Recognising that changes in technology and the competitive landscape in recent years mean that the debate about a future digital transition programme for radio in the UK has shifted, Margot James, Minister for Digital and the Creative Industries, has confirmed that the government will begin a review of digital radio in the coming weeks to conclude by the middle of 2020.
Delivering a keynote address at the Radio Festival, James suggested that the radio industry was in “great shape” but could not be complacent. “The market is more competitive than ever, with competition from podcasts and music streaming services,” she noted. “Six million people listen to podcasts each week in the UK – and many of them are younger people, who are increasingly seeing podcasts as their default way of getting audio content. Alongside this change in consumption habits, digital advertising is become more prominent, which can create challenges around how to gain value from content.”
“I firmly believe that there is a place for traditional radio,” she declared. “Whatever technological changes may take place, people are still striving for high quality and relevant audio content, with very high production values.
She admitted that commercial radio remained the most regulated UK media sector and subject to a system of regulation designed for AM and FM radio services in the late 1980s. “And this regulation is becoming increasingly out of date and burdensome as analogue radio audiences decline,” she stated. “Digital radio now accounts for more than 52 per cent of all UK radio listening and we need a legislative structure that reflects this change, and gives us flexibility to deal with the change that lies ahead. The rapid growth of digital technologies like digital and online radio, and on-demand audio services like TuneIn, Spotify and Apple Music provide a real challenge to all radio broadcasters but also an opportunity,” she suggested.
According to James, reaching 50 per cent share of all listening last year was an important milestone in the development of digital radio and for radio as a whole. “The package of measures announced by DCMS in December 2013 including improvements to digital radio coverage alongside the investment in content by broadcasters and support from car manufacturers and the supply chain have helped to drive the take up of digital radio by consumers,” she said.
“We said that we would review the progress of digital radio and consider the next steps once the listening threshold had been reached. I had preliminary discussions with representatives from the BBC and commercial radio and industry at a roundtable in March. We also supported an industry workshop in April. It is clear that changes in technology and the competitive landscape in the past five years [since December 2013] mean that the debate about a future digital transition programme for radio has shifted,” she stated.
“Previously the radio industry’s boundaries were clear: radio was delivered through a bespoke distribution system to a bespoke individual device. But this is no longer the case. Increasingly audio consumption is through hybrid devices that also do a myriad of other useful things – such as smart speakers in home and dashboard info-tainment systems,” she noted.
“A consideration about the future of radio can no longer be seen as just a binary decision about a switch from an analogue to a digital broadcast platform. A review must have a much broader focus to reflect the growing challenges arising from IP-based audio content delivery and how this affects future decisions on radio distribution,” she asserted.
“But there is also an opportunity here. For broadcasters and other stakeholders to collectively develop a shared vision for a sustainable vibrant digital audio sector for the UK. And to come up with some tangible steps to achieve the vision. So I can confirm that we will begin a review of digital radio. We will move forward on a programme of work that will begin in a few weeks and conclude by the middle of next year,” she advised, suggesting that in order to be successful it would have to be a collaborative effort.
“I look forward to working closely with the BBC and commercial radio and with manufacturers, the car industry and others in the radio supply chain over the coming months,” she concluded.