Analysis of the UK radio industry's support for the government's 'Digital Radio Upgrade' policy but unwillingness to fund it, written by Grant Goddard in October 2010 for Grant Goddard: Radio Blog.

1. DIGITAL RADIO UPGRADE?
EVERYBODY WANTS IT,
NOBODY WANTS TO PAY FOR
IT. YEAR-IN YEAR-OUT
PREVARICATION CONDEMNS
DAB RADIO TO FAILURE
by
GRANT GODDARD
www.grantgoddard.co.uk
October 2010

2. Digital Radio Upgrade? Everybody Wants It, Nobody Wants To Pay For It. Year-In Year-Out Prevarication Condemns
DAB Radio To Failure page 2
©2010 Grant Goddard
It was the Radio Festival, the industry’s annual get together. Everyone wanted to talk about
how wonderful the DAB future of radio would be. But nobody wanted to explain how ‘Digital
Radio Upgrade’, the government policy to make the UK’s DAB transmission system fit for
purpose, will be paid for. It is the radio sector’s favourite parlour game: pass the DAB Upgrade
parcel.
The first player is the BBC:
Q: “Very briefly, a one-word answer. Do you have any money set aside now to spend
on [Digital Radio Upgrade]?”
Tim Davie, director of BBC Audio & Music: “No.”
Second is commercial radio:
Q: “Does commercial radio have any money to spend on [Digital Radio Upgrade]? [...]
What’s your guess?”
Phil Riley, chief executive of Orion Media: “‘No’ is the answer at the moment.”
Third are the politicians:
Jeremy Hunt MP: “I think the most important thing is not something the government
can do, but something the industry can do …”
But hold on. This dialogue came from the Radio Festival in 2009…. We need to fast forward
one year.
It was the Radio Festival, the industry’s annual get together. Everyone wanted to talk about
how wonderful the DAB future of radio would be. But nobody wanted to explain how ‘Digital
Radio Upgrade’, the government policy to make the UK’s DAB transmission system fit for
purpose, will be paid for. It is still the radio sector’s favourite parlour game: pass the DAB
Upgrade parcel.
The first player is the BBC:
“It remains to be seen who will pick up the £100m tab [for Digital Radio Upgrade], with
[Tim] Davie saying he did not have the necessary funds.” [from 'The Guardian']
Second is commercial radio:
“[Global Group chief executive Ashley] Tabor said the commercial [radio] sector will
only pay for the rollout of those local DAB multiplexes that are commercially viable.”
[from 'The Guardian']
Third are the politicians:
Ed Vaizey, Minister for culture, communications & creative industries: "The BBC has
to work with me on coverage. I am talking to the BBC and I hope to accelerate the
pace of digital radio coverage."
Déjà vu, anyone? Delegates paid £899 to witness this repeat performance. I have already
placed my bet on precisely the same sentiments being made at the Radio Festival in 2011,
though the odds offered by the bookie were not at all good. On the coach home from the
Festival, everyone must have joined in the usual radio industry singsong:
“When do we want digital radio switchover? Now!
Who do we want to pay for DAB Upgrade? Somebody else!”

3. Digital Radio Upgrade? Everybody Wants It, Nobody Wants To Pay For It. Year-In Year-Out Prevarication Condemns
DAB Radio To Failure page 3
©2010 Grant Goddard
And while we are on the topic of déjà vu, I am reminded of an analyst report about DAB from
June 2008, in which I had written:
“The digital switchover of radio is so far into the future as to be intangible.”
I was swiftly rebuked for this viewpoint in an e-mail from a radio sector CEO.
Now fast forward to the 2010 Radio Festival. Andrew Harrison, chief executive of commercial
radio trade body Radio Centre, said:
"There is no doubt if [digital take-up] carries on at its current projectory we will never
get there." [sic]
The current RadioCentre strategy remains inexplicably that the BBC should pay not only for
improvements to the BBC’s DAB radio transmitters, but also for the commercial radio sector’s
(see my earlier blogs). The nails seem to have been hammered firmly into that coffin by this
week’s speed-axing session between the government and the BBC.
Although subsequent press reports have implied that the cost of the (previous) government’s
Digital Radio Upgrade policy will now be underwritten wholly by the BBC, the available
evidence says otherwise. The resulting four-page letter from the government to the BBC Trust
set out in detail all the new items to which the BBC’s funds will have to be applied in future.
The World Service? Yes. BBC Monitoring? Yes. S4C TV? Yes. Local television? Yes. DAB
radio? No….
Oh, hold on. In the penultimate paragraph on the final page there is a single sentence about
DAB penned by Secretary of State Jeremy Hunt:
“I also welcome the BBC’s plans to enhance its national DAB coverage in the period of
this agreement, and to match its national FM coverage as a switchover date draws
near.”
But while the rest of the letter is littered with the oft repeated phrase “The BBC will …”, this
solitary mention of DAB radio is couched only in terms of “BBC plans” without a hint of
compulsion. DAB is an obvious afterthought here and, much to RadioCentre’s chagrin, it refers
only to the BBC improving its own DAB transmitter coverage and not to improving commercial
radio’s.
In the coming months, when the inevitable axe falls sharply across BBC budgets as a result of
this week’s gobsmacking (© Ray Snoddy) agreement between the BBC and the government,
DAB radio must be an obvious short straw. Lose BBC local radio, or lose DAB? BBC
local/regional radio accounts for 15% of BBC radio listening. BBC digital radio stations account
for 4%. Here comes the chopper ….
[First published by Grant Goddard: Radio Blog as 'Digital Radio Upgrade? More Like Digital Radio Groundhog Day',
23 October 2010.]
Grant Goddard is a media analyst / radio specialist / radio consultant with thirty years of
experience in the broadcasting industry, having held senior management and consultancy
roles within the commercial media sector in the United Kingdom, Europe and Asia. Details at
http://www.grantgoddard.co.uk