RADIO REPORT: DIGITAL - 21ST CENTURY RADIO. We've all heard about digital TV, but what about digital radio? In 18 months the first national multiplex should be awarded. And yet, there are sceptics in adland, Richard Cook reports

Seventy-five years ago the manufacturers of radio equipment had a small problem. No one was buying their admittedly expensive sets. People were quite prepared to admire the valve technology and handsome wooden cabinets of the wireless, but few were prepared to actually purchase one.

Seventy-five years ago the manufacturers of radio equipment had a

small problem. No one was buying their admittedly expensive sets. People

were quite prepared to admire the valve technology and handsome wooden

cabinets of the wireless, but few were prepared to actually purchase

one.



The problem was there wasn't much they could listen to with this

equipment.



The manufacturers decided radical action was needed, clubbed together

and started the radio service that in a few years was bought by a

grateful nation and became the BBC. Radical action, perhaps, but it

certainly helped kick-start the sale of radio sets.



Now, three quarters of a century later, radio is on the point of having

to re-invent content for a second wave of new-fangled hardware. Radio,

in short, is going digital.



'Digital is radio's gateway to the multimedia world,' explains John

Trewsdale of NTL, the company which runs the transmitter network for

commercial broadcasting, 'The analogue radio systems we have in use are

pushing 80 years old, which is seriously low-tech. It's about time that

radio got in step with the rest of the world and went digital. With

digital technology we can all enjoy CD-quality broadcasts,

interference-free reception and a range of multi-media services

too.'



Digital audio broadcasting (DAB), to give it its full title, can do all

that and more. In addition to the extra clarity and sharpness, it can

support a text screen which has obvious benefits for the advertising

community, not least for the convenient disposal of the financial

services small-print which at the moment clogs up the airwaves.



Despite this, digital radio has enjoyed a lower profile than its

televisual equivalent, which is generally held responsible for

everything from media fragmentation to the bloated fees being charged

for TV sports rights.



In fact, it's a similar technology but will not lead to quite the same

sort of explosion of channels.



The first multiplex, a national service, will carry the existing three

independent national radio stations and up to six others when it

launches - probably around September 1999. Nor does DAB have all the

advantages that digital TV has. Pay per view - one of the central planks

of digital TV strategy - is not a viable option for radio.



'One really exciting thing about DAB is that it is designed to be used

where radio is at its strongest - on the move. FM was designed to be

used in a stationary environment, but this is designed to take advantage

of the fact that most people consume radio in all sorts of places - in

the car, out in the garden, wherever,' says Trewsdale, 'and the fact

that we will have, in the fullness of time, up to eight national digital

services, as opposed to three at the moment, is an exciting prospect for

everyone.'



Well, not quite everyone. It's no secret that the advent of digital

technology was initially greeted with scepticism, even by some people

within the industry, while to advertisers it has remained very much a

closed book until now. The advertising agencies on the other hand have

started to find out about the service's attractions, even if, for the

moment, they remain largely unimpressed.



'The problem we have with digital is that it fundamentally appears not

to be editorially led,' CIA Medianetwork's head of radio, David

Fletcher, points out. 'The history of innovation, from the Rabbit phone

to Video 2000, shows that consumers are not prepared to invest in new

technology just because it's there. I could see a use if you were

advertising a high-tech product and wanted to target early adopters, but

no one has ever bought a 30-second TV spot because of Teletext, and

that's the way we're looking at digital radio right now.'



One advantage commercial radio does have in spreading the word about DAB

is the fact that the BBC is so committed to it. The BBC gets its own

national multiplex, and unlike independent local radio, its local radio

stations are also guaranteed the option of going digital.



'The BBC is predicting that DAB will achieve a 40 per cent penetration

in ten years,' points out Quentin Howard, managing director of GWR's new

Group Digital Division. 'Which is the same sort of penetration achieved

by VHS, CDs, or even colour television, and I'm confident we can surpass

that.'



Howard is leading the GWR bid to run the national multiplex, which will

be the first stage in the 18-month shift to digital. The Radio Authority

will be inviting applications from March, and hoping to announce the

winner by September. The multiplex owner decides on the mix of

programming it will carry and once this is decided, the Radio Authority

will start to award the regional and local multiplex licences - first to

Greater London, Birmingham and Manchester and then throughout the

country.



Although existing ILR stations are not guaranteed space on the digital

multiplexes, outside of London availability is not thought to be a

problem.



As a carrot to the stations, the Radio Authority is offering extended

eight-year licences to successful applicants to digital format.



'The potential for DAB is huge,' says Howard. 'Digital radio has the

capacity to broadcast data software, graphics and even video. And the

commercial opportunities extend to innovations like smart cards being

built into the receiver. You could, for example, store a list of all the

records you heard that you liked. You would then take the card into your

record store and have them make up your own personal CD or

minidisc.'



In the beginning, however, much of the success of the system for

advertisers is going to depend on how many listeners are persuaded to

adopt the service -and that in turn is going to depend on the cost of

the hardware.



'As in all new technology, the hardware will start expensive and get

cheaper as demand picks up,' Trewsdale says, 'but I think a DAB in-car

system could easily start at around pounds 350, which is about the same

as top-end analogue and, within five years, we'll be able to buy DAB

walkman's for pounds 30.'





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