The Week: GCap plans to sell stake in Digital One in bid to cut costs

GCap has dealt a serious blow to the future of DAB radio by claiming it is "not an economical platform".

On Monday, the group's new chief executive, Fru Hazlitt, revealed plans to sell its 63 per cent stake in the national digital radio operator Digital One to Arqiva, as part of a £9 million cost-cutting package.

The Capital and Classic FM parent is to close its digital radio stations TheJazz and Planet Rock, and sell off its Xfm analogue radio licences in Scotland, Manchester and South Wales, but retain Xfm's London operation. Hazlitt also announced a U-turn on Capital's three-year-old "two ads in a row" policy, which has failed to meet revenue expectations. It will now run up to nine minutes of ads an hour.

Hazlitt said: "We have had to turn advertisers away. I think they will welcome us giving them more opportunities to advertise, rather than the alternative, which is to put our prices up."

- Perspective, page 16.