News release

December 15, 2006

CRTC announces results of its commercial radio policy review:
Increases funding for Canadian content development

OTTAWA-GATINEAU - The Canadian Radio-television and Telecommunications Commission (CRTC) issued today three public notices flowing from its review of its Commercial Radio Policy 1998. The first notice, entitled Commercial Radio Policy 2006, deals with a number of issues, including Canadian content and French-language vocal music. The second focuses on the treatment of radio applications in small markets and the third sets out certain changes to the Commission's digital radio policy.

New regulated and unregulated technologies for the distribution of music to consumers have emerged in recent years. These include MP3 players, iPods and other personal media devices, Internet music services and radio streaming, such as streaming over wireless broadband, podcasting, peer-to-peer file sharing and downloading, cell phone radio and satellite radio.

"The key challenge facing the radio industry is to remain relevant in a marketplace characterized by rapidly changing technology and consumer behaviour," said Charles Dalfen, Chairman of the CRTC. "We are confident that the measures announced today will enable commercial radio broadcasters to contribute effectively to the achievement of the objectives set out in the Broadcasting Act, while operating efficiently in an increasingly competitive environment.”

The establishment of a new approach to Canadian content development (CCD), financed by the contributions of broadcasters, will place an emphasis on the creation and promotion of audio content for broadcast through the development of Canadian musical and spoken word talent, including journalists. This approach should help to increase the amount of high-quality Canadian music and spoken word material, and promote emerging Canadian talent.

Under the new approach to CCD, the Commission proposes to establish a basic contribution system based on a radio station's revenues, rather than on the size of the market in which it operates. Stations with comparable revenues will make comparable payments. This basic contribution system will take into account the unique circumstances of small stations, regardless of the size of their markets. It will also automatically adjust for changes in the financial situation of radio stations.

Broadcasters will continue to make contributions to support FACTOR and MUSICACTION, which assist in the development of a variety of Canadian artists, including new and emerging artists. Broadcasters acquiring existing stations will also continue to make contributions to the Radio Starmaker Fund and Fonds RadioStar.

The Commission estimated that, if the new CCD system applied to the 2005-2006 broadcast year, total contributions from radio broadcasters would have risen by between $3.5 million to $4 million when compared to the previous year.

The Commission considered the possibility of increasing the minimum level of Canadian popular (category 2) musical selections from 35 per cent to 40 per cent. It determined that such an increase would not be appropriate at a time when the commercial radio industry must respond to the challenge of competing with new unregulated sources for the delivery of audio programming.

However, the Commission proposes to set a minimum level of 25 per cent for Canadian concert music (subcategory 31) and of 20 per cent for Canadian jazz and blues music (subcategory 34) aired during each broadcast week, which would replace the current minimum regulatory level of 10 per cent for these two subcategories.

In addition, radio licensees will be asked to make specific commitments to provide airplay for and to promote emerging Canadian artists.

Calls for radio applications

In a second public notice issued today, the Commission modified its policy concerning the issuance of calls for radio applications in response to the challenging environment faced by broadcasters in smaller radio markets. When the Commission receives an application to operate a new radio station in a small market, where the population aged 12 and above does not exceed 250,000, the Commission's staff will assess this market's economic state in order to determine its ability to sustain a new radio station. Should its preliminary analysis indicate that the market in question is unable to support a new radio station, the applicant will then have the opportunity to either withdraw the application or submit additional information. This step will provide greater transparency and help prevent overlicensing in smaller radio markets.

Digital radio

The Commission, in a third public notice also issued today, set out its revised policy for digital radio broadcasting. In order to enhance the prospects of digital radio broadcasting offered in the L-band, licensees will be free to develop whatever broadcast services they believe will be of greatest interest to the listening public.

The CRTC

The CRTC is an independent, public authority that regulates and supervises broadcasting and telecommunications in Canada.

Reference documents: Broadcasting Public Notices CRTC 2006-158,
                                 2006-159 and 2006-160
                                 Broadcasting Notice of Public Hearing CRTC 2006-1
                                 Broadcasting Public Notice CRTC 1998-41

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Copies of today's documents are available through our Internet site (http://www.crtc.gc.ca) or by contacting the documentation centre of any CRTC office. These documents are available in alternative format upon request.

Date Modified: 2006-12-15

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