Speech
Independent Private Radio and New Technologies
Notes for an address
by Andrée Noël
Commissioner for the Quebec Region
Canadian Radio-television and Telecommunications Commission
to the Annual General Meeting of l’Association de la Radio Privée Indépendante Francophone (ARPIF)
Quebec City, Quebec
November 19th, 2005
(CHECK AGAINST DELIVERY)
Thank you, Renée (Giard, President of the ARPIF). Dear friends and broadcasters, it is a pleasure to participate in your Annual General Meeting, and I thank you for the invitation.
I had the pleasure of attending this same meeting two years ago, and I have very fond memories of that occasion. Meetings like these are useful both for you and for the CRTC, because they enable us to better grasp each other’s realities and concerns. They also allow us to discuss our work and to better understand our respective organizations.
Your association represents 42 local and regional stations whose work is proving to be of critical importance. The services offered by your members are important to listeners because they provide them with access to radio that is truly local and close at hand, radio that is part of their daily lives, and radio that reflects their reality.
On behalf of the CRTC, therefore, I would like to congratulate you for your work and your support of the Canadian broadcasting system.
New Technologies
When you invited me to speak to you today, you shared with me the uncertainty you feel with regard to the arrival of new technologies such as digital radio and subscription radio. And you suggested that I discuss what priorities you might put in place to address these challenges.
We are living in an era of great technological transformation. For television broadcasters, for example, cellular phones with screens, and the Internet can both provide users with access to television, and therefore become new competitors. There are new competitors for you in the radio industry as well: for example, the cell phone that lets users listen to music, specialty digital radio stations, and subscription radio.
What do we do in the face of this technological explosion? My answer, first and foremost: local programming. In my opinion, that is your greatest strength, and the most effective means of countering the potential impact of these new technologies.
You are certainly not the only ones concerned about technological developments. Last week, I was in Winnipeg to attend the conference of the Canadian Association of Broadcasters (CAB), where several of the workshops dealt with new technologies. Broadcasting companies large and small were wondering about the potential impact these technologies would have. But they also agreed that broadcasting mode is less important than content, and that priority should be given to the programming and services offered to listeners.
Digital radio creates a sound equal to that of a compact disk. The technology improves the quality of the music offered to listeners, so it should be to broadcasters’ advantage to offer better quality. But the technology also represents significant additional costs. And it is spreading quite slowly. At the CAB conference last week, serious questions were raised about the appropriateness for Canada of adopting the technology currently being used in the United States. So, there are still uncertainties about the development of digital radio in Canada.
And how about subscription radio: will it have a significant impact on existing broadcasters? Overall, we still don’t know how much interest the public will have for it. We know that it will increase the choice of programs offered to listeners, but they will have to pay subscription fees in return. We also know that it will not be able to offer local programs as you do, nor sell local advertising.
Subscription satellite radio is of particular interest to people who drive through several cities or regions. They won’t have to be constantly changing the channel to pick up stations as they drive. In that sense, it is not a direct competitor for you.
The two satellite subscription services that we have approved will pay significant amounts of money that will be used to develop Canadian artists. They will give those artists greater exposure by broadcasting their work to subscribers throughout North America.
It is also interesting to note that in the United States, where subscription radio has been operating for four years, there has been no significant impact on the revenues and profits of conventional radio stations. In fact, a recent study conducted by JP Morgan Securities estimates that, in 2005, satellite radio only has 1 percent of the listeners of traditional radio, and that by 2010, this share will probably increase to 3.5 percent.
In Canada, these forecasts will be even lower, because of the following differences:
- In Canada, subscription radio services will not have the right to broadcast local advertising, and satellite radio is limited to 6 minutes of national advertising per hour.
- The share of listeners in cars is important for satellite radio. However, the vehicle audience in Canada represents only 25% of total listeners, compared to 35% in the United States.
Furthermore, in an interview published in Cartt.ca on October 25 of this year, Patrick Grierson, the President of Canadian Broadcast Sales, states that given the non-commercial nature of satellite radio, he doesn’t anticipate an impact on commercial radio in 2006, nor for some time to come.
So let these perspectives reassure you, particularly since you have an advantage that is not an option for national services, the advantage of communicating directly with your communities.
Local Programming
As private independent broadcasters, you have a great deal of flexibility in the local programming content that you offer your listeners. You often develop a long-term relationship with them, a relationship that we might even call intimate and privileged. You are in the best position to understand their needs and tastes.
You can react quickly to changes that arise. You can inform your listeners when something good, or bad, happens to one of them; you tell them about news that hits close to home and that influences their lives; or of emergency situations that could affect them.
So, which medium will members of your community choose most of the time? Most likely the medium that tells them what’s happening close to home, that passes their messages on to the community, that speaks of their success in the arts, in sports, or other fields of activity. And that calls upon their generosity when one of their own is in need.
When you renew your licences, you tell the Commission about the activities you organize in your areas. We certainly notice how varied and creative they are, and how truly geared they are to the needs of your listeners.
Because that’s the key: giving your listeners what they want.
And traditionally, French-language listeners are attracted by the values of Francophone society. They want to recognize themselves, both on television and on the radio. Your local media are therefore in a position to respond to this fundamental need.
You can strengthen your local services in a number of ways; for example, through agreements with other local media, like a partnership with the local newspaper.
When you hire new employees, you may find young candidates, familiar with all the new technologies, who can be of great benefit to your companies. They will most likely have suggestions for you on how to take advantage of the interesting opportunities that the new technologies offer. It is important to remember that these young people are your current and future listeners, and that they make up the largest share of users of new technologies.
Finally, as far as subscription radio goes, allow me to make a little suggestion. When it decided to license satellite subscription radio services, the Commission made it clear that they must offer at least eight original channels produced in Canada. At least 50% of the programming of an original channel produced in Canada must be made up of programs produced for that channel and broadcast for the first time on that channel. But this also means that programs that have already been broadcast by other Canadian stations could be rebroadcast by these channels. So, that could well be a new business opportunity for existing stations like yours!
Review of the 1998 Commercial Radio Policy
When you invited me, you also suggested that I update you on our plans to review the 1998 Commercial Radio Policy. You are no doubt aware that the CAB has written to the Commission twice, in September and October of this year, asking us to push back this review by 24 to 36 months. In a letter dated November 4, the Commission responded to the CAB, and I quote, that it “considers that a review of the Commercial Radio Policy is timely and that any further delay would not be advisable, especially given the many technological and other changes taking place and the impacts they may have on the radio and music sectors. In the Commission’s view, a policy review will, amongst other things, provide an opportunity to discuss the most effective Canadian content and Canadian talent development measures in support of Canadian music and artists. ”
The Commission adds that it “considers that it is the appropriate time to ensure that all regulatory, commercial and technological options are explored in order to facilitate radio’s successful transition to digital transmission and reception.”
The Commission therefore intends to issue a notice in the near future informing those interested of the dates for the review of the Commercial Radio Policy and setting out the issues that it deems to be of particular importance.
It will therefore be important for you to share with us not only your comments with regard to these concerns, but also any other observations with regard to your own reality.
I would like to reiterate the importance that the Commission attaches to radio services like yours. Your opinions are important to us and we hope that you will share them with us when the Commission deals with issues of concern to you. Your participation in our processes helps us to make more enlightened decisions.
I thank you for your attention. Mr. Bernard Montigny, General Counsel, Broadcasting, is with me today, and we are both now prepared to answer any questions you might have.
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Date Modified: 2005-11-19
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