CHUM seeks to add foreign radio channels to service by Grant Robertson

TORONTO -- CHUM Ltd. is looking to expand its Canadian radio operations and wants federal regulators to allow its proposed subscription radio service to import channels from countries such as the United States.

Chief executive officer Jay Switzer said CHUM is altering its plan for a subscription radio service, which had called for heavy promotion of Canadian content, in order to compete with satellite radio programming now being offered.

"We still have a very pro-Canadian, Canada-first platform, but we're looking for some flexibility in terms of how we might move some of [our] Canadian content around," Mr. Switzer said after CHUM's annual meeting in Toronto yesterday.

The company's new strategy looks to "pair up some completely Canadian channels with some imported channels, which we hadn't originally asked for," Mr. Switzer said.

CHUM is looking to start a digital subscription radio service to compete with Canada's new satellite radio providers. It put those plans on hold recently when Ottawa granted licences to the emerging industry that it felt were too thin on Canadian content requirements.

Canadian Satellite Radio and Sirius Canada Inc. have both launched satellite service in recent weeks, with roughly 10 per cent of their channels focusing on Canadian programming. CSR is linked to the U.S. network of XM Radio while Sirius, partly owned by the CBC, also offers channels from its affiliated network south of the border.

Satellite radio offers programming for a monthly fee of between $13 and $15, using receivers that start at slightly less than $100.

CHUM's subscription radio proposal would be a ground-based digital service, but its plan to pair Canadian produced programming with imported channels would in some ways resemble the approaches of CSR and Sirius.

The Canadian Radio-television and Telecommunications Commission isn't expected to make a final ruling until late January or February.

The new approach for CHUM comes as the company is also looking to increase its 33-station conventional radio network in Canada by acquiring rival broadcasters or setting up new FM stations, Mr. Switzer said.

CHUM has applied for a new radio licence in Calgary where it has no FM station. Regulatory hearings will begin in February. It could also look to add stations in markets where it only has one FM station, such as Vancouver, Edmonton and Toronto. Federal rules limit companies to two FM stations in any one market.

"There are some key markets where we could have more FM stations," CHUM chairman Jim Waters said.

But in a relatively strong Canadian market, the company is not alone in wanting to acquire radio assets.

"Everybody's a buyer and there are no sellers," Mr. Switzer said.

Following the death of CHUM founder Allan Waters less than two weeks ago at the age of 84, Jim Waters said the company's plans are to continue growing when opportunities arise, rather than sell assets.

Despite rumours that CHUM's radio and TV operations are coveted by other broadcasters, Mr. Waters said his father never wanted the family business sold. Allan Waters' estate controls nearly 88 per cent of the company's voting shares.

Allan Waters stepped down from the company's board this fall amid declining health. CHUM appointed Denise Donlon, a former executive with MuchMusic and Sony Music Canada Ltd., as a director yesterday.

Mr. Waters said CHUM expects to bolster its radio presence on the FM dial in 2006 and will wait for a response from federal regulators on its plans for subscription radio.

"We've got a very good licence that we just haven't determined exactly what we're going to do with yet," Mr. Waters said.

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