Tag Archives: Cogeco

CRTC gives clear channels to TSN, Tietolman-Tétrault-Pancholy

The CRTC’s decision on Montreal AM radio stations came out this morning. Here’s the skinny:

The two other applications, TTP’s English-language news-talk station and Cogeco’s English all-traffic station, are denied, not because the CRTC feels they are without merit, but because the other applicants made better cases for the two clear-channel frequencies and neither would accept 990 as a backup. The CRTC hints that the two might be approved if they reapplied for other vacant AM frequencies (like 600 or 850), but that these applications would have to be reconsidered on their own merits.

Also Monday, the CRTC denied four applications for low-powered AM radio stations in Montreal, three of which would target ethnic communities and the fourth a religious station. The CRTC felt they would negatively impact the five existing ethnic stations, notably CKIN-FM 106.3 (Mike FM’s sister station), which has programming targeting the South Asian and Latin American communities, and religious station Radio Ville-Marie (CIRA-FM 91.3).

The second decision has an impact on the first, in that one of the stations had applied to use 600 kHz. The denial of that application means the frequency is available to the big commercial players. Tietolman-Tétrault-Pancholy has hinted that it might be interested in that frequency, provided it can use a tower or get space for one to build themselves. The only one capable of doing that frequency right now is Cogeco’s towers, which will continue to go unused, but Paul Tietolman says he has no intention of asking Cogeco for them.

You can read a summary of what’s going on in this article I wrote for Tuesday’s Gazette. Below, I go into a bit more analysis.

The hierarchy

Reading the decision, it becomes clear how the CRTC judged the applications based on hierarchy:

  1. CKGM’s frequency change clearly made the strongest case, because it was an already-existing station and because moving it would offer another frequency for another applicant. (The CRTC likes to make as many people happy as possible.) Its content – sports – is also better suited to a signal that carries farther into the regions. So CKGM wins the biggest prize, 690 kHz.
  2. Tietolman-Tétrault-Pancholy’s application was taken seriously, and the CRTC believes enough in its business plan that it is willing to give them a chance. But it wasn’t going to give the one applicant both clear-channel frequencies. So TTP gets 940. And since they said they would not accept 990, one application has to be denied. The French market is stronger in Montreal and its surrounding regions, and there isn’t as much direct competition for a French news-talk station as their is in English with CJAD, so the French station gets approved.
  3. Cogeco’s application for an English all-traffic station couldn’t convince the CRTC that it required a signal so powerful that it can reach into Gaspé. They made a valiant effort, saying that they need to be heard across the Ontario border for people who commute from that far, and that their application should be approved because otherwise the existence of the French all-traffic station would create an imbalance in services to different languages. But the CRTC remained unconvinced. And since Cogeco wouldn’t accept anything but 690 and 940, that application had to be denied.
  4. Dufferin’s Radio Fierté gets 990 more by process of elimination than anything else. Two applications were approved for clear channels, and the other two wouldn’t accept 990, so Dufferin gets it. That isn’t to say the CRTC wasn’t excited about their application and eager to increase the diversity of the radio industry in Montreal. But it seems pretty clear that if TTP would have accepted 990 for its English station, it probably would have gotten it.

Calling their bluff

One thing I like about the CRTC decision is that it calls a lot of bluffs from the applicants.

Cogeco went all in, saying it’s 690, 940 or nothing. I find it hard to believe they’re just going to walk away from $1.5 million a year, and their deal with the Quebec government was already modified once when they decided to make CKAC an all-traffic station. Because that $1.5 million is based on costs instead of audience (otherwise it would be more for the French station), there’s no reason to believe they couldn’t reach a deal for another frequency like 600 or 850. Cogeco’s Mark Dickie told me before the decision that there is no Plan B. If that’s true, they either have to come up with one or walk away from this project.

The latter option would be particularly embarrassing because both parties have been acting as if this was a done deal. The government has been advertising a coming English traffic station, and Cogeco has even asked for applications for potential traffic hosts, with only a footnote at the bottom pointing out that these jobs might not actually ever exist.

Is Cogeco willing to walk away from $1.5 million a year? Is the Transport Ministry willing to walk away from their promise of all-traffic radio in English? We’ll see.

The CRTC also called the bluff of Tietolman-Tétrault-Pancholy, which originally said it wanted both clear channels or nothing, then softened that stance suggesting the English station could find another alternative frequency. They continue to insist that they need both stations for the business plan to be viable, but say the English station might not need to be a clear channel if they can get adequate coverage in Montreal and the West Island. So far 600 kHz seems to be the only one able to do this, but that would require either expanding the site they were planning to use or using Cogeco’s CINW/CINF site in Kahnawake. The latter option is very distasteful to Tietolman and his partners.

When I finally reached Tietolman on Monday, he said he wouldn’t comment (other than to point out that TSN said it would be fine with 940, which I guess means TTP felt the CRTC should have given 690 to them and given 940 to TSN). Tietolman said he and his partners are going to study the decision carefully and decide where to go from there.

Though nobody’s pointing this out, the CRTC decision combined with TTP’s position should mean that the group will decline the license. I highly doubt that will happen, but if TTP doesn’t get a decent frequency for its proposed English station, or if the application takes too long, they might face the choice of going with just the French station or going home.

Six months to a year

The big question for the winning applicants is when they’re going to be on the air. Bell Media says it’ll be “within six months” for CKGM, which would mean by the end of May (maybe just before the playoffs start, or just after the Canadiens are eliminated). It’s unclear at this point whether it will operate for any length of time on both frequencies, though that has been the practice in the past.

Evanov/Dufferin hopes to have its station up within a year, but has to wait for CKGM to vacate its frequency first. The decision gives the group a second choice in terms of transmission site. It already had a letter showing it could enter into negotiations for use of the CJAD site, but as part of the hearing Bell Media committed to negotiating use of the CKGM site for another station on 990, and even said it would submit to binding arbitration concerning a transmitter sharing deal. Evanov tells me they will look at both possibilities.

Other coverage

Clear Channel Cagematch: Cogeco’s all-traffic station

Over the coming days, I’m taking a closer look at the applications for Montreal’s AM clear-channel frequencies 690 and 940 kHz that were presented at CRTC hearings in October. We’ll start with the first one: Metromedia (Cogeco), which applied for an English-language all-traffic station on 940.

Mark Dickie, General Manager of The Beat 92.5 and part of the organizing committee for Cogeco's English all-traffic station

“We didn’t expect this,” Mark Dickie said. “Where was everybody in February or March of 2010? Nobody was really interested in those frequencies then.”

It’s a perfectly reasonable argument from the group that first applied to reactivate 690 and 940 AM. The frequencies have been unused since January 2010, when CINW 940 and CINF 690 were shut down. The licenses for those two stations were officially revoked on June 8, 2010. For almost a year, anyone could have applied for those frequencies, but nobody did.

So when Cogeco, which acquired Metromedia from Corus on Feb. 1, struck a deal with the Quebec government to setup two all-traffic stations on those unused (and seemingly unwanted) frequencies, there was no reason to think the regulatory step was anything more than a formality. The CRTC originally scheduled the applications to be heard along with a bunch of others in a rubber-stamp hearing (it ended up lasting 15 minutes, with no presentations or questions).

But then everyone decided they wanted in, too. Interventions were filed by competitors Astral Media and Bell Media, and would-be competitor Tietolman-Tétrault Media. They demanded that there be an open call for applications, questioned giving clear channels to local all-traffic stations, and in the latter two cases said they would apply for one or both of those frequencies instead. They also pointed out how Cogeco asked for – and received – an exception to the CRTC’s ownership concentration rules by having a third French-language FM station in Montreal, and that another French-language radio station would give them a total of five in this market.

The CRTC responded by pulling the two applications from that hearing and issuing an open call for applications for those two frequencies with an Oct. 17 hearing date in Montreal. The call prompted four other applications.

Cogeco, whose deal with the Quebec government initially had an Oct. 31 deadline for the stations to go on the air, decided it couldn’t wait for the full process to complete itself, and transformed CKAC Sports 730 into a French all-traffic station on Sept. 6.

It subsequently withdrew its application for a French all-traffic station on 690.

I asked Dickie why, if Cogeco considered the CKAC shutdown regrettable, Cogeco didn’t maintain its application and either switch the all-traffic station to 690 or put sports on it. He said they felt, in light of the interventions and the concern about how many stations Cogeco owns, that it was unlikely such an application would be successful.

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CRTC hears applications for 690 and 940 AM

In what is believe it or not considered an expedited process, the CRTC begins hearings Monday on five applications for the vacant frequencies of 690 and 940 kHz for commercial radio stations.

This story, in The Gazette on Saturday, gives the skinny on what the CRTC will be deciding. (Bonus points if you correctly point out that the file photo attached to the story is of the Mount Royal tower, which has no AM transmitters. Now get a life.)

Quick history lesson: These frequencies belonged to Radio-Canada (690) and CBC radio (940) for more than half a century, until both stations moved to FM (95.1 and 88.5, respectively) in 1998. A year later, what was then Metromedia launched Info 690 and 940 News on those frequencies. Both stations struggled, 940 in particular, for the next decade. Two format changes (news-talk with “940 Montreal” and then automated music with “940 Hits”) later, then-owner Corus put both out of their misery, shutting them down. They’ve been silent ever since.

Fast-forward a year and a half, and Cogeco, which bought Corus Quebec – including the unused transmitters – announces a deal with the Quebec government to run all-traffic stations in French and English, to the tune of $1.5 million per station per year. The deal requires the stations to be running by Oct. 31.

The CRTC application was supposed to be a simple thing, with approval easily acquired by the deadline. The frequencies had been unused for a year and a half, and it had been a year since the licenses for CINW and CINF were revoked, but there were no applications to use them. While the FM band is saturated in Montreal, there are plenty of AM frequencies that sit silent (600 and 850 are two other examples) because nobody wants them.

But the CRTC got quite a few interventions demanding an open call for applications. The CRTC agreed, and set a hearing date for Oct. 17.

Judging that far too late, Cogeco shut down CKAC Sports and replaced it with their French all-traffic station on Sept. 6. They subsequently withdrew their application for 690 AM, figuring they’re unlikely to be awarded a fifth French-language radio station in Montreal.

That leaves five applications for the two frequencies. You can download and read the applications from the CRTC’s website. Here they are in brief:

For 690 kHz:

  • Radio Fierté, a French-language music and talk station targeted at Montreal’s gay community, owned by Dufferin Communications/Evanov Communications, which runs PROUD FM in Toronto.
  • TSN Radio, currently at 990 kHz. The Bell Media all-sports station wants to change frequency to improve its coverage, particularly at night, when it has to modify its signal to avoid interference with other stations on that frequency. Bell says the former Team 990 has never been profitable, and probably won’t unless it gets better coverage.
  • 7954689 Canada inc., a company formed by businessmen Paul Tietolman, Nicolas Tétrault and Rajiv Pancholy, which wants to start a French-language news-talk station. Tietolman (the son of CKVL/CKOI founder Jack Tietolman) and Tétrault (former city councillor and PQ/BQ candidate) unsuccessfully tried to present a counter-offer to Cogeco’s $80-million purchase of Corus Quebec, and part of their offer would have been to revive 690 and 940.

For 940 kHz:

  • 7954689 Canada inc., a corresponding English-language news-talk station with what is so far a nearly identical format.
  • Cogeco’s English all-traffic station, which it says would be operational by “mid-winter” if approved.

The agenda for the meeting has presentations from all these applicants on Monday, and support/opposition debates on Tuesday.

Scheduled to appear are, among others:

  • For Bell Media (TSN Radio), General Manager Wayne Bews, host Denis Casavant, Ringside Report host Dave Simon Bell Media Radio Engineering Director Dave Simon* as well as Bell Media Radio president Chris Gordon and Bell Media regulatory affairs bosses Mirko Bibic and Lenore Gibson
  • For Tietolman/Tétrault/Pancholy, the three owners, representatives of Léger Marketing as well as former CJAD program director Steve Kowch and morning host Jim Connell
  • For Dufferin Communications (Radio Fierté), Proud FM operations manager Bruce Campbell, sales manager John Kenyon, Evanov sales VP Ky Joseph, Proud FM announcer Bob Willette, Dufferin VP marketing Carmela Laurignano, Evanov VP finance Michael Kilbride, and lawyers Chad Skinner and Andrée Wylie
  • For Cogeco (Metromedia CMR), Richard Lachance, VPs Yves Mayrand, Daniel Dubois, and Mélanie Bégnoche, 98.5/CKAC assistant GM Michel Lorrain, The Beat 92.5 GM Mark Dickie and consultants Serge Bellerose and Maurice Beauséjour

On Tuesday, the presentations will get responses, mostly from the other applicants. (Astral Media, which owns CJAD and four music stations in the city, is certainly following this, but isn’t appearing at the hearing.) Radio Fierté and TSN Radio each have four supporters offering testimony to the hearing.

You can read all 226 interventions (many are repetitive, thanks to campaigns by TSN Radio, Cogeco and Dufferin to have people write to the CRTC, in many cases using form letters). All are on the record even if the writers aren’t appearing at the hearing.

The only intervenor appearing independently is Sheldon Harvey, the moderator of the Radio in Montreal group. Harvey submitted multiple interventions, supporting the applications by Tietolman-Tétrault-Pancholy and opposing those of Cogeco and Dufferin (he didn’t submit an intervention regarding TSN Radio). Harvey deemed the 50,000 watt clear channels “overkill” for an all-traffic station, and proposed Cogeco operate CKAC 730 bilingually instead. He also said a clear channel was “overkill” for Radio Fierté, and recommended they use another vacant frequency.

The deadline for interventions passed weeks ago, so the CRTC won’t be hearing any new opinions on these applications, but

The hearing takes place Monday and Tuesday, starting at 9am, at Delta Centre-Ville, 777 University St., room Régence AB. Audio from the hearing can be streamed online via the CRTC website. You can listen to the direct floor audio here or an English translation here.

*CORRECTION: Dave Simon of Ringside Report emails me to say it’s not him who’s appearing at the hearing. It’s actually another Dave Simon who works at Bell Media Radio. That is, unless there’s a third Dave Simon associated with TSN Radio. Only Cogeco provided titles for the people appearing with them (Tietolman/Tétrault/Pancholy has what companies they work for), hence the possibility of confusion in case there are other cases of people with the same name.

Government pays for Cogeco to shut down CKAC Sports

http://www.youtube.com/watch?v=NIBVts1PTdU

Following two days of rumours (thanks mainly to Pierre Trudel), Cogeco this morning confirmed that it is switching formats for CKAC 730AM, Montreal’s only major commercial French-language AM station. It will go from being an all-sports station to an all-traffic station effective Tuesday morning. After the announcement, Cogeco immediately pulled the plug on sports broadcasting, and is running music until then, interrupted every half hour by a three-minute announcement by Cogeco VP Richard Lachance.

Listen to the announcement running on CKAC during the weekend (MP3)

Live sports broadcasts will be carried on Cogeco’s news-talk 98.5FM, and some (but not all) personalities will move there as well. Lachance tells LCN that seven employees will be affected, four of whom will find new functions at 98.5. Michel Villeneuve and Ron Fournier, notably, will have shows on 98.5, in the evening (when the station currently rebroadcasts shows from earlier in the day).

In a bitter and ridiculous press release, Cogeco mainly blamed its competitors, who opposed a fast-track process for Cogeco’s all-traffic licenses to be approved by the CRTC. It complained that nobody was interested in the vacant 690 and 940 frequencies formerly held by Corus’s all-news stations and purchased by Cogeco when it bought Corus Quebec, without addressing the claims by competitors like Bell Media that Cogeco was unwilling to negotiate selling the former stations’ transmission towers and other facilities.

But mostly it stresses that it had to establish an all-traffic station by the day after Labour Day, when supposedly the fall traffic season will begin. Waiting until October (or later) would be unacceptable. It’s “urgent” that it has to be up by September, Cogeco says. People relying on traffic reports every 10 minutes just isn’t enough.

What’s not said in the press release is that this is all about money. Cogeco’s not in a rush to get this all-traffic station on the air because it cares about Montreal drivers. It’s in a rush because it cares about the $1.5 million subsidy from the Quebec government. The agreement between Cogeco and the Ministry of Transport says the stations must be operating by Oct. 31, but the contract actually begins Sept. 1. (It doesn’t make clear what happens if Cogeco misses its deadline.) Once that happens, the station begins collecting $125,000 a month from the government to pay its staff.

Thankfully Cogeco doesn’t own a popular English-language AM station, so it can’t shut that down to turn it into an all-traffic station. Instead, it will wait for the CRTC to decide on 940AM, and is asking them to hurry in making a decision (they are hurrying, and had already tightened deadlines for applications for that frequency).

When this all-traffic station idea was announced in May, I panned it as a waste of $9 million of government money over three years for something that just about every radio station already provided for free ad nauseam. Cogeco’s competitors agreed, and demanded an open call for applications for those frequencies, which the CRTC granted.

Now it seems even more obvious how bad an idea it is. Cogeco has compared its $1.5-million subsidy against the ad revenue from CKAC and decided it would rather the government subsidy. The Quebec government is essentially using public money to push Cogeco into shutting down a popular all-sports radio station and replace it with something that is redundant to every other station in the market.

(One might ask if Cogeco didn’t want to shut down CKAC, why not apply for an all-sports radio station on 690AM and bring it back? The press release is silent on this.)

It’s a sad day for Montreal radio, and an even sadder day for common sense and government spending.

CKAC 730AM will go all-traffic Tuesday, Sept. 6 at 4:30am. The CRTC hears applications for 690 and 940AM (Cogeco has withdrawn its application for 690) on Oct. 17.

UPDATE: Similar commentary from Stéphane Laporte.

A Facebook page has been setup to protest the decision. CKAC Sports’s Facebook page has a brief note from the station: “Merci à chacun d’entre vous de nous avoir suivi, lu, et d’être venu commenter ainsi que partager votre passion pour le sport”, followed by a lot of angry comments.

You can also watch video of CKAC’s empty studio while listening to Céline Dion and other awful music.

Other coverage

The Team 940? Bell proposes frequency swap

Cogeco’s CRTC application to bring two Montreal AM radio stations back to life has prompted interventions from the owners of the other AM stations in the city – Astral (which owns CJAD) and Bell Media (which owns CKGM/The Team 990) – as well as Paul Tietolman, who has been trying for some time to start up his own AM station at 940 kHz.

The interventions (two are opposed to the application, while Astral is negative but not quite so categorical) are based on these main points, which have been responded to by Cogeco:

  1. Concentration of ownership: The interventions point to the fact that Cogeco asked for and received an exemption to a CRTC policy that forbids any owner from having more than two stations on the same band in the same language in the same market. This allowed them to purchase all of Corus Quebec’s radio assets in Montreal, adding CKOI and CHMP 98.5FM to CFGL Rythme FM, giving them three French-language FM stations. Now they want to add two more stations to their empire, giving them five French-language stations (they also own CKAC) and two English-language stations (with CFQR). Cogeco responds by saying that exception was, well, exceptional, and that owning two French-language AM stations would not be a further exception to CRTC policy. Cogeco also says it doesn’t believe an all-traffic station (even one that solicits advertising) would be a significant competitive threat to existing broadcasters.
  2. Use of clear channels: The interventions agree with me and other radio watchers that 50,000 watts and a signal pattern that stretches into the Maritimes and northeastern Ontario is overkill for a Montreal traffic station. They say that if the application is approved, it should be for two frequencies that are not clear channels. Cogeco responds that the frequencies have been vacant since June 2010 (when the CRTC announced it had revoked the licenses) and no one has applied for them.
  3. Unfair competitive advantage: The interventions question the entire point of a publicly-funded all-traffic station. And while there’s nothing the CRTC can do to change how the Quebec government spends its money, the incumbents object because the funding would give the traffic stations an unfair competitive advantage. The funding “will allow Metromedia (the Cogeco subsidiary that owns the stations) to aggressively sell advertising in the marketplace, potentially offering lower rates than what is offered by the incumbents. This potential strategy will only serve to further undermine an already weak market,” writes Bell Media VP Kevin Goldstein in his intervention. Cogeco responds by quoting news articles demanding better communication about road conditions from the government and says they only expect about a quarter of its advertising revenue ($600,000 for the first year) will come at the expense of their competition.
  4. Guarantee of format: The interventions say there’s no guarantee that their all-traffic format would be maintained once the contract with the Quebec government runs out. Cogeco responds that it would accept a condition of license making such a guarantee.
  5. No public bidding: The interventions feel this project should have been open to a public bidding process. Cogeco responds that any broadcaster could have responded to the notice from the transport ministry that it intended to award this contract to Cogeco, but none ever did. The lack of demand meant the government did not have to open bidding on the project.

Here’s where the intervention from Bell gets interesting: They state that they have been trying, since Corus shut down CINW (940 Hits) and CINF (Info 690) in January 2010, to purchase the transmitter and antenna from them, to no avail. Bell says that if the CRTC wants to approve this application, it would be prepared to perform a frequency swap, taking either 690 or 940 kHz and taking up a clear channel that allows them to broadcast 50,000 watts day and night.

Propagation patterns for CKGM (Team 990AM) in red (day) and black (night) vs. CINW (940AM) in purple and CINF (690AM) in blue, as provided in Bell's CRTC intervention

As Team 990 gains broadcast rights to Canadiens games in the fall, nighttime propagation becomes more important. As a Class B frequency, 990 requires the transmitter to modify its signal at night, reducing its coverage. Switching to 940 would give CKGM a much larger coverage area.

The idea makes a lot of sense. Montreal sports teams – and the Canadiens in particular – are going to have a lot more interest in the outlying regions than Montreal traffic information. It makes sense for that station to have a larger coverage area. And, of course, most people interested in traffic will listen to the radio in their cars, which should not have trouble picking up a giant transmitter just a few kilometres away.

But Cogeco responds by criticizing Bell’s suggestion that it would have been too expensive to retune its existing transmitter and antenna from 990 to 940 kHz. It quotes an engineering expert it hired that said in the worst case scenario of having to replace everything, it would cost less than $250,000.

We’ll take them: Tietolman

Tietolman Tétrault, in its intervention (PDF), suggested the stations use frequencies of 600 and 850 kHz (formerly of CIQC and CKVL, respectively) and said the 690 and 940 frequencies should be open to applications. It said it would be willing to apply for both:

Tietolman Tétrault Média est déjà prêt, intéressé et apte à appliquer pour l’obtention de ces fréquences. Nous avons en main un plan d’action que nous estimons bénéfique pour la diversité radiophonique nécessitant ces deux fréquences-clés. Évidemment, ces deux fréquences seraient en ondes peu de temps après l’obtention des licences.

Tietolman, whose family once owned CKVL, had tried to offer a competing $81-million bid for Corus Quebec, including 690 and 940. They’ve indicated for a while now that they’d like to bring back 690 and 940, though they haven’t said what kind of format the stations would have.

Other interventions

A few other smaller groups and individuals also filed interventions in this application.

Jacques Blais of S.O.S. Québec Radio filed a handwritten note (PDF) – he wrote that he had computer problems – in which he called the project useless and a waste of public money, and appealed to common sense in rejecting it. He also repeated that 50,000 watts was too much for this station, and said the 690 and 940 frequencies should be reserved for French-language stations only, because the French language is threatened in Quebec.

That last part is kind of funny because his supporting documentation was my previous blog post and an article from The Suburban.

Marc St-Hilaire of the Syndicat général de la radio union said (PDF) endorsed the new station but said it was worried that Cogeco would deduct the number of people it hires for these stations from its commitment to hire journalists for its Cogeco Nouvelles news agency. Cogeco made the commitment as part of the deal that got it to own three francophone FM stations in Montreal.

Chantale Larouche of its parent union the FNC expressed similar thoughts in a separate intervention (PDF).

Cogeco says each station would have six full-time announcers, plus a full-time traffic journalist, and that these would be in addition to the commitments they already made for the creation of Cogeco Nouvelles and the hiring of journalists.

Finally, Miguel Therriault of Quebec City filed a very brief intervention (HTML), saying, in its totality: “Les coûts sont outrageusement exagérés. De plus ce service est complètement inutile. Les stations de radio actuelles répondre très bien à la demande. C’est une dépense inutile.”

You can read the interventions here:

The hearing to discuss Cogeco’s application was supposed to happen next Monday, but the CRTC announced last week that the items have been withdrawn from the agenda and will return as part of a later hearing. No explanation was given and no date has been set yet.

UPDATE: An open call has been issued for the two frequencies, with a deadline of Aug. 29. Cogeco maintains it still wants to setup all-traffic radio stations and will go through this process if necessary.

Alouettes broadcasts return to CKAC

For the second consecutive year, the Alouettes have prematurely ended their deal with their official French-language radio broadcaster and switched to its major competitor.

It was announced on Tuesday that the Alouettes will be returning to Cogeco’s CKAC Sports for the 2011 season. CKAC will broadcast 20 games (the regular season has 19 18, so this covers all of those and the two preseason games), plus all playoff games.

Pierre Martineau, a spokesperson for Cogeco Diffusion, says the deal is for this coming season only, and some games will also air on Cogeco’s regional FM stations.

Having CKAC Sports broadcast the games seems like such a no-brainer, and indeed they broadcast the games for many years, signing a five-year deal in 2007. But that deal was mutually dissolved so that the Alouettes could strike a deal with Astral Media’s NRJ for broadcast rights in 2010. That deal was supposed to last until 2013.

The switch to NRJ wasn’t perfectly smooth. NRJ is a music station (like CHOM, which also broadcasts some Alouettes games), and license limits meant they couldn’t broadcast five games last season, according to La Presse.

Fans also weren’t crazy that NRJ used the RDS play-by-play audio instead of their own staff, though CKAC did the same thing.

A representative of the Alouettes did not immediately respond to voice mail messages requesting comment.

The Alouettes’ English radio rights are held by Astral, with games airing on CJAD and CHOM until 2013. It’s unclear if the move away from Astral on the French side will have any impact on the English rights. No doubt the Team 990 would be more than happy to pick up rights to Alouettes games, much like they would love to take rights to Canadiens games away from CJAD someday.

Last month, CKAC announced an agreement to air Canadiens games for two more seasons, ending in 2013-14.

All-traffic radio: A $9-million waste

Coverage map for CINW 940AM at 50,000 watts, as submitted to CRTC

Last week, news came out that Cogeco and the Quebec government have reached a deal that will see the creation of two new all-traffic AM radio stations in Montreal set to open in the fall. The project will cost taxpayers $9 million over three years.

It’s the most ridiculous use of $9 million I’ve seen in a while.

The history of 690 and 940 AM

Montreal has had two giant holes in its radio spectrum since January 2010. Both frequencies – 690 and 940 kHz – started out as CBC stations. CBM (CBC Montreal) moved to 940 and CBF (Radio-Canada Montreal) moved to 690 in 1941. They were among Canada’s oldest AM radio stations and each had clear-channel status, meaning that they could operate at 50,000 watts and did not have to reduce power overnight to avoid interference.

Clear-channel status is highly sought – or at least it was. There are only about a dozen such stations in Canada (CKAC is the only active one in Montreal), and the clear-channel status means they can be heard from very far away with a good enough antenna.

Despite this seemingly huge advantage, CBC decided in the late 90s to move its AM stations in Montreal to FM – 88.5 and 95.1 MHz – where they remain today as CBC Radio One and Première Chaîne). The argument was that FM provided better quality audio and the signal would be easier to capture in the city. The tradeoff – that the signal would no longer be carried by skywave to neighbouring provinces and territories – didn’t seem to be such a big deal. It was a controversial move at the time, particularly for CBC Radio listeners who had better reception with AM than FM.

In 1999, the decades-old CBC transmitters were shut down and the frequencies vacated. Métromédia (later Corus Quebec), which owned CIQC 600 AM and CKVL 850 AM, wasted no time in snapping the clear channels up, and moved those two stations to the vacated frequencies. They were reborn as all-news stations CINW (940 News) and CINF (Info 690).

We all know how that turned out. The anglo all-news station didn’t work out financially, so they changed it up into a news-talk format in 2005. When that didn’t work either, they fired everyone and started played music in 2008. (Info 690, meanwhile, kept going with their news format). Then, in January 2010, Corus pulled the plug on both stations and gave up. They returned their licenses to the CRTC.

Since then, the frequencies have remained vacant. Clear AM channels that it seems anyone could have had just by asking. But no takers.

In 2010, Corus agreed to sell its Quebec assets to Cogeco. This included the transmitters for CINW and CINF, even though they were inoperative and had no broadcast license. The deal was approved in December, giving Cogeco the equipment (and a lease on the transmitter site in Kahnawake until 2021) but no idea how to use it in a way that could make it profitable.

And here’s where the Quebec government comes in.

Congrats, Cogeco lobbyists

According to documents they submitted to the CRTC (you can download them yourself from here), Cogeco found out about the Quebec transport ministry wanting to improve the way it communicates information about traffic disruptions to the public. With all the construction work expected to come (the Turcot Interchange, for example), they wanted to minimize the pain to drivers by keeping them as well informed as possible.

Cogeco went to them and proposed a … let’s call it a partnership. Cogeco would provide the transmitter, the programming, the staff. The government would provide access to traffic information and lots and lots of money.

The government thought it was a great idea, and on April 14 they published their intention to award a contract to Cogeco. The deal was finally announced last week by the government and Cogeco (PDF) and the CRTC announced it would hold a hearing on the proposal to give the licenses back to CINW and CINF. News coverage was brief, most just regurgitating the press release:

The station, which according to the deal must be operational by Oct. 31 (though the target date is Sept. 1 pending CRTC approval), would broadcast live from 4:30am to 1am weekdays and 6am to 1am weekends and holidays. This information includes:

  • Traffic status on highways and bridges
  • Road conditions
  • Information on road work sites (it’s unclear if this is just those run by the transport ministry or all municipal sites as well)
  • Highway safety tips
  • Weather conditions

In other words, the kind of stuff you’d expect from any traffic information radio station. Missing from this list is an item about providing information on public transit service. It’s unclear why both sides left this out of their press releases, but it’s contained in their CRTC submission and in the contract between the government and Cogeco, and I would imagine the intention is to include such information in their broadcasts.

The deal also includes promotion of the station by Cogeco and 25 minutes a day of airtime for the ministry.

Cogeco says it plans to use CHMJ in Vancouver (owned by Corus) as a template. That’s also an all-traffic radio station, but with one major difference: It’s not funded by the government.

You could also compare it to The Weather Network and MétéoMédia, which provide all-weather programming, funded mainly by subscriber fees that all cable subscribers must pay for the channels.

Why this is a bad idea

I appreciate that the ministry wants to improve communication about traffic and road work. But they’re doing this by getting into the broadcast business. The figure of $3 million a year might not be much, but it represents about three-quarters of the stations’ proposed budgets. Cogeco also predicts that figure will rise if the contract is renewed beyond three years (the CRTC asks for seven-year projections for a station’s finances) to $3.3 million a year for the next three years.

Put simply, this is a solution to a problem that does not exist. I mean, seriously, is the biggest complaint about commercial radio that there aren’t enough traffic reports? Just about every station does traffic reports every 10 minutes during rush hours. CJAD does it all day. All this without any specific funding by the government to do so. Even CBC Radio One does traffic reports, including public transit updates. (The CBC is funded by the federal government, but that funding doesn’t come with a requirement to do traffic updates. CBC Radio does traffic reports because it knows that’s what rush-hour listeners want to hear.)

This isn’t to say an all-traffic radio station wouldn’t make sense. CHMJ is trying that format. And it’s a good idea for AM radio, because most portable music devices these days can’t receive AM radio, but most cars can. But if there’s a demand for it, then it can be done without government funding. And if there isn’t a demand for it, why bother?

Cogeco’s own submission to the CRTC says there are about 1.3 million vehicles travelling in the Montreal area during the afternoon rush hour (less in the morning), which means more than $2 per vehicle per year spent on these stations. They expect their market share will be 1.5% for the anglo station and 1.6% for the francophone station. Based on their estimated total weekly hours of listening, the English station would expect about 1,000 listeners on average (more, obviously, during rush hour) and the French station about 3,000 listeners.

And CRTC submissions are usually pretty optimistic.

Why this is overkill

The other thing that bugs me about this is the choice of channel. Cogeco wants to put both these stations on clear channels, and have both running 50,000 watts day and night. The reach of these stations, as you can see from the map at the top of this post, is not just the greater Montreal area, but as far as Gaspé, Moncton, southern Maine, Kingston, northern Ontario and even Labrador. The vast majority of its listening area couldn’t care less what happens on the Champlain Bridge.

Then again, if nobody else wants the frequency, I guess it’s better to do that than nothing at all. But surely we can find a better use for such a powerful signal than traffic reports for one city.

There are also some strange proposals, like having a roving reporter patrol the city to report from the scenes of major traffic events. Compare this to the private sector that has helicopters flying overhead to report on traffic and other issues. It’s a government employee doing a job that the private sector is already doing better.

What the government should spend its money on

In the grand scheme of things, $9 million isn’t a lot of money. But rather than spend it on duplicating a service the private sector already does for free, how about the transport ministry use it more wisely. Spend it on adding more traffic cameras, providing better real-time information to traffic reporters, better ways of getting information to smartphones and other portable devices, improving the Quebec 511 service. Create a database of road work (both provincial and municipal) that can be integrated into Google Maps and used to suggest better routes to drivers.

Or, you know, they could use it to improve the province’s highways. At least repave the kilometre or two closest to the Ontario border, which will give the most psychological bang for the buck and end those silly anecdotal cross-border comparisons.

The CRTC will be hearing the two applications for all-traffic radio stations on July 18 in Gatineau. Comments and interventions are being accepted until June 20. The contract is contingent on CRTC approval and would be cancelled if CRTC approval doesn’t materialize before Oct. 31.

UPDATE (May 31): A Gazette piece says that there was a call for bids in this deal. That’s not entirely accurate. On April 14, the transport ministry published its intent to give a contract to Cogeco (a document that starts off by saying “this is not a call for bids”), and gave competitors 10 days to indicate that they could provide a competing offer for the deal – something that if accepted would have led to a formal call for bids. After the deadline passed, the ministry gave the deal to Cogeco.

Welcome to the Cogeco radioverse

It’s official. Despite an after-the-fact plea from Astral to overturn CRTC approval and block the purchase, Corus Quebec’s radio stations officially became part of the Cogeco family on Feb. 1.

The new owners wasted no time imposing the new order, escorting previous bosses out the door (assuming they didn’t quit) and appointing a new executive team.

As part of the agreement with the CRTC, Cogeco can continue to own three francophone FM stations in Montreal (98.5FM, Rythme FM 105.7 and CKOI 96.9), but has to sell some stations in other regions:

  • CKOY-FM 104.5 (since renamed CJTS-FM) in Sherbrooke, which operated under the CKOI brand
  • CFEL-FM 102.1 in Quebec City, also a CKOI-branded station
  • CJEC-FM 91.9 in Quebec City, under the Rythme FM brand

If you’re interested, feel free to bid. It’s unclear what will happen after the sales are complete (will they be able to keep the same brand? Will they want to?), but for now it’s business as usual.

Another station that was part of the Corus network, CKRS in Saguenay, was sold separately to local investors.

On the anglo side, the only affected station is CFQR 92.5 “the Q”, which switches from Corus to Cogeco. Astral Media owns the other stations, CHOM, CJFM “Virgin Radio” and CJAD. There’s no word on any changes to management or programming or anything else at that station so far.

CRTC caves in to Cogeco

The CRTC, which sets rules regarding concentration of ownership in broadcast media, decided it could simply ignore them in a ruling on Friday that gave Cogeco the right to buy almost all the assets of Corus Quebec.

Specifically, Cogeco would buy 11 stations for $80 million, including Montreal’s 92.5 the Q (formerly Q92), CFQR-FM.

In Montreal:

Elsewhere:

  • CJRC-FM Souvenirs Garantis 104.7 in Gatineau
  • CIME-FM 103.9 in St-Jerome
  • CHLT-FM Souvenirs Garantis 107.7 in Sherbrooke
  • CKOY-FM 104.5 in Sherbrooke
  • CHLN-FM Souvenirs Garantis 106.9 in Trois-Rivières
  • CFOM-FM Souvenirs Garantis 102.9 in Quebec City
  • CFEL-FM (“CKOI”) 102.1 in Quebec City

The biggest problem with the acquisition is that it would violate a CRTC rule that says one company can’t own more than two stations in each language on each band in each market. Cogeco was willing to get around this by selling stations in Quebec City and converting one in Sherbrooke into a retransmitter of Montreal’s CKAC sports station.

But it wanted an exception in Montreal. CHMP 98.5 is the flagship station of the Corus talk radio network, and Rythme FM (CFGL) and CKOI are the No. 1 and No. 2 music stations, making them a whole lot of money. Cogeco said that a requirement to sell one of those stations would torpedo the whole deal (CKOI alone represents half the cost of the acquisition), and promised that in exchange for this special consideration they would hire journalists throughout Quebec and create a talk-radio news agency.

And the CRTC caved. Well, mostly.

They didn’t buy the idea of turning Sherbrooke’s CKOY FM into a retransmitter of Montreal’s CKAC sports station, and gave Cogeco a year to find a buyer for it. They also made a strict condition that Cogeco’s plan for a news agency continue, so they can’t pull a bait and switch.

That part is good news. The idea of Cogeco Nouvelles sounds good. At least the part about them hiring 33 full-time journalists and spending $3 million a year on news sounds good. The part about sharing content sounds a lot like the regional stations will all take the majority of their content from Montreal and insert a bare minimum of local stories just to justify their license.

But still, considering how little actual journalism comes out of private radio in Quebec, on the whole this is good.

There are also a few additional incentives to sweeten the deal, like this: Cogeco will “provide its services free-of-charge to groups operating fewer than three French-language radio stations in Quebec’s small markets as long as they agree to supply COGECO Nouvelles with news from their markets. The service’s content will also be available free-of-charge to community radio stations.”

Oligopoly

But as nice as all that is, and I hope Cogeco Nouvelles succeeds, the problem of radio competition remains. Instead of three players in the Quebec francophone (popular) music scene in Montreal, there would be two, representing an astonishing 95% of advertising revenue in the biggest market in Quebec. And that’s true for both the French and English-language markets in Montreal. If you discount jazz, classical and CBC/Radio-Canada’s stations, the two will own all seven music stations (four francophone, three anglophone) in Montreal.

Much of the debate at the CRTC seemed to be about Astral Media, which owns the NRJ and Rock Détente networks and is seen as a major player in the regions. But rather than acknowledge that there’s a serious problem with Astral Media owning stations that should be competing with each other (this is particularly true in Montreal’s anglophone market, where Astral owns CHOM 97.7, CJFM 95.9 Virgin Radio and CJAD 800), the CRTC decided that the best response was to create an even bigger behemoth in Cogeco.

With the acquisition, Cogeco stations would have an astounding 46.6% market share in the Montreal francophone market and 22.4% in the anglophone market, or 41.3% total. Astral, meanwhile, has a 31.4% share in the francophone market and a 55.4% share in the anglophone market. Note that all these numbers don’t exclude CBC/Radio-Canada stations. When you consider just commercial stations, or as a share of ad revenues, those numbers are even higher.

The suggestion that this would somehow “restore a competitive balance” is silly.

The Montreal-less network

There’s also a problem that isn’t being considered very well here: While Cogeco argues that regional talk-radio stations need the resources and “expertise” of Montreal’s 98.5 FM, it also plans to sell stations in the regions to a third party that won’t be able to setup a Montreal station if they want to build a network.

For example, CKOI is a brand network in Montreal, Sherbrooke and Quebec City. As part of the acquisition, Cogeco will have to sell the Sherbrooke and Quebec City stations in this network, but not the Montreal one. And there isn’t exactly a lot of extra space on the dial for someone to setup a new francophone music station in Montreal. So not only would anyone who wants to buy these stations have to change their brands (along with the Rythme FM station in Quebec City), but they wouldn’t be able to take advantage of whatever efficiencies Astral and Corus/Cogeco think they have found with multi-region brands.

Personally, I think music radio stations can do fine without needing to belong to a Montreal-network (some names are already popping up as potential buyers). But it’s funny that Cogeco puts such a strong emphasis on the need for a Montreal flagship station for its talk radio network but has no problem with other people having radio stations in the regions without a Montreal-based moneymaker to keep them afloat.

In conclusion: Good for radio, bad for radio choice

I’m happy that the CRTC handled some of the issues I brought up in my criticism of Cogeco’s plan. And I’m happy that Cogeco is planning to setup a regional radio news network and hire journalists.

But this is a step backwards for radio diversity in Montreal, at a time when the city desperately needs more competition in commercial radio.

The CRTC should review its rules for media concentration, particularly because the public seems to be abandoning the AM band and because Montreal’s numbers suggest that commercial music stations aren’t strictly segregated on the basis of language.

Montreal has seven commercial radio stations that all play popular music that sounds a lot alike. It should have more than two companies running them.

More coverage in:

UPDATE (Jan. 12): Almost a month after the CRTC’s decision, and weeks before the transaction is set to close, Astral decides to appeal to the federal court to overturn it, saying it was “arbitrary and unreasonable” to change the rules at the last minute just for Cogeco. VP Claude Laflamme makes the point in the statement that “the sudden lack of predictability in the application of the CRTC policy penalizes all broadcasters which in the past decided not to pursue business opportunities in order to abide by the policy as formulated and as consistently applied.”

La Presse quotes Cogeco as counter-arguing that Astral controls 75% of the anglophone market (they own CJAD, CHOM and CJFM, but that doesn’t violate the CRTC’s rules), and they shouldn’t be pointing fingers about media concentration.

Note that while Astral suggests that Cogeco should have been forced to sell one of the music stations, it doesn’t have its eyes on them because it already owns two francophone FM stations in Montreal (CITE Rock Détente 107.3 and CKMF NRJ 94.3)

UPDATE (Jan. 14): Corus says it will, of course, fight this appeal, and that the Cogeco deal is still set to close on Feb. 1.

Cogeco’s self-serving plan for Quebec radio

Three months after announcing a deal to buy Corus Quebec’s radio stations (with the exception of CKRS in Saguenay, which has been sold to an independent group including Guy Carbonneau), Cogeco and the CRTC yesterday both released Cogeco’s proposal for how it will run those stations.

Among the highlights:

Cogeco News

In addition to the above, Cogeco is talking big about creating a “news agency” that would serve all its stations (I guess they mean something bigger than Corus Nouvelles). Here’s what they say in their press release:

The news agency that COGECO proposes to set up will play a key role in enriching local information and will provide a complement to the other information sources available in Quebec. All of the stations of the COGECO group as well as independent stations in the regions and community stations will be asked to contribute to the content available through the agency. In return, they will be able to select the most relevant news for their respective listening audiences and produce their own news bulletins locally.

Pooling resources through the news agency, which will be coordinated by FM 98.5, will create a full information source available 24/7 – because news happens nights and weekends, too.

Furthermore, sharing information resources will allow regional stations CHLN-FM Trois-Rivieres, CHLT-FM Sherbrooke and CJRC-FM Gatineau, which will remain predominantly spoken-word radio services but will now primarily target men between the ages of 25 and 54, to devote their resources to producing local shows. Most significantly, this means the return of local public affairs programming in the morning and at noon, as well as locally produced news bulletins.

Finally, a night-time show and a weekend morning public affairs show will be produced and offered to all stations of the group. Community stations and independent stations in the regions will also have the benefit of these new resources and information content.

“We want to put information radio in Quebec back on top,” commented Mr. Lachance. “Since COGECO is a business that is close to its people, it is a natural fit for us to make local information and local interest content the heart of our strategy. The decision to include independent stations in the regions and community stations in the agency aligns with that, and we think this is great news for radio in Quebec.”

Unless I’ve misunderstood, this sounds a lot like what the TV networks have done to local television stations. They still produce local newscasts locally (well, except Global), but many of the stories they produce are prepackaged by the national network. Without the resources and staff to put together a full newscast, the local stations are forced to use these prepackaged reports, even if they’re local stories from local newscast hundreds of kilometres away that have little interest to their communities.

And Cogeco is trying to sell this as a good thing for local radio.

Of course, if the alternative is no news at all, or a straight rebroadcast of a Montreal signal, I guess it is good news.

Let us cheat, but only where we get rich

Cogeco doesn’t try to hide the fact that its request to keep its stations in Montreal is all about money. Rythme FM is the No. 1 station in Montreal, 98.5 has the most popular morning show, and CKOI also does very well here.

Their excuse for wanting to keep all these money-generating stations? They’re throwing out a bunch:

98.5 is special: “The proposed exception affects only FM 98.5 in Montreal’s French-language radio market and would allow COGECO to operate three French-language FM radio stations, each in its own niche.”

Are Rythme FM and CKOI so different that they qualify as their “own niches”? And the exception applies equally to them. Nothing stops Cogeco from keeping 98.5 and selling Rythme FM or CKOI. It’s selling both stations from those networks in Quebec City and shutting down CKOI’s sister station in Sherbrooke.

It saves the French language: “The distinctiveness of the bilingual Montreal market and the importance of keeping talk radio like FM 98.5 strong in order to ensure the sustainability of French-language spoken-word radio in Quebec justify our request for an exception”

I have no idea what bilingualism has to do with this, nor how “the distinctiveness of the bilingual Montreal market” somehow means it makes sense to concentrate ownership. I don’t know whether 98.5 is profitable. If it is, they can sell it to someone who will keep the talk radio format. If it isn’t, there’s no guarantee Cogeco won’t change the format and make it a music station or something else that’s cheaper to produce.

It helps the regions financially: “Without that exception, it will be next to impossible for COGECO to indefinitely support regional spoken-word radio stations that have been running heavy deficits for many years.”

That’s an argument for converting CKOY in Sherbrooke from a station to a retransmitter, but what does it have to do with Montreal? Does Cogeco expect us to believe that if we give them an exception to media concentration rules that they’ll subsidize money-losing regional stations indefinitely?

It helps the regions with programming: “The limited exception sought by COGECO would breathe new life into stations in the regions by providing them links to strong programming sources – to FM 98.5 primarily, for information and public affairs, and to CKAC-AM for sports and CKOI-FM for its expertise and music content.”

Again with the distraction. CKAC has nothing to do with the exception, since it’s an AM station. And as for CKOI, you just said you’re selling its sister station in Quebec City and shutting down its sister station in Sherbrooke. If Montreal-based programming would save these stations, why do you insist on getting rid of them?

We should include anglo stations too: “… a very high number of francophone listeners tune in to English-language music stations.”

Sure. CHOM and CJFM get a lot of francophones listening to them. But so does CFQR, which you’ll recall is one of the stations you’re buying. Add in the anglo stations, and Cogeco wants to own five of the 13 commercial radio stations in the city, and four of the eight commercial FM (mainstream) music stations. This doesn’t support their argument very well.

Straight-up bullshit: “Our plan is without a doubt the best opportunity to increase diversity of voices across Quebec that the broadcasting system has seen in many years.”

You’re buying a former competitor. Don’t pretend it’s the opposite of what it is.

Ooh, money!

Oh, and that last part they mentioned about “an exceptional contribution of 9% of the total transaction value, an amount of $7.2 million, to various organizations and initiatives to support the radio system”? Sounds kind of generous, doesn’t it?

It’s CRTC policy that when a broadcaster is sold, the buyer proposes a “tangible benefits” package of 10% of the purchase price to contribute positively to the development of the broadcasting system. The money doesn’t go to the CRTC, but to organizations that support independent productions and other good things.

You math majors might notice that their 9% proposal is less than the 10% CRTC policy. In other words, it’s another exception they’re asking for, one that they’re selling to the public as a generous donation on their part.

What the CRTC should do

Cogeco hasn’t made anywhere near a solid case for keeping three FM stations in the Montreal market. It’s selling or shutting down Rythme FM and CKOI-branded stations elsewhere in Quebec, and freely admits its only motivation for wanting to keep these stations here is money. The CRTC should order Cogeco to sell one of the FM stations in Montreal, and let someone who isn’t Cogeco or Astral Media take a shot at making money from commercial francophone radio in Montreal.

Cogeco’s point about the unprofitability of regional stations is a good one, but giving the company what it wants in Montreal won’t suddenly make those stations profitable (even with all the big talk about a news agency they promise). It will at best simply delay their eventual decision to either sell or shut down those regional stations.

In Quebec City, Cogeco’s plan to sell two stations would put it in compliance with CRTC guidelines. No problem there.

In Sherbrooke, Cogeco is presenting its plan as a “win-win-win”, proving it doesn’t give a crap about local radio. The CRTC should order Cogeco to find a buyer for CKOY. Corus found a buyer for CKRS in Saguenay, and those Quebec City stations are going to someone. I’m willing to bet there’s interest in CKOY if it’s on the block for cheap. If Cogeco is interested in having a CKAC retransmitter in Sherbrooke, it can apply for a new license on a vacant frequency.

The CRTC will hold a hearing on Sept. 28 at 9am at Le Nouvel Hotel (1740 René-Lévesque W., corner Saint-Mathieu) to consider the application.

UPDATE (Aug. 6): Cogeco VP Richard Lachance does interviews with Infopresse and Paul Arcand explaining the plan, saying the new news service will create about a dozen jobs (including reporters in the federal and provincial legislatures), and there’s no Plan B if the CRTC decides it doesn’t like Cogeco’s plan.

Trente, meanwhile, takes another look at the plan, referencing this blog post.