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ftm Radio Page - December 17, 2010

Local content cut as broadcaster takes DAB deal
Too good to refuse

UK media regulator OFCOM’s radio licensing committee approved Bauer Media’s request to combine programming at its three Kiss radio stations into a single national brand. Local programming and news, required under existing rules for all non-national broadcasters, will be dropped. In return, Bauer Media must operate the Kiss branded channel on digital radio via the DAB platform. (See more on digital radio here)

OFCOM began granting local broadcasters the quasi-national option in return for commitments to DAB earlier this year. Two other mostly music radio brands have taken the plunge so far, Global Radio’s Heart and GMG’s Smooth Radio. Broadcasters have argued that listeners don’t care about expensive to produce local services. Certainly shareholders don't.

Global Radio is widely expected to take its Capital brand to the quasi-national for DAB option next year. Capital is a more foreground station with roots in the London market, presenting a quite different branding challenge than simply taking all-music channels to the national platform.

Bauer Media’s licenses for the Kiss stations have been amended to reflect the reduced programming requirements. “Should such DAB carriage not be provided, the requirement for local programming would revert to being a requirement under the stations' formats,” said the OFCOM statement (December 16). (JMH)

Broadcaster challenges “unprecedented”
No exits

A statement released by Communicorp directors, reported by the Irish Independent (December 14), shows the tough going for radio broadcasters in 2010. Revenues dropped by nearly one-quarter to €65 million from €85 million in 2009.

Communicorp, principally owned by long time Irish broadcaster Denis O’Brien, operates 42 radio stations in nine countries, significantly in Ireland, Estonia and the Czech Republic. Revenues from operations in Ireland accounted for 58% of the total. Revenues at the Irish operations, which include Today FM and 98 FM in Dublin, fell by 24%, slightly more than revenues at operations in Central and Eastern Europe.

“An unprecedented period of global economic challenges and market volatility,” said the directors’ statement, defined 2010. Communicorp managers slashed costs across the company, reducing head-counts and expenses slightly more than 20%.

The austerity measures will continue. “We will maintain our strategy of managing the portfolio intensively, focusing tightly on managing cash resources while retaining a cautious outlook,” said the directors statement. Exits from existing investments were not specifically mentioned. (JMH)

Last minutes deal for digital radio
playing for big chips

German private and public broadcasters reached an agreement with infrastructure provider Media Broadcast (December 15) on financing for the roll-out of national digital radio channels using the DAB+ standard. The agreement was necessary for the commission that allocates license fee funds to public broadcasters (KEF) to release more money for digital radio. Because negotiations had gone nowhere when a September deadline was reached the KEF extended it until December 15th.

"This is an essential step to securing the future of radio in the digital world," said Deutschlandradio General Director Willi Steul in a statement. Six or eight national channels, a mix of public and private, will appear by the end of 2011. More decisions will be forthcoming. (See more on digital radio here)

Attempts to tap automakers and receiver makers for money failed against the argument that they would benefit most, reported Kress (December 15). Last week UK chipmaker Frontier Silicon agreed to a sizable, four-year “advertising” contribution. It was apparently sufficient to tip the balance. Frontier Silicon makes chips for DAB+ receivers.

German DAB advocates have compared digital radio with digital photography, analogue radio extinct like film cameras. Of course, most digital cameras are now in mobile phones. (JMH)

Radio becomes must-have smartphone app
Branding, badge-value and growing

Ah, the smartphone; the 21st century fashion accessory. No Swiss banker is without their Blackberry, usually waving it in front of everybody. Those iPhones are the must-have icons for teenaged girls and their mothers. Geeks, of course, wouldn’t be without their Samsung Galaxy.

Radio broadcasters, fearful of losing the device battle, have attached themselves – literally and figuratively – to every sort of new media thing. Smartphone apps are the latest in the surge in new ways to satisfy listeners, from the loyal to the curious. UK smartphone users claiming they’ve downloaded radio apps numbers 2.2 million, according to RAJAR’s Midas 7 survey of radio’s new media users, up from 1.4 million in six months.

Smartphone users in the UK numbered 11 million, according to comScore Mobilens in January 2010, up 70% one year on. UK smartphone penetration, always a debatable number, would then be 22.9%. That’s far lower than the 32% penetration rate in Italy but far higher than Germany’s 16.5%. Radio apps range from aggregators to branded station apps.

Listening to radio via the internet actually fell to 32% from 33.9% one year on, said the Midas study. Podcasts, downloadable programs or features, were accessed by 8.1 million, not changing one year on.

RAJAR (Radio Joint Audience Research) produces the Midas (Measurement of Internet Delivered Audio Services) study twice a year. The sample is a subset of the RAJAR radio audience surveys. (JMH)

Nielsen exits US radio measurement
Growth markets not affected

Every big international company must, at some point, evaluate challenging markets. Nielsen is big, successful and reaches into almost every corner of the world with media measurement. The US radio measurement business just didn’t make the cut.

In a brief announcement (December 14) the company said it “has decided to end its measurement of radio in the United States, as of the Fall 2010 period.” Thus ends a two-year trial of its “sticker diary” intended to open a door to the radio ratings monopoly of the Arbitron Company. Nielsen provided radio ratings in small and medium US markets.

Not affected are Nielsen’s radio measurement services in Australia, New Zealand, China, India, Indonesia, South Africa, Taiwan, Thailand, Singapore, Philippines and Malaysia.

Name the growth markets. (JMH)

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