Radio Authority publishes assessment of the local digital multiplex licence award for Leicester

20/02

22 February 2002

Radio Authority publishes assessment of the local digital multiplex licence award for Leicester

The Radio Authority has today (22 February) published the details of its assessment of the local digital multiplex licence award for Leicester. The Authority awarded the licence to Now Digital Ltd. on 7 February 2002.

A copy of the full assessment is attached.

ENDS

NOTE TO EDITORS

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.

LOCAL DIGITAL RADIO MULTIPLEX SERVICE:

LEICESTER

ASSESSMENT OF LICENCE AWARD

The local digital radio multiplex service licence for the Leicester area was awarded to Now Digital (East Midlands) Ltd. on Thursday 7 February 2002, to run for twelve years from the date the service commences broadcasting.

Applications were invited on 24 August 2001. By the closing date of 20 November 2001, two applications were received, from:

Emap Digital Radio Ltd., a wholly-owned subsidiary of Emap Performance Ltd.

Now Digital (East Midlands) Ltd., a company whose shareholders are Now Digital Ltd. (GWR Group plc), Sabras Sound Ltd., Capital Radio plc, and Chrysalis Radio Ltd.

Consideration of the successful application

Members were pleased to note that local digital multiplex licence advertisements are now regularly attracting more than one applicant, demonstrating a growing confidence in the commercial prospects for digital radio, and raising the standard of application proposals through increased competition.

Coverage area and timetable

NDEM's technical plan proposes the use of three transmission sites, at Copt Oak and Waltham initially, with a third transmitter, at Skeffington, to be introduced during the first two years of operation. According to the applicant's own estimates, its initial transmission network will provide ‘outdoor coverage’ of 84.2% of the adult (aged 15+) population of the ‘primary protected area’ (PPA), rising to 88.3% with the implementation of the third site. However, whilst this is in line with the Authority's technical guidelines, its experts considered that the signal within buildings in parts of the city of Leicester might not be as strong as listeners would expect, and so the applicant has been asked to re-examine its transmission plans in order to address this concern. NDEM is planning to launch the service in November 2002.

2. Ability to establish and maintain the service

Now Digital (East Midlands) Ltd. is a consortium comprising Now Digital Ltd., a company wholly owned by GWR Group plc and an experienced operator of digital radio multiplexes, local analogue licensee Sabras Sound Ltd., Capital Radio plc and Chrysalis Radio Ltd. Members took the view that NDEM's application presented a prudent and achievable business plan, the reliability of which was aided by the fact that all of programme providers (apart from the second East Midlands regional service, for which the licence has yet to be awarded) were also shareholders, thus providing a degree of security for the income for the multiplex operation.

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

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

Contemporary hit radio Leicester Sound (provider: Leicester Sound Ltd.)

Asian music and speech Sabras Radio (provider: Sabras Sound Ltd.)

Talk and predominantly adult 106 Century FM (provider: Capital Radio plc)

contemporary music

Adult rock The Arrow (provider: Chrysalis Radio Ltd.)

Pop hits from the past four decades Pop Hits (provider: GWR Group plc)

Music for teenagers and pre-teens Cube (provider: Capital Radio plc)

New regional service (or alternative) Format and provider not yet known

Young Asian and Asian communities Asian Plus (provider: Sabras Sound Ltd.)

In Members' view, the programme bouquet proposed by NDEM catered reasonably well for the tastes and interests of the listeners in the area, and benefited from the definite inclusion of the main existing ILR services of Leicester Sound, Sabras Radio and the regional station for the East Midlands, 106 Century FM. Members were particularly impressed by the plans for Asian Plus, a complementary locally-sourced Asian service comprising both programming for young Asians and a platform for local Asian and other community groups. While Members thought that the bouquet of programme services offered could have been more wide-ranging in appeal, they appreciated the fact that the group had put forward programme proposals that it was confident of delivering.

4. Broadening the range of local digital programme services

As this is the only local multiplex covering the Leicester area to be licensed, now or in the foreseeable future, the 'broadening of choice' criterion is effectively satisfied by default.

5. Local support

NDEM obtained a good level of letters of endorsement from the local community, reflecting the reputation of local ILR companies Leicester Sound and Sabras Radio who were among the group's shareholders. However, the group's use of a market research survey designed to demonstrate support for its proposed programme services was felt by Members to be most unconvincing, due to the absence of any clear correlation between the survey findings and the applicant's selection of programme formats.

6. Fair and effective competition

The Authority has no been given no reason to believe that the applicants did not each act 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.

BACKGROUND

Copies of the non-confidential section of the applications were made available for public inspection in the reference section of Leicester Central Library, and at the Authority’s offices in London. A notice was issued on 20 November 2001 inviting public comments on the applications.

Under the terms of section 51(2) of the 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:

the extent of the coverage area as proposed by the applicant;

the timetable relating to achievement of the proposed coverage area and the start of broadcast services;

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;

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;

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;

the extent to which the application is supported by persons living in the area; and

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.

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