Race for London radio licence still wide open

The fight for last London FM licence for the foreseeable future has attracted some fierce competition. And with both big and small stations battling it out, the Radio Authority has a tough decision to make.

New youth music is the favourite offering of the 25 applicants bidding for the remaining London FM radio licence.

The other contenders are spread somewhere between broadcasting Jacques Chirac’s views on French farming, Bucks Fizz’s Making Your Mind Up and the Chipmunks singing their rendition of It’s a Small World After All.

Although the odds may be stacked against some of these niche players, the Radio Authority has the right to choose either a mainstream commercial station or a smaller targeted one.

The Authority has been known to surprise, given that Viva! and the Christian station Premier have both received licences within the past three years.

But both Viva! and Premier have dived in audience share since they were established. Premier has gone from 193,000 listeners in the last quarter of 1995 to 109,000 in the first three months of 1996, according to Rajar figures.

Viva!, the radio station for women, has also had falling audience share, with the latest Rajar statistics showing it had just 11,000 listeners tuning in.

However, this hasn’t hindered the growth in commercial radio audiences, says Justin Sampson, director of operations for the Radio Advertising Bureau.

The diversification of radio licences has been a benefit to the advertising industry in two ways, he says.

“Commercial radio as an industry has grown significantly. Over 60 per cent of radio listeners listen to commercial stations, and that’s good for advertisers reaching mass markets,” he adds.

The other benefit of the diversification has been to segment the market. “Young people can be targeted through Kiss FM, and middle-aged, upmarket people through Jazz FM,” says Sampson.

Some of the more obscure licences that have little chance of picking up the 104.9 licence include two children’s radio applicants – Buzz FM and London Children’s Radio.

Two stations with an Irish music format are also vying for the licence, and Radio France Internationale is planning to offer French music, language and culture.

“There is a feeling among advertisers that the industry is much more willing to back media brands, strong-branded stations that deliver the audience,” says Sampson.

Howard Bareham, a media buyer at The Network, says radio stations like Viva! and London News Radio are taking up valuable frequencies.

“The Radio Authority is under a lot of pressure over the new licence, because stations like Premier and Viva! have not been successful in the slightest,” he says.

Bareham believes more mass market appeal with news, sport and music is what London is missing. “Reading between the lines of the proposals, the music some are going to offer is almost the same.”

XFM, a specialist alternative rock music station, targeting 15 to 34- year-olds, missed out on a licence in 1993 and 1994, but is now a strong contender with the backing of media group CLT, Chris Parry of Fiction Records, Robert Smith from The Cure and Harvey Goldsmith.

The Edge is another “new music” for “young Londoners” proposal that is being led by Chris Evans’ Ginger Group.

Sampson says the area of mass market commercial stations is still being explored. Unlike the US, the UK is not saturated with stations and the London radio licence is part of a blueprint for the rest of the country.

CIA’s head of radio buying, David Fletcher, says: “In the big picture, commercial radio is reasonably successful, with Viva! and Premier the exceptions to the rule.”

He has his own theory on how the Authority will choose a winner for the licence, which has the potential to reach 5.9 million listeners.

Strong branded contenders would be Capital, which wants to convert Capital Gold from AM to FM and London Atlantic, a youth station with current and recent hits.

“I don’t know if politically they will be the acceptable choice. Why give it to the strongest players in the market?” says Fletcher.

He says Rocket FM, backed by Mohammed Al Fayed’s Liberty Broadcasting Company, may have positioned itself correctly as a mainstream rock station. It claims to be the “the only radio station dedicated to the artistry of rock music.”

Fletcher says the Authority turns a blind eye to its past failures, so niche players will not necessarily be discounted in the race for the winning station, which will begin broadcasting next year.

The decision on the licence, originally set for October, is now likely to be delayed until the turn of the year because of the introduction of a new “public interest” test.

The test, set up through the Broadcasting Bill, means the authority will have to assess the impact of a station owning two licences on the same waveband, and in the same area. Of those applying, London News Radio and Capital already hold an FM licence in the London area.

At the moment, there is still no certain favourite in the race to win the FM licence.

Knowledge Bank

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