SPOTLIGHT ON: CROSS-MEDIA OWNERSHIP - Radio Authority puts healthy check on media monopolies

But should advertising or politics inform decisions? Alasdair Reid investigates.

But should advertising or politics inform decisions? Alasdair Reid

investigates.



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

radio.



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

January).



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

take?



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

considerations.



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

make.



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

isn’t there.’



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

later.



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.’



Become a member of Campaign from just £45 a quarter

Get the very latest news and insight from Campaign with unrestricted access to campaignlive.co.uk ,plus get exclusive discounts to Campaign events

Become a member

Looking for a new job?

Get the latest creative jobs in advertising, media, marketing and digital delivered directly to your inbox each day.

Create an Alert Now

Partner content

Share

1 Job description: Digital marketing executive

Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).