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Broadcasting Decision CRTC 2003-192
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Ottawa, 2 July 2003
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9115-0318 Québec inc. (Radio Nord
Communications inc. and La Société Spectra-Scène inc., being the
shareholders)
Montréal, Quebec |
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Application 2002-0288-8
Public Hearing at Montréal, Quebec
3 February 2003 |
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Commercial French-language specialty FM radio station in Montréal
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In this decision, the Commission
approves the application by 9115-0318 Québec inc. (Radio Nord
Communications inc. and La Société Spectra-Scène inc., being the
shareholders), for a new commercial French-language specialty FM radio
station in Montréal, at 91.9 MHz (channel 220B1). The proposed station
will provide a jazz and blues specialty format targeting an adult
audience in the 35-64 age group. |
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Introduction
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1. |
The Commission received an application by
9115-0318 Québec inc. (Radio Nord Communications inc. and La Société
Spectra-Scène inc., being the shareholders) (RNC-Spectra) for a
broadcasting licence to operate a commercial French-language specialty
FM radio programming undertaking in Montréal at 91.9 MHz (channel 220B1)
with an effective radiated power of 900 watts. |
2. |
The Commission considered this application
at a public hearing held in Montréal from 3 to 19 February 2003. At the
hearing, the Commission heard eleven other applications in connection
with the Montréal market. The Commission today also approves four of
these proposals: the operation of a French-language commercial AM radio
station (Broadcasting Decision CRTC 2003-193), of an ethnic commercial
FM radio station (Broadcasting Decision CRTC 2003-194), of a native FM
radio station (Broadcasting Decision CRTC 2003-195) as well as the
addition of a transmitter to the broadcasting licence for a Canadian
Broadcasting Corporation (CBC) radio station associated with the Radio
One network (Broadcasting Decision CRTC 2003-196). |
3. |
The criteria used by the Commission to
evaluate the applications considered at the 3 February 2003 public
hearing are set out in Introductory statement to Broadcasting
Decisions CRTC 2003-192 to 2003-203: Applications related to radio
stations in the Province of Quebec, Broadcasting Public Notice CRTC 2003-33,
2 July 2003 (the Introductory Statement). In the Introductory Statement,
the Commission also addresses the various proposals that were
technically mutually exclusive and the general interventions to most of
the applications, and states its conclusions on the capacity of the
markets in Montréal, in Sherbrooke, in Trois-Rivières and in Saguenay to
support the addition of one or more new radio stations, taking into
account the competitive state of each market. |
4. |
The present decision addresses the
particulars of RNC-Spectra’s application. |
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Ownership structure
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5. |
RNC-Spectra is controlled by
Radio Nord Communications inc. (RNC), a company controlled by Groupe
Radio Nord inc., which is in turn controlled by Jean-Yves Gourd. RNC
holds 75% of the voting shares of RNC-Spectra, while La Société
Spectra-Scène inc. (Spectra-Scène) holds the remaining 25%. |
6. |
Spectra-Scène is affiliated
with Équipe SPECTRA, which produces entertainment and television and
film programming of all kinds. Spectra-Scène holds a 7% interest in ARTV
inc., which is the licensee of the French-language specialty service, "artv." |
7. |
RNC-Spectra does not currently
hold a radio licence in the Montréal market. Groupe Radio RNC inc., a
wholly-owned subsidiary of RNC, holds a licence for a French-language
radio station serving Gatineau and Ottawa. RNC is, itself, the licensee
of six French-language radio stations, including five in
Abitibi-Témiscamingue, Quebec and one in Hawkesbury, Ontario. |
8. |
RNC also holds five licences
for conventional French-language television undertakings: CHOT-TV (TVA)
and CFGS-TV (TQS) Gatineau; CKRN-TV (SRC) and CFEM-TV (TVA) Rouyn; and
CFVS-TV (TQS) Val d’Or. RNC also holds a 21.03% interest in the Category
1 specialty service known as ONE: The Body, Mind and Spirit Channel, and
a 19.06% interest in Radio Témiscamingue incorporée, the licensee of the
FM radio station CKVM-FM Ville-Marie. |
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Programming overview
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9. |
RNC-Spectra proposed a "Cool
Jazz" specialty music format consisting of jazz and blues (category 34),
world beat and international (category 33), folk and folk-oriented
(category 32) and pop, rock and dance (category 21). |
10. |
The target audience is the
35-64 age group. The applicant stated that at least 70% of the station’s
programming will be jazz and blues (primarily vocal). It added that Cool
Jazz is effectively a specialty format, and that the core of its target
audience, specifically adults between the ages of 54 and 64, are not
well served in the Montréal market. |
11. |
Conditions of licence
that relate to the station’s specialty format and to the percentage of
programming to be devoted to subcategory 34 (jazz and blues) are set out
in the appendix to this decision. |
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The interventions
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12. |
Numerous interventions were
filed in response to this application: 67 in favour, 2 opposing, and 5
offering comments. |
13. |
Radio Ville-Marie, the licensee
of CIRA-FM Montréal, opposed the application on technical grounds. Radio
communautaire de la Rive-Sud requested that the Commission examine the
intervener’s economic vulnerability so that it would not lose jazz and
blues audiences in the South Shore of Montréal to the new station. |
14. |
The CBC expressed concern that
the applicant, given the collaboration in its ownership by RNC and
Spectra-Scène, could obtain exclusive broadcasting rights to taped
events produced by Spectra-Scène, including coverage of the Festival
International de Jazz de Montréal. The CBC, which airs festival
recordings aimed at all Canadians, was concerned that Spectra-Scène
would receive an undue advantage through its activities as both producer
and broadcaster, and that Canadians outside Montréal could be deprived
of the opportunity to enjoy this major Canadian cultural event. The CBC
proposed that the Commission impose a condition of licence to preclude
any such advantage, and recommended that all applicants be required to
demonstrate that the contribution of their proposed services to the
advancement of Canadian culture would effectively compensate for any
loss in the contributions of other broadcasters operating in the same
music format. |
15. |
In reply, the applicant stated
at the hearing that it has created a: |
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[TRANSLATION] very strict code of ethics that has been reviewed and
approved by the Société de développement des entreprises culturelles,
in place since the Jazz Festival was founded, to ensure there is no
appearance of conflict of interest, but more importantly to ensure
obviously, that public funds are invested appropriately in the
promotion of Francophone music. [The code also states that] any
transaction between the Jazz Festival and a company related to Équipe
Spectra must be conducted under conditions better than those offered
to a third party… thus saving the festival money, and not offering an
advantage to Spectra.
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16. |
The applicant added that it
could not afford to favour a Spectra subsidiary, as doing so would
constitute a violation of the code of ethics, and because [TRANSLATION]
"it is in the long-term interest of the Jazz Festival to collaborate
with all radio and television broadcasters." The applicant further
indicated that it is in the interest of the Jazz Festival to be
broadcast nationally, and even internationally. Finally, Spectra-Scène
stated that it has no intention of favouring a radio station in which it
holds shares. |
17. |
The Commission is satisfied
with the information provided by the applicant at the hearing, and has
determined that a particular condition of licence with respect to the
exclusive rights of the first broadcast of original Canadian programs
produced by the Spectra team and its subsidiaries in connection with the
Festival International de Jazz de Montréal and other jazz events in
Canada is not necessary. The Commission may, however, review the
applicant’s performance in this respect at the time of licence renewal.
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18. |
An opposing intervention filed
by the Association des radiodiffuseurs communautaires du Québec (ARCQ)
as well as the comments by the Société professionnelle des auteurs et
compositeurs du Québec and the Association québécoise de l’industrie du
disque, du spectacle et de la vidéo (ADISQ) are addressed in the
Introductory Statement. |
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Evaluating the application
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19. |
In its assessment of
applications for new commercial radio stations, the Commission takes
into account four main factors or bases of comparison that it has
identified as being relevant. While the relative importance of the
factors will vary depending on the specific circumstances of the market,
these factors are: |
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- the quality of the application;
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- the diversity of news voices in the market;
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- the likely impact of a new entrant or entrants; and
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- the competitive state of the market1.
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Quality of the application
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20. |
The Commission generally
assesses the quality of applications competing for licences to operate
new commercial radio stations by examining the following: |
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- local programming proposals and plans for providing reflection of
the local community;
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- Canadian content commitments;
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- quality of the business plan, including the proposed station
format; and
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- commitments in support of the development of Canadian talent.
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Local programming and local
reflection |
21. |
At the hearing, RNC-Spectra
stated that, in each broadcast week, it would devote 125 hours to local
programming and 2 hours 42 minutes of news. The applicant proposed to
offer 14 hours of original spoken word programming per broadcast week,
consisting of local, regional, national and international newscasts,
interviews and documentaries on jazz artists and the history of jazz,
cultural spots, weather, sports and traffic, as well as stock market
information. In response to the Commission’s questioning at the hearing
regarding the definition of local and regional news, the applicant
stated that local means Montréal, and that regional includes the suburbs
south and north of Montréal. The applicant also stated that editorial
control and responsibility for news will remain in Montréal. The
station’s full-time staff will include one news journalist and one
journalist assigned exclusively to providing coverage of cultural
events. |
22. |
The Commission considers that
the information provided by RNC-Spectra at the hearing regarding local
programming and spoken word programming, specifically local and regional
news, is satisfactory. |
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Canadian content |
23. |
Section 2.2 of the Radio
Regulations, 1986 (the Radio Regulations) requires that, on a weekly
basis, a minimum of 35% of all category 2 (popular) musical selections
and a minimum of 10% of all category 3 (special interest) musical
selections broadcast be Canadian selections. |
24. |
In its application, RNC-Spectra
made a commitment to exceed the requirements of the Radio Regulations by
ensuring that a minimum of 45% of category 2 musical selections and a
minimum of 35% of category 3 musical selections are Canadian. Adherence
to these commitments shall be by condition of licence, as set out
in the appendix to this decision. |
25. |
The Commission further notes
the applicant’s commitment to devote 45% of category 2 musical
selections broadcast Monday to Friday from 6 a.m. to 6 p.m. to Canadian
selections broadcast in their entirety. The Commission notes that this
commitment exceeds the 35% minimum set out in the Radio Regulations by
10%. |
26. |
The Commission is of the view
that the new station will add to the amount of Canadian music available
in the Montréal market, and is satisfied with its discussions with the
applicant at the hearing regarding the concerns of ADISQ in this regard. |
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Business plan and proposed
format |
27. |
As noted above, the RNC-Spectra
business plan is based on a Cool Jazz music format targeting adults in
the 35-64 age group. According to the market study filed by the
applicant, [TRANSLATION] "the new station will be complementary because
it will occupy a niche that is not currently exploited by stations in
the market with respect to both format and target audience." |
28. |
The applicant expects that
two-thirds of the station’s audience (i.e., 2% of the radio audience in
Montréal) will be drawn from existing stations, and that the station
will attract approximately half a million dollars in advertising
revenues away from existing Montréal stations. Based on the information
filed with the application and on its discussions with the applicant at
the hearing, the Commission is of the view that the station will have a
limited impact on existing stations in the market. This takes into
account the station’s projected audience share and advertising revenues,
which are fairly modest compared with other stations in the Montréal
market, each of which generates an average of $6.8 million in
advertising revenues. |
29. |
The Commission finds that the
business plan is realistic and that the projected advertising revenues
are achievable. |
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Canadian talent development
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30. |
RNC-Spectra committed to invest
$1,400,000 in direct contributions to Canadian talent development (CTD),
and $168,000 in indirect contributions, over seven years. Under the
terms of the CTD Fund established by the Canadian Association of
Broadcasters (the CAB Development Fund), licensees who adhere to the
plan and serve markets the size of that of Montréal are required to
contribute an annual minimum of $27,000 to the CAB Development Fund via
an eligible third party. |
31. |
RNC-Spectra committed to
participate in the CAB Development Fund, and to contribute $50,000 to
MusicAction each year, representing $350,000 over seven years, which
exceeds the minimum level required under the CAB’s Distribution
Guidelines for Canadian Talent Development (Distribution
Guidelines). In addition, the applicant made the following commitments
for each of the seven years of its licence term: |
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- the endowment of five $5,000 scholarships, including one at each
of the four universities in the Montréal region offering music
programs and at the Conservatoire de musique de Montréal;
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- a contribution of $25,000 to support the Festival des Harmonies du
Québec;
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- a contribution of $40,000 to the Couleurs Jazz competition;
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- a contribution of $30,000 to organize two free concerts as part of
the Festival international de Jazz de Montréal, featuring a new artist
and a well-known Canadian jazz musician;
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- $30,000 to present two other jazz concerts in Montréal, featuring
a new artist and a well-known Canadian jazz musician.
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32. |
Adherence to the above
commitments shall be by condition of licence, as set out
in the appendix to this decision. |
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Diversity of news voices in the market
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33. |
Given that RNC-Spectra is a new
entrant to the market and that all of the programming to be aired by the
proposed station will be produced locally, the Commission is confident
that the new station will enhance the diversity of news voices in the
market. |
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Impact of a new entrant and competitive state of the market
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34. |
The Commission generally seeks
to ensure that the competitive impact of a new entrant to a radio market
will not impinge unduly on the ability of existing stations to meet
their programming responsibilities under the Broadcasting Act
(the Act). At the same time, the Commission’s predisposition lies
clearly in favour of increased competition and diversity, and the
improvements in the overall quality of available services that these
promote. |
35. |
As stated above, the Commission
is of the view that the station will have a limited impact on the
Montréal market. The capacity of the market to absorb one or more new
entrants, the competitive state of the market, and the opposing
intervention filed by ARCQ on this issue are addressed in the
Introductory Statement. |
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Cultural diversity
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36. |
In Commercial Radio Policy
1998, Public Notice CRTC 1998-41, 30 April 1998 (Commercial Radio
Policy), the Commission encouraged all radio broadcasters to reflect the
cultural diversity of Canada in their programming and employment
practices, especially with respect to news, music and promotion of
Canadian artists. |
37. |
The Commission notes the
information provided by RNC-Spectra in its application and in its
discussions at the hearing concerning cultural diversity on the
airwaves. It also notes RNC-Spectra’s intention to develop a cultural
diversity policy and implement a cultural diversity strategy. That
policy will be developed by the director of Human Resources jointly with
a member of the board of directors, and will address employment and
on-air content. |
38. |
Because the station will
specialize in jazz, it will have a strong appeal among numerous ethnic
groups and provide an exceptional opportunity to reflect cultural
diversity. The Commission encourages the applicant
to promote the cultural diversity of Canada in its programming and
employment practices. |
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Technical issue
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39. |
Radio Ville-Marie opposed the
applicant’s proposed use of 91.9 MHz, citing potential interference with
its station, CIRA-FM Montréal, which operates at 91.3 MHz. The
intervener asked the Commission to impose a condition of licence
requiring that the antenna be installed on the same site as, or near to,
the Radio Ville-Marie antenna. |
40. |
In its reply to the intervener,
the applicant emphasized that its assurances to the Department of
Industry (the Department) and to Radio Ville-Marie would be sufficient
guarantee that the CIRA-FM frequency will be protected. The Commission
noted in this regard that the Department’s new standard now authorizes
the use of the third adjacent channel2
within a single market. However, should the Department determine during
the testing period of the proposed station that such use would result in
unacceptable technical interference, it would require the licensee to
take the appropriate corrective measures. |
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The Commission’s conclusion
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41. |
The applicant’s explanations
provided at the hearing, and the commitments it has made, have convinced
the Commission that the station will offer a format that is truly
focused on jazz and blues. The Commission notes that, because of its
unique Cool Jazz format and jazz-oriented spoken word programming, the
station will be distinct from other stations in the market, even should
some of them occasionally play standard jazz, world beat and blues
selections. |
42. |
The Commission considers that the new
station proposed by RNC-Spectra will add to the choice of local
programming available to listeners in Montréal, particularly those in
the 54-64 age group, and will also assist in meeting their expectations
and needs. Further, the Commission considers that, because of the
station’s truly specialized format, it will differ from other stations
in the Montréal market and will have no undue impact on existing
stations in that market. |
43. |
Given the significant proposed
contributions to the promotion of Canadian French-language artists, the
Commission is confident that the new station will make an important
contribution to the fulfilment of the Broadcasting Policy for Canada set
out in the Act, and to the objectives identified in the Commercial Radio
Policy. |
44. |
In light of the above, the Commission
approves the application by 9115-0318 Québec inc. (Radio Nord
Communications inc. and La Société Spectra-Scène inc. being the
shareholders) to operate a commercial French-language specialty FM radio
programming undertaking in Montréal. The station will operate at
91.9 MHz (channel 220B1) with an effective radiated power of 900 watts. |
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Issuance of the licence
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45. |
The licence will expire 31 August 2009 and
will be subject to the conditions specified therein and in the appendix
to this decision. |
46. |
The Department has advised the Commission
that, while this application is conditionally technically acceptable, it
will only issue a broadcasting certificate when it has determined that
the proposed technical parameters will not create any unacceptable
interference with aeronautical NAV/COM services. |
47. |
The Commission reminds the applicant that,
pursuant to section 22(1) of the Broadcasting Act, no licence may
be issued until the Department notifies the Commission that its
technical requirements have been met, and that a broadcasting
certificate will be issued. |
48. |
Furthermore, the licence for this
undertaking will be issued once the applicant has informed the
Commission in writing that it is prepared to commence operations. The
undertaking must be operational at the earliest possible date and in any
event no later than 24 months from the date of this decision, unless a
request for an extension of time is approved by the Commission before 2
July 2005. In order to ensure that such a request is processed in a
timely manner, it should be submitted at least 60 days before this date. |
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Employment equity
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49. |
In accordance with Implementation of an
employment equity policy, Public Notice CRTC 1992-59, 1 September
1992, the Commission encourages the applicant to consider employment
equity issues in its hiring practices and in all other aspects of its
management of human resources. |
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Secretary General |
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This decision is to be appended to the
licence. It is available in alternative format upon request, and may
also be examined at the following Internet site:
http://www.crtc.gc.ca |
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The relevance of these four factors
was highlighted by the Commission in Introductory Statement – Licensing
new radio stations which appeared in Decisions CRTC
99-480,
99-481
and 99-482, all dated 28 October 1999.
In FM radio broadcasting, the term third adjacent channel is used
when two frequencies are separated by an interval of 600 kHz. FM radio
broadcasting frequencies are separated by intervals from 88.1 MHz
to 107.9 MHz. The Department’s rules governing frequency allocation
prohibit the licensing of stations within the same community or in
neighbouring communities that use any frequency deemed to be a second
adjacent frequency. |