The Empress drops the emperor’s new clothes

It’s typical of the haphazard and unsatisfactory development of digital commercial radio in this country that its fate should be crystallised by a hurriedly conceived GCap defence document.

No disrespect to embattled new GCap chief executive Fru Hazlitt over the “hurried” bit. The circumstances are not of her making. She holds an imperfect set of cards and must play them as best she can in the very limited time given GCap to ward off an unwanted takeover bid by Charles Allen’s Global Radio.

Since no easy revenue wins are readily apparent, that means “unlocking shareholder value” by deep cuts, otherwise she’ll end up the Lady Jane Grey, rather than “Empress” of radio. And what could be a bigger drain on GCap’s resources than the digital experiment? Out goes Planet Rock and theJazz; more importantly, she’s going to sell GCap’s majority stake in the national Digital One multiplex for £1. In fact, she’d be rid of the whole DAB platform, she says, if she had a free hand. But she does not.

That’s a savage blow to the morale of the whole DAB movement. After all, GCap is the biggest commercial radio operator and its espousal of the cause, since take-off in late 1999, has been critical in creating what momentum digital commercial radio has achieved over the past eight years. Recent Rajar figures reveal that UK digital listening has topped 100 million listening hours. And digital radio sets are now beginning to tumble off the shelves, providing a long overdue stimulus for manufacturers to raise their game.

The trouble is, DAB has had to rely on the vagaries of commerce to survive, and this has been difficult in the absence of any unique selling proposition other than a (potentially) superior delivery channel. How unlike digital television where, although gross mistakes were made (not least by Ondigital, ITV’s predecessor to Freeview), all elements of the industry have been galvanised by a State-sponsored digital changeover programme with a definite analogue cut-off date.

In the radio sphere, by contrast, digital sets long remained unappetisingly expensive, clunky and far from portable. At the same time, innovation – meaning original content – has been scant and interactive capability (a second defining characteristic of digital, after enhancement of the signal quality) scant. No wonder digital-only stations account for just 4% of all radio listening, and most of that on the BBC.

It is the BBC, of course, that will emerge the winner as an unintended consequence of GCap’s decision; though its victory may be Pyrrhic. The would-be countervailing strategy of the 4 Digital Group, now embarking on the launch of its second string of stations, looks badly dented. True, if he wins the GCap takeover tussle, Allen has promised to stay true to GCap’s original digital strategy. But it won’t be the same. DAB’s biggest commercial champion has shown just what it thinks of digitalisation. The damage is already done. You can’t blame Hazlitt for that. But it’s a great opportunity missed all the same.

Recommended

What’s the big idea?

Marketing Week

Do campaigns still need a big idea that can be applied across all channels, or is it more effective to tailor content to each platform? By Caroline Parry When the contestants of last year’s reality show The Apprentice were challenged to create an advertising campaign, CHI & Partners founder Johnny Hornby bestowed upon them a […]

Clear Channel earnings increase due to outdoor sales growth

Marketing Week

Clear Channel Communications, the US media group, has reported a 52% increase in earnings for the fourth quarter of last year, which it puts down to strong growth in its international outdoor sales. The company says revenues for its outdoor division, for the year to December 31, were up 13% to $3.3bn (£1.67bn). Overall revenues […]

The online data black market

Marketing Week

The market for online data has experienced an explosion in growth but demand is outstripping supply, paving the way for websites that are obtaining and selling data illegally. By David Reed

Comments

    Leave a comment

    Close

    Discover even more as a subscriber

    This article is available for subscribers only.

    Sign up now for your access-all-areas pass.

    If you're an existing paid print subscriber find out how to get access here.

    Subscribers enjoy unlimited access to unrivalled coverage of the biggest issues in marketing, alongside practical advice from the digital experts at Econsultancy.

    With a subscription to Marketing Week Premium you will get full access to:

    > World-renowned columnists

    > Analysis & case studies

    > Exclusive leading-edge insight

    > Carefully curated reports & briefings from Econsultancy

    > Plus, much more including a £300 discount for the Festival of Marketing

    Subscribe now

    Got a question?

    Contact us on +44 (0)20 7292 3703 or email customerservices@marketingweek.com

    If you are looking for our Jobs site, please click here

    Subscribers enjoy unlimited access to unrivalled coverage of the biggest issues in marketing, alongside practical advice from the digital experts at Econsultancy.

    With a subscription to Marketing Week Premium you will get full access to:

    > World-renowned columnists

    > Analysis & case studies

    > Exclusive leading-edge insight

    > Carefully curated reports & briefings from Econsultancy

    > Plus, much more including a £300 discount for the Festival of Marketing

    Subscribe now