Wednesday, 4 August 2010

Lies, damned lies and … Ofcom’s first digital radio progress report

Ofcom quietly published its first Digital Radio Progress Report in July 2010, without fanfare or a press release. This report has been a remarkably long time coming, given that DAB radio has been with us more than a decade. During that time, Ofcom has published 26 Digital Television Progress Reports, starting in 2003.

Here was an opportunity for Ofcom to demonstrate that it is acting in the public interest by publishing solid, objective data about the progress of digital radio in the UK. Did it take that opportunity? No. Instead, Ofcom published a set of data that are so selective and so distorted that they misrepresent the progress (or lack of it) made to date in advancing the UK towards the ‘digital radio switchover’ that our government is determined to execute. Why? Because Ofcom (like the government’s DCMS department) seems determined to persuade us that its totally unrealistic plan for DAB radio has not been an unmitigated disaster with the citizen/consumers on whose behalf it is supposed to be working.

It might appear pedantic to pick over the details of data represented in this feeble 24-page Ofcom report. However, it must be stressed that this is no nitpicking exercise. The Digital Economy Act 2010 insists that this very document submitted by Ofcom (and another by the BBC) to the government will decide whether the UK will progress to ‘digital radio switchover’. It is these data that will decide whether we can continue to receive BBC network radio stations on the 100 million analogue radios that are out there. It is these data that could mean we have to replace perfectly satisfactory analogue radio receivers in every household across the country, at a cost of millions to consumers.

To note the issues in the order they appear in the Ofcom report:

FIGURE 1
This Ofcom graph purports to show that:
• Digital platforms’ share of radio listening increased from 12.8% to 24.0% between 2007 and 2010 (this is TRUE)
• Analogue platforms’ share of listening decreased from 87.2% to 76.0% between 2007 and 2010 (this is FALSE)

The four figures cited in Figure 1 for the analogue platform – 87.2% in 2007, 82.2% in 2008, 79.9% in 2009 and 76.0% in 2010 – are an Ofcom invention. These false data seek to demonstrate that a rapid decline in analogue listening has taken place. This is not true. As the graph below shows, analogue listening has remained remarkably static over this timeframe.
  
   
The situation is complicated by two facts: a significant proportion of radio listening remains ‘unspecified’ by respondents in RAJAR listening surveys, and that this proportion has varied greatly in size in different surveys. However, this does not detract from the falsehood of Ofcom’s attempt to demonstrate that analogue listening is in sharp decline.

FIGURE 2
This Ofcom graph purports to show that:
• 54% of 15-24 year olds use digital radio
• 57% of 25-34 year olds use digital radio
• 56% of 55-64 year olds use digital radio
• 46% of 65-74 year olds use digital radio
• 29% of 75+ year olds use digital radio.

In fact, the fine print explains that Ofcom had asked the question ‘Have you ever used digital radio?’ This ensured that the results were almost meaningless because they tell us nothing whatsoever about current usage of digital radio. For example, a 68-year old who, on a single occasion ten years ago, had listened to digital radio for 10 minutes will have answered ‘yes’, despite having made no further usage during the last decade.

Ofcom’s objective here seems to have been to highlight the large size of the resulting numbers, without indicating that they derive from an almost useless question (garbage in, garbage out). If you were to ask people ‘Have you ever bought a banana?’, almost 100% would respond ‘yes’. Their answers tell you absolutely nothing about the current market for bananas. Exactly the same is true of digital radio usage. In this context, the resulting numbers seem remarkably low because only half the population has ever tried digital radio (even once in their lifetime).

FIGURE 3
This Ofcom graph purports to show that:
• 53% of adults use digital radio
• 63% of adults in socio-economic groups AB use digital radio
• 55% of adults in socio-economic group C1 use digital radio
• 48% of adults in socio-economic group C2 use digital radio
• 42% of adults in socio-economic groups DE use digital radio.

Just as in Figure 2, the fine print explains that Ofcom had asked the question ‘Have you ever used digital radio? The same issues apply here as with Figure 2.

FIGURE 5
This Ofcom graph shows digital platforms’ share of total radio listening, but the data omit:
• A comparison with the analogue platform
• A time sequence to show how fast the market is changing.

The following graph demonstrates the slow growth of digital platforms and their low level in comparison with analogue. It also demonstrates that a proportion of the growth in digital platform usage is the result of a statistical technicality caused by a reduction of ‘unspecified’ listening in recent quarters.


The following graph demonstrates the slow growth of individual digital platforms since 2007, using the same scale as applied in the preceding graph.


FIGURE 8
This Ofcom graph purports to show that:
“five digital-only services generated a weekly reach of 1 million+ listeners in Q1 2010.”

However, the fine print explains that the Ofcom data refer to “all listeners [aged] 4+”, whereas the radio industry’s standard metric is and always has been 'adults 15+'. Indeed, all RAJAR audience data used in this same Ofcom report refer to 'adults 15+', except for Figure 8.


Once the graph is re-worked using '15+' instead of '4+' data (see above), it is evident that:
• Only three digital-only radio stations generate a weekly reach of 1m+ adult listeners
• BBC World Service was included in the Ofcom graph (and was one of the five stations cited as exceeding 1m weekly reach) even though it is not digital-only, being available across a large part of the UK on 648AM
• BBC Asian Network was omitted from the Ofcom graph (also available on analogue but limited to the Midlands)
• Not only are Panjab Radio and NME Radio no longer available on the national DAB platform (as the Ofcom text notes), but Q Radio is no longer on DAB, and the BBC has proposed the closure of Asian Network
• These weekly reach data for digital-only stations should be considered in the context of analogue radio stations – for example, BBC Radio 2 has a weekly adult reach of 14.6m.

FIGURE 9
This Ofcom graph purports to show that:
• Digital radio’s current share of listening is “broadly in line with the organic growth outlined on the [government’s] forecast chart.”

Bizarrely, the Ofcom graph displays the government forecasts but has omitted the historical data that would show how successfully the forecast has been achieved to date.


The forecast published in June 2009 predicted that, by year-end 2009 (a mere six months later), digital platforms would account for 24% or 26%, the latter the result of a concerted ‘drive to digital.’ In fact, the year-end figure was 21%. The likely reason that Ofcom has failed to include the historical data is that neither of the two forecasts (‘organic growth’ or the ‘drive to digital’) has any chance of being realised. If the current growth rate is extrapolated, the 50% criterion will be reached by year-end 2018, and certainly not by either 2013 or 2015, as the forecast (credited to Value Partners) predicted.

FIGURE 14
This Ofcom graph and accompanying text assert that:
• “DAB sets made up over a fifth (21%) of all radio sales by volume” in the year to Q1 2010
• “In the portable market, DAB sets accounted for 65% of sales.”

However, Ofcom omitted to point out that:
• Fewer DAB radios had been sold in 2009 than in 2008
• DAB radios were a lower proportion of total radios sold in 2009 than in 2008
• Its reference to “the portable market” is limited strictly to ‘portable radios’ of the type used in kitchens. There is not a single mobile phone on sale in the UK that includes DAB radio, and the vast majority of portable media players that include radio do not have DAB radio.


In fact, the data in the graph above demonstrate that:
• DAB radio receiver sales volumes peaked in 2007/8 at 2.2m per annum and have declined 13% since then to 1.9m per annum
• Analogue radios contributed a greater proportion of total radio receiver sales in 2009 (79%) than they had in 2008 (78%)
• DAB has not invigorated the market for radios, with fewer radios sold now than ever, perhaps due to evident consumer confusion about ‘digital radio switchover’.

FIGURE 17
The Ofcom graph shows that:
• 17% of adults say they are likely to buy a DAB radio in the next 12 months.


However, the Ofcom graph does not offer a historical perspective. The graph above demonstrates that the propensity to purchase a DAB radio has diminished over time. In 2006, 17% of respondents said they would be likely to buy a DAB radio within the next six months. In 2010, 17% said they would be likely to buy a DAB radio within the next 12 months. This would translate into a significant reduction in DAB radio receiver sales. Additionally, the proportion of respondents who say they do not know if they will purchase a DAB radio continues to increase over time, perhaps a further symptom of market confusion or DAB indifference.
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Given that Ofcom has had the luxury of several years to prepare this first Digital Radio Progress Report, the result is a travesty. It should not be the regulator’s role to selectively highlight and distort data that support its own policies in a document specifically requested by government in order to inform a parliamentary decision on digital radio switchover. We deserve better from our public servants. Otherwise, they might as well go and work for Digital Radio UK, the lobby group (funded by commercial interests and the BBC) busy pumping out propaganda to try and persuade consumers that they need DAB radio.

On page 5 of this first Digital Radio Progress Report, Ofcom notes:

“Our principal general duty, when carrying out our radio functions, is … to further the interests of citizens in relation to communications matters.”

Exactly how are citizens' interests being furthered by Ofcom distorting the facts about digital radio take-up?

15 comments:

KeithJamesMc said...

Excellent.

If this was first time that OFCOM was caught out, you could put it down to an overeager researcher.

But, unfortunately the manipulation of data for what one can only assume is *their* preferred desired outcomes can be seen in a whole variety of reports across telecoms & tv sectors.

This suggests there are deep problems within the organisation.

DAS TV said...

Very interesting reading. Thank you

dp said...

Ofcom’s first annual Digital Progress Report for radio repeats RAJAR, with fancier graphics. It presents RAJARs as “all radio listening” without noting the known limitations:

RAJARs is for subscribers, larger Commercial and the BBC. It represents about 320 stations, not including about 100 smaller Commercial stations, or Community, Student, Hospital, (Pirate) and Internet Only—which all total about 1,000 UK stations. And, not including the rest of the world. While RAJARs allows write-ins for non-subscribing stations, without pre-printed subscriber name cards and stickers—and credits them with about 2% of listening—their focus on subscribers throughout their process ensures under-reporting of non-subscribers.

RAJARs is live listening only. RAJAR’s separate MIDAS study estimates additional listening for on-demand, podcasts, and personal tracklist services—all Internet—equals Internet live listening.

RAJARs platform choices for “How” listening--AM/FM Radio, DAB Digital Radio, Digital TV, or The Internet—credits FM listening on DAB/FM radios to DAB (and Internet listening on DAB/FM/Internet radios to DAB)! And, fast-growing Mobile is not included. http://www.rajar.co.uk/docs/about/RAJAR_diary_example_page.pdf


So, DAB listening is over-reported and Internet listening is under-reported, by not including to the same degree:

The many non-subscribing stations in the UK (and the Rest of the World)—which are relatively lower DAB listening and relatively higher Internet listening.

On-demand (listen-later and archive), podcasts, and personal tracklist services listening—which are essentially all Internet.

FM and Internet listening on DAB/FM/Internet radios—which are currently mis-credited to DAB—and FM and Internet listening on Mobile—which are not yet credited.


A more accurate comparison requires:

Reducing the DAB ~15% for FM (and Internet) listening on DAB Radios. Perhaps 1/4 to 1/3 to 1/2 (which certainly should be studied) equals ~11-10-8% actual, total DAB listening.

Increasing the Internet ~3% for non-live listening not reported, for non-subscribing stations under-reported, and for platforms mis-credited and not reported. Doubling the ~3% for on-demand, podcasts, and personal tracklists equals ~6%. Perhaps doubling for under-reported non-subscribers, and for mis-credited DAB platform and unreported Mobile platform equals ~9-12% actual, total Internet listening.

It seems likely that total DAB radio listening and total Internet radio listening are probably now about equal—both ~10%.


And, Internet radio listening is growing faster...

Nosher said...

That's a nice exposition of OFCOM's statistical bogosity. However, I do have one point of feedback:

"In 2006, 17% of respondents said they would be likely to buy a DAB radio within the next six months. In 2010, 17% said they would be likely to buy a DAB radio within the next 12 months. This would translate into a significant reduction in DAB radio receiver sales"

Actually, no - it doesn't. I would argue that nobody really sits down and thinks "Hmm, should I get that radio I want in 3 months' time or 9 months?" (OK, unless they're focused on a particular model and are waiting for the price to drop). Both questions really amount to "are you likely to buy a DAB radio sometime in the indeterminate future", and as such the figure of 17% is effectively unchanged.

Jamie said...

Isn't the key wrong in your first graph? Analogue is purple and digital is green, no?

Richard Lawley said...

Great summary - and interesting to note that the legend on Figure 1 has Digital and Analogue reversed (although I could not find this in the original OfCom document linked to in the blog). I know this is a detail...

Russ said...

Excellent post!

Very informative and a great example of how regulatory bodies should be more thoroughly scrutinised by the public (and Parliament!)

-Russ

Grant Goddard said...

Thank you for the feedback. My apologies for having reversed the key in the first graph. I have now corrected this error.

I understand Nosher's point, but it begs the question: why did Ofcom change the question from 'Will you buy a DAB radio in the next 6 months?' to 'Will you buy a DAB radio in the next 12 months?' if not to hope to get a better outcome? [I have paraphrased the actual question]

On the issue of RAJAR's (in)accurate reflection of reality, I will be posting a blog entry on the latest RAJAR results soon.

Yours gratefully,
Grant

mary said...

it is informative.

Steve Whitt said...

Now here is the rub, most DAB radios also have FM and no-one measuring audience figures really knows whether a listener is tuned to BBC Radio 2 on FM or on DAB. Indeed a sizable proprtion of listeners will not know.

I suspect that any eventual DAB car radio will be dual FM/DAB and this will continue to corrupt true listening figures.

But one thing is clear, in most FM/DAB simulcast situations, reception quality will be superior on the FM band and in some parts of the country reception of DAB remains at best marginal.

The only way to reveal true listening figures is to stop all FM/DAB simulcasting

Despite the claims of the DAB snake oil salesmen, sales of FM only radios continue to exceed sales of DAB/FM radios. One only needs to count the number of FM radios that come bundled in mobile phones, mp3 players etc and of course every new car. If DAB can match FM for geographic coverage, audio quality, portability/battery operation, receiver economy then it might be fair to suggest that DAB is the future. Right now radio listeners are being sold a pup.

Ray Cathode said...

Ofcom is not independent, it is an arm of the government in the same way as the BBC is. Neither body can be trusted to speak the truth because both are carrying out policy instructions from the DCMS.

The way to deal with them is like this author did so successfully by painstaking revelation. Gaining a reputation for unfairness and bias will mean the end of "trusted status" for the BBC Trust and Ofcom.

I'm still waiting for the BBC Trust's Red Button consultation to be published, now one of the longest unpublished on record. Hopefully it will overturn the BBC lie that red button services on Freeview were cut to allow HD to launch. The truth is rather different in that Ofcom allocated a Channel Four stream for the BBC to use to restore a red button service. But the BBC has decided against using it, thus reducing Freeview red button streams to one, compared to satellite's six streams. The Channel four stream could have helped to bring BBC Alba to Freeview, and even that consultation has now been deftly fudged by postponing it until another fudged consultation is determined (ie the new government makes up its mind). The BBC management has stated that it is not in the best interests of viewers to proceed with a Channel Four stream. I doubt whether the BBC Trust will mention my complaint even if it actually publishes the results of its Red Button consultation.

These organisations should stop pretending that they are independent and admit that they are just following orders. Then we will all know where we stand in the UK broadcasting autocracy.

johngm6lyj said...

This needs halting before our current well thought out and proven broadcast radio system is ruined and lost forever, there are far more important issues involved than just commercial gain.

Terry Purvis said...

Looks like OFCOM are employing an argumentum ad populum technique which according to Wikipedia is: a fallacious argument that concludes a proposition to be true because many or all people believe it; it alleges: "If many believe so, it is so."

However, apart from OFCOM and a few vested interests how many of us in the "real world" believe what they say.

Commercial Waste said...

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Ringo Bell said...

It's not good for the regulator to skew the figures as it is important that they retain respect. They could lose credibility over this. I hope that they counter it with a correction statement.