Wednesday, 16 December 2009

Radio in the Digital Economy Bill: three more amendments tabled

The following amendments to the Digital Economy Bill will be considered at Committee Stage in the House Of Lords, scheduled for 20 December 2009 and 6, 12 , 18 January 2010.


What does Clause 30 do? According to the government’s Explanatory Notes:

"Clause 30 allows the Secretary of State to give notice to OFCOM of a date by which digital switchover must occur for services specified in the notice. In making a decision to nominate a switchover date, the Secretary of State must take account of any reports by the BBC and OFCOM about the future of analogue broadcasting.
The date for digital switchover is the date after which it will no longer be appropriate for the service in question to be broadcast in analogue form.
The Secretary of State may nominate different switchover dates for different types of radio services and may withdraw a nomination of a switchover date.
After a switchover date has been set, OFCOM are required to vary the licence periods of all licences for the services specified by the Secretary of State so that they end on or before that date. However, OFCOM cannot shorten the duration of a licence so that it would end less than 2 years from the date on which OFCOM give notice of the variation, unless the licence-holder consents.
OFCOM may not vary a licence period so that it ends after the switchover date.”

A.      Lord Clement-Jones and Lord Razzall have proposed an amendment to Clause 30:

Page 33, line 19, at end insert—
"(2A) The Secretary of State may not nominate a date for switchover—
(a) unless it can be established that all local commercial radio stations will have the opportunity to move to digital audio broadcasting,
(b) until the proportion of homes in each of the four nations of the UK able to receive—
(i) national BBC services,
(ii) national commercial radio services,
(iii) local BBC services, and
(iv) local commercial radio radio services [sic],
via digital audio broadcasting is equal to the proportion able to receive them via analogue broadcasting.
(c) until digital audio broadcasting accounts for at least 67 per cent of all radio listening, and
(d) until digital audio broadcasting receivers are installed in 50 per cent of private and commercial vehicles."

Page 33, leave out line 21 and insert—
"(a) must ensure that all commercial and BBC radio services broadcasting in the UK have the opportunity to switchover on the same date,"

Page 34, line 1, leave out "2" and insert "4"

In (my) plain English, this amendment would prevent the government from announcing a single digital radio switchover date until:
• Listening via DAB accounts for two-thirds of all radio listening
• DAB radios are installed in 50% of cars
• 50% of households in each nation have access to a DAB radio
• All BBC and commercial stations, large and small, have been offered the opportunity to migrate from analogue to DAB.
In practice, none of these criteria could possibly be met within the next decade, which would effectively scupper the notion of a digital switchover date. Additionally, a four-year termination notice period would be inserted into renewed commercial radio licences (instead of the government’s proposed two-year period).

B.      Lord Cotter has proposed a separate amendment to Clause 30:

Page 33, line 33, at end insert—
"97AA Disposal and recycling of domestic analogue radios
(1) Following a decision to give notice to OFCOM under section 97A of a date for digital switchover, the Secretary of State must devise a scheme for the disposal and recycling of domestically owned analogue radios.
(2) The scheme must include provision for a financial incentive for domestic owners of analogue radios to purchase a radio suitable for digital audio broadcasting following disposal and recycling of their analogue radios.
(3) The financial incentive must be based on any profit made from the disposal and recycling of analogue radios and must not be derived from public funds."

In plain English, consumers will have to be paid something for all those analogue radios they will be expected to no longer use.


What does Clause 31 do? According to the government’s Explanatory Notes:

“Clause 31 allows the further renewal of national analogue licences for a period of up to seven years. All of these licences have already been granted a renewal of 12 years under the powers in section 103A of the Broadcasting Act 1990 (“the 1990 Act”). ……”

Lord Clement-Jones and Lord Razzall have proposed an amendment to Clause 31:

“The above-named Lords give notice of their intention to oppose the Question that Clause 31 stand part of the Bill.”

In plain English, this amendment would delete the proposal in the Bill to automatically renew the three national commercial radio licences for a further seven years. Instead, the licences would have to be auctioned individually to the highest bidder, as required by existing legislation. The greatest impact would be on Classic FM, whose licence would have to be advertised by Ofcom in 2010, if this amendment were passed. Its owner, Global Radio, would be faced with Hobson’s choice – either to bid a significantly higher amount (maybe £10m+ per annum rather than the present £2m+ per annum) to win/retain the licence, thus diminishing its ‘cash cow’ status, or to lose the single most profitable licence in commercial radio. Either option might seriously undermine Global Radio’s ability to trade profitably and to service its debt.

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