79/01

22 June 2001

The Radio Authority has today (22 June) published details of its assessment of the third local digital multiplex licence award for Greater London. The Authority awarded the licence to The Digital Radio Group (London) Ltd. on 6 June 2001.

A copy of the full assessment is attached.

The Radio Authority is responsible for licensing and regulating Independent Radio in accordance with the statutory requirements of the Broadcasting Acts 1990 and 1996. It plans frequencies, awards licences, regulates programming and advertising, and plays an active role in the discussion and formulation of policies which affect the Independent Radio industry and its listeners.

The third local digital radio multiplex service licence for Greater London was awarded to the Digital Radio Group (London) Ltd. (DRg) on Wednesday 6 June 2001, to run for twelve years from the date the service commences broadcasting.

Applications were invited on 24 November 2000. By the closing date of 13 March 2001, three applications were received, from:

• The Digital Radio Group (London) Ltd., a company whose shareholders are GWR Group plc, The Wireless Group plc, SMG plc, Matsushita Electric Europe Ltd., RMG (Ritz Media Group) plc, Carphone Warehouse plc, Asian Sound Ltd., Clubmend Ltd., Channelfly plc and Time Out Ltd.

• London Digital Radio Ltd., a company whose shareholders are SCORE Digital Ltd., Saga Regional Digital Radio Ltd., Forever Broadcasting Digital Radio Ltd., Etheraction UK Ltd., The Radio Development Company Ltd., Somethin’ Else Sound Directions Ltd. and Indigo Technologies Ltd.

• MXR London Ltd., a company whose shareholders are Chrysalis Group plc, Soul Media Ltd., Capital Radio plc, Guardian Media Group plc, UBC Digital Ltd., Spectrum International Radio Ltd. and Ford Motor Co. Ltd.

All three applicants submitted proposals which Members had no doubt would satisfy the statutory criteria set out in the Broadcasting Act 1996.

1. Coverage area and timetable

DRg’s technical proposals offered less robust coverage in parts of the core transmission area than the other two applicants, because the group decided to use a lower level of transmission protection in order to enable an extra programme service to be carried on the multiplex. Members had concerns about such a reduction in the level of transmission protection and the implications this had for maintaining contiguous reception across the service area, although they considered that numerically the actual difference in coverage achieved between DRg and the other applicants was not significant and was outweighed in the particular circumstances of this licence award by the advantages of the programme services on offer. The applicants’ commencement and roll-out plans were all broadly similar. DRg is aiming to launch all but one of its services in December 2001 (with Passion for London to commence within twelve months of the launch of the multiplex) using an initial eight transmitters at Croydon, Alexandra Palace, Bluebell Hill, Guildford, Reigate, Zouches Farm, Hemel Hempstead and Kemsing. The group proposes to implement another two transmitters at Brookmans Park and High Wycombe in 2002, and has identified further sites which may be used if required.

2. Ability to establish and maintain the service

The Authority recognised that all three groups had been established by some of the radio industry’s most successful operators together with a variety of new investors, all of whom would be capable of establishing and maintaining a multiplex service. However, in the context of Greater London with two local multiplexes already licensed, Members considered that the specialist services proposed by DRg were a determining factor in this award, appealing as they are designed to do to new and committed listeners to digital radio and thereby enhancing the marketing base for the multiplex to assist swifter uptake of receivers.

3. Catering for tastes and interests of people in the area

The commercial programme services proposed by the applicant are as follows:

Children Abracadabra (provider: Soundstart Radio Networks Ltd.)

Soft rock The Arrow (provider: Chrysalis Group plc)*

Urban Choice (provider: Soul Media Ltd.)*

Current Chart Liquid (provider: Virgin Radio Ltd.)

Adult contemporary and speech Passion for London (provider: Passion for the Planet Ltd.)

Gay Purple Radio (provider: Clubmend Ltd.)

Country and Irish Ritz (provider: RMG plc)

Student SBN London (provider: Channelfly plc)

Rock and pop rock Storm (provider: GWR Digital Ltd.)

Young Asian TAP (provider: Asian Sound Ltd.)

Entertainment Time Out Live (provider: Time Out Group Ltd.)

[* subject to confirmation]

Members noted that the proposed programme bouquet will provide Londoners with simulcast services of two local analogue licensees, Ritz Country and Choice FM. In addition, it offered a selection of adventurous services not only new to digital, but notably included some which were entirely new to radio and would effectively cater for communities within London whose tastes and interests were not currently being fully met. 

Members thought that the proposals for a service for young children and their carers, Abracadabra, were well thought out, realistic and could offer a genuinely new listening experience for this largely unserved audience. Similarly, the proposed student service, SBN, currently broadcasting on satellite and the internet, would be a distinctive addition to those formats targeting young people in the capital. These two services will occupy the same channel, during the daytime and evening/overnight time slots respectively. The programme proposals of Purple were focussed, and Members were confident that it would provide a service attractive to a wide section of the gay community. The proposals for TAP, an Asian service targeting young Asians with contemporary Asian and fusion music, and Passion for the Planet, a service combining adult contemporary and world music with speech content geared to environmental and health issues, were viewed by Members as interesting new formats. Members considered the inclusion of one of London’s major brands, Time Out, as the provider of an entertainment service for Londoners to be especially advantageous in promotional terms.

4. Broadening the range of local digital programme services

This statutory criterion requires the Authority to judge applicants’ programming packages against existing local digital sound programme services. Two local digital multiplexes are already on air in London. Members judged that, when compared with the digital programme services already available to Londoners, the programme bouquet proposed by DRg was the most likely to broaden the range of local digital programme services because many of its programme services targeted niche audiences. Specialist formats such as those offered by Abracadabra, Purple Radio, TAP, Time Out and Passion for London would contribute greatly to the choice of digital radio services in London.

5. Local support

A large number of letters of support had been sent directly to the Authority from prospective supporters of the various niche services which will be provided by DRg. The majority of these expressed support for the inclusion of a student service and a children’s service. Other letters and e-mails accompanied DRg’s application and expressed support for Purple, Passion for the Planet, Ritz Country, The Storm, and TAP.

6. Fair and effective competition

The Authority has no reason to believe that the applicant has not acted in a manner calculated to ensure fair and effective competition when contracting or offering to contract with potential or proposed service providers. In accordance with the licence conditions pursuant to the Broadcasting Act 1996, the Authority will keep matters of fair and effective competition and undue discrimination under regular review.

Copies of the non-confidential section of the applications were made available for public inspection at the Authority’s offices in London. A notice was issued on 13 March 2001 inviting public comments on the applications.

Under the terms of section 51(2) Broadcasting Act 1996, when considering whether, or to whom, to award a local digital radio multiplex licence, the Authority must have regard to the following specific matters:

1. the extent of the coverage area as proposed by the applicant;
2. the timetable relating to achievement of the proposed coverage area and the start of broadcast services;
3. the ability of the applicant to establish the proposed service and to maintain it throughout the period for which the licence will be in force;
4. the extent to which the digital programme services proposed to be included in the service would cater for the tastes and interests of persons living in the area and, where it is proposed to cater for particular tastes and interests, the extent to which those services would in fact cater for those tastes and interests;
5. the extent to which any proposed digital sound programme services would broaden the range of programmes available by way of local digital programme services in that area and, in particular, the extent to which they would cater for tastes and interests different from those already catered for by local digital programme services already provided in that area;
6. the extent to which the application is supported by persons living in the area; and
7. whether, in contracting or offering to contract with persons providing digital programme services or digital additional services, the applicant has acted in a manner calculated to ensure fair and effective competition in the provision of such services.

The Authority is also required to take account of any representations made in respect of the applications.