But should advertising or politics inform decisions? Alasdair Reid
Sir David English lobbied long and hard to force a relaxation in
cross-media ownership laws. As the chairman of Associated Newspapers, he
had a vested interest - Associated’s parent company, the Daily Mail and
General Trust, wanted to diversify, particularly into television and
With the enactment of liberal broadcasting legislation last year, Sir
David thought he had won. Clearly he hasn’t. Last week, the Radio
Authority blocked a proposed acquisition of the Leicester Sound radio
station by DMGT’s radio subsidiary, DMG Radio (Campaign, 24
Leicester Sound is the city’s dominant radio station. Another DMGT
subsidiary, Northcliffe Newspapers, owns the Leicester Mercury, the
city’s dominant local newspaper, plus a number of freesheets including
the Leicester Mail.
A clear case of unacceptable dominance?
Yes - but wasn’t that a risk the Government said it was prepared to
The dominance of a local advertising market is now regarded as an
irrelevance when set against the big picture. Has the Radio Authority
lost the plot? And anyway, is it the right sort of body to be in the
front line of media competition policy?
The Radio Authority’s response is that the Broadcasting Act gave it the
role, which it is quite happy to have. The authority also points out
that the advertising market is only one of a number of its
Promoting plurality of ownership and diversity in the sources of
information available to the public is another, as is assessing the
benefits that a big media owner could bring to a station.
So, was the market situation the most important factor? The Radio
Authority won’t say. But it did reveal that the Office of Fair Trading
also ran its rule over the proposed deal, and had no comments to
Either way, the advertising industry is rather pleased with the outcome.
As Neil Hepburn, a director of BMP DDB who specialises in the regional
press, says: ’Yes, there may be synergies to be had on the editorial
side but for some companies it would be very tempting to abuse a
monopoly that ownership of a discrete market would give them. I’m not
saying DMGT comes into that category but it’s right that the temptation
Rupert Garrett, the head of radio at BBJ Media Services, has a similar
perspective: ’I can’t see how the political factor can be important.
We’re talking about a music station without much political clout. But I
think the decision was correct. Had it gone ahead we would have been
concerned about conditional selling.’
Where does all this leave media owners? The Radio Authority insists that
no hard and fast principles can be inferred from the decision - each
future case will be examined on its merits.
Charlie Cox, the managing director of DMG Radio, says that he will
absorb the decision before considering the company’s next move. There is
little doubt that there will be a next move - sooner rather than
And, according to a senior executive at a rival radio group, it should
search for the key in politics, not advertising. ’Would the Radio
Authority - which is to say the Government - allow other permutations?
Could a dominant newspaper owner buy the second biggest radio station in
an area?’ he asks.
’My guess is that the Radio Authority is fairly relaxed about the
advertising issues - but never underestimate how worried MPs get when
all local media is controlled by one organisation. You can bet that MPs
can influence the Radio Authority when it comes to public interest
considerations. I look forward to DMGT’s next move. It could be an
interesting year in the radio industry.’