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Is satellite radio going Canadian?

OTTAWA, Ont. - Satellite radio may finally be coming to Canada, something both truckers, especially those who truck to remote areas, and the advertisers who court them should be glad to hear....

OTTAWA, Ont. – Satellite radio may finally be coming to Canada, something both truckers, especially those who truck to remote areas, and the advertisers who court them should be glad to hear.

But the deal is far from done, as licence holders now have to make the business case for content conditions imposed by the CRTC (Canadian Radio-television and Telecommunications Commission).

The CRTC recently announced the approval of three subscription radio licences and the establishment of a licensing framework for satellite subscription radio services in Canada. It approved on June 16 the licence applications of SIRIUS Canada Inc. (SIRIUS Canada) and Canadian Satellite Radio Inc. (CSR) for subscription radio services to be delivered by satellite and terrestrial transmitters, and the application by CHUM Limited (CHUM/Astral) to offer subscription radio services uniquely through terrestrial transmitters.

“These decisions foster the objectives of the Broadcasting Act and balance the interests of Canadian consumers, the radio industry and the music industry,” said CRTC Chairman, Charles Dalfen. “These licences will harness new technologies for Canadians and give Canadian talent exposure to listeners across Canada and indeed, North America – both through new Canadian channels and airplay on U.S. channels. New and emerging artists should benefit especially from the airtime that is being reserved for them.”

The newly licensed services will add new programming to the Canadian broadcasting system. There will be more choice and diversity for consumers, particularly those in rural and remote areas, where broadcasting choices are limited.

But the Commission placed conditions on the two newly-licensed satellite radio services, designed to ensure the broadcast of Canadian content and to benefit established and new Canadian artists.

The Commission is requiring that the satellite subscription radio licensees offer:

At least eight original channels produced in Canada. A maximum of nine foreign channels may be offered for each Canadian channel; At least 85 per cent of the musical selections and spoken word programming broadcast on the Canadian channels must be Canadian; At least 25 per cent of the Canadian channels must be in the French language; At least 25 per cent of the musical selections on the Canadian channels must be new Canadian musical selections;

A further 25 per cent of the selections must be by emerging Canadian artists.

The licensees must also contribute at least five per cent of their gross annual revenues to initiatives for the development of Canadian talent, such as FACTOR or MusicAction funds, which assist the development of new musical artists.

Licencees have 150 days from the granting of their licences to accept or refuse the terms offered by the CRTC.

At press time, Sirius Canada had yet to say “yeah” or “nay,” to the commission’s conditions.

“The CRTC has worked hard on a reasonable and creative framework for SIRIUS to move forward in providing Canadians with an outstanding programming line-up,” said Kevin Shea, president and CEO. “We’re going to explore the conditions of the licence in more detail and their impact on our business. At the end the service has to be commercially viable.”

As for CSR, it’s owned by Canadian John Bitove, but also partnered with U.S.-based XM Satellite Radio Inc. (broadcaster of several trucker-focused radio shows, via Channel 171, a.k.a. Open Road).

“We are very excited about being licensed and we appreciate the balanced and progressive approach the CRTC has taken in making this decision,” said Bitove. “We now have to sit down with our partner XM to discuss the new and incremental programming conditions of this licence which were not contemplated in our original application.”

Whether the licencees accept or refuse, it’s pretty clear that satellite subscription radio services will not be available in Canada via satellite facilities that are owned and operated by Canadians.

That’s because Canada has no satellite facility capable of distributing digital satellite radio broadcasting and is unlikely to have such a facility in the future, according to the Commission, because Canada has not secured with the International Telecommunications Union the required spectrum resources at the S-band to develop its own specialized satellites.

If Sirius Canada did accept the licence conditions, it would offer programming channels provided by U.S.-based SIRIUS Satellite Radio inc., which owns 20 per cent of the shares of SIRIUS Canada, in addition to Canadian programs, produced by The Canadian Broadcasting Corporation and Standard Radio Inc. which hold the balance of the shares, with 40 per cent each.

CSR would also offer channels provided by U.S.-based XM Satellite Radio Inc.

As for developing content for Canadian truckers, Stephen Tapp, president and COO of CSR had this to say: “The trucking community is the bedrock of our business. Satellite radio provides continental service that gives that mobile audience the entertainment and information they need to make their jobs more enjoyable.

“The community has also told us that here’s a positive safety aspect of the service.

“No matter where they are, there’s always something on, and it travels with you. They are also our greatest sales people.

“When you love XM you talk about it. These guys are a vital part of the success of XM and we plan to continue that tradition in Canada.”

As for French-speaking listeners, the Commission also approved the application of CHUM and its associate, Astral Media Radio Inc., to offer a service comprising 50 channels produced entirely in Canada, of which at least 20 per cent would be in the French language. In its application, CHUM/Astral said it also intends to offer five channels intended for the Aboriginal, Chinese, German, Italian and South Asian communities.

According to the CRTC, the music broadcast by these channels would have to respect the minimums required by Commission regulations: notably, for popular music, 35 per cent Canadian content, and, in the case of French-language channels, a minimum of 65 per cent of musical selections in French.

In addition, CHUM/Astral would have to contribute two per cent of its gross annual revenues to initiatives for the development of Canadian talent.

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