Have You Heard About The Hearing in Toronto?

In case you haven’t heard, the recent CRTC Hearing in Toronto was one of the most competitive ever, with a record number of applicants vying for the last available frequency in Canada’s largest market. The 88.1 frequency became available when the Ryerson license was pulled by the commission. The popularity of this hearing stems from the fact that the market currently boasts approximately $250 million annually in radio ad revenue, with local broadcasters posting significant profit margins. I was pleased to participate in the process which ran from May 7-16 at the Allstream Centre, and while I wouldn’t presume to speculate on who will prevail, I can provide a bit of insight as to what took place.

This time out there were 7 commissioners instead of the usual five presiding, headed up by Len Katz ,Chair and Tom Pentefountas, Vice-Chair of the Commission. In all, 22 applicants appeared, 19 vying for the 88.1 frequency and the remaining 3 seeking local area licenses. Given that the larger mainstream broadcasters are already maxed out in terms of Toronto ownership, we heard from a nice mix of applicants with very different perspectives.

We had a healthy slate of multicultural/ethnic applicants including, most notably, Lenny Lombardi and Radio1540. Some other applicants were seeking a technical amendment…..a shift from their current frequency to the preferable 88.1. These included Dufferin Communications (Proud-FM), Intercity Broadcasting (Fitzroy Gordon’s G98.7), and La Cooperative Radiophonique. Radio Canada and MZ Media (Moses Znaimer) sought nested FM transmitters/repeaters. There were three proposals for talk formats from Tietolman, Tetrault & Pancholy (Toronto’s New Talk: TNT), WorldBand (News Talk) and BIZ88 (Business News & Information). Scott Jackson and Trust Communications proposed a Christian format. Doug Bingley and Rock95 Broadcasting offered up an Indy format. Ryerson sought to get its specialty license back. Frank Torres brought forward a Blues format (Dawg-FM) comparable to his Ottawa station. Triple A was a popular choice of format with applications from Michael Wekerle, Paul Larche (Triple A with a mixture of Comedy) and Newcap (a variation on Triple A called Modern Adult). I was working with Family-FM, proposing a family-friendly mix of music and enriched spoken word.

Once again, CCD (Canadian Content Development) commitments clearly play a role. We heard pledges of anywhere from a few hundred thousand to around $5 million (from 3 applicants) and in one instance $12 million (over the 7 year term of licence). There is a fine balance between committing enough to be competitive and committing so much that the entity will struggle to be financially viable. The commission seemed a bit skeptical of the $12 million pledge as it might present an unwieldy burden to the applicant.

Equally important were the projected ratings and budgets. Given that the 88.1 frequency is encumbered, overly optimistic projections were questioned. Keep in mind that there are only about 1.7 million listeners within the 3 mV/m contour or about 4 million listeners within the .5 mV/m contour. Share projections beyond the 2% to 3% of Total Hrs. Tuned for A12+ could invite questions. Moreover, corresponding revenue projections which are overly aggressive could be deemed suspect. While offering listeners diversity and the optimal format are of paramount importance to the commission, any application must be judged to be financially viable.

CANCON, as always, remains important. Pledging 40% seems essential. Supporting Emerging Artists has become more and more of a hot button. Most of the music applicants seemed to recognize this.

So what does it take to win a license? Of course, applicants have to exhibit financial stability as part of the process. They have to come forward with unique proposals that fill a clear and pressing need in the lives of Toronto listeners. They have to add diversity to the marketplace. It was clear that the commissioners are open to all comers large or small. In an age of corporate consolidation, it is particularly important that new or independent broadcasters be given an equal opportunity. The deciding factor must always remain…..the best interest of the listeners.

We now stand by for of the CRTC decision which could take a few months. What we have seen is another demonstration of the fact that radio continues to generate significant competitive interest and innovative ideas. Clear evidence that the medium will remain viable as it searches for digital solution in an ever more fragmented media universe. Stay tuned….next up is Winnipeg

David Bray is President of Bray & Partners Communications.
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