BBC risks stake in digital radio race

Commercial radio believes only the BBC’s full commitment will bring down the price of digital sets. But the BBC is procrastinating.

The BBC’s alliance with commercial radio is being tested to the full as tensions rise over the development of digital radio.

The BBC and Digital One – the UK’s sole national digital multiplex operator, which is 63 per cent owned by GWR Group and the rest by carrier NTL – agreed to promote digital radio as a platform. They are working on joint listener and research projects until a large enough audience allows battle to recommence.

Digital One chief executive Quentin Howard says: “It is essential that we both fight for the same thing. The gloves will come off when there is an audience to battle for.”

But the gloves have come off early. Commercial radio companies are complaining that the BBC is stalling its digital radio plans, and are questioning the corporation’s commitment to the medium.

They want the BBC to promote digital radio through its analogue broadcasts and to produce new digital content to give manufacturers an added incentive to produce cheaper sets to drive take-up.

Some commercial radio sources believe the public consultation by the BBC – carried out before Christmas and being considered by the governors – concentrated on digital TV and online to the detriment of digital radio. They fear this reflects the corporation’s priorities.

Others think the BBC is focusing on the Internet, rather than the new multiplexes, as a means of broadcasting radio. They want the BBC to take up its guaranteed places on the new local digital multiplexes.

BBC head of digital radio Glyn Jones believes the commercial sector is attempting to manipulate transmission price negotiations payable to the commercial operator of the multiplexes.

It is negotiating with Capital Radio over its multiplexes in Birmingham, Manchester and London, which are scheduled to go live this summer.

Capital Radio group managing director Sally Oldham says: “It isn’t clear how important digital radio is to the BBC. If you read the report to the Davies Panel there is no mention of radio, just digital TV. You have to question its commitment. We need it to demonstrate an overt commitment, not a tacit one.”

But Jones admits the BBC has its work cut out with the arrival of Greg Dyke, the new budget and the Government’s decision on the Davies Report in early February. “The Government’s decision on BBC funding affects its aspirations and plans – and we have a new director-general,” says Jones.

Stephen Mulholland, managing director of radio production company Wise Buddah and former editor of BBC digital radio, says: “The BBC is faced with a more complex digital mix than radio alone and I’m not surprised it is taking its time to consider the whole mix.”

The BBC began digital radio broadcasts in 1995 when there were no digital radio receivers. Howard says: “The BBC’s launch damaged digital because the manufacturers said ‘so what?’ – it was a false start.”

But Jones denies a lack of commitment and retorts: “Between 1994 and 1997 it was hard to get commercial radio enthusiastic about digital.”

Howard believes Digital One is negotiating with manufacturers to produce cheaper digital radio sets, but says a strong commitment from the BBC would help drive the bargain.

He is in talks with a manufacturer to produce own-branded sets to retail at &£200, undercutting the cheapest current model by &£300.

Howard wants the BBC to take a more active approach: “The simplest thing Jenny Abramsky could do is add the words ‘and on digital radio’ when the frequencies are read out on air but the BBC is racked with politics, I suspect it is beyond her control.”

The BBC simulcasts Radios 1 to 5, and is test-broadcasting Radio 5 Live Sports Plus, BBC Parliament and the World Service.

It is also considering a new station using the archives of Radio 1 and 2; a comedy, plays and books service from Radio 4’s archive; an extension of the BBC Asian Network to national service; and black music and travel data services.

Digital One launched on November 15 last year, broadcasting Classic FM, Planet Rock, Core, The Mix, TalkSport and Virgin, and is to add Capital’s first national station Life, and Guardian Media Group part-owned station OneWord.

One commercial radio insider says the sector has taken a lead because “the BBC has decided to put all its resources into online”.

Jones comments: “The BBC doesn’t put all its eggs in one basket, but concentrates on developing the best and strongest services to be well positioned on all the different platforms.”

But the BBC has no marketing manager for digital radio and, according to Jones, a new recruit will carry out a dual role across digital radio and radio online.

A new BBC radio unit under Simon Nelson, head of new services, is co-ordinating radio online and will launch a new black music station drawing on Radio 1’s Saturday night schedule.

Capital’s Oldham says: “I would hate to think as we embark on the most important phase in the development of digital radio, it [the BBC] is using stalling tactics to camouflage problems as to why it can’t fulfil its obligations.”

She says if agreements with the BBC are not reached over multiplex transmission costs the matter will be referred back to the Department of Culture, Media & Sport for arbitration, which would cause further delay.

Oldham lays down the gauntlet: “If the BBC doesn’t commit we will go to air without it, we won’t delay”, while Howard adds: “If it doesn’t start to play catch-up soon it’ll have lost the race on radio.”

Jones maintains that the BBC does intend to take up its slots on the multiplexes. But if the BBC doesn’t throw its weight behind digital radio broadcasting, the commercial sector will struggle to bring the price of equipment low enough for the mass market.

The two sides have always taken a different approach to digital radio, but Dyke – in conjunction with the new budgets and the Davies Report – will decide whether they can continue to tolerate the differences.

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