8 AUGUST THE NEW ZEALAND GAZETTE 3347

The Corporation proposed simulcasting for a period of 90 days.
We believe that this is a reasonable period in the circumstances
for promotion of the FM station on the AM station and we
will permit simulcasting for that period.

The Radio Avon application involves the retention of the AM
operation.

Where grants have been made elsewhere, the applicant has
accepted that it should cease operations within a period defined
under the regulations not exceeding 4 years. The usual practice
is to issue a new warrant in which the existing AM operation
becomes a supplementary warrant and expires within a stated
period.

In this case the applicant has proposed that on grounds of special
circumstances it should be permitted to retain its AM warrant
indefinitely.

We do not find those special circumstances made out but in view
of the type of programming which is of a pioneering nature
among an older audience, we would have considered it
reasonable for the existing AM operation to continue for several
years, as there would be a difference between the formats of
the 2 stations.

(i) The desirability of avoiding monopolies in the ownership or control
of news media

There is no question of a monopoly in any of the particular
applications.

However, this is a convenient point to consider the media
involvement.

The Canterbury FM application involves a 40 percent
shareholding by both the publisher of The Press newspaper and
Metropolitan FM Broadcasting, warrant holder of Magic 91 in
Auckland.

It has become customary in AM warrants to limit news media
companies, which includes both newspaper companies and radio
companies, to a maximum of 30 percent interest. However, it
has been accepted that applications by newspaper companies
for commercial FM warrants should be considered on their
merits and this is indeed adopted as part of Government policy.
The Tribunal's reasons for recommending this policy were clear
in the FM report.

The 2 major shareholders were prepared to undertake to protect
the editorial independence of the station and its editor, not to
sell their shares without consent and not to take shares in each
other.

In these circumstances and because the radio station is in another
centre, we would impose a condition that the news media
ownership limit be 30 percent but consent to the two named
companies having a 40 percent interest each, for so long as

(1) They do not take shares in each other (either directly or
indirectly)

(2) The ownership of those 2 companies does not change to the
extent that any shareholder which is a news company (as
will be defined in the warrant) gains a prescribed interest
in the warrant.

As far as the ownership regulations are concerned, the company
would have to ensure that compliance was achieved.

In relation to the ZM and Radio Avon applications there would
be no new news service introduced.

In the case of the other 2 stations there is a possibility of an
additional service, although it is also possible that the successful
applicant may use a Radio Avon service.

Radio Avon has a significant financial interest in the companies
holding the other 3 warrants in the South Island. The grant of
their application would involve their having an interest in 5
warrants, this is a disadvantage of the Music 90 FM proposal.

(j) The hours during which the applicant proposes to broadcast
programmes

The Canterbury FM proposal is for 18 hours on weekdays and
for 24 hours in the weekends. The broadcasting hours would
be increased to continuous broadcasting after 2 years. We do
not believe the additional 6 hours to be so important as to
require a condition.

The other applicants propose a continuous service.

(k) The extent of advertising matter which the applicant proposes to
broadcast

3ZM estimated 6 minutes per hour in the first year, 7 minutes
in the second year and 8 minutes in the third year. This was
less than that proposed by Canterbury FM and Radio Avon and
the same in the first year as Mainland FM in its establishment
period.

Canterbury FM was prepared to accept a maximum of 8 minutes
per hour.

If one FM warrant were granted the Tribunal would impose a
limit of 8 minutes per hour. The grant of 2 warrants would
make that statutory limitation unnecessary as we believe the
competitive element would tend to limit the amount of
advertising.

Music 90 FM would have a self imposed limit of 10 minutes.

We were persuaded that, if 2 FM warrants are issued, there should
be no special restrictions on commercial content.

(l) The proposed rates and charges to be made in respect of advertising
programmes

The 3ZM rates appear to be generally lower than the others and
the Mainland FM rate to be the highest which is in keeping
with its proposal for the lowest commercial content.

(m) Such matters as may be necessary for the purpose of imposing
conditions under section 71A of this Act

We have referred to the consents which would be required.

(o) Such other matters as may be prescribed in regulations in that
behalf

The submission was made to us that Regulation 14A Broadcasting
Regulations requires the Corporation, if granted a warrant for
3ZM-FM, to surrender the warrant for 3ZB.

It is convenient here to consider the effect of Regulation 14A.
(S.R. 1981/295)

"14A. (1) A single sound-radio warrant may be issued in respect
of—
(a) A frequency modulation broadcasting station; or
(b) Both a frequency modulation broadcasting station and
an amplitude modulation broadcasting station.
(2) Notwithstanding section 72 of the Act, but subject to the
proviso to that section and to regulation 16A of these
regulations, every sound-radio warrant issued in respect of a
frequency modulation broadcasting station shall, unless
sooner revoked, continue in force for a period to be specified
in the warrant, which period shall not exceed 5 years after
the date of the issue of the warrant.
(3) Where—
(a) An applicant for a sound-radio warrant in respect of a
commercial frequency modulation broadcasting station or in
respect of both a commercial frequency modulation
broadcasting station and a commercial amplitude modulation
broadcasting station is the holder of a sound-radio warrant
in respect of a commercial amplitude modulation
broadcasting station; and
(b) The Tribunal is satisfied that the frequency modulation
station serves or will serve a significant proportion of the
same area as the amplitude modulation broadcasting
station—
it shall, unless the Tribunal determines that there are special
circumstances, be a condition of any warrant granted that
the applicant surrender the warrant previously held in respect
of the commercial amplitude modulation broadcasting station
(whether or not the warrant granted authorises the operation
of the commercial amplitude modulation broadcasting
station).
(4) Notwithstanding subclause (3) of this regulation, where
the Tribunal grants a sound-radio warrant that authorises the
operation of a commercial frequency modulation broadcasting
station and of a commercial amplitude modulation
broadcasting station, the Tribunal may make it a condition
of the warrant that the holder of the warrant shall surrender
the warrant, to the extent that the warrant authorises the
operation of a commercial amplitude modulation
broadcasting station, at the expiration of a period to be
specified in the warrant, which period shall not exceed 4 years
from the date on which the commercial frequency modulation
broadcasting station begins broadcasting.
(5) The Tribunal shall specify in every sound-radio warrant
issued in respect of a frequency modulation broadcasting
station or in respect of both a frequency modulation
broadcasting station and an amplitude modulation
broadcasting station, the coverage objectives of the frequency
modulation broadcasting station to which the warrant relates.
(6) It shall be a condition of every sound-radio warrant issued
in respect of a frequency modulation broadcasting station
that the holder of the warrant observe in respect of that station
the coverage objectives specified in the warrant in respect of
that station."

D