There had been occasional discussion about the viability of having a locally based radio station in the area, but nothing had ever eventuated. A Melbourne radio station executive Mr. M. B. Duffy became aware, through his involvement with 3KZ, that radio reception in the Colac-Otways area was generally quite poor. Duffy took the initiative and responded to the challenge that others had only spoken of and came to Colac in an effort to interest local businessmen in his proposal to establish a radio station in the area.
He was fortunate in finding a few enthusiastic backers from within the town and in 1938 they joined forces to form the Colac Broadcasting Company Pty Ltd.
The most vital milestone in the preparatory stages though, was the granting of the all-important licence to broadcast. When this licence was obtained on January 27, 1939, all was set for the station to proceed. The need for a studio was quickly filled by enthusiastic director Mr Malcolm Wallace, who undertook to provide a suitable site. The property at 241 Murray Street (where the station still stands) was selected and construction work was soon under way.
There was an air of excitement and "considerable interest" around the town in the lead-up to the Saturday night opening of 3CS on October 7, 1939.
A large representation of local dignitaries arrived at the new station building for the 8pm opening of 3CS. Attendance was by invitation and the guest list read like a "Who's Who" of the Colac district. Local MLC Mr J. P. Jones; the Colac Shire President, Cr J. Miller; councillors L. Bayer, G. Howey and A. Bilson and the Town Clerk Mr A. N. Walls were all included in the official party. Appropriately, the Mayor of Colac at this time was Cr. Walter Selwood - Chirman of Directors of the Colac Broadcasting Company.
In front of the auditorium gathering, Cr Selwood introduced the local Federal Member, the Hon. G. A. Street, Minister for Defence. After receiving an enthusiastic reception from the crowd, Mr Street rose and thanked the directors for their invitation to perform this happy duty, which helped him forget, at least for a short time, a few of the worries that now confronted him.
Referring to 3CS, Mr Street remarked on the efforts of those who had been behind establishing the station. "That showed there was a fine spirit of enterprise in the community, which was prepared to stand behind something new in the district.". He thought the broadcasting station would be a tremendous benefit. In officially declaring the station open, he "wished it every success and that the standard maintained, would be one of which the district would be proud.".
Radio Station 3CS was now on the air. The Revellers' orchestra struck up and an evening of varied entertainment launched the station for guests and listeners alike.
Colac listeners seem to have quickly responded to this new medium, notwithstanding what would seem to listeners today as irregular hours of operation. Transmission commenced at 6.30am and continued until the station closed down at 9.30am each day. A further session would be held between noon and 4.00pm, with another break off-air until 5.30pm. The station closed down at 10.30pm on weeknights and continued until midnight on Saturdays. Provision was made to extend these times if necessary, to cover special functions. On Sundays, 3CS didn't commence broadcasting until 11.00am. The first session lasted to 2.00pm, with the evening programme running from 5.30pm to 10.30pm.