Both Digital Britain and the final report of the Digital Radio Working Group which preceded it have placed considerable emphasis on one performance metric – the date when the proportion of listening to all radio via digital platforms surpasses 50%. This date will be a ‘trigger point’ for policy changes that will impact the entire radio broadcast industry and it is therefore important to ensure that the data used to determine it are entirely correct.
Figure 6 on page 93 of the Digital Britain Final Report is a graph that shows three things:
· Historical data for the share of all radio listening listened to on digital platforms from 2005 to date
· A trendline demonstrating how this share would continue to increase through “organic growth”
· A forecast demonstrating how this share would grow faster if a “drive to digital” were to be pursued.
In the Digital Britain graph, the historical data for digital platforms’ share of radio listening is shown as 7% at year-end 2005, 12% at year-end 2006, 17% at year-end 2007 and 20% at year-end 2008.
However, the historical data I have from RAJAR (the radio industry’s official radio ratings body) show these figures as 11.0% for year-end 2005, 12.5% for year-end 2006, 16.6% for year-end 2007 and 18.3% for year-end 2008.
So there may be minor differences in the precise numbers for each year, but is that really such a big deal in the overall scheme of things? Well, in this case, yes it is. Whilst the numbers look relatively close on paper, it is only when you draw them onto a graph that you can see the significant differences.
In the Digital Britain report, the trendline for continuing ‘organic growth’ demonstrates that the important 50% criterion would be reached in 2015. The government is proposing that, through a concerted “drive to digital”, that date could be brought forward to 2013. Left to its own devices, the 50% criterion would be reached six years from now, but concerted action could reduce that time to four years.
However, instead of using the data in the Digital Britain report, if a graph is constructed of the official quarterly data from RAJAR, the resultant trendline displays a noticeably less steep gradient. Using this industry data, the 50% criterion is unlikely to be reached through ‘organic growth’ until 2018. In this scenario, the government’s concerted “drive to digital’ would pose the challenge of reducing the interim period from nine years to four years.
Whilst it might seem realistic in Digital Britain to propose reducing a six-year period to four years through concerted action to push digital radio, the reduction of a nine-year period to four years represents a considerably more substantial challenge for the industry to achieve. Some might say it could prove impossible.
The issue becomes even more critical for the commercial radio sector when you realise that the Digital Britain report threatens to revoke stations’ licence renewals if the radio industry as a whole does not succeed in achieving this 50% criterion by 2013. In other words, the government is holding a gun to the radio industry’s head – either achieve this specific goal by 2013, or you may lose your livelihoods.
This is what makes this single dataset so critical to the future of the radio industry. Is the 2013 goal a reasonable target that can be realistically attained, as Digital Britain argues, or is it unrealistic if the interim period has to be somehow slashed from nine years to four years?
When you agree to join a game of poker, you should always check first that the odds are not overwhelmingly stacked against you winning.
[NB: The trend lines in the above graph are straight-line trendlines generated automatically by Microsoft Excel from the datasets, not my subjective judgement.]
[Thanks to Phil for sharing his concerns]
[This blog was discontinued 2013. Check my current blog: link at top of sidebar.] I am an independent media analyst based in London, specialising in the radio broadcast industry. I have created and implemented successful strategies for the radio sector over three decades, including: the launch/turnaround of large-scale commercial music broadcasters in the UK, Europe and Asia; investment advice to City media shareholders; and significant contributions to public policy on broadcasting
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