Capital Radio Self-Immolates or Much Ado About Being Number Three

Michael Hedges August 14, 2006

Wall-to-wall music stations – and BBC Radio 1 – win the latest London radio audience survey. Capital Radio resembles a cinder. Ah, the perils of a mature radio market in the midst of a smokin’ hot media market…

After RAJAR released second quarter audience figures UK media watchers rolled their eyes, sighed and prepared to bury Capital Radio if not the whole of GCap. Not only has the commercial radio icon been beaten by Magic and Heart but also – in London, of all places – by BBC Radio 1.

The commercial radio winners in the Q2 RAJAR London audience survey seem to be of the “more music, less anything else” ilk. Magic, Heart and Smooth FM showed strong increases while Capital Radio continues to dissipate. The mid-demographic, all-music appeal of Magic and Heart even affected BBC Radio 2, which dropped in London to 10.7% from 12.3% in Q2 2005.

BBC Radio 1 – led graciously by morning star Chris Moyles – has proven a point or two. In the national survey Radio 1 broke into double digits – 10.3% market share, up from 9.2% year on year. In the London survey area Radio 1 jumped to a 5.9% market share, up from 4.8% in Q2 2005. He saved, as he said he would, Radio 1.

It doesn’t take a brain surgeon to see that Capital Radio’s ratings problem isn’t going away. Their new programming man – Scott Muller, Australia’s Programmer of the Year – arrives later this summer. In realistic terms, even being generous, Capital Radio – and GCap itself – is stuck in the suffering for the rest of this year. GCap says Capital Radio has bottomed out. Stock traders are already punishing. But please don’t forget, recent losses not withstanding, Capital Radio’s morning show still beats Radio 1, Magic and Heart in London.

Then, too, the BBC can entertain. This seems new. Only a few years ago nobody gave the BBC a second though in terms of entertainment: information, yes. Times have changed.

Not that the BBC has lost its position as the news and information provider. BBC 4 still delivers a huge audience, leading in London with a 13.1% market share, though slipping in the spring survey period. 

Even though the aggregate market share for commercial radio increased with the latest RAJAR results, its companies will no doubt continue to shriek about unfair BBC competition. After all, the commercial stations won their first points with the youth audience. BBC radio channels increased among listeners 15 to 45. Commercial channels did not.

Today, it seems, commercial radio in the UK has become the respite from youth culture as well as high information content. The commercials stations gaining the greatest market shares are now the music only, largely soft music stations. These are highly profitable channels, no doubt, but not market sizzling.

Are the digital stations making or breaking this rule? BBC 6 and BBC 7 showed double digit increases in weekly reach against the same period last year in the national survey. RAJAR estimates the potential digital radio audience – people who own a DAB receiver, listen via digital TV or internet -  increasing to 54.3% of persons over 15 years. Listening via the internet or TV set-top boxes increased, again, by double digits.

Not lacking in money or brains, though the money part is subject to review by the accountants, GCap has several options with Capital Radio. One option not on the table is blowing up the station and doing something entirely new. It’s market shares are falling and ad agencies don’t understand the “less is more” pitch. Fully bracketed between Radio 1 (for todays’ hits) and Radio 4 (for todays’ information) Capital Radio must win something neither can – or, at least can’t get credit for: London.

BBC Radio channels are national channels, ignoring – as everybody does - those BBC local stations. Five BBC radio channel have a national market share greater than 1.0%. The rest are largely DAB services.

Radio 1 attracts most attention – as well it should – for so obviously competing with the commercial radio sector. But Radio 2 – locally referred to as “the Baby Boomers’ Radio 1”) remains the unquestioned market leader with a 15.7% market share, down slightly one year on from 16.0%. And Radio 4 slipped to a 10.7% market share from 11.3% in Q2 2005. Radio 3 held on to 1.1%. Five Live increased to 4.5% for 4.4% one year on.

WAIT: Where was that World Cup audience? TalkSport made no gain in the national survey but increased to 2.8% market share in London over 2.3% one year on.

Programmers, managers and all stock traders fall to the fallacy of believing that radio listeners are only that, radio listeners, and subject only to marketing speech about radio. They are not. They live in the real world where zeitgeist plays a significant role. Those surveyed for the Q2 RAJAR listening estimates voted for less talk – except for Chris Moyles. 2006 will turn out to be the year of the great media escape. There’s too much news and it’s all bad so where’s that no-talk station.

Heart and Magic will fade. The future is bleak for music download services on terrestrial FM. And, too, their programmers will either fall to Don’s Rule or a changing spirit of the times. The iPod is a fashion statement. The only statement made by Heart and Magic is “We’re boring and isn’t it wonderful.” Boring, in media, never lasts long. The ad buyers will see to that.

The new RAJAR audience figures show a volatile listener market: good news for programmers – bad news for ad sales managers and media buyers. More UK listeners of all ages are accessing radio through new platforms…and more platforms. RAJAR now estimates the potential digital radio audience at over 27 million adults. Programmers benefit from listeners interested in trying different channels. Their tricks to entice them and hold them become more readily apparent.

Those who read well that spirit and avoid the hubris of the meteorically risen will pass those lessons on to their listeners and thrive.

The RAJAR Q2 2006 radio listening survey was released august 3, 2006 for the quarter ending in June.

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