good on her.

704              There are lots of people in Drumheller who do support CKUA because of the programming they provide.

705              But I thought that perhaps we could use a little rock and roll in Drumheller.

706              COMMISSIONER CUGINI:  I will ask you the same question that was asked of Newcap.

707              In this market there is quite a bit of out‑of‑market tuning to the Calgary stations.  We can see that from the share numbers.

708              What are you going to provide to Drumheller listeners that they currently aren't getting from listening to radio stations in Calgary?

709              In other words, how are you going to make your radio station so attractive that the Drumheller residents are going to change their listening habits and tune in to your radio station?

710              MR. BOLIN:  First of all, Drumheller receives no music radio stations from Calgary on a constant level.  You may get something ‑‑ it depends on where the sun is, or whether it's a foggy day.  I don't know what the heck it is, but the only true station that we get in Drumheller is CKUA.

711              We do get AM stations, and like I mentioned before, they have done flips from the AM to the FM band, or they have gone all news, or whatever.

712              I think, just turning on the transmitter in Drumheller and playing some rock and roll, people are going to be switching over to our station.

713              There is absolutely nothing there right now.

714              COMMISSIONER CUGINI:  One of the most important components of any business plan for a radio station, obviously, is what percentage of the audience you think you will be able to attract.

715              Again, throughout your application I didn't see any audience share numbers.  Did you look at what percentage of the audience you would be able to attract?

716              MR. BOLIN:  I think in our application we mentioned that 50 percent of the audience would be listening to our station.

717              COMMISSIONER CUGINI:  So you are projecting a 50 percent share.

718              MR. BOLIN:  Yes.

719              COMMISSIONER CUGINI:  Is that starting in Year 1?

720              MR. BOLIN:  Yes.

721              COMMISSIONER CUGINI:  And straight through to Year 7?

722              MR. BOLIN:  Sure.

723              COMMISSIONER CUGINI:  Do you see it increasing at all, or do you see it staying steady at 50 percent?

724              MR. BOLIN:  As long as we can keep the listener happy with what we are providing, we will see an increase, or stay the same.  If we can't, then there will probably be a decrease.

725              COMMISSIONER CUGINI:  Ad revenues, on the other hand, are also projected based on share data.  How did you come up with your ad revenue projections?

726              MR. BOLIN:  As a business owner, I have been approached by CKDQ to advertise, and although my business is a construction business and a cabinet business, I couldn't see the justification for the amount of money they wanted for an ad on that station.  So I figured that if I could get an affordable ad rate, we could attract more people to our station and get some non‑traditional advertisers on there.

727              I do think that the advertising part of it was a little bit high for Drumheller, and that is what prompted that.

728              COMMISSIONER CUGINI:  So you have never advertised on the AM radio station?

729              MR. BOLIN:  No, I never have.  I have used the newspaper.

730              Right now in Drumheller ‑‑ in Drumheller, my phone rings every day, so advertising would almost be moot for me.  It's not that I don't want people to know, or I could sponsor something, but in my type of business a lot of it is ‑‑ you know, I did a good job for somebody over there, "We will use him" type of thing.

731              I have been approached by CKDQ, but, like I said before, their advertising rates were a little bit too steep for me to actually justify ‑‑

732              COMMISSIONER CUGINI:  I could have used you two years ago when I renovated my kitchen.

‑‑‑ Laughter / Rires

733              COMMISSIONER CUGINI:  Your ad revenues appear to be significantly lower than those projected by the other two applicants.  And this, of course, demonstrates market impact.  In other words, how much of a hit will the incumbent take if we license a new radio station ‑‑ one or two ‑‑ to serve Drumheller, and yours are, by far, the lowest.

734              Are you being overly cautious?

735              MR. BOLIN:  Yes.  We had a business plan.  We had the opportunity to up our power during this application, but we thought that we would stick with our business plan.  We want to start off small.

736              Drumheller is a town that doesn't boom.  Drumheller has been here for a long time.  It started in the thirties as a mining community, and it kind of went downhill a little bit during the fifties, and then it just kind of stayed the same.

737              It is a slow‑growing town, so we decided to have our ad rate a little bit lower.  I think we went with $20 an ad for two minutes an hour, over the 12‑hour period that we are on in the daytime.  That is what we started with.

738              And we found that we could probably sustain a radio station at that rate.

739              We don't have the high transmitter costs, and we have a smaller staff than the other stations would have.

740              COMMISSIONER CUGINI:  One of the things we also need to look at is a further breakdown of your ad revenue, and I am wondering if you have had the opportunity to take a look at what percentage of your total advertising will come from new advertisers, that is, people like yourselves, who haven't used radio as a medium before, what percentage will come from increased budgets of existing advertisers, how much will come from the incumbent radio station, and how much will come from other media, that is, print or ‑‑

741              Do you have that breakdown?

742              MR. BOLIN:  No.  We are a brand new business idea.  We would almost have to go into their books to know what the heck is going on here before we would have that.

743              We just kind of figured that we could sell this.  I'm sorry to say that, but we have our heart and soul in this, too.

744              COMMISSIONER CUGINI:  We find that most people in radio do.

745              MR. BOLIN:  Yes.

746              COMMISSIONER CUGINI:  Okay.  I am going to move on to your spoken word programming.  You did give us a bit more detail today, but, generally, you say in your application that you will be 100 percent local, and that is equal to 126 hours a week.  But at another point you say that you will be local for 60 hours a week.

747              Can you confirm to me which it is?  Is it 126, or is it anything less than 126?

748              MR. BOLIN:  Our on‑air would be 60 hours a week, and although we are in the community, we would be there ‑‑ we are not networked, we wouldn't be taken into syndication programming at this point.

749              I guess we would say that it would be 60 hours.

750              COMMISSIONER CUGINI:  And the rest would be voice tracked?

751              MR. BOLIN:  Not voice tracked, automation or ‑‑

752              We haven't talked about voice track.

753              COMMISSIONER CUGINI:  Are you planning on doing any voice track programming?

754              MR. BOLIN:  Yes, we could probably do some, but I am not a great fan of voice track.  It is kind of ‑‑

755              I would rather have somebody in the studio, myself.

756              COMMISSIONER CUGINI:  So if you are live for 60 hours, what are you doing for the other 66?

757              MR. BOLIN:  Automation.  It wouldn't be voice track, it would be automation.  It would be computer automation, with our station breaks and our PSAs, and advertising that would be automated.

758              COMMISSIONER CUGINI:  All right.  Give me a sense of what you mean by computer automated.

759              Is your radio station running on a wheel at this point, the 60 hours are then repeated?

760              MR. BOLIN:  No.  No, if we break it down to one day ‑‑

761              Let's do one day.

762              From six in the morning until six at night ‑‑

763              COMMISSIONER CUGINI:  Right.

764              MR. BOLIN:  ‑‑ we will have two announcers in there, a news guy, and then at six at night we turn on the computer and we have the computer play the music, and we have our ads injected, and we have our automated news service, if there is one.

765              We plan on doing that, and let it just operate by itself, so we can take a day off, or take the evening off.

766              COMMISSIONER CUGINI:  Would anybody be available during those hours should there be an emergency, should there be a requirement for an emergency alert to be broadcast?

767              MR. BOLIN:  The Alberta Emergency Alert Service actually overrides your radio station, and they go on‑air when they want to.  They take over your programming.

768              We could probably be attached to something that ‑‑ obviously, we are going to be listening to our radio station and we will know that.

769              Drumheller is a small community.  We have "rush minute", we don't have "rush hour", and it wouldn't be hard to get to the studio at all.

770              COMMISSIONER CUGINI:  Okay.  Thank you.

771              In terms of the specifics of your spoken word programming ‑‑ and I am going to refer to your oral presentation that you just delivered to us ‑‑ you say "for an estimated total of 183 minutes per broadcast weekday" would be total spoken word.  So that is two hours and 23 minutes per day of spoken word.  Correct?

772              MR. BOLIN:  Correct.

773              COMMISSIONER CUGINI:  For a total of 21 hours and 35 minutes weekly of spoken word?

774              Hopefully my colleagues and the accountants are impressed by that quick calculation.

‑‑‑ Laughter / Rires

775              MR. BOLIN:  If that is what it calculates out to ‑‑

776              COMMISSIONER CUGINI:  Okay.  So 21 hours and 35 minutes weekly of spoken word.

777              Of that, you say that 70 minutes a day will be news and sports.

778              MR. BOLIN:  Yes.

779              COMMISSIONER CUGINI:  Of that 70 minutes a day, how much is strictly news?

780              MR. BOLIN:  We plan on using a news service.  So there would be a three‑minute national news feed, and a two‑minute local news broadcast, and then ‑‑

781              COMMISSIONER CUGINI:  And who would do that two minutes of local news?

782              MR. BOLIN:  Our news person.

783              We also will have a sports ‑‑ about a three‑minute sports injection there.

784              COMMISSIONER CUGINI:  I just want to know the news component.

785              This three minutes of news service, would that be a national news service that you would be subscribing to?

786              MR. BOLIN:  Yes, it would be Broadcast News.

787              COMMISSIONER CUGINI:  Broadcast News.  Okay.  Thank you.

788              MR. BOLIN:  I will use them as an example.  I have been talking to them.  I am not aware of anybody else who provides that service.

789              COMMISSIONER CUGINI:  The other elements of your spoken word programming ‑‑ for example, the stock and business reports and the school reports, as well as "Valley View" and "Tonight in the Valley" ‑‑ those would all be produced by your on‑air personalities?

790              MR. BOLIN:  Yes.

791              COMMISSIONER CUGINI:  Which leads me to the question of staffing, because that is commendable.  It is a high level of spoken word programming, and that is a lot of work for two full‑time on‑air personnel and a news person.

792              How hard are you going to work these people to be able to produce that level of spoken word programming?

793              MR. BOLIN:  We also will have an account executive there who will be out in the community talking to people.

794              Our policy is going to be that you will have to have a recording device with you whenever you leave the studio, because we are sound, we are not pictures, we are not anything else.

795              So any information you can get ‑‑ and if we have to, we will go out and find these people.

796              I know a lot of people that play the piano and the guitars in the bands, and stuff like that, and I could probably provide a year's supply of programming myself.

797              Not mentioned in our staff was myself, as general manager.  These were only the hired employees.  So that would be another employee, or another person at the station.

798              And we want to encourage internship or ‑‑ whatever it takes, because radio needs more new people and new sounds, and this would be an opportunity for someone to go out and do some of this stuff.

799              COMMISSIONER CUGINI:  So you will be offering internship opportunities ‑‑

800              MR. BOLIN:  Sure, yes.

801              COMMISSIONER CUGINI:  ‑‑ and opportunities to volunteers, for example?

802              MR. BOLIN:  Yes.

803              We want to be truly local.

804              COMMISSIONER CUGINI:  Okay.  I am going to move on to your Canadian Content Development commitments.

805              In your application, again, you cite at one point $1,500 per year, and at another point you say $1,900 per year for CCD.  Can you confirm to us which of those two figures is your CCD commitment?

806              MR. BOLIN:  Could I have a moment?

807              COMMISSIONER CUGINI:  Absolutely.

‑‑‑ Pause

808              MR. BOLIN:  I am having trouble finding that.

809              I know that we committed $500 for a scholarship for the high school and ‑‑

810              I can't figure out what ‑‑

811              Could you refresh my memory?

812              COMMISSIONER CUGINI:  I do have in your financial projections for Canadian Talent Development ‑‑ I have a figure of $1,500.  So perhaps just the $1,900 was an error in your application, and we will take $1,500 as your yearly commitment to CCD?

813              MR. BOLIN:  Yes.  There was a minimum in there, but we ‑‑

814              COMMISSIONER CUGINI:  Are you referring to the basic contribution?  Is that perhaps ‑‑

815              MR. BOLIN:  Wasn't the basic contribution $400?

816              COMMISSIONER CUGINI:  It is $500.

817              MR. BOLIN:  It is $500?

818              Okay, it is $500.

819              We were going to allow another $500 to ‑‑

820              I think it is only $1,500, yes, because we are going to give another $500 to the high school, as a scholarship, and we are going to award another $500 to the music festivals, I'm sure.

821              I hate to be uninformed about that.  I thought I knew about that one, but ‑‑

822              COMMISSIONER CUGINI:  That's okay.  It's a lot of information.

823              So, therefore, your over‑and‑above contribution is $1,000 a year.

824              MR. BOLIN:  Yes.

825              COMMISSIONER CUGINI:  And then, if we add that to your basic contribution of $500, that brings us to the total of $1,500 per year of CCD.

826              MR. BOLIN:  Yes.

827              COMMISSIONER CUGINI:  One of the things that we introduced in the Commercial Radio Policy was that, of the basic contribution of $500, 60 percent would go to FACTOR or Musique Action.

828              Do you agree with that, and will you accept that as a Condition of Licence?

829              MR. BOLIN:  Sure.

830              COMMISSIONER CUGINI:  Of the over‑and‑above, therefore, of the $1,000, 20 percent of that would go to FACTOR or Musique Action.

831              Is that acceptable to you as a Condition of Licence?

832              MR. BOLIN:  So of the $1,000 ‑‑ that would be $1,200?

833              COMMISSIONER CUGINI:  Twenty percent of the $1,000.

834              MR. BOLIN:  So that would only be $800 allotted to the scholarship and the award?

835              COMMISSIONER CUGINI:  And the music festival, yes.

836              MR. BOLIN:  That is almost like stealing away from those guys, isn't it?

837              I am going to say no.  I would rather give those guys in Drumheller the money than to have it leave the community.

838              COMMISSIONER CUGINI:  So should we, then ‑‑

839              Okay, we are going to have to work this one out.

840              With $500 for the scholarship ‑‑

841              MR. BOLIN:  Or we will donate the $1,200 and make up the difference.

842              COMMISSIONER CUGINI:  Donate the $1,200 to...?

843              MR. BOLIN:  To the $1,000 we will add another $200, just to make up the difference.  It will be easy math then.  We don't mind.

844              COMMISSIONER CUGINI:  Okay.  Thank you.  Easy math is always a good thing.

845              MR. BOLIN:  Yeah, that's good.

846              COMMISSIONER CUGINI:  Thank you for that.

847              In terms of the scholarship, have you contacted any educational institutions in the Drumheller market to determine which offer programs that would make this an eligible CCD contribution?

848              MR. BOLIN:  Not formally.  I have talked to the principals of both schools.

849              We now have two high schools, one a Catholic high school, and the Golden Hills School Division has their school.  I haven't talked to either one of the principals.

850              This was a plan that we had, and I am sure they wouldn't turn it down, if one of their students was registered in the broadcast industry or music, to further their career in university, or wherever.

851              COMMISSIONER CUGINI:  And both of these high schools offer music programs?

852              MR. BOLIN:  Yes.

853              COMMISSIONER CUGINI:  The music festival ‑‑ is this a contribution that you would be making to a music festival that currently exists in Drumheller?

854              MR. BOLIN:  The music festival does currently exist.  It has been running for about 80 years, I think.

855              COMMISSIONER CUGINI:  And what is the nature of that music festival?

856              MR. BOLIN:  It is a showcase of the talent of Drumheller, and persons of the valley.  They have the opportunity to perform in their special field, whether it be spoken word or music.

857              And they are adjudicated, and they are graded, and then the top ‑‑

858              The adjudicators pick an evening performance, and then those people go on to the Alberta Music Festival, and from there they ‑‑

859              It is an opportunity for talent to be recognized in Drumheller.

860              COMMISSIONER CUGINI:  So this would be a contribution to that festival, but not necessarily specifically to a participant in the festival.

861              MR. BOLIN:  We could actually pick somebody in the festival, in a certain category that we wanted the contribution awarded to, like a finalist in percussion, or a finalist in piano, or a finalist in spoken word or poetry.  We could pick them, and they actually receive monetary awards besides trophies and other gifts.

862              We would like to help sponsor that program.  It is a community ‑‑ a vibrant community project in Drumheller.

863              COMMISSIONER CUGINI:  I have one final question, Mr. Bolin, and it's a bit of a tough question, I will grant you that.

864              My colleagues may have others, and legal staff may have other questions, as well.

865              I hear you.  Drumheller is a small community of 8,000 people.  You are a well‑respected businessman in the community.  There is a very strong incumbent, Newcap, which is serving the radio market currently.  Newcap is an applicant in these proceedings.  Golden West is another applicant, another well‑heeled broadcaster, with loads of experience.  Why should we trust you to run a radio station in Drumheller?

866              MR. BOLIN:  Because I live here.  I live in this community and I love the community, and I think that someone who has a finger on the pulse of the community would be able to contribute more.

867              We are looking beyond the monetary gains of making a dollar in the advertising industry.

868              Our whole idea was to provide Drumheller with an alternative to the AM station we have now.

869              Our idea was to provide more information.  Our idea was to get the community more involved with itself.

870              Many things happen in our community, and we have to depend on the newspaper, which comes out once a week, to find out what is going on, or what had gone on, or who won an award, because our local station is not providing that information.

871              That is why I think I should be the applicant that you guys select.

872              COMMISSIONER CUGINI:  Thank you very much, Mr. Bolin, and Ms Bolin.

873              Thank you, Madam Chair.

874              THE CHAIRPERSON:  Commissioner Patrone?

875              COMMISSIONER PATRONE:  How are you both doing today?

876              MR. BOLIN:  Not bad, and you?

877              COMMISSIONER PATRONE:  I'm fine, thank you.

878              I just want to ask a couple of quick questions.

879              You said, Mr. Bolin, that you are involved with the Drumheller Dragons.

880              Is that correct?

881              MR. BOLIN:  Yes, I am a billet supporter.

882              I am not an on‑ice official for the juniors, I am too old for that.  They get the young guys to do that.

883              But I do minor hockey.

884              COMMISSIONER PATRONE:  Do you have any plans for live coverage of the games, or playing back the games?

885              MR. BOLIN:  Yes.  Actually, there is a young lad in Drumheller, his name is Jason Blanke, and he is the voice of the Dragons.  He does the arena broadcasting, or the arena announcing.

886              He travels with the team and broadcasts the games on the internet back to Drumheller or ‑‑ well, across the world, I guess.

887              So we can actually find out what is going on with our hockey team.

888              Also, part of the prerequisite to belong to the Alberta Junior Hockey League is to have a broadcast of your game.

889              They do both the home and the away games.

890              We have been talking to Jason, and we plan on handling the Junior "A" Hockey Team.  I think that Drumheller is the only town that has a Junior "A" Hockey Team in Alberta that doesn't have the games broadcast.

891              We have talked to the incumbent, CKDQ, and they said it was just too cost prohibitive for them to have somebody go out and do that, but I think we could do that just fine.

892              COMMISSIONER PATRONE:  You spoke about doing recordings of local bands, if I heard you correctly ‑‑ going out and actually recording shows?

893              Is that what you are planning on doing?  And, if so, are you planning on airing those shows in their entirety?

894              MR. BOLIN:  Well, I don't know, you have to edit a little bit.

895              The East Coulee Spring Festival is a prime example.  It is a showcase for the community to fundraise for the community.

896              If you have ever been to Drumheller, and if you have any geographics of Drumheller ‑‑ I mean how it is laid out ‑‑ it is a long town now.  It stretches right down the valley about ‑‑ I don't know ‑‑ 10 or 12 kilometres, whatever it is.  East Coulee was one community at one time.  It was a town by itself, and it has evolved into Drumheller.

897              They have a spring festival, and if we go out and record this spring festival, we plan on broadcasting parts of it back to the public just to promote that program so we can say this is the kind of music you are going to be able to hear out there and just help the community out because that's ‑‑ you know, that's what I think a radio station is all about.  We should go out there and just do this.

898              COMMISSIONER PATRONE:  What about school reports?  You said you are going to have nine minutes?

899              MR. BOLIN:  Yes.

900              COMMISSIONER PATRONE:  What exactly is a school report?

901              MR. BOLIN:  Yes, that's a good question.

‑‑‑ Laughter / Rires

902              MR. BOLIN:  A school report would be someone from the school whether it be a principal, a teacher, a student, telling us what's going to happen after school for the day, what's happening in their sporting events, whether it's pajama day or crazy hair day or whatever; just get the kids involved in the radio station and in the broadcasting part of it so we can ‑‑ I think if we get the kids involved we will get the adults listening because their kids are on the radio and we are going to be able to sell advertising that way.

903              COMMISSIONER PATRONE:  You spoke about All Canadian Days.

904              MR. BOLIN:  Yes.

905              COMMISSIONER PATRONE:  I imagine July 1st would be a pretty good candidate for that.

906              MR. BOLIN:  Yes, that's a good one.

907              COMMISSIONER PATRONE:  Just curious, how many of these days do you plan on having and is this going to be like a regular segment on your station?

908              MR. BOLIN:  If the Commission wants it a condition of licence I could schedule probably one a month if you wanted but probably that might be a little too much.

909              We would like to do some different things like all Canadian, like July 1st or May long weekend or, I don't know, sometime in December you know or January, maybe even January 1st, the all Canadian or whatever.

910              Yes, we do plan on doing that because I do believe ‑‑ I'm a very patriotic guy.  I have got a flag in my yard.  You know, I believe in what we are doing over in Afghanistan.  I believe it in all and I do believe that being a Canadian and promoting our talent here in Canada is number one.

911              COMMISSIONER PATRONE:  I want to thank you both for coming here today.

912              Commissioner ‑‑ thank you, Madam Chair.

913              THE CHAIRPERSON:  Commissioner Molnar.

914              COMMISSIONER MOLNAR:  Thank you and welcome this morning.

915              MR. BOLIN:  Thank you.

916              COMMISSIONER MOLNAR:  I just have a couple of questions.

917              I want to first ask about the financial forecast.  I realize that you have put forward a business plan that is significantly different than the other applicants before us here today.  I would say a scaled‑down version, you know?

918              MR. BOLIN:  Yes.

919              COMMISSIONER MOLNAR:  But you project that you will be PBIT‑positive in year one and each year thereafter.  And if we look, for example, at the incumbent and their forecast, the application they put forward, they would project that they will incur losses in the first four years of the new radio station.  That's very significant to carry losses for any period of time.

920              And I just wondered about the financial capacity that you might have should the financials not be as positive as you project.

921              MR. BOLIN:  Well, first of all, we don't plan on failing.  I understand ‑‑

922              COMMISSIONER MOLNAR:  And fair enough.  I don't think they would plan on failing either when they are carrying those losses towards ‑‑

923              MR. BOLIN:  Yes.

924              COMMISSIONER MOLNAR:  ‑‑ you know, achieving financial success.

925              MR. BOLIN:  To carry the downfall in case there isn't the projected monies you know, we haven't even ‑‑ we didn't think about that part other than, you know, dipping into some savings or something like that to get it going.

926              COMMISSIONER MOLNAR:  M'hm.

927              MR. BOLIN:  Or maybe scale back a bit if it's a possibility of employees or something like that.  But I don't want to do that.  Yes, it would probably have to be financial.

928              We also plan on selling shares in our company.  So we probably could have some monies generated through that.  I know nobody wants to invest in a company that's going downhill, by no means, but if we can get online with these people with investors prior to any downturn, but I really can't see that happening right now.

929              COMMISSIONER MOLNAR:  Right, and please, I'm not suggesting that you would see a downturn, more of a ramp up.

930              MR. BOLIN:  Yes.

931              COMMISSIONER MOLNAR:  You know which is what we see traditionally within the business cases of new stations.

932              MR. BOLIN:  Yes.

933              COMMISSIONER MOLNAR:  Is that you would see losses in the first years as you build your audience share, as you recover some of the capital costs related to putting forward ‑‑ or putting together a new station.  You know there is that front end load cost, if you will, and I think ‑‑ you know, you say a suggestion might be to decrease staff.  Of course, with five staff it's pretty difficult to think that's ‑‑

934              MR. BOLIN:  Yes, yes.

935              COMMISSIONER MOLNAR:  ‑‑ a possibility.  So I think it is a true potential that that might have to be carried by the principal investors.

936              MR. BOLIN:  Yes.

937              COMMISSIONER MOLNAR:  That sort of loss, is that something that ‑‑

938              MR. BOLIN:  Yes, that's what we would plan then.

939              COMMISSIONER MOLNAR:  Okay.

940              Could I just ask a little bit about the experience that would be available to run the radio station?  Obviously, you are an experienced business man.  You are talking about bringing in five resources, two on air people; your account executive.

941              Do you see being able to acquire people with radio experience as part of that group of five who would understand some of the, you know, regulatory commitments you need to make and so on to ensure that you remain compliant and relevant to your market?

942              MR. BOLIN:  Yes, we had decided that we would have to hire someone who has gone to school in the broadcast industry to get us up and online.

943              Part of it was trying to be local and first of all have someone from the community apply for the jobs and take the jobs that are in there.  We do ‑‑ yes, like we said, we would like to hire somebody that has gone to broadcast school so they can help us get up and going.

944              We are small.  We are going to be small so we will be like an entry‑level broadcaster.  We are not going to be, you know, full fledged.  The main thing ‑‑ I don't know.  That's probably it.

945              COMMISSIONER MOLNAR:  Okay.

946              I'm going to move on from that, and I asked Newcap who was here before you a couple of questions that I would like to ask you as well; one related to cultural diversity.

947              And I realize you are small.  You are going to be on the air just 60 hours but do you see somehow being able to reflect within your programming schedule the cultural makeup of your marketplace?

948              MR. BOLIN:  Our marketplace is ‑‑ you know, I don't want to say it but we are very isolated in Drumheller.  We don't have First Nations lands near us.  We don't have an influx of ethnic people in Drumheller.  It grew up as a European farming community.  I hate to say it, but most of the people are white Anglo‑Saxons.

949              Our biggest diversity there would be a religious one which would be the farming communities of the Hudderites.  Drumheller does not have a big native population.

950              Our biggest ‑‑ probably the closest thing to a native population would be we do have a penitentiary and 50 percent of the population in that penitentiary are native.  And we did consider having native broadcasting from a broadcaster in northern Alberta ‑‑ provide us with a couple of hours a week.  So we could have some native broadcasting for those guys there but they don't ‑‑ they can't get out and buy anything so all it would ‑‑ that would be just a public service to them.

951              The diversity in our town, there is really no hatred or anything.  I'm not saying it's not there but it's not visible.  We accept everyone in our community.  We have ‑‑ you know, like visible minorities are just us.  They are just regular folk that is us.  So they are going to listen to the same type of music as us, I hope, unless they have a specific song they want to hear from wherever they are from, you know, or whatever their origin is.

952              I'm just saying that our selection of music and our programming it's going to be for Drumheller.  Don't think that I don't see anything out there, you know, for different ethnic groups and stuff like that but it's just not there in Drumheller, you know.

953              COMMISSIONER MOLNAR:  Okay, thank you.

954              My last question relates to use of the internet or other sources of new media to support your radio station.  Would you see ‑‑ would you have plans to use new distribution platforms such as the internet to put forward a website that would support and promote your station?

955              MR. BOLIN:  Yes.  We have a large community of first of all, Junior A hockey players that come from all over Alberta and Canada to play.  And their parents aren't there and they would like to hear their hockey players play the game.  If we broadcast ‑‑ our broadcast day if we put it on the internet, then they have a chance to hear that.

956              We also have a large community of international students in Drumheller that attend our high school and they come from Mexico, China, France, all over the world they come to Drumheller.  This would be also an opportunity for their parents to see what is going on in the community that they ‑‑ where they live.

957              So we do plan on using the internet and we would like to use all the technologies available other than podcasting or cell phones right now.  We don't want to get too cost‑prohibitive.

958              The internet, if we go on streaming on the internet it's going to cost us for as many people go on.  We want to put a quality product on there.  We would sell advertising on that website as long as the CRTC doesn't regulate too much of that.  I know that they want to change some of the regulations in that area and we would be happy with anything they had.

959              COMMISSIONER MOLNAR:  Okay, just one quick follow up.

960              Did you incorporate the costs of creating that website and any associated costs of streaming into your financial forecasts?

961              MR. BOLIN:  Yes.

962              COMMISSIONER MOLNAR:  Yes?

963              MR. BOLIN:  We presently own valleyfm.ca and we have used this website to solicit support for our application here today.  And we plan on using that site to stream our broadcast day.

964              COMMISSIONER MOLNAR:  Okay.  Thank you very much.  Those are my questions.

965              MR. BOLIN:  Thank you.

966              THE CHAIRPERSON:  Mr. Bolin, I have a few questions.

967              I am just wondering, first of all, I would just like to better understand, after six o'clock in the evening you say the programming is going to be played using a computer?  Can you just tell me how that would be programmed?  I don't quite understand that.

968              MR. BOLIN:  Pardon me?

969              THE CHAIRPERSON:  I don't quite understand that.  Can you tell me how that will be programmed?

970              MR. BOLIN:  Well, during the broadcast day we use computers to play music and ads and everything.  So what you can do now is turn on a computer and it can play song after song.

971              THE CHAIRPERSON:  Yes.

972              MR. BOLIN:  I know we are not going to be a jukebox but, you know, we can fill up the rest of the broadcast day.  You do have a choice, I suppose, of shutting off your transmitter or to turn on a computer and have people listen.

973              THE CHAIRPERSON:  So your staff will program that?

974              MR. BOLIN:  Yes.  Oh, yes.

975              THE CHAIRPERSON:  And you will insert ads in it, you said?

976              MR. BOLIN:  Yes, ads and public announcements.  We could actually insert sports reports, weather reports and news.

977              THE CHAIRPERSON:  All right.

978              Okay, I have a better understanding of that.  Thank you.

979              I was curious to know when I read through your material ‑‑ I just wanted to understand.  Let me ask the question this way.  I notice that you are planning, I think, $112,000 ‑‑ $116,000 including a $59,000 contingency for your capital costs of facilities and Newcap in theirs is suggesting $700,000.

980              I just wondered, and this ties into my other question so we can do it together ‑‑ I just wondered if that's related to the fact that you have chosen a low power frequency?  I just wonder what kind of technical advice you had and how you came up with these numbers and also the reason for picking a low power frequency.

981              MR. BOLIN:  Okay.

982              First of all, it probably is the fact that we are low power and that they are higher power.  Our costs were ‑‑ we asked Pippin Technical from Saskatoon.  They actually handled our engineering for our frequency ‑‑ to give us a breakdown of equipment for our studios and for our transmitter and we used those numbers.

983              What was the last part of that question?

984              THE CHAIRPERSON:  I was wondering why you picked a low power frequency.

985              MR. BOLIN:  Oh, a low power, yes.

986              Presently, in Drumheller we have a 10 watt tourist information station that plays a continuous loop of information.  And it seems to service the valley quite, quite well.  There are some spots because of that power.

987              We thought we would go with 50 watt power not for any other reason other than it would serve the purpose and it would provide the music and the information that we can get in the valley.  There would be no reason to go out beyond the valley unless we are going to go and service Hanna.  We would have to probably put our transmitter on ‑‑ there is a big pile of dirt between Drumheller and Hanna.  It's called the Handhills and we would have to have a transmitter on there and we would have to be 100,000 watts like CKOA to boom into our valley and to service whatever other areas farther east of us.

988              THE CHAIRPERSON:  It's my understanding that if you have a low power frequency that you can be bumped, so to speak, if somebody comes along and wants to put the full service on the frequency.

989              Did you consider that?

990              MR. BOLIN:  Yes, we have.  The availability of frequencies, we have submitted I think three other frequencies that are available for Drumheller ‑‑

991              THE CHAIRPERSON:  So you are ‑‑

992              MR. BOLIN:  ‑‑ if we are bumped from that.

993              Like I said before, Drumheller receives almost no FM and, well, other than we would maybe interfere with somebody else you know, in the valley there it's pretty ‑‑ it's almost wide open.

994              THE CHAIRPERSON:  As long as ‑‑

995              MR. BOLIN:  I know it's tough to find in Canada.  It would almost be like northern Canada where you wouldn't pick up anything.  But you know it's tough to pick up anything out of Drumheller.

996              THE CHAIRPERSON:  Just to go back to the commercial hits question that Commissioner Cugini was asking you, we are just a little bit concerned.

997              You said that you would accept a condition that you wouldn't play more than 15 percent hits.  And I think I should caution you because most of the licensees as for up to 49.9 percent.  15 percent would really restrict you especially with the format that you have selected, a classic hits station.

998              So I just wonder if that's just maybe a misunderstanding.

999              MR. BOLIN:  It must be.  I am confused right now.

‑‑‑ Laughter / Rires

1000             THE CHAIRPERSON:  So you wouldn't be able to play more than 15 percent hits on your station and a hit is defined as something that made it to ‑‑ a record that succeeded on the charts up to and including December 31st, '80.

1001             MR. BOLIN:  Yes.

1002             THE CHAIRPERSON:  So 15 percent?

1003             MR. BOLIN:  Yes, that's wrong, yes.

1004             THE CHAIRPERSON:  Okay.

1005             MR. BOLIN:  Yes.

1006             THE CHAIRPERSON:  So you probably want the norm, 49 percent?

1007             MR. BOLIN:  Yes, sure.  Yes, I wasn't aware of that.

1008             THE CHAIRPERSON:  Okay, thank you.

1009             That's all my questions, but I will give you another chance.  I know that Commissioner Cugini ‑‑ I don't know, does Legal has any questions?

1010             Oh, yes, sure.  We will go with Legal first.

1011             MR. MORRIS:  Thanks, just a couple of questions.

1012             I just wanted to confirm the amount of your programming that is going to be local programming.  So of the 126‑hour broadcast week how much of that will be local programming?

1013             MR. BOLIN:  Everything but our news from BN News.

1014             MR. MORRIS:  Everything but your broadcast news?

1015             MR. BOLIN:  Broadcast news, yes.

1016             MR. MORRIS:  Okay.

1017             And of your news how much of it will be pure news, and by pure news I mean not sports, weather or traffic, so just pure news.

1018             MR. BOLIN:  According to BN they said they had three minutes of national, of news service and then we are going to provide two more minutes of local news.

1019             MR. MORRIS:  And that will be pure news and won't have sports?

1020             MR. BOLIN:  No sports in that at all.

1021             MR. MORRIS:  Okay.

1022             And just to confirm your percentage of local news, so your total news would be about, you said, two minutes?

1023             MR. BOLIN:  Two minutes per broadcast.

1024             MR. MORRIS:  Per broadcast?

1025             MR. BOLIN:  Yes.

1026             MR. MORRIS:  So that would be 40 percent?

1027             MR. BOLIN:  Yes.

1028             MR. MORRIS:  Of your ‑‑ okay, of your local news, okay.

1029             Thank you.

1030             THE CHAIRPERSON:  So Mr. Bolin, I know that Commissioner Cugini gave you an opportunity but we will give you another opportunity, if you like, two minutes to tell us why again we should pick your application over the others.

1031             MR. BOLIN:  I'm a nice guy.

‑‑‑ Laughter / Rires

1032             THE CHAIRPERSON:  We can see that.

1033             MR. BOLIN:  Yes, okay.  Yes, everyone is a nice guy.

1034             This is not just a dream.  It's a community service that we want to provide to Drumheller and we think that we have a fairly decent business proposal.  We have a very good idea.  We have good community support and we are not smoke and mirrors.  We are here just as basic Drumhellerites trying to get a rock station in Drumheller, and that's all.

1035             THE CHAIRPERSON:  Thank you, Mr. and Mrs. Bolin.  Thank you.

1036             MR. BOLIN:  I would like to thank the Commission.  Thank you.

1037             THE CHAIRPERSON:  Now, we are going to adjourn now for an hour and a half for lunch.  So we will resume about 2:15.

1038             Thank you.

‑‑‑ Upon recessing at 1240 / Suspension à 1240

‑‑‑ Upon resuming at 1417 / Reprise à 1417

1039             THE SECRETARY:  Thank you, Madam Chair.

1040             I have a quick announcement.

1041             For the record, Newcap Inc. has filed today in response to undertakings, confirmation emails from Tim Gregorash, Principal, St. Anthony's School, and Don Ewing, Associate Principal, Drumheller Composite High School regarding Newcap's proposed over and above CCD contributions.  These documents have been added to the public record and copies are available in the public examination room.

1042             We will now proceed with Item 3 which is an application by Golden West Broadcasting Limited for a licence to operate an English‑language FM commercial radio programming undertaking in Drumheller.  The new station would operate on frequency 99.5 MhZ with an effective radiated power of 3,600 watts non‑directional antenna, antenna height of 15.6 metres.

1043             Appearing for the applicant is Mr. Lyndon Friesen.

1044             Please introduce your colleagues and then you will have 20 minutes for your presentation.

*PRESENTATION / PRESENTATION

1045             MR. FRIESEN:  Thank you, Cindy.

1046             Members of the Commission, Commission staff, fellow applicants, we are pleased to be here today.

1047             My name is Lyndon Friesen, President of the Golden West Broadcasting, and with me today on the far right are Elmer Hildebrand, CEO of Golden West Broadcasting, and next to me is Robin Hildebrand, Director of Human Resources for Golden West Broadcasting.

1048             This is an exciting opportunity and we look forward to investing in the local community and bringing Drumheller unprecedented local service.

1049             Today we will show you that Drumheller not only needs a radio station but a Golden West FM radio station.  Located in the heart of the Badlands in east‑central Alberta, Drumheller is a unique, vibrant community.  It's a community that offers all the services of an urban centre while still maintaining a small town feel.

1050             As you heard earlier, Drumheller is a city of 8,000 plus with approximately 24,000 in the general trading area with significant growth since the last licence was awarded.  The population base is already capable of sustaining an FM radio station as it continues to grow.

1051             The locals refer to Drumheller as "The Ditch" because of its unique geographical position, a situation that makes it virtually impossible to access Calgary or Red Deer stations reliably.  Drumheller's only existing commercial radio station is a regional AM country music format, which you heard earlier.  The other alternatives for musical diversity are of course the internet, new media and/or satellite radio.

1052             Drumheller deserves a local FM radio station to serve their community, a radio station that has a strong focus and commitment to quality radio, a radio station that provides local news and information for Drumheller on FM.

1053             Local community service is a hallmark in every community where we operate.  This will be no different in Drumheller.  There is a clear need for more choice and establishing a local, crystal‑clear FM voice would enhance the existing radio service in the Drumheller region.  Our kind of service is focused on what matters most to the community, what's happening on city council, the chamber, the extremely vibrant arts and music community, the oil and gas sectors, civic organizations and the retail and business community.

1054             Drumheller deserves a dedicated and exclusively local approach to gathering and delivering fresh, current local content.

1055             We will report on activities that often miss the headlines.  We will be able to provide comprehensive, interactive content combined with an exciting new musical format for Drumheller.  We strongly believe the level of service to the community will be above and beyond anything they have experienced so far.

1056             The local content we will consistently deliver goes much deeper than traditional newscasts.  It's personal and interactive coverage of the events happening on the streets, in the neighbourhoods and delivered at the pace current audiences demand.

1057             MS HILDEBRAND:  Golden West's local all the time policy includes our hiring practices.  We are committed to developing a strong, local staff deeply tied to the community with an inherent knowledge of the area to better serve the listeners.  Our entire staff will be part of the fabric of the town well versed in current issues, activities and events and a vital part of connecting with and serving listeners.

1058             It's also interesting to note that our head of programming for Golden West, Barry Vice, grew up and started his radio career in Drumheller.

1059             MR. FRIESEN:  Local news is an integral and essential part of local content and a top priority, certainly our top priority.  All day local announcers will talk about current issues and stories.

1060             The cornerstone of our local content will be a comprehensive, fully staffed team of interactive reporters gathering and reporting ongoing news stories and community events while also giving in‑depth coverage to a busy sports community, a large, very diverse and active arts community and of course the agriculture and ranching industries.  And because the pulse of a community is its people you will just as likely hear from everyday citizens as you will the mayor, councillors and other prominent locals.  We will be talking to Drumheller's business leaders, chatting with parents getting their kids off to school and getting comments from the cheering crowd at the local Peewee game.

1061             Here is an example of the type of news stories we are talking about.

‑‑‑ Video presentation / Présentation vidéo

1062             MR. FRIESEN:  We will focus on the community's important issues and everyday achievements.  We don't subscribe to a national news service so our reporters and announcers they also don't mind the newspapers of the large cities just next door just outside our back door. Sufficient news is happening everyday right in the Drumheller area; a world‑renowned dinosaur museum that brings in 400,000 people annually, an incredible popular theatre, music and arts programs and, as you heard earlier, federal penitentiary, as well as the Badlands and the hoodoos.  All of these are endless sources of local news and information.

1063             MS HILDEBRAND:  We know from other communities where we operate that Drumheller will benefit from four local interactive reporters as well as two or three local on‑air staff who would also gather content.  This would give Drumheller a total of seven people interacting with newsmakers in person, on the phone, on the air and on demand fully equipped with microphones and cameras.

1064             This will create fresh, relevant content to give Drumheller up to the minute information about their community.  This would all be live on air or with live assist from six a.m. to seven p.m. Monday through Friday and six a.m. to five p.m. on weekends.  Live assist is simply the on air announcer working on an alternate project in the building while at the same time being on the air.

1065             MR. FRIESEN:  We will do the same thing for sports.  We have years of commitment and experience in promoting and supporting local sports.  Drumheller will receive full coverage and interactive promotion of sports at all levels.

1066             Local sports is our focus.  We talk to the local athletes, families and coaches on the air throughout each day.  We will bring fans all the scores from all their favourite teams from hockey to golf tournaments.  We will hook up with local organizations to bring people all the details.

1067             The coverage of local news and events will be as diverse as Drumheller itself, including the activities of the thriving agriculture, ranching and natural resources sectors of the region.

1068             The booming economy of the province of Alberta will be reflected in the local stories.

1069             And as we explored Drumheller we discovered an extraordinary arts community; residents, politicians, business owners and teachers who are also artists, singers, actors and musicians.  The local artistic community is incredibly active but struggling for local recognition and community support.  These individuals and groups need and want to have a voice of their own.  We can give them one providing a showcase for their craft and talent.

1070             The Drumheller Composite High School is a major force in the arts and music community and has a vast array of programs committed to these genres.  The diversity of talent in the region is truly incredible.

1071             With only one musical format, with only one format currently available, Drumheller is accessing other genres of music we think via the internet or satellite radio.  To serve this available audience Golden West Radio will bring Drumheller a broad spectrum FM radio station playing the best songs picked from different formats.  Our station will be made up of the best pop, rock and AC songs for the seventies, eighties and nineties as well as the latest hits from today's favourite performers.

1072             Some of our core artists will include Sheryl Crow, Feist, John Mayer, Tom Petty, Michael Bublé, Hedley, U2 and Bryan Adams.  The music library will feature over 1,300 active records and we will commit to a minimum of 40 percent Canadian music daily.  The music will be a hybrid of the best, most played songs from the last 25 years.  You are never more than one song away from something anyone would love.

1073             Here is a sample of the format we will offer.

‑‑‑ Video presentation / Présentation vidéo

1074             MR. FRIESEN:  That mix of well‑known performers and incredibly popular songs was 55 percent Canadian artists, which tells you that our commitment to a minimum of 40 percent Canadian content will energize the music available locally in Drumheller.

1075             Another Golden West hallmark is the promotion, support and exposure of local musical talent.  We actively promote and provide exposure for a host of local musicians and emerging artists.  For us this is all about giving exposure to local groups and musicians, showcasing their local brand of music.  For Drumheller this includes airing and producing weekly programs featuring local talent.  There is an amazing source of local musical talent in Drumheller, more than enough for us to produce Made in Drumheller, a weekly 30‑minute program showcasing the music and talent of singers and songwriters from the region.

1076             We will also create a new and separate music category specifically for emerging local artists, scheduled a minimum of three times a day, seven days a week, all in primetime, 6 A to 6 P.

1077             Over the years we have partnered with thousands of local artists on the Prairies to create similar radio initiatives.  These artists find this kind of promotion and air play extremely helpful in kick starting their careers and, even better, it's really good music the local audiences love.

1078             That's what we will do on the radio and we will multiply all those same benefits by giving Drumheller their own new media platform, a source of online content with exclusively local focus, updated several times a day, seven days a week.  With an interactive web 2.0 format this will generate terrific interaction among the people it serves.

1079             We have launched new media sites in many of the Prairie communities where we operate and time and time again we are astounded and amazed at how the local people embrace this technology.  The sheer volume in traffic generated by these sites is incredible.  They are key sources of information people trust, becoming just as integral and important as the newspaper used to be.

1080             We anticipate this same reaction in Drumheller.  This is not just a radio station website but a new media portal for the people of Drumheller.  Local community content, information, resources and entertainment, it's all there, delivered online by the radio station.

1081             Onsite weather equipment will display real, current and local conditions.  When local news goes on air it also goes online, refreshed throughout the day.

1082             Interactive community‑based reporters will frequently relay local information about relevant issues in their community to people online.  This site will include discussion boards, on‑demand video and a wide range of user‑generated content.

1083             Drumheller will have access to classified ads, job listings, community entertainment and more 24 hours a day, seven days a week.

1084             MS HILDEBRAND:  Golden West has built a solid reputation of being committed to the community and this new FM station and new media platform for Drumheller will continue that tradition.  Local radio is what we do and have always done, long before new media made it the latest trend to take a more local approach.  As one of the few family‑operated radio companies in Canada, we are committed 100 percent to service for smaller communities and cities.  Drumheller is a community and region unto itself and deserves to have its own voice and be seen and heard that way.

1085             MR. HILDEBRAND:  Currently, women locally hired and trained represent 40 percent of our management team and 72 percent of our sales force.  This past February we were honoured with the Canadian Women and Communications Employer of the Year award for being leaders in hiring and advancing local women into positions of leadership and for the third year in a row Golden West Broadcasting was named one of Canada's 50 best managed companies.  Both of these awards are a testament to our longstanding commitment to local community service.

1086             It is more important in Canadian Content Development for in‑depth community service that serves local and emerging artists than providing a lot of money to FACTOR.  So as we have done in previous applications, we are going to provide to FACTOR only the minimum required since we find that really isn't where our money should go.  Recently, we got a package of CDs from FACTOR with all the stuff they had done.  Only one of the entire package was from the Prairies so it's not our kind of stuff.

1087             As an example, our weekly half‑hour program featuring local artists will have a value of more than $200,000 alone in real exposure over the first licence term.

1088             We have also committed $5,000 annually for seven years to the Drumheller Composite High School music program, $5,000 annually for seven years to the East Coulee Spring Music festival, $2,000 annually for seven years to Beethoven in the Badlands, $8,000 annually for year six and seven to artists that have not yet emerged.  This is a total commitment of $100,000 in cash over the seven‑year licence term.

1089             We are also not ignorant of the fact that one of the other applicants is projecting 50 percent more revenue than we have outlined in our application.  I think, as the Commission knows, we tend to be conservative in our estimates and promises and then we go above and beyond in developing our audience and our business.  As a rule, we then try to deliver more than promised in our original application.  We will try to do no less in Drumheller.

1090             We will also likely have the least impact on an incumbent broadcaster since our goal is to develop new local staff and we will look to develop new local business.  Our unique brand of radio appeals greatly to communities in western Canada and we know the same will be true of Drumheller.

1091             Finally, in as many other communities where we are, we are comfortable operating in the shadows of large urban centres.  We have no interests in these large cities like Calgary or Edmonton.  In this case we would be serving the community of Drumheller.  We know we can provide the kind of radio service that Drumheller wants and needs.  Not only would our proposed service be the best for the community, it would also have little impact, financial impact on the existing broadcaster in the market today.

1092             Members of the Commission, that concludes our presentation.  We are ready for your questions.

1093             THE CHAIRPERSON:  Thank you.

1094             Commissioner Molnar will be starting with the questioning.

1095             COMMISSIONER MOLNAR:  Good afternoon, and thank you for a very full presentation.  It's provided a lot of information.  So thank you for that.

1096             Let me begin by asking a little bit about your financial projections.  I note you state in your revenue projections that they are made based upon many years of experience in operating small community radio stations.  We certainly acknowledge your experience in that.  I wondered if your revenue projections were based on any kind of research, if you had any work in particular that you used to base your revenue projections upon?

1097             MR. HILDEBRAND:  Over the years we have not used research for this kind of thing nor have we used research for what kind of music or format we should be providing.  Basically, we are operating a number of communities of this size and so we have that kind of research to go back on as to what kind of business we could develop.

1098             COMMISSIONER MOLNAR:  So do you see this as similar to some of the other markets that you serve today?

1099             MR. HILDEBRAND:  Surely.

1100             COMMISSIONER MOLNAR:  With the revenue projection that would be similar?

1101             MS HILDEBRAND:  Surely.

1102             COMMISSIONER MOLNAR:  Could you give me an example, one of the communities that you serve?

1103             MR. HILDEBRAND:  Oh, we serve similar communities I guess in Saskatchewan, Estevan, Weyburn, Kindersley, Rosetown which is quite a bit smaller, and we have a number of communities in Manitoba which are of this size or smaller.  We have as well communities in southern Alberta.

1104             COMMISSIONER MOLNAR:  Okay.

1105             I just want to follow up on a comment you just made at the end of your presentation where you noted that you tend to be conservative in your estimates of revenues and expenses and over deliver.  So let me ask you, assuming you are somewhat conservative in your revenue projections, what would you view to be the outcome of that as it relates to the radio system?

1106             MR. HILDEBRAND:  I'm not sure ‑‑

1107             COMMISSIONER MOLNAR:  So, if your revenue projections are, in fact, understated and you will be able to derive greater revenues from your new station than you had projected, what would you see would be the outcome; greater investment in programming?

1108             You know, how would that deliver back into the system?

1109             MR. HILDEBRAND:  Well, certainly, if we did grow faster than projected, we'd obviously be providing even more service.

1110             But by and large we tend to see this growth as being relatively small, and our revenue increases from year to year, as you see in our projections are relatively small and, again, history has shown us that that's basically how it works, and your operating expenses also increase about the same level, so...

1111             COMMISSIONER MOLNAR:  Your application assumes no impact upon the existing media and particularly the existing AM station in Drumheller.

1112             Can you elaborate and give us the basis for that assumption?

1113             MR. FRIESEN:  Sure.  You know, we've been adding ‑‑ you know, again, it just comes from experience or from our experience at least.

1114             We've been adding new FM radio stations in many, many small markets, such as the ones Elmer previously mentioned, and in most of the small communities where we're at, where we've added an FM radio station exactly like we're talking about here today, we have not impacted at all.

1115             In fact, the opposite.  We have not impacted the AM revenues that we've been receiving from those towns.

1116             And, so, we think that the impact needn't be felt in any way.  In fact, we continue to grow our FM ‑‑ or our AM revenues in spite of adding the FM revenue.

1117             So, at least our experience is that it doesn't have to impact.  With numbers the way that they're projected here, certainly that's the ‑‑ you know, that gives us the experience from the other markets.  And, certainly, we haven't felt any impact on our AMs when we launch an FM.

1118             So, we think that that same model could easily exist here.

1119             COMMISSIONER MOLNAR:  We did hear Newcap this morning talk about quite a significant transfer.

1120             MR. FRIESEN:  Mm‑hmm.

1121             COMMISSIONER MOLNAR:  I think they were talking within the range of about $200,000 that they viewed may shift from the AM to the FM.

1122             MR. FRIESEN:  Mm‑hmm.

1123             COMMISSIONER MOLNAR:  You don't believe that your experience doesn't ‑‑

1124             MR. FRIESEN:  Well, we just haven't experienced that.  And, so, I don't think we've experienced any fall off anywhere where we've added an FM.

1125             And, again, you know, some broadcasters operate or do their operations  differently and change focus.

1126             You know, we still rely very much on the prairies on our AM radio stations for continued revenue growth and, so, we've been able to   successfully operate them that way.

1127             So, certainly, from our experience we wouldn't know of the other ‑‑

1128             COMMISSIONER MOLNAR:  Okay.

1129             MR. FRIESEN:  We certainly wouldn't think you'd have to have anything fall off, because we ‑‑ you know, I don't think we have.

1130             MR. HILDEBRAND:  I think it's important to understand here that the AM has a certain audience, and the FM station, whether it's ours or Newcap's, will have a different audience.  So, that it will basically repatriate the audience that's now listening to Calgary when it can get the signal or satellite or other out‑of‑area tuning.

1131             So, it's a new block of listeners that become available and, as you have another block of listeners, you have, you know, additional advertising budgets that tend to work that way, so...

1132             COMMISSIONER MOLNAR:  You mentioned that FM has a new block of listeners and it's, I guess in some ways, you know, untried, untested.

1133             At this point there's no FM station in Drumheller.  So, I'm interested in how you chose your format.

1134             MR. FRIESEN:  You know, we ‑‑ as Elmer indicated earlier, we have 50 years of serving small community radio stations on the prairies and by spending just a little bit of time in those communities, you get a sense for what might make    sense.

1135             It's not scientific, it's not something you can even articulate easily, it's a sense for what we think makes sense, and from our experience tells us that it's going to make sense.

1136             What we do know is that in a community like this where they don't have much else, and I think you've heard it from the other    applicants, is that it's going to need to be a pretty broad‑based rock/pop type of radio station.

1137             And I think that's what you heard us play because, you know, country is well served in that market and this isn't.

1138             And, so, to be a broad‑ranging, wide spectrum, playing only good songs, it's not scientific, but it makes sense.

1139             COMMISSIONER MOLNAR:  Okay.  I'm just going to steal something from Commissioner Cugini where she spoke about being everything to everyone, but that works, in your view, in a smaller market?

1140             MR. FRIESEN:  You know, we have similar markets.  We do this same style, where we have the same kind of ‑‑ and I'm not going to call it, well, sure I can ‑‑ it's a more isolated media market.  And, so, it's not isolated, but in terms of media and in terms of radio, and we do that elsewhere.  Estevan is a great example.

1141             And a similar broad appeal radio station is one that we do there as well and we do in other places, which isn't even ‑‑ which aren't even quite as isolated, and the acceptance is incredible.

1142             So, we think that this type of music will make just as much sense here.

1143             MR. HILDEBRAND:  And the music is only a small part of what we actually present to the community.

1144             Even though the music is important, it's not the most important thing.  We think the community involvement, the local news and all of that package is as important as music.

1145             So, that enables us to broaden the spectrum significantly, and that whole mix then, how it's presented is what makes the success of the radio stations that we've been able to launch so far.

1146             COMMISSIONER MOLNAR:  Thank you.  And I will move off of music in just a minute into some of the other elements, but I have a couple more questions related to music.

1147             One relates to your ‑‑ in your application you stated that 10 per cent of your music would be folk and folk‑oriented music as part of your adult contemporary format, that 10 per cent would be in the sub‑category 32, folk and folk‑oriented music; is that correct?

1148             MR. FRIESEN:  Yes.

1149             COMMISSIONER MOLNAR:  Could you tell me how many hours 10 per cent is?

1150             MR. FRIESEN:  Offhand, I won't be able to do that because it would be a guess but, you know, what we're trying to do there is to emphasize the  broad‑based appeal or broad‑based approach to scheduling music and playing music.

1151             So, that's what we're trying ‑‑ so, no, I can't give you a specific number.

1152             COMMISSIONER MOLNAR:  So, I assume that you're not planning to play that as a program in a dedicated period of time but more within your entire ‑‑

1153             MR. FRIESEN:  Right.

1154             COMMISSIONER MOLNAR:   ‑‑ musical list.

1155             MR. FRIESEN:  Right.

1156             COMMISSIONER MOLNAR:  So, under that situation would you be willing to commit to the 10 per cent ‑‑

1157             MR. FRIESEN:  Sure, yes.

1158             COMMISSIONER MOLNAR:  ‑‑ as a condition of licence, to have that as a condition of licence?

1159             MR. FRIESEN:  Sure, yes.

1160             COMMISSIONER MOLNAR:  Okay.  Thank you for that.

1161             MR. HILDEBRAND:  I think the other area where this comes into play is in the emerging area of music which all of us are having a hard time    defining, but if you look at our existing radio stations, the half‑hour weekly program that we put on from local artists, I mean, it's a broad cross‑section of music.  And, so, some of that would certainly fall into that category there as well.

1162             So, it just enables us to sort of be a little broader.

1163             COMMISSIONER MOLNAR:  Okay.  I'm going to turn away from music now and speak of some of your spoken word commitments.

1164             I'd like to refer to chart 1 that you have in your application.  And I think ‑‑ did you also give out a copy of that in with your presentation with us today as well?

1165             MR. FRIESEN:  Yes.

1166             MR. HILDEBRAND:  Yes.

1167             MR. FRIESEN:  Yes, we did.  We ‑‑

1168             COMMISSIONER MOLNAR:  Right, okay.  That's great.  Yeah, okay.

1169             Just to make sure that we fully understand what these commitments mean here, so in total this says ‑‑ my hours are gone ‑‑ but if we work this out, I believe it's supposed to be six hours 55 minutes of news and sports from Monday to Saturday; correct?

1170             This hasn't changed?

1171             MR. FRIESEN:  I haven't done the math but, yes, it works out to six hours and 55 minutes.

1172             COMMISSIONER MOLNAR:  That's right.  That's right.

1173             MR. FRIESEN:  It's right at the bottom.

1174             COMMISSIONER MOLNAR:  It shows at the total at the bottom, six hours and 55 minutes.

1175             MR. FRIESEN:  Yes, yes.

1176             COMMISSIONER MOLNAR:  So, I just want to make sure that we do understand what all is encompassed in this six hours and 55 minutes.

1177             So, is this entirely local, or is this local, regional, national?  You know, what is encompassed in this?

1178             MR. FRIESEN:  Our approach to all of the communities we serve is a directly local approach.  You know, we likely over invest in the news and information gathering side of our business, and that's so that we can do 100 per cent local service.

1179             Broad regional or even the more national, international events, if they don't have a local impact ‑‑ we generate all of our stories in the communities that we serve and, so, all of the time that you see here will be generated by our folks that work and live in Drumheller.

1180             MR. HILDEBRAND:  To add to that, we were not planning to subscribe to Broadcast News or Canadian Press.

1181             COMMISSIONER MOLNAR:  Okay.  Just to make sure I understand, so this is local, this is produced locally, but you would be reflecting the news both within the local area, within the region and within the national and international, you know, news of interest to your audience, despite where it    originated; is that true?

1182             MR. FRIESEN:  Yes, but it will always ‑‑ I guess the caveat that I'm trying to emphasize is that all of the news that we will air will have local flavour and local impact.

1183             And, so, whether it's ‑‑ you know, if it's the Canadian Government that's going through things, if there's a local impact, we're going to talk about it to local people and reflect that fact rather than just use a national news service and play what they think is the news for the day.

1184             We take all of the ‑‑ I mean, this is our whole brand.  Local news is what we do, and so we invest deeply in it, and we take this and we actually don't even have, you know, the national news services that we can rely on because we want our people to dig deep into the community, talk to people, talk to them about issues that we know.

1185             I mean, news is available everywhere and, so, we'd want to localize that and make it their radio station.

1186             And, so, that's our brand and that's why we do it this way.  It's a lot more work, and it's a very intense and expensive way to do business, but we think that's the only way that we're going to continue to grow.

1187             And it certainly plays well when you add the interactive side to it, because, I mean, all the rest of the news is available anywhere else in the world.  This is unique, this is about their town for them.

1188             MR. HILDEBRAND:  The national and international news is generally well covered by television and newspapers; whereas the local news is non‑existent.

1189             And, so, we made a commitment many years ago to do that ‑‑ just that.  And, as a result, that enables us to get tied to the communities and wedded to the community in a way that is amazing and the loyalty that that brings is just incredible and we just know it works and that's what we've made our commitment to do.

1190             COMMISSIONER MOLNAR:  Fair enough.  I'm just wanting to make sure I fully understand this, so I'm going to give you an example.

1191             Let's say, for instance, that a senior Cabinet minister would hand in his resignation; would you have that on your news?

1192             MR. FRIESEN:  We might.  If it has local impact, depending who the minister is.  If it's, you know, today's story and then it has to do with Drumheller, if there's a local connection we would bring it there.

1193             Otherwise, that news is available    elsewhere.  We all know about it and we didn't hear it on a radio station from Drumheller.  And, so, it's available.

1194             If it has a local tie‑in, if this ‑‑ I won't play that ‑‑ but it depends where she's from.

1195             MR. HILDEBRAND:  If his girlfriend was from Drumheller, yes.

1196             MR. FRIESEN:  I don't know if they've got biker gangs in the ‑‑

‑‑‑ Laughter / Rires

1197             MR. FRIESEN:  I don't know if they have biker gangs in Drumheller, so...

1198             COMMISSIONER MOLNAR:  I would think that, you know, 10,000 people from Drumheller would, therefore, be very well served with local news if it's six hours and 55 minutes only about them.

1199             MR. FRIESEN:  Yes.

1200             COMMISSIONER MOLNAR:  Okay.  Could you explain ‑‑ on this chart there's no Sunday, so, could you explain to me what the plans are for Sunday?

1201             MR. FRIESEN:  Boy.  Well, I know what our plans are.  I don't see it on here, but ‑‑ so, I    don't know if the numbers are going to make sense.

1202             But Sundays we do the same thing that we do on Saturdays.  So, we'll have a full morning, six, say to noon, as you can see here with the local newscasts and with the sports you can see there as well.  So, looks like an oversight.

1203             COMMISSIONER MOLNAR:  Okay.  No, that's fair.

1204             MR. FRIESEN:  It should have said Sunday there as well.  That's a weekend package.  We do the same thing on Saturdays and Sundays.

1205             COMMISSIONER MOLNAR:  Okay.  And for the rest of the day, is there someone available for breaking news and ‑‑

1206             MR. FRIESEN:  Yes.

1207             COMMISSIONER MOLNAR:  There is?

1208             MR. FRIESEN:  We ‑‑ you know, with a news staff of this size for this community, we do assign people on the weekends.

1209             The person working Sunday morning is then responsible for the rest of the day to go and to be accountable for the rest of the rest of the day.

1210             And, so, the people that are on air assume responsibility, and if there's things that happen, emergencies, it's their file, they have to stick close to it.  And we have systems which can call them in and alert them and, you know, that work through our phone services that alert them and page them.

1211             And, so, those are the kinds of things that we do in all of our locations to make sure that we're not absent from the radio station.

1212             COMMISSIONER MOLNAR:  Sorry.  Just one more question regarding this chart 1.

1213             The six hours and 55 minutes is local news and local sports.  It doesn't contain, I don't believe, announcer talk; is that right?

1214             MR. FRIESEN:  No, no, this is just newscasts.

1215             COMMISSIONER MOLNAR:  That would be in addition?

1216             MR. FRIESEN:  Yes.

1217             COMMISSIONER MOLNAR:  Additional spoken word?

1218             MR. FRIESEN:  Yes.

1219             COMMISSIONER MOLNAR:  And that you state is an additional 15 per cent; is that right?

1220             MR. HILDEBRAND:  Approximately, that would be the number, yes.

1221             COMMISSIONER MOLNAR:  Over and above the six hours and 55 ‑‑

1222             MR. HILDEBRAND:  But it would vary from day to day and week to week but, in that range, yes.

1223             COMMISSIONER MOLNAR:  Okay.  Thank you, that's fine.

1224             Would it be possible for you to confirm what is the total number of hours of spoken word programming then, considering the announcer talk and so on, and giving us a total amount for that?

1225             MR. FRIESEN:  Of course.

1226             COMMISSIONER MOLNAR:  Okay.  Thank you.

1227             To move on, I just have a question on live‑to‑air programming.  I did not see in your application any reference to how many hours you would be live‑to‑air.

1228             Do you know the number of hours?  Is it ‑‑

1229             MR. FRIESEN:  And I think what we said earlier ‑‑ no, I don't know the total number of hours offhand, I haven't done that calculation.

1230             Just one minute.

1231             But we did mention...

1232             You know, this is typically how we do it throughout our system and certainly this is what we plan to do for Drumheller.

1233             Live on air or live assist, what that means ‑‑ we explained what that meant earlier ‑‑ but we're going to have people on air in the building 6:00 a.m. to 7:00 p.m. Monday through Friday and from 6:00 a.m. to 5:00 p.m. on weekends, Saturdays and Sundays.

1234             The rest of the time will be live assist and, again, a similar approach to making sure that the radio station is current is how we assign people that are actually on air.

1235             They're in charge of what has ‑‑ of the outcome, and so they really don't ‑‑ and that's why we refer to it as live assist.  I mean, they'll be doing other things, but it's their file and they're on it, and they're required to...

1236             And where we do this, it really does ‑‑ it does ‑‑ the outcome is that we really never do leave the radio station to just leave it on auto pilot.

1237             COMMISSIONER MOLNAR:  Okay.  Thank you for that.

1238             I had been planning to ask you about Canadian content development, and I see you have provided us a list of where you would propose to direct your CCD.  Maybe just one question.

1239             You are aware of the 2006 Commercial Radio Policy and the rules around CCD.  So, all of these are qualifying ‑‑

1240             MR. HILDEBRAND:  Yes.

1241             COMMISSIONER MOLNAR:  ‑‑ contributions?

1242             MR. HILDEBRAND:  Yes.

1243             COMMISSIONER MOLNAR:  Yes.  Okay, thank you.

1244             I had also been planning to ask a question related to new distribution platforms, but you provided us a lot of information on your plans related to the website.  So, thank you for that, I won't pursue that.

1245             MR. HILDEBRAND:  But it is much more than a website, our ‑‑

1246             COMMISSIONER MOLNAR:  Yes, fair enough, fair enough.  It is an important portal for your community.  I understood that, yes.

1247             A question I have asked others here today is related to cultural diversity.

1248             Recognizing that I heard from other groups that there isn't a large multicultural component to Drumheller, nonetheless, I wondered if you had anything you would like to comment related to how you would reflect the cultural diversity of Drumheller within your radio station?

1249             MR. HILDEBRAND:  You know, I think basically, as we mentioned in our preamble, is that our plan is to hire local people and train local people and, so, we would reflect the community that is there.

1250             So, that would really be a cross‑section of the entire community and, so, that ‑‑ our whole process of hiring local people then reflects all of that local culture and local diversity back on the air.

1251             And, so, that's how we propose to cover that part of the broadcast spectrum.

1252             COMMISSIONER MOLNAR:  I wanted to ask a couple questions about hiring local.  First off,   approximately how many people are you expecting to   hire within the Drumheller ‑‑ for the Drumheller radio station?

1253             MR. FRIESEN:  I think when we start it will be 10 to 12 people.

1254             COMMISSIONER MOLNAR:  And I want to understand what you mean about, we will be 100 per cent local and we will hire local.

1255             We heard, for example, Newcap this morning talking about the very important element that synergies bring to being able to have a profitable station within a market such as Drumheller.

1256             Are you looking to have synergies with some of your other stations and take advantage of anything within your other radio group?

1257             Or, when you say you are 100 per cent local within Drumheller, is it an autonomous, you know, 100 per cent operated within that market?

1258             MR. HILDEBRAND:  What we do, basically, is we have 100 per cent autonomous on‑air news and programming that the back room ‑‑ I mean, as you heard from Newcap, there are a lot of synergies in our accounting, traffic, administration, engineering and overall management, but the local service is provided by local people that are right at the station.

1259             COMMISSIONER MOLNAR:  Do you have any sense as to the value of those back‑end synergies?  You know, if you were to be a one‑off radio station operating versus being able to take advantage of that synergy, what do you believe that's bringing to this market?

1260             MR. HILDEBRAND:  We think that a one‑off radio station to do the kind of thing we're proposing to do would have to have at least 50 to 60 per cent more employees than we're planning to have, simply because you then need everything.  You need all of the services that are required to operate a radio station, you need to have there if it's a one‑off operation, and that whole back‑end synergy isn't there.

1261             You know, another big piece of ‑‑ that enables us to provide really good creative services.

1262             We have our own in‑house creative systems in one of our sites that provide creative for all of our radio stations, and that enables us to hire people that are a bit more experienced, that actually develop a career in that field, and enables us in that way to provide better creative for all of our stations.

1263             So, to hire those kind of people at each location is hugely costly.  So, the face of the radio station is totally local.

1264             The back‑end synergies are what makes it viable, otherwise, we wouldn't be applying for a radio station in Drumheller, because a radio station here with no other stations to lean on for synergies wouldn't be viable, in our view.

1265             COMMISSIONER MOLNAR:  Thank you.

1266             Those are my questions.

1267             THE CHAIRPERSON:  Commissioner Menzies.

1268             COMMISSIONER MENZIES:  Thanks.  I'm glad you touched on that last point because I was going to go there with a couple of questions.

1269             Just more specifically in terms of the presentation, I don't want to get in trouble with the Drumheller Chamber of Commerce, but when you compare Drumheller as a market to some of the other areas around, it could be argued that it's being left behind.

1270             And Red Deer to the northwest has grown 25 per cent in the last 10 years, Brooks to the southeast has grown eight per cent, Strathmore seven, eight per cent, even Dutchess is growing at seven per cent.

1271             And Drumheller's population grew a little bit in the last census, but basically got it back to where it was 10 years ago.

1272             And it's got a good museum, a great museum, and it has a penitentiary, which provides stable employment and that, but there's not a lot going on there.

1273             And, so, that's what I'm trying to understand, in terms of that and given the limitations of the signal, where do you see getting the revenue from to grow this in Drumheller?

1274             Your revenue shows about a 90 per cent increase from year one to year seven and I'm having difficulty seeing where that money is going to come from given the last 10 years.

1275             I mean, who knows what happens in the next 10, but there's not a lot of evidence to go on for economic growth.

1276             MR. HILDEBRAND:  Well, I think it's similar to some other communities that are like size that we operate in.  Portage La Prairie for example in Manitoba is much in the same position, has had about the same population for the last 15, 20 years.  It's an old community like Drumheller, but by providing the kind of service we do and getting the community involvement, the revenue continues to grow.

1277             And the businesses that are there want to do more business, and with the relationships that we are able to build, historically it tells us that we can grow gradually at that level.

1278             And, so, that's what we base it on.

1279             COMMISSIONER MENZIES:  But aren't you going to have to go after advertisers in some of those other centres that I mentioned who would be wanting to draw people away from Drumheller.

1280             And you have a signal that can't ‑‑ it doesn't really get out of the valley, I guess that's what I'm trying to get at.

1281             MR. HILDEBRAND:  Then I don't think you really could ‑‑ I mean, the advertising generally, at least our concept is, we like to keep our advertising local as well.

1282             For example, we would have difficulty taking advertising out of a Calgary business to ask    Drumheller people to come to Calgary, because for us that's counter productive.

1283             COMMISSIONER MENZIES:  Yeah.

1284             MR. HILDEBRAND:  And, so, we would choose probably not to do that.  And, so, we feel a community this size, if we compare with other communities that we're in, this should work.

1285             Now, whether we'll be successful in seven years from now, if we're here, and you had asked us now did you hit those numbers, we have no way of knowing that, obviously.

1286             But our experience tells us that if we do the right job for the community, that our business grows.  It just sort of follows.

1287             And we have ‑‑ one of the things I often tell our people, that our business is like very ‑‑ it's a very simple business.  If you provide the service to the listener, then you have the listener who the advertiser wants to talk to, and if you keep doing that, that ball just gets a little bigger every year as it rolls forward.

1288             COMMISSIONER MENZIES:  No, I don't ‑‑ I'm not questioning your ability to build an audience.  I'm really talking about whether the commerce that's in Drumheller isn't going to ‑‑

1289             MR. HILDEBRAND:  You're wondering whether revenue is there.

1290             COMMISSIONER MENZIES:  Yeah.  Yeah,   I'm just wondering whether the revenue is there.

1291             And in terms of your impact on the incumbent, if your business plan calls for you having a $600,000 increase in revenue, or almost ‑‑ just say, let's call it $80,000 a year over the term of the licence, I don't see the ‑‑ there isn't any evidence in the last 10 years to indicate that the market is going to grow at that kind of pace and have the minimal impact on the incumbent that is forecast.

1292             MR. HILDEBRAND:  Well, we have ‑‑ I mean, I guess we can't answer that definitively.

1293             COMMISSIONER MENZIES:  I know.

1294             MR. HILDEBRAND:  But our experience and our feeling is that there is a lot of advertising that can be developed, that, you know, new ideas create new advertising.

1295             And so, if for example, you would be licensed in ‑‑ we would be licensed and we would be sharing the audience or the community with Newcap, Newcap would probably come up with some innovative ways that would maintain their revenue and continue their revenue growth, and we would provide innovative ideas and procedures that we would get similar to our level of revenue, and I think we would both be able to co‑exist quite nicely.

1296             COMMISSIONER MENZIES:  How would you see that breaking down, given the fact that the AM basically goes ‑‑ I mean, it goes as far east as Oyen, which is pretty much in Saskatchewan.

1297             MR. HILDEBRAND:  Mm‑hmm.

1298             COMMISSIONER MENZIES:  And the FM is that much more limited.  How would you ‑‑ just give me an example.  If I was an advertiser, how would you sell me on you serving us?

1299             MR. HILDEBRAND:  Their signal is obviously so big, so they would be, you know, great for regional advertising, which our station wouldn't be too good for, but our station would be great for local advertising.

1300             And, so, they would make a case to the GM dealer for one process, we would make a case for another process, and if we were both creative in our selling procedures we'd both get the business from the GM dealer.

1301             COMMISSIONER MENZIES:  Okay.  Just in terms of ‑‑

1302             MR. HILDEBRAND:  Which actually then ‑‑ excuse me, which actually expands the advertising budget for businesses.

1303             COMMISSIONER MENZIES:  And you get more milk from the same cow.

1304             MR. HILDEBRAND:  Or maybe milk it twice a day.

‑‑‑ Laughter / Rires

1305             COMMISSIONER MENZIES:  And just in terms of the arts community that you mentioned being vibrant and that.  I'm familiar with Rose Bud Theatre, but can you give me any other examples of that community in Drumheller?

1306             MS HILDEBRAND:  The theatre community in general there is incredibly active.  The high school has a very busy active production company of their own and as does the Rose Bud Theatre.

1307             There's many people in those communities that are actors by night and retailers by day and it just ‑‑ it ‑‑ there seemed to be quite a ground swell of activity as far as the arts community goes.

1308             COMMISSIONER MENZIES:  Okay.  But there isn't anything specific that's ‑‑ I mean, there's the Beethoven in the Badlands, but that's kind of imported from Calgary; right?

1309             MS HILDEBRAND:  Beethoven in the Badlands.  There's also the East Coulee Music Festival which is focused on a lot of local artists, musicians largely, and there's another music festival in the spring as well that focuses on the local artists.

1310             COMMISSIONER MENZIES:  Okay.  Thank you.

1311             No more questions.

1312             THE CHAIRPERSON:  Commissioner Cugini.

1313             COMMISSIONER CUGINI:  Thank you.

1314             Just a little bit more information on the web portal.  In your clip this afternoon you also include video, or you intend to include video on the web portal.

1315             What kind of talent are you going to have to attract to be able to ‑‑ you know, you have an on‑air personality for radio who's going to do news, and now are you going to ask that person to also be a videographer so that person can supply material to the web portal?

1316             MR. FRIESEN:  You know, what we're finding is that when we attract young people and, you know, our average age of employee in our company is 32 years old and there's a few of us that aren't, so, that means we ‑‑

1317             COMMISSIONER CUGINI:  Up here too.

1318             MR. FRIESEN:  ‑‑ we go out of our way to make sure that the people we hire have an interest in new media.

1319             Not hard to find in young people.  These people are highly skilled.  They don't see it as extra work to take a little flip video along when they're out there, in fact, they think it's great fun to take it back, edit it, and they'll do this even in their spare time, because this is their hobby, this is what they do, this is how they communicate with each other.

1320             And, so, we're just finding that new media side is an incredible opportunity for them to grow even more skills.

1321             You've got to remember too that online we don't have to have television style edited video.  This can be YouTube's quality video    captured by an inexperienced amateur and it gets as much viewership as something that has been highly     produced.

1322             So, it's a little different world we're finding, a different audience.  They're not critical of poor production, for instance, online, they think it's really cool just to see a picture.

1323             And, so, the interesting part too is that, you know, we just launched something, you know, very interactive.  Where I live last weekend, there was a fire ‑‑ major forest fire in the province, 30 miles down the road.  It was the first weekend we launched and allowed users to add their video, and this is the first weekend, and because you marry radio with online and, you know, we're running the news stories and telling them to look online, user‑generated video was coming in.

1324             So, we don't even have to be the experts.  What we have to do is carefully monitor what's going in and coming out.

1325             So, it takes a lot more to manage, but certainly we don't have to ‑‑ when you're talking about local content there, we don't have to be the only generators of it because the user‑generated side, that whole world of young people, I mean, it's feeding in incredibly fast, so...

1326             COMMISSIONER CUGINI:  And whose responsibility is it at the station level to do that kind of editing out of user‑generated content?

1327             MR. FRIESEN:  In each environment we have people assigned to it.  Now, it's not the same in every location, and in this case I don't know yet, but we do ‑‑ we can't leave that to chance.

1328             COMMISSIONER CUGINI:  But would it be the news director, would it be the general manager of the station, at that level?

1329             MR. FRIESEN:  Usually the manager together with either the program director and the news director.

1330             It needs a more collaborative approach because it's not really only news and it's not just programming, this is something else.  And, so, it's more collaborative.

1331             You know it when it's wrong.  People tell you quickly.  It's a very ‑‑ people are communicating, yeah.  So, even if we miss it, we'll find out before it's up a minute, so...

1332             COMMISSIONER CUGINI:  And I imagine it's much more relevant in communities that don't have a local television station?

1333             MR. FRIESEN:  Oh, for ‑‑ but, you know, I don't know.  This is new media.  People are contributing to it and ‑‑ you know, so where it's coming from, it's so new that I don't know that it's taking away from anybody.

1334             This is just new fun stuff, and I think if you challenge them to contribute and get involved with it, and if you're ‑‑ I mean, one of the hardships of making this commitment is that then we actually have to update it two or three times a day.

1335             People will not come to your site if your news is the same in the morning as it is in the evening, and it's got be local, fresh, generated locally, professionally done.  Reliably 365 days of the year you have to change this thing, otherwise it won't get the kind of attraction that I think we have.

1336             So, no, it is a big commitment, but we've been at it for about five or seven years and I think we may be getting some traction with it.

1337             COMMISSIONER CUGINI:  And do you want find that the interest from your listeners to provide user‑generated content differs from format to format?

1338             MR. FRIESEN:  I might ‑‑

1339             COMMISSIONER CUGINI:  I mean, will this format attract more or less user‑generated content than other formats in other markets?

1340             MR. FRIESEN:  You know, we're used to creating kind of boxes because old people don't ‑‑ no, no, actually all the pictures we're getting are from 65 plus, they love this.  You know, we think it's just a new medium for new young people.

1341             COMMISSIONER CUGINI:  Hey, you said it, I didn't.  You put me under 32, so...

1342             MR. FRIESEN:  But, you know, I don't make those assumptions any more.  I mean, the people that are online is everybody and we better provide something. and you can't just go by age, there are no rules.  And, so, I think that's what we are seeing, certainly from the work that we've done.

1343             COMMISSIONER CUGINI:  Mr. Hildebrand's been hot to hit that button on his microphone.

1344             MR. HILDEBRAND:   Well, no, I just want ‑‑ Lyndon may be a little modest on this whole process, but the amount of interactive traffic that our portals are generating is incredible and we have been able to actually build a separate business on that side, aside from the radio business, and it is growing like topsy, you know.  So, that's where the future's at.  I'm convinced of that, so...

1345             COMMISSIONER CUGINI:  Do you find that there are advertisers on your web portals that don't necessarily advertise on radio, or do they see the web portal as complementary to their advertising on your radio stations?

1346             MR. FRIESEN:  Because we sell it separately, we try not to mix it up, so, we rarely get into that discussion.

1347             COMMISSIONER CUGINI:  Mm‑hmm.

1348             MR. FRIESEN:  But all of our potential advertisers are also potential radio advertisers.

1349             You know, we'll get the two to blend a campaign where we'll want the radio station to drive   activity to the web promotionally and vice versa.

1350             And, so, at the end of the day we want them to end up in their store buying something and, if we can do that, we're going to be successful.