Over the past year-and-a-half, we’ve thought — and written — about the then-impending ownership changes that were looming across the country (The Evolving Landscape of Canadian Radio Ownership from October 2013, along with the earlier February 2013 piece Changes Are Coming). Let’s have a look at how things played out.
First, a quick recap to freshen the memory: Bellmedia had paid $3.4-billion for the assets of Astral Media (various radio outlets & specialty TV channels) but needed to shed ten radio stations in order to stay within the CRTC’s market ownership guidelines, while Newcap Radio announced their plans to sell off their Alberta-based holdings during the same time-frame. The fates of dozens of stations (and their staff) were up-in-the-air.
Even though Newcap Radio eventually mothballed their Alberta divestiture plans (reportedly unable to find interested buyers), they did become a major participant in the Bell asset sell-off, picking up five properties in Toronto and Vancouver for the tidy sum of $112-million. The big question now becomes, what are they going to do with their new assets?
It’s unexpected that there will be any changes to Boom 97.3 Toronto any time soon, as the station continues to post solid ratings, thanks to an engaging on-air lineup (backstopped by Stu Jeffries in mornings) and a playlist that goes a little deeper than your typical Classic Hits outlet. Across the hall at Flow 93.5, the future may not be as secure. The station had transitioned to a more-rhythmic CHR sound while under the reign of Bell, but the efforts have yet to deliver an appreciable increase in ears, with Flow posting a 2.3-share (F25-54) in the Feb 24-May 25 PPM, putting it behind Virgin’s 7.5, KiSS’ 6.0 and Z103.5’s 3.8. When Flow launched in 2001, it’s declaration of being the only “Hip Hop & R&B” destination in the GTA made it a unique entry in the market, embracing a sound, style and culture that was largely ignored elsewhere on the dial, generating a fierce loyalty with listeners who felt the station reflected their life and lifestyle. If Newcap decides to remain in the Top 40 race, the challenge seems like it will be to find a way to stand out from the crowd while still growing that key F25-54 demo, no easy task.
The Vancouver acquisitions seemed to need a little more immediate attention. The Virgin branding on 95.3 was the first to go — with Bell owning the Canadian rights to the name, the imaging needed to be replaced once the ownership change was finalized in late-March. Recognizing that the frequency’s old moniker, Z95.3 (used from the mid-90’s through 2004) still carried goodwill in the Lower Mainland, Newcap resurrected the name and polished up the graphics for a relaunch, complete with a new morning show, as the previous one (Nat & Drew) had crossed the street to Bell’s QMFM (a station which will most likely see it’s own revamping to the Virgin nameplate later this year based on Bell’s license deal with Virgin International which calls for seven branded outlets).
With hopes of duplicating the Classic Hits success the company is experiencing in both Calgary and Edmonton, Newcap pushed the under-performing AAA-rocker The Shore out to sea, pink-slipped staff and relaunched the signal as LG104.3. For those living in Vancouver in the 1970’s & 80’s, the original CKLG was a powerhouse, so by utilizing the “LG” suffix with a Classic Hits playlist, Newcap hopes to tap into the sentimentality the calls elicit. As of this writing, the on-air lineup has yet to be revealed, though if they execute the same playbook being used in Alberta, expect a marquee name with strong local heritage for the morning and/or afternoon drive slots, ideally somebody associated with the old CKLG during its prime.
The issues facing CISL (AM650) aren’t unique to Newcap — as the ratings continue to show, music on AM isn’t a lure for listeners, hence the reason for the number of talk-shows and blocks of brokered programming the station runs. CISL’s expenses will be going up this year, as the lease on their current transmitter site expires in August and they need to move their stick. Once the transmitter issue is dealt with, Newcap can then focus on what the best course of action is for the signal’s future – with the Oldies format probably not delivering sufficient ROI, do they ramp-up the amount of talk content or, most likely, do they explore options of leasing the frequency to a third-language entity that would serve Vancouver’s growing ethnic populations?
The Bell assets in Ottawa went to Corus Entertainment, which paid $13-million and then proceeded to pump a tranquilizer dart straight between the eyes of The Bear. While never a market-leader, The Bear did return consistent ratings and so the industry expectation was that, with Corus having extensive experience in Rock programming, there’d be some tweaks and adjustments but otherwise, things would remain pretty much status-quo with the station, as it nicely filled the Active Rock niche in the city. Imagine the surprise in late-March when it was announced that the Bear was being put down and a CHR (Jump 106.9) was taking its place, ready to go head-to-head with Hot 89.9. The reasoning behind the decision? We have to assume that Corus’ research showed that Top 40, even with serious competition, was more viable, sales-wise, than continuing down the Active Rock path alone.
As for Boom 99.7, our original speculation, that Corus would flip it to their existing Fresh FM brand and realign the station to Hot Adult Contemporary, failed to materialize. Instead, the station will continue to battle with Bell’s 93.9 Bob FM for the hearts, minds and ears of Classic Hits fans. Interesting to note that, as part of the transaction closing, Corus agreed to pay Bell the princely sum of a dollar-per-year in order to continue using all of the associated Boom branding in Ottawa.
The Jim Pattison Broadcast Group picked up the remainder of the Bell assets, Winnipeg’s QX104 and Fab 94.3, as well as Calgary’s 101.5 Kool FM, for a price that was originally quoted as $25.5-million, though the CRTC later revised the figures to include working capital, assumed leases and trademark licences, bumping the total up to $29.8-million. Aside from issuing new ID cards to staff, there’ve been no major changes with the Winnipeg properties, nor, in our opinion, will there likely be, as both stations connect well with their listeners and deliver respectable numbers.
The situation in Calgary meanwhile, is not so assured for Kool FM, which has been an under-performer since launching seven-years ago, struggling to find it’s footing (and listeners) in a crowded market. The arrival of a high-profile morning show (Dan Freeman, aka “Tarzan Dan”) in late-2012 has yet to revitalize the station, which has given rise to the growing speculation that Pattison will soon pull the plug on the Hot AC’er and take a direct run at market-leader CKRY, a Corus-owned outlet which has had a lock-hold on the Country segment (averaging a 13-share) for more than a decade. Being able to slice off even a 3-share from CKRY would be an increase over the existing audience Kool has been living with. Already possessing a winning programming team at the highly-rated JR-Country in Vancouver, Pattison could easily extend that talent base to Calgary and bring CKRY their first real competition in years. With the staff recently in overdrive preparing and launching the recently-licensed AAA-rocker, 95.3 The Peak, management’s focus will most likely now shift over to determining the best course of action for the 101.5 frequency.
So, at the end of the day, who has ultimately benefited from this wide-spread change-up in station ownership? Aside from Bell getting some much-needed cash into their coffers, we’d like to think that there are two real winners.
First and foremost, it’s the listener. Increased competition forces the already in-market programmers and on-air talent to “up” their game and get better, while the new corporate entrant can bring different programming philosophies, ideas and perspectives that can result in completely new listening options on the local dial.
The other big winner is music. CRTC guidelines stipulate that a Canadian Content Development (CCD) contribution of at least 6% of the transaction value must occur whenever there is a transfer of station ownership. With Bell taking over the Astral properties (and then the resulting sales to Newcap, Corus and Pattison), that’s a CCD contribution of nearly $82-million going towards FACTOR, MUSICACTION, Radio Starmaker, Fonds Radiostar and other initiatives that develop and support musicians across the country over the next seven-years.
It’s been quite an interesting ride following all of this over that past few years via this newsletter. We’re pleased to see that quite a few of our predictions came true, but as always with radio there were some out of the blue surprises to keep it interesting as well.