RAJAR Qtr 1 2008 - "Story of The Blues"

Every set of listening figures tells a story beyond that of the immediate numbers, and the latest set of figures in the UK issued by RAJAR last week are no exception.

Actually, it’s a story with several tales to tell.

First, the main theme. The BBC is starting to pull seriously ahead of commercial radio, with almost 57% of listening verses Commercial radio’s 41%. Depending on which side of the fence you sit on, you can either see this as just rewards for investment in content and talent… or a blatant abuse of a privileged position designed to drive any commercial rivals into the ground… and stand on them hard! The BBC is long used to allegations of this sort, and to be fair, has to walk a delicate line of being successful… but not too successful, because “that’s just not fair”!

Perhaps it’s also tied into that peculiar British disease. We like success, but then when we see something becoming too successful, we cry foul, and denounce it as terribly unjust and really not very… well… ‘British’. Odd. To give a parallel example in the world of retail, I need only mention the word ‘Tesco’! ‘Nuff Said!

With Radio 1 back above 11 Million listeners and Radio 2 at 13.6 Million, there is no doubt that the BBC has made further inroads into the beleaguered commercial sector.

Virgin Radio’s resident number cruncher (and generally all round good-egg) Adam Bowie has written a very thoughtful piece on his personal blog about this topic and illustrated the theme with a rather good graph, which I've "borrowed". (I'll give it back whenever you want Adam!)

I think I need say no more on this topic, as the lines speak for themselves!

Another theme in this great RAJAR story is the tale of woe that continues for GCap. Capital has now slipped to 4th place in terms of reach with Kiss 100 now cume-ing an audience of 1.583 Million a week compared to Capital’s 1.563 Million.

Despite Kiss being a strong listen, I expect this to reverse itself over the remainder of the year as the ‘Denise’ effect kicks in. Word on the street is that the internal research is very strong for her and it’s only a matter of time before this translates to RAJAR. The fact of the matter is she’s a far bigger star than Johnny now. But how long can Capital hold on to her for? Hmmmm…

Elsewhere in GCap, Xfm’s worst nightmare has come true. Its market share is under 1% (at 0.9%) and its audience dropped a whopping 26% to just 379,000! (That “let’s get rid of all the DJ’s across the day” was a cracking idea wasn’t it!!) Is it time for that brand to be “humanely euthanized”? The boys at Global Radio certainly have a full ‘in-tray’ when they take over from the GCap!

And finally to a more subtle, yet highly significant tale: The number of people listening to some sort of digital radio continues to grow. Almost a third of the population (31.4%) listens to digital radio at least once a week, with DAB being the dominant technology. Sure… most of this is to analogue stations on digital, but it was great to see Planet Rock cume well the half million mark! Even The Jazz signed off with over 400,000 listeners. A bit too hasty to switch that one off? Over 27% of the UK’s population has a DAB radio, so it seems although the commercial sector is in turbulent times over the economics of DAB, the public still quite like it.

So, what’s the morale of our story? Simple really - invest in content! Easier when you have guaranteed funding I accept, but nonetheless, it seems to be a bit of a no-brainer really. And what is commercial radio’s answer to the current situation? Networking. Hmmmm – is this really investing in content? More on that to follow I think…

The Big DAB Gamble!

This morning’s announcement by Fru Hazlitt, (CEO of GCap Media) that “DAB is not viable”, is quite a momentous moment. Far be it from me to dramatise further an already dramatic announcement, but this is huge.

You’ve probably read all the facts elsewhere, but to put this all in context, here are some of the headlines from GCap’s statement this morning:

- Closure of national DAB stations Planet Rock and The Jazz
- Sell all the Xfm stations outside London or hand the licences back
- Sell off stake in Digital One Multiplex
- Abandon Capital’s ‘2 ads in a row’ policy
- Call for the switch off of AM

This ‘defence plan’ as it has been called, is really a last throw of the dice for GCap (even if it’s Fru’s first throw at this particular table). Global are hovering ‘vulture-like’ and we’ll see what the next few weeks bring. But back to the DAB issue. The UK’s largest commercial player has come out and basically said, “We think DAB is rubbish and we’re bailing out while we can”. Is this right, or are they just responding to a difficult economic climate, cutting costs, and dealing with a legacy of investment and belief in DAB which bordered on religious fervour, from Ralph et al.

This kind of puts commercial radio in an awkward spot as they’re now very divided with Bauer seemingly doing well with The Hits, Smash Hits, Heat Radio, and Q Radio and ready to launch ‘Closer’ as a radio brand. (No coincidence the timing of the press release to herald the announcement of Ric Blaxill joining Bauer’s national digital brands! He actually joined a while ago but this bit of pro-DAB PR says to the world… “We’re still investing in DAB and doing fine thank you very much”!!) And Channel 4 constantly have to put out statements saying how committed they are to the 2nd national multiplex.

So let’s try and make sense of this all. I believe Fru’s thinking was that the best way for GCap to survive as a company was to do something dramatic. The City loves bold initiatives. You take a gamble and hope that the city / investors back you. The ‘red or black’ scenario is a common one and GCap has gone for a defensive option of cutting where it can save most… DAB. The net spend in 2007/07 was £8 Million. This, combined with the other measures announced will hopefully placate the city and investors enough to not be tempted by an improved offer from Global in the next few weeks. I thought the comment from Charles Allen on the Times Online was a good one: “You can’t shrink your way to growth”. We shall see.

The sad thing about all this is that all the papers tomorrow will write “DAB in Crisis / The End of Digital Radio / Digital Killed The Radio Star” etc. There’s no doubt that the economics of it are challenging, particularly at the moment, however there is still a belief from many within commercial radio (not to mention the BBC!) who fervently believe in it. So GCap backing out of DAB should be seen more in the context of a company trying to survive this year “It’s about the here and now” – (Fru Hazlitt), rather than sounding the death knell for a technology that is already in around a quarter of homes in the UK.

Let’s spare a thought for the people at GCap. It can’t be a great place to be today. Planet Rock and The Jazz are both really good radio stations staffed by people who want to make great radio day in day out. And the Xfm sell off will no doubt affect a large swathe of employees. Plus, I wouldn’t place much money on the newly re-launched ‘Gold’ surviving. It’s on AM and DAB… both platforms are on today’s blacklist. They’ll be a lot of good people going home tonight with rather glum faces.

Two final thoughts on what probably should have been about 5 postings! (Sorry!!)

Capital is ditching its ‘only 2 ads in a row’ policy. Last year that policy cost the company almost £6 Million. About bloody time!! It was never the ‘silver bullet’ it was trumpeted to be at the time and was a great demonstration on how to loose £6 Million a year with no tangible benefit.

And ‘Jerry’s Final Thought’ today… What a damning indictment of the post merger GCap / ‘Bernard’ era today’s announcement is. Talk about a public slap in the face. Actually - it’s more like a public flogging! (Except the perpetrators are exiting stage left with rather large cheques in their back pockets and no whip marks visible!)

This will go down as one of commercial radio’s biggest U-turns ever… and the history of this company is almost comedic if the real twists and turns were laid out for all to see. Let’s pause… take breathe… and wait for the next roll of the dice as we remember the words of American playwright Wilson Mizner…

"Gambling… The sure way of getting nothing from something!"

The Heroes of RAJAR - Qtr 2 2007

As the dust settles on another batch of RAJAR press releases and UK radio stations draw up the list of people to promote... or fire, it's time to pick out the villains and heroes... and no, not the flying senator, or indestructible cheerleader types.

There were a few main stories that are worthy of mention.

Kiss overtake Capital
Congratulations to the guys at Kiss, who have finally caught up with Capital. We've certainly discussed the possibility of them catching Capital before on this blog, and now it's happened. With Kiss at a 4.5% reach and Capital dropping to 4.1% and the reach neck and neck at 1.51 Million, there were probably two very different meetings taking place at the respective stations on RAJAR evening last week.

Kiss's offering continues to sound fresh and connected to young London and the new morning show with Rickie and Melvin is starting to take root. For me, Capital's issue is not with the execution of the format. They've gone young and the product sounds fine. No, it's the strategy that I find difficult to understand. Capital seem to have left Heart and Magic to slug it out at the top, while settling for trying to pick up Radio 1, Kiss and Xfm listeners along the way. The move is bold... but I can't help thinking it won't get you to Number 1 in London again. The team in Leicester Square have a real battle on and I hope Steve Orchard's words of August 2006 where he the "believed the station had hit rock bottom", don't get rolled out too much over the next few weeks. The city certainly gave GCap a good kicking, with quotes like "GCap has marketed Capital in this quarter, so there can be no excuses for these results!" Ouch!

The Jazz... Nice!
Debuting with 334,000 listeners is a pretty nice job! Taking a listen to the station, the formula is the same as has been applied to Classic FM; take a specialist music genre, and make it as accessible to as many people as possible. Classic FM took the fear out of listening to classical music... and The Jazz will do the same for Jazz.

More for Moyles
If I was sitting in GCap Towers... or even EMAP towers for that reason, I'd find the biggest pot of money I could lay my hands on and send it all to Chris Moyles on the condition that he came to a daily show for the network I was running. (Believe me... it's been thought of!) His show goes from strength to strength and is testament to hard work, good production and 'letting the talent get on with it'. With 7.26 Million listeners a week, he can play his "Saviour of Radio 1" jingle as much as he wants now!

The Future is... Digital
More people are listening to radio and more are using digital technologies to do this. 2 Million 15-24's listen on mobile phones and almost 13% of total listening by all adults is now done on either DAB, DTV or the internet. Let's compare this figure in 12 months time to see the continued growth, and then factor in the Channel 4 effect too!

So, as ever... always something interesting to mull over. Now if only we knew someone who could paint the radio future... Hmmm... I wonder...