Source : Vancouver Sun

CRTC has okayed the service with certain conditions

B.C. retailers are eager to see satellite radios on their shelves after Thursday's decision by the CRTC to approve three licence applications for pay-radio services in Canada.

But it could be late fall before the service is geared up and ready to meet stringent Canadian content rules.

"We have our fingers crossed and we're hoping it may be October," said Wynne Powell, president and chief operating officer of Vancouver-based London Drugs. "It could still be a Christmas item if the business plans of the satellite radio companies can support it."

The CRTC approved three licence applications for pay-radio services, including two satellite-based systems and one ground-based, and with the proviso that the services meet stringent Canadian-content rules. While the satellite radio companies, which are relying on satellites that serve the U.S. market as well, proposed to have five channels produced in Canada, the CRTC has upped that number to eight.

Despite the tougher rules, the satellite applicants, both linked to U.S. companies where satellite radio service is already becoming the fastest-growing consumer electronics product in history, suggested Thursday the conditions could be met.

"At first glance, it doesn't look to be unrealistic," said Kevin Shea, chief executive officer of Sirius Canada Inc., a consortium of the CBC, Standard Radio and U.S.-based Sirius Satellite Radio. "The question remains, will we be able to have a competitive, viable service?"

John Bitove, head of Canadian Satellite Radio, which is partnered with the U.S.-based XM Radio, was pleased by the CRTC's decision and he said that while there's work to be done to deal with the tougher Canadian content rules, he thinks it's doable.

"We applaud the CRTC," he said. "This was very difficult to balance all the various interests."

Stephen Tapp, president and chief operating officer of CSR, said the company has to negotiate the new programming requirements with XM before it can make plans to roll out the service in Canada.

Conditions set by the CRTC for the satellite subscription radio licensees include:

- At least eight original channels produced in Canada with a maximum of nine foreign channels offered for each Canadian channel

- At least 85 per cent of the musical selections and spoken word programming broadcast on the Canadian channels to be Canadian

- At least 25 per cent of the Canadian channels must be in French

- At least 25 per cent of the musical selections on the Canadian channels to be new Canadian musical selections

- A further 25 per cent of the selections to be by emerging Canadian artists

- All licensees must contribute at least five per cent of their gross annual revenues for the development of Canadian talent, to be contributed equally to the development of English and French-language talent

Consumer electronics retailers say the introduction of satellite radio services will breathe new life into the audio sector with pent-up demand, suggesting the units will be flying off store shelves as soon as they are stocked.

"We think it is going to rejuvenate the audio market and that this will be an exciting time for consumers and retailers alike," said Craig Touchie, director of audio video for The Source by Circuit City stores.

Retailers have had to watch frustrated as customers repeatedly inquire about satellite radio with some, finding it unavailable on this side of the border, choosing to access the service through the so-called grey market of the U.S. offerings. The satellite signals from the XM and Sirius services offered in the U.S. cover all of North America but with the CRTC approval, Canadians were not licensed to pick them up.

Lori DeCou, director of communications for Future Shop/Best Buy stores, said her company is already talking to the satellite radio companies and expects to have products on the shelves, ranging from $120 to $350, as soon as CSR and Sirius Canada are ready to launch their services.

Recording artists across Canada are celebrating in the wake of the announcement, according to Gregg Terrence, president of Indie Pool, which represents more than 20,000 Canadian artists.

"It is a groundbreaking decision, a crucial decision that recognizes the need to help emerging artists receive some important radio play."

Satellite radio, delivered by satellites rather than on an FM or AM band, offers superior quality sound, with commercial-free programming anywhere in the country. Much like cable television, listeners pay a monthly fee for the service of their choice, with that fee expected to range from $10 to $15.

The decision didn't meet with approval across the board. Ian Morrison, spokesman for the Friends of Canadian Broadcasting, which supported the application by CHUM and Astral for a land-based service, said he will meet today with various other arts organizations to consider appealing the decision to cabinet or the Federal Court.

© Vancouver Sun