RadioCentre CEO Siobhan Kenny has used her first public appearance to urge Government to relax content regulation and provide greater certainty over commercial radio licence renewal.
Speaking at the RadioCentre Members’ Conference in Westminster today, Kenny said, “This small legislative change would help provide stability, secure investment and avoid multiple stations changing hands and brands all at the same time.”
A release from RadioCentre to go alongside the speech has said that the Government must act swiftly “to avoid potential chaos in radio licensing”.
Many popular commercial radio licences will start to expire from 2017 onwards, the organisation explains. “Without new legislation the national licences will be auctioned to the highest bidder, regardless of the programming content or public value provided by these services. Local licences will be awarded by Ofcom on a ‘beauty parade’ basis, draining resources from the sector and creating the risk of confusion for listeners.”
Kenny also called for a relaxation in content regulation of commercial radio in the face of increasing competition from the BBC and online music services.
“One of the most important jobs of the industry body is to provide the evidence that demonstrates the continuing value of the sector to our key audiences in a fast-changing world,” she said. “I look forward to continuing that work."
You can find Siobhan Kenny’s RadioCentre speech in full below:
I am delighted to be here in such illustrious company both on the platform and in the hall. Approaching the three-month mark in the role of CEO of RadioCentre, I figure I am just about at the perfect way point with the honeymoon period still intact. I’m hoping that after the honeymoon a long and happy marriage awaits.
I am a great believer in the power of first impressions. I have worked in a few sectors in my career and it is clear to me that what happens to you in your first few days, weeks and months is a pretty good guide to what will happen in the years ahead.
So my first impressions of radio? It’s a sector full of huge fun, enthusiasm and drive. The people who work in it really, really love what they do. They have a loyal fan base who feel the same way about it. And that is really worth something.
Having spent six years working in publishing, I am more than used to the death knell being sounded for so-called legacy businesses. Just as in publishing, nothing could be further from the truth in radio. I find a vibrant sector, brimming with ideas, changing and adapting to get the best from new technology and the new consumer behavior which comes with it.
Ways to be entertained might be expanding but there are some universal truths. The need for fun, company, music and information are always there. And those boxes are all ticked by radio, something which I don’t see changing any time soon.
Today I want to cover a couple of things which are simultaneously opportunities and challenges, both for the industry at large and for RadioCentre.
First, and I can say this as a newcomer, is the perception gap between the reality and what the outside world thinks of commercial radio. Not listeners, I hasten to add, who know exactly what they get from their local radio station.
No, more worryingly, the perception gap exists among our key audiences – advertisers and policy makers. Which might possibly have something to do with the audio consumption patterns of those key audiences.
On the one hand, the numbers tell us the industry is in great shape. Commercial radio revenues have been up for the last three quarters and look like increasing by a further 6% in the next quarterly figures. 35 million listeners or two thirds of the adult population every week represents a healthy number for any planner, you would have thought.
And yet radio seems to have to fight for space on agency schedules. It is an undervalued medium which can significantly boost campaigns if used in the right way. Empirical evidence which demonstrates an ROI of nearly 8:1 (RAB research) is hard to argue with.
The IPA Touchpoints survey shows radio share of the media day continues to be a very healthy 22%. Sadly however that does not translate across to a similar chunk of ad revenue where radio accounts for a puny 3% share. I call that a very big and expensive hole.
So we need to carry on making the case for radio, doing everything we can to overcome the perception gap, hoping to drive up that 3% share at least into double digits. Which maybe a heroic target but there is no harm in having one of those.
When we come on to decision makers and regulators, I don’t think it is contentious to say that most of them would naturally tune into BBC Radio (4,3,2,5), ahead of, say, Kiss or Capital. MPs of course, all understand the power of their local stations and they tend to love being on them. They also understand that with 3000 hours of public service broadcasting every week and £18m raised for charity, the medium really does deliver public value.
These are some of the things I, for one, didn’t realise about commercial radio. So, having addressed my own perception gap, I can understand how it works for others.
Generally I would say that commercial radio, before we even consider the BBC, is a sector which is pretty highly regulated, in some instances being bound by legislation which was drafted in a pre-internet age. This at a time when a host of new entrants are crowding into the audio market, unfettered by such constraints, tends to create something of an uneven playing field.
If we could ask anything of Ed Vaizey and his Government as we come up to manifesto time which would give a great boost to a bona fide, home-grown, nationwide industry, it would be this: please consider a relaxation of the content regulation and provide greater certainty over licence renewal. A small regulatory change that would help a sector with no guaranteed funding continue to innovate.
So the current numbers are promising but what are the underlying trends revealed if you dig deeper? Reach still looks impressive - even among 15-24s, three quarters of whom are tuning in each week. But while people are still listening, they aren’t listening for as long every week. And that is especially obvious among 15-24s, with all the competing choices for their time and attention.
There is strong emerging evidence that audio consumption overall is enjoying a double digit increase. That includes all downloaded music, YouTube, CDs – even the old vinyl which is apparently enjoying a resurgence (note to self – get up in the attic to kick start a domestic 80s revival).
Even in that audio landscape, against all that competition, our emerging data shows that live radio enjoys a massive 75% share of ear. It’s easiest to think of it as the difference between wanting the social experience of radio or communing with your own, much loved favourites. They are more complementary than competing experiences and there is room for both in our audio world.
The industry is awash with exciting ways to enhance what radio does, to broaden its audiences and to make the most of all digital revenue opportunities. RadioPlayer is a brilliant product, a great example of joint working with the BBC – a fantastic app which allows consumers to get access to all of UK radio. And it is improving all the time.
Global Radio’s recently launched Digital Audio Exchange will help brands buy audio ads across radio and streaming services. So you can buy space across Spotify, Blinkbox and MixCloud alongside your traditional radio stations. With a host of well-known brands signed up, the goal is to make it compellingly easy to capitalise on growing mobile music listening. Let’s hope it helps to bridge that gap again.
The RAB are working right now on their next piece of research, a multi-layered project which will shine a whole new light on the broader audio context and how consumers are actually behaving. Watch this space – it will be published in the Autumn and promises to unveil some arresting new insights.
Like so many media outlets in the commercial sector, we, of course, love the BBC. Or, more accurately, we love the BBC and we love to hate the BBC. We love it when it does things we could never do, we admire and appreciate it and are proud of it in that instance. But when it steals our clothes (or, worse still, buys the clothes we covet but can’t afford) we get really cross.
It is excellent when the BBC produces fine, distinctive, public service broadcasting which couldn’t be done by the commercial sector. It is a bit less than excellent when it endlessly cross promotes or treads on our toes – BBC Brits anyone? If we sound jealous, that’s because we are! I wish we had a guaranteed income of any sort, let alone in the billions. RadioCentre will continue to make a robust case for the BBC’s continued good health, but for it to stick closely to its public service remit.
Our friends at OFCOM are as aware as anyone of the challenges faced by the commercial radio sector. We are moving on in the digital debate and we have lots of lively discussions with them about creating a level playing field where all can thrive in the future.
So there are loads of challenges but where’s the fun in having none of them? Let’s hope that we at RadioCentre can work on behalf of the whole industry with partners across the spectrum to ensure a great future for our sector within a thriving UK media industry.