Press cuttings relating to the GCAP decision
RTE heralds the future of digital radio in Ireland
17 February 2008
Irish enthusiasts - and RTE - are standing by new radio technology. Catherine O’Mahony reports.
Plans to establish an Irish digital radio service using DAB (digital audio broadcasting) technology are on track, despite hiccups with the medium in Britain.
RTE, which is spearheading a trial of DAB radio in the Dublin area, is understood to be ready to expand it to other major urban areas, and is also set to launch its DAB channels on the internet. By the end of this year, executives say RTE will have a full licence to operate a DAB service nationally. DAB is, according to its supporters, the future shape of radio.
Meanwhile, in Britain, the latest on DAB sounds gloomy. After months of speculation, GCap Media, the largest commercial radio broadcaster in Britain, last week finally axed its digital-only radio stations, stating that the medium had not matched expectations.
Fru Hazlitt, GCap Media chief executive, said digital radio was ‘‘economically inviable’’, after the company last year spent stg£8 million on digital radio, while more than 90 per cent of its listeners tuned in to FM stations.
It’s a potential blow for DAB technology, although the BBC, which has invested in DAB for more than ten years, defended its choice.
There are lots of positive statistics for the BBC to cite: more than 22 per cent of British adults now claim to have DAB at home, and it makes up 10 per cent of all radio listening. Two million DAB radios were sold in Britain last year.
DAB is at an embryonic stage here by comparison, although DAB radios have been promoted heavily by electronics shops in the last six months, probably partly since many are British-owned.
RTE has been leading the way on promoting DAB, but its entire annual budget for developing it is a tiny €250,000, out of a total radio budget of €60 million.
JP Coakley, RTE’s head of operations, said RTE hoped to get an accurate picture soon on how DAB sales were going, and would decide partly on that basis how to proceed.
From a consumer’s point of view, digital radio sets are very user-friendly. There’s no crackle between channels and the sets feature a screen that can deliver information about the content, offering multimedia options that traditional radio cannot match.
‘‘In the end, it’s the public who will decide if this stands or falls,” said Coakley. ‘‘If we could see, say, one in 20 people tuning in to us on DAB, that would be game-on.”
He argued that the GCap problems related more to GCap’s corporate strategy than its business model. ‘‘They need to cut costs fast and a quick way to do that is to cut DAB. But they’ve dropped some FM channels as well.”
At present, DAB is still on trial here, since regulators ComReg and the Broadcasting Commission of Ireland (BCI) have yet to issue full licences for digital radio transmission.
The BCI said last week it would need to deliberate as to whether DAB was the correct technological model for the Irish market at all. However, since its time is taken up at present with establishing a framework for digital television, the BCI will not begin to address digital radio issues until the end of 2008.
Meanwhile, 15 radio stations, including two newly created commercial digital stations and four new digital-only radio stations from RTE, are broadcasting to DAB receivers in the greater Dublin area.
Since FM remains the principal way most people listen to radio, most operators are paying twice for transmission, as long as their DAB service is operated along with their analogue service.
This doesn’t deter RTE, whose public service broadcasting remit justifies its role as a prime mover on new technologies.
However, some observers think the cost might well prove an issue for commercial players, especially if it remains unclear precisely how long they will have to keep providing two services.
A report on digital radio by the European Broadcasting Union last year estimated that it might be 2020 before many European countries switched off their analogue radio services.
Enthusiasts for DAB radio believe this technology is the only future for radio, and will replace analogue as the transmission mode of choice sooner rather than later.
‘‘If you look properly at Britain, you can see that digital radio is one of the few bright lights in an industry that’s under pressure,” said Coakley.
‘‘There are now twice the number of services on DAB that there are on FM.
‘‘Our conviction is that this has to happen,” he said. ‘‘We need three things for this to work - we need low-cost receivers, we need a regulatory catalyst and we need new and exciting broadcasters to come on board.”
Dusty Rhodes, whose Digital Audio Productions company is behind two new commercial digital channels being tested - an all-80s channel and an R’n’B channel - said he hoped DAB’s woes in Britain would accelerate moves by regulator Ofcom to provide a proper regulatory structure for DAB.
‘‘It’s not a death knell for DAB, far from it,” he said. ‘‘Watch out because that space [vacated by GCap] will be filled.”
Without a timetable for switching off FM radio, he could understand why some commercial stations would see no logic in paying for DAB.
‘‘It’s still a fantastic system,” said Rhodes. ‘‘What I hope it might do is remind people that we need to talk about setting a firm switch-off date for the analogue service.”
Rhodes has been making money from advertising and sponsorship on his digital radio stations, although he conceded that the prices he could charge were very low. Joe Dalton, media buyer at Precision Media, said it was early days for this technology, and it wasn’t yet on the radar for major brands.
‘‘It’s got huge potential and I do think this is the future,” he said.
‘‘It will grow niche stations and that’s great. But, for now, penetration is low and it’s a limited reach.
‘‘Only 1 per cent of new cars are fitted with DAB radios,” said Dalton.
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