MEDIA: Law ignores radio reality

National heritage secretary Virginia Bottomley last week confirmed radio

companies will be able to own two FM and one AM license each when the

Broadcasting Bill becomes law this month.

The relaxation of ownership rules will not be mirrored by a change in

the Radio Authority’s licensing remit. Applicants for licenses will

still be judged by what they offer in terms of ‘extending listener

choice’.

But judging by the track record of recent station launches in London, it

may be the harsh realities of the market that ultimately decides the

fate of smaller players.

At present, out of the 20 commercial radio stations in the capital only

the big players are getting a respectable share of listeners. The four

newest stations - Viva, Premier, Sunrise and Country - have scraped

together a combined listening share of less than 2%.

The problem for niche stations is how to grab advertisers’ attention.

Derek Morris, joint media director of BMP DDB, says: ‘Clients want good

quality 16-to-44 ratings. They aren’t interested in fragmented radio.’

Carphone Warehouse, which regularly advertises with mainstream stations

Capital, Heart and Classic FM, does not include single-interest stations

in its media plan. ‘We aim for a powerful, consolidated message rather

than weakening it across several alternatives,’ says marketing manager

Ruth Greenwood.

With radio, as in any other medium, money talks. ‘Only a certain number

of formats are financially viable, and some niche offerings have fallen

flat on their faces,’ says Clive Howse, associate director of The Media

Business.

Viva, the women’s station, is a classic example of a specialist station

missing the mark. Its weekly reach has plummeted from 121,000 in the

third quarter of 1995 (Rajar) to just 11,000 in the first quarter of

1996.

Radio stations are being forced into becoming mainstream, says Morris.

‘The Radio Authority licences stations to broaden choice, but market

forces are driving radio stations back to the middle ground.

‘Niche stations fill a gap in the market but they are finding that there

is no market in the gap.’

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Across the dial

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Station                Listening share

Capital Gold               17.2%

Capital Gold AM             5.5%

Melody                      4.4%

Kiss FM                     3.7%

Virgin FM                   3.4%

Heart                       2.6%

Jazz FM                     1.7%

Sunrise                     0.8%

Country                     0.7%

Premier                     0.3%

Viva                        0.0%

Cross section of local listening

Source: Rajar/RSL

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This article was first published on Marketing