Media Forum: Should radio back digital?

Could commercial stations get behind DAB more, Alasdair Reid asks.

This Christmas, we must once again do our best to spare a thought for the digital radio industry. And this is no trivial plea - because, of course, there is a very real danger of compassion fatigue here.

For many years now, there has been an expectation that the festive season will somehow kick-start the digital radio revolution, with the nation massing dangerously in Currys to clear its shelves of DAB sets.

Come Yuletide morn, however, and, year after year, the industry's stocking is empty. This is a story of almost Dickensian pathos, featuring the ghost of digital Christmas past (the former GCap boss Ralph Bernard), the ghost of digital Christmas present (Ford Ennals, the chief executive of Digital Radio UK) and the ghost of digital Christmas future (situation vacant, but sozzled Santas need not apply).

As for Scrooge ... well, take your pick. This year, the sleep-disturbed man in the Wee Willie Winkie nightcap is none other than William Rogers, the chief executive of UKRD, the owner of 15 local radio stations. He's refusing to run a Christmas promotional campaign devised by Digital Radio UK - and he's not alone: Global Radio and GMG Radio are in the same camp.

They argue that it's pointless (and, in fact, counterproductive) to promote DAB while local coverage remains so patchy - and this patchiness is unlikely to improve any time soon, thanks to a BBC licence-fee settlement that has pulled funding from further coherent DAB development.

The expectation not so long ago was that DAB (and digital distribution in general) would provide a new impetus for the commercial radio sector. Commercial stations would, according to theory, be able to compete more effectively with the BBC, thus winning a greater share of listening - which would, in turn, be the engine for renewed advertising revenue growth.

But the BBC funding situation and the general economic outlook are conspiring to make the latest target for analogue radio switch-off, 2015, look wildly optimistic. DAB is a technology that always offered rather dubious benefits. Now, pessimists argue that it may already be obsolete.

On the other hand, you could argue that the commercial sector can't afford to be so prissy. Surely it should be grasping every opportunity to get behind digital. Howard Bareham, the head of radio at Mindshare, agrees that, in many respects, digital radio seems to be stuck at the crossroads. "I'm not sure I buy the argument about it being dishonest to promote DAB. There was a campaign to promote digital radio last year and the year before that and it wasn't dishonest then, was it? So this is a bit of a red herring," he asserts.

Perhaps, Cathy Lowe, the head of radio at PHD, says - but she argues that the issue of DAB is clouding the bigger picture as regards digital. They are not the same thing. She explains: "There has been too much emphasis on DAB as a platform. I appreciate that the Christmas market is crucial to boost DAB sales, but the radio companies have already spent money backing DAB for little return. How and where people consume radio is changing and the key to radio's digital future is getting DAB in-car and developing online and mobile offerings that allow more interaction with listeners and more revenue streams than just linear broadcast. DAB is not a must-have for listeners - and investment has never been in response to consumer demand. Other technologies will advance faster and be more compelling than DAB, which is likely to get left behind."

Meanwhile, Matthew Landeman, a board director at Carat, insists: "The fact that commercial radio companies are not unanimous in supporting the current marketing campaign reflects a desire to put pressure on the Government to sort out infrastructure funding. Without commercial radio's support, the Government's vision for the medium's future is compromised. The media owners know that."

That's sort of how Simon Blackburn, MPG Media Contacts' head of radio, sees things too. He says that commercial radio owners support digital evolution in principle but are right to withhold marketing spend until the major structural issues are settled. He concludes: "The first priority must be coverage, not just the significant effort required to increase blanket coverage of UK transmission areas, but also to strengthen coverage in built-up areas - which requires stronger transmitters to overcome interference caused by dense concentrations of tall buildings. Until this happens, why would any commercial operator want to support digital and risk misleading listeners?"

MAYBE - Howard Bareham, head of radio, Mindshare

"Arguably, commercial radio could do more to promote more short-term digital goals, especially as the ad market is picking up. But longer term, everyone has a right to be wary."

YES - Cathy Lowe, head of radio, PHD

"The issue of who pays for national transmission of DAB gives the commercial companies the excuse not to promote digital radio. Digital is key to radio's future - but, for commercial radio, DAB is only one of several platforms to explore."

YES - Matthew Landeman, board director, Carat

"The commercial radio sector clearly knows it can do more. Its current posturing is about leverage. Commercial radio has already piled a huge investment into digital so it's in its collective interest to make it work."

NO - Simon Blackburn, head of radio, MPG

"Why would you promote digital to your listeners when there's still no guarantee that they can pick up any signal? I've lost count of the number of occasions when clients, friends or colleagues have complained of poor or non-existent digital reception."

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