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I was part of a fun Zoom call over the weekend. It was to celebrate 21 years of Digital One. They’re the people that run the first national digital radio multiplex - that’s the one that broadcasts Classic FM and Kisstory (amongst others) on DAB radio.
You might think it’s strange to have a party for a multiplex, or a number of transmitters, but really it was a party for the people who’ve been employed with (or near) it over the last two decades. There were about 25 of us on the call.
Like all these things, it was fun to see a lot of old faces and virtually catch-up, alongside occasional appearances of kids topping up wine, or dogs drifting into shot. But what was really nice, was to contemplate the effect that these people, most of whom you won’t know, had on the radio industry as it is today.
Digital One launched in 1999, and was commercial radio’s big shot at competing with the BBC. They’d launched their own national multiplex a few years before, but it mainly just simulcast their national radio stations. Digital One was going to bring together the initial commercial national stations and host a whole load of new ones too. It was also designed to push digital radio as a consumer proposition.
When they applied for the licence in 1998, it was going to be a joint venture between GWR (who owned Classic FM), Virgin Radio and the company behind Talk Radio alongside the transmitter business NTL (now Arqiva). This idea was somewhat derailed by Chris Evans taking over Virgin at 1997 and getting out, and then Kelvin Mackenzie, the new owner of Talk Radio, pulling out just after it had been awarded. This left GWR and NTL to hold the thing together.
The digitisation of UK radio had always been GWR’s baby. Quentin Howard, its Chief Engineer had seen the tech be demonstrated in the mid-90s and had persuaded Ralph Bernard, the company’s Chief Executive, to support it. There wasn’t universal support for the new platform, as this unstable new ownership structure demonstrated.
The regulator advertised local and regional digital multiplex licences, which encouraged other radio operators to get involved. In exchange for taking part, the Radio Authority extended their FM licences (meaning no one could bid against them). This was a clever move that incentivised everyone to take part in DAB, but didn’t necessarily incentivise enthusiasm.
The core issue in the first few years, post-1999, was that the radios were too expensive (the cheapest was £299 for a HiFi separate) and there were no sets in cars. Many in the radio industry had assumed ‘if they build it, they will come’ for both manufacturers and listeners. They were very wrong.
Fundamentally the radio sector didn’t have any experience in launching a consumer technology platform (and didn’t realise it would need some).
Radio’s problem often comes from its name. With ‘radio’ meaning both content and the distribution platform. At the beginning radio was a platform in need of content. That’s why manufacturers got together to fund the British Broadcasting Company to make some. Later on the ubiquity of radio as (an analogue) platform meant that stations forgot that much of their success was down to devices rather than what was just broadcast over them. It’s something lots of stations still forget today.
Luckily Digital One (and GWR) did realise that they would need to do some things to get the platform working and it’s this ground work that later led on to its success with DAB now being the dominant platform, the backbone, of listening in the UK.
It did a number of clever things. Firstly it worked closely with potential manufacturers and retailers, supporting them through partner marketing and an airtime bank of adverts on commercial radio stations. Through this it learned about the issues that got in the way of their desire to have ‘cheap radios’. Fundamentally the radios were expensive because the chipset (that did all the clever stuff) was expensive, this then doubled in cost when the set was built and then doubled again when it was sold. If this chipset could be cheaper then the price would drop significantly.
In the end Digital One, supported by GWR, invested £1.5m into the Chorus chip in 2001. This unlocked the first £99 digital radio - which became the Evoke 1 - which launched in June the next year.
The £1.5m investment was a huge deal, but outside of GWR, the rest of the radio industry and the BBC refused to take part. They didn’t see it as their job to fund the chip. They couldn’t conceive of it being essential to their future success.
The BBC did support digital radio in other ways. 2002 was the year that 6 Music, 1Xtra and BBC7 (now Radio 4 Extra) launched. Suddenly, with the Evoke, there was a way to listen to it.
But Digital One, GWR, Quentin and Ralph had done the heavy lifting. They drove interest in the project, encouraged the regulator to license it, weathered ownership storms, launched the biggest digital radio network in the world, survived brickbats from competitors, then funded the chip to make the thing work.
The build from 2002 was still tough, with many in the sector still unenthusiastic about the new platform. Whilst there was content investment from most radio groups and some support of the cross-industry Digital Radio Development Bureau (later Digital Radio UK), most still saw the success of the platform as someone else’s problem.
Fundamentally most of the sector saw FM as unassailable, and they liked their monopolies. Even with low listening many detested the idea of new stations coming into their core markets. At the time it felt ridiculous and looking back it seems incredibly parochial. This one foot in, one foot out approach, extended the time it would take to establish the platform and also extend the amount of money the groups were paying before there would be some profits. Had they gone bigger, earlier, they wouldn’t have bene in this situation.
By the beginning of 2008, in the middle of a market crash, GWR (now GCap)’s new boss Fru Hazlitt was trying to save the company from being taken over by Global, and slashed costs, alongside DAB investments, with plans to sell off Digital One and to shut the digital only spin-offs, including Planet Rock, doubling down on FM. She was unsuccessful defending GCap as a stand alone company, with Global buying it, six weeks later, in March 2008.
Around this time there was a lot of change. Emap has been purchased by Bauer and the old Virgin Radio (now Absolute) had been bought by the Times of India. The BBC was still smarting from its 2007 licence fee settlement. Collectively there was a pause whilst the sector worked out what it wanted to do with digital radio. Global had proceeded with Fru’s disposal of Digital One (and its local multiplex business) to Arqiva and there were strong rumours that they’d be out of the platform completely. Bauer and the BBC didn’t want to be left holding the baby.
In the end, the launch of the Digital Radio Action Plan brought the sector together to focus on coverage, cars, consumers and content. The end result we see now - DAB listening is the biggest platform for radio consumption in the country. The scale of the platform and the fact it’s in 67% of homes, means that new stations can launch, but more importantly there’s a business model where they can invest in high quality content. Whether that’s the new talent and styles on Times Radio, Virgin Radio and Scala or building on big brands, with stations like Absolute 90s, Kisstory and Heart 80s, radio output has been enhanced.
DAB’s scale becomes the enabler of these stations which can then become multi-platform with distribution on apps, smart speakers and online. Success also means budget for investment in podcasts and other new forms of output. The net result is that radio-as-a-platform is in a strong position as it can deliver for consumers wherever they tune in, with quality products. So much of this is underpinned by the DAB backbone.
Ireland is an interesting control. Outside a little bit of DAB from the public broadcaster, they chose not to go down the digital radio route. The result has seen much of the sector preserved in aspic, with a line-up existing of many of the same stations that were on-air twenty years ago. Whilst all the radio groups have brand extensions online, they’re predominantly content-less jukeboxes with low audiences.
I’m sure this lack of success digitally has inhibited the development there, of other online products, particularly for commercial radio. If you look at podcasting the highest rated commercial radio podcast is catchup for Pat Kenny on Newstalk (at 16). Other than The Last Word from Today FM, a catchup podcast at 37, no other commercial radio content is in the top 100. Indeed, there are few examples of any commercial radio operator creating native podcast content not dependent on ‘best of’ material from the radio.
Irish radio faces the same new entrants that the UK does, from the likes of Spotify, podcasts and other streaming services, but they’re ill-equipped to take them on. But also have they fundamentally done a disservice to listeners by refusing to innovate their output for 20 years? Consumers are used to expanded, high quality choice, if they don’t get it one platform they’ll surely go elsewhere?
Whether UK radio is going to be able to withstand the winds of digital competition it’s hard to know. What is for certain though, is that it’s proved it can do big things, when it chooses to make big steps.
The big successful digital companies from the last 20 years - the Facebooks, the Spotifys - had big, audacious goals. They were created by small, high performance teams, who were focused on doing something different - and then really going for it.
In the UK, the small Digital One team had a huge impact on UK radio by going big when many grumbled in the corner. Well done to them, and their vision, and to those who stood on their shoulders to do even more for the radio sector.
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