Saturday, 6 August 2011

UK DAB radio receiver sales fell in 2009 and 2010, but "digital radio sales have held up - they are flat" insists Mr Switchover

For an organisation that has been charged with marketing DAB radio to the British public, Digital Radio UK has managed to remain remarkably invisible during 2011. This alone made the appearance of Digital Radio UK’s chief executive on BBC Radio 4’s ‘You & Yours’ show notable. The fact that nothing new was said was hardly surprising – there is nothing new to say about DAB.

Out in the real world, as opposed to the imaginary world inhabited by Digital Radio UK, the notion that ‘DAB radio’ will replace AM/FM radio is already a dead duck. The only believers still worshipping ‘DAB’ seem to be Digital Radio UK, RadioCentre, Ofcom and government civil servants.

The evidence is transparent. The number of DAB radio receivers sold in the UK fell year-on-year in both 2009 and 2010 (by 6% and 2% respectively). These data are collected by GfK and supplied to Digital Radio UK. These numbers, together with a nice colour graph, were distributed at last month’s RadioCentre members’ get-together. These are industry data of which Digital Radio UK is perfectly aware.

Yet, Digital Radio UK’s chief executive insisted in this interview on national radio that “digital radio sales have actually held up – they are flat year-on-year.” This is untrue. ‘Down’ is not ‘flat.’ ‘Down’ is ‘down.’ DAB radio receiver sales peaked in 2008 and have been falling since. DAB receiver sales in 2010 were 8% below that 2008 peak. That is clearly not ‘flat.’

I wonder how it is that:
• The chief executive of a high-profile marketing organisation can appear on Radio 4 (audience: 11m adults per week) and flatly state something that he must know not to be true?
• The board of Digital Radio UK does not haul him in and remind him that his job description is to ‘persuade’ consumers of the value of DAB, not deceive them?
• A substantial proportion of this organisation’s funding is derived from the BBC Licence Fee, so the public is effectively paying for an executive to tell them untruths about consumer take-up of DAB radio?


You & Yours
BBC Radio 4
29 July 2011 @ 1200

Ford Ennals, chief executive, Digital Radio UK [FE]
Wiiliam Rogers, chief executive, UKRD [WR]

Q: Are you not disappointed with the lack of a rise in [DAB] radio sales?

FE: No, I think what the Ofcom report confirms is the solid progress that is being made. We see growth in overall digital listening, we see growth in terms of the number of homes that have a digital radio receiver in there. So, 40% of all homes now have a DAB receiver in them, we know that 47% of all listeners are listening to digital radio every week, and we have seen growth in digital listening. So I think progress is being made. I think we are in a difficult sales period for overall retailers and we have seen a decline in overall consumer electronics sales. Digital radio sales have actually held up – they are flat year-on-year. We have now sold 13 million DAB digital radios, but the key thing, just lastly, to remember is that you can receive digital radio via digital television, via a computer or, indeed, via a smartphone and many, many households and consumers have those.

Q: William Rogers, are you surprised by the lack of increase in interest in digital radio?

WR: No, not in the least. And I think we have to remember that Ford, with respect to him, is being a little disingenuous because, of course, the switchover is about people being forced to move way from analogue and onto DAB. So that’s the issue we need to focus on. And what this report highlights, and I’m personally delighted to see it, is it really does shine a light on the shambles that is this proposed DAB migration.

Q: But things aren’t that bad. There are increases in radio usage, as Ford has just indicated.

WR: Well, hang on a minute. The whole premise behind the switchover is that it will be, quote, consumer led. And the one thing we know from these statistics is that, whatever else it is, it’s not being consumer led. As your reporter quite rightly said earlier, of the eight-and-half million radio devices sold in the twelve-month period we are talking about, four out of five of them did not have a DAB receiver capacity. And, more interestingly, of those people who were asked whether they were likely to buy a DAB set at any time in the next twelve months, four out of five of them said they were not likely to. So the consumer is making it very clear what they want and, after eleven years, it’s time this thing was put to bed.

Q: Ford Ennals, one of the things that we constantly hear from listeners is the whole issue of reception. That’s really what, I think, the message is that we get from people. That is what they are worried about. Whether they approve or not [of DAB], what they say is an awful lot of people can’t get them [DAB radio signals] and, if they can get them, they can’t get them consistently.

FE: Well, I think, where the industry and the broadcasters are absolutely unified and agreed is that digital is the future of radio in the UK. And I think it’s just a matter of the timetable and the transition path for that. One of the big issues is, as you have said, is about coverage and about the ability of everyone to get a strong [DAB] signal. Now, what Ofcom have done is developed a plan to extend coverage, both of the local services and the national services, so that people can receive those services and get more confidence. But there is a direct parallel here with TV and digital television – I ran the TV switchover programme – and, back in 2006, the majority of TV sales were analogue and only 75% of the population could get digital television. Now, what happened over the next few years is we saw a very swift transition and we saw transmitters built out that so everyone could get digital TV. We’ll see the same on radio.

Q: What about that, William? We don’t jump ‘til we have to. We don’t buy ‘til we have to.

WR: Look, look. Let’s be clear about this. Ford Ennals is paid to market the DAB switchover, so I understand why he has to say what he has to say, because the message from this report is clearly embarrassing for him to make a case which clearly doesn’t exist. There are a number of points we have to remember. First of all, the comparison with TV switchover is plainly an absurd point to make. They are not remotely, in any way shape or form, similar. And people are choosing not to endorse DAB as an alternative [to FM/AM]. The critical thing we have to understand here is three elements. First of all, ….

Q: You’ll have to confine yourself to one because we are really tight for time.

WR: Okay, the fundamental problem with this whole process is that you cannot migrate an entire sector if the [DAB] platform you have chosen does not have the capacity to allow you to do so. And there are scores of radio stations in this country who will be denied the opportunity to move to a DAB platform, because the choice was wrong in the first place.

Q: A ten-second response.

FE: Just finally. People love digital radio. We’ve seen it with [BBC] 6 Music and we saw the campaign to save 6 Music. We’ve seen it with the response to Radio 4 Extra. And they’ll continue to enjoy it in the future.

Q: I’m sure our postbag and our e-mails will be as big as usual. William Rogers and Ford Ennals, thank you both very much indeed.

...................................
Point of information:
Ford Ennals was chief executive of Digital UK, the TV switchover marketing organisation, from April 2005. He announced his departure in November 2007, the same month that the first UK region entirely switched off analogue television broadcasts.

4 comments:

quintessential said...

I have started an e-petition "Abandon the forced migration from FM to DAB radio".

I feel it is important that listeners know they can continue to buy FM radios and they won't become obsolete.

I urge people to sign it by going to http://epetitions.direct.gov.uk/petitions/3395

Grant Goddard said...

The Following e-mail was sent to me (in full):
.............
Dear Mr Goddard ,

With regard to your blog of August 7 ‘ digital radio sales have held up ‘.

Given the personal nature of your comments I thought there might be some value in clarifying the points I made on the You and Your interview .

The interview subject was the Ofcom report on the Communications Market : Digital Radio Report which was published on 28 July 2011.

My comments on You and Yours , as per the transcript you provided , were directly sourced from the Ofcom Report :
1. I said that - there was growth in digital listening . Pg 3 , 1.3 Ofcom state there was a ‘ 2.5pp increase in digital listening over the year ‘ .
2. I said that - there had been growth in terms of homes with digital radio . Pg 3 , 1.10 Ofcom state that households claiming to have access to DAB digital radio were ‘ up by 3.7 percentage points year on year ‘ .
3. I said that - digital radio sales actually held up – they are flat year on year . Pg. 13 Ofcom state that DAB radio sales in year to Q1 2010 were I.9m and in year to Q1 2011 were 1.9m .

I do not believe that quoting statistics verbatim from an Ofcom report could in any way be perceived as being an attempt to deceive consumers.

You say that the only believers still ‘worshipping ‘ DAB – from which I take you mean supporting – are DRUK , Radio Centre , Ofcom and Government .

I would add to that list the BBC and the major Commercial Radio Broadcasters as well as the 46% of all radio listeners who are happily listening on a digital platform every week.

I admire your one man campaign in the face of progress and what consumers / listeners genuinely enjoy . While I do recognize that an element of policy challenge can be constructive I can assure you that we do our very best to provide / quote the facts as we know them or are provided them .

Sincerely

Ford Ennals
Chief Executive Officer
Digital Radio UK

Anonymous said...

The figures being argued about are out of date anyway, albeit that they are based on an Ofcom report.

Roberts Radio have reported a surge in DAB sales just after Radio 4 Extra launched in April and DAB sales for May 2011 are apparently also up on May 2010.

Unless sales levels fall back in the second half of 2011 the indications are that Mr Ennals may have something to crow about when the 2011 figures are released.

DP said...

Ford Ennals, Chief Executive Officer, Digital Radio UK:
“I can assure you that we do our very best to provide / quote the facts as we know them or are provided them.”

“We see growth in overall digital listening, we see growth in terms of the number of homes that have a digital radio receiver in there. So, 40% of all homes now have a DAB receiver in them, we know that 47% of all listeners are listening to digital radio every week, and we have seen growth in digital listening. So I think progress is being made. I think we are in a difficult sales period for overall retailers and we have seen a decline in overall consumer electronics sales. Digital radio sales have actually held up – they are flat year-on-year. We have now sold 13 million DAB digital radios, but the key thing, just lastly, to remember is that you can receive digital radio via digital television, via a computer or, indeed, via a smartphone and many, many households and consumers have those.”


“40% of all homes now have a DAB receiver in them”
Ofcom report: http://stakeholders.ofcom.org.uk/binaries/research/radio-research/digital-radio-reports02/report280711.pdf
DAB digital radio ownership rose to over a third of adults (38.2%) by Q1 2011, up by just over five percentage points in the year (Figure 6).
Source: Research from: Ofcom, GfK and RAJAR in Q1 2011
RAJAR estimates that over a third of UK households (38.2%) owned a DAB radio set by March 2011 (Figure 12); this figure was up by 3.7 percentage points year on year and by 30.1 pp over a six-year period.
RAJAR release: In Q1, 2011 almost two in five of the population (38.2%), or 19.7 million adults (aged 15+) claimed to live in a household which has a DAB set (c.f. 17.7 million in Q1, 2010 and 6.7 million in Q1, 2006).
RAJAR release: In Q2, 2011 almost two in five of the population (38.9%), or 20.2 million adults (aged 15+) claimed to live in a household which has a DAB set (c.f. 18.2 million in Q2, 2010 and 7.6 million in Q2, 2006).

“47% of all listeners are listening to digital radio every week”
Ofcom report: From the perspective of frequency of listening, (based on Ofcom’s own consumer research), 34% of the UK population claimed in Q1 2011 to have listened to a digital radio service on a weekly basis (this compares to a figure of 47% from Rajar for those listening to radio for five consecutive minutes in a typical week).
By digital platform, equal numbers of consumers claimed in Q1 2011 to listen to radio services through a DTV or DAB platform (25% and 27% respectively).

“Digital radio sales have actually held up – they are flat year-on-year”
Ofcomreport: Device sales incorporating a DAB tuner made up 1.9 million of the total - over a fifth (22.3%) of the total, comparable to the figure for 2009 (see Figure 7).
[Year to Q1 2004 0.3]
[Year to Q1 2005 0.9 +300% ]
Year to Q1 2007 1.7 [1.73 +21.4%]
Year to Q1 2008 2.1 [2.01 +16.2%]
Year to Q1 2009 2.1 [2.08 + 3.5%]
Year to Q1 2010 1.9 [1.95 (- 6.2%)]
Year to Q1 2011 1.9 [1.91 (- 2.1%)]
Source: GfK sales data, 2006-2011. Note: Figures cover GB only, GfK Panel. Market data represents over 90% of the market.
[The bracketed figures are GfK, which DRUK reports, before Ofcom (seeming inconsistent) rounding. You could round all of the past 5 years to 2, and make it appear to be flat—but the reality remains, it is not. A 2.1% decrease, following a 6.2% decrease is not flat and is not holding-up.]
DRUK release: Digital radio reaches a major landmark in the lead-up to Christmas, as GfK Retail and Technology* announces that 12 million digital radios have been sold in total in the UK. Digital Radio UK estimates that due to strong Christmas sales over two million digital radios will be sold during 2010, and that a cumulative total of 20 million digital radios will be sold by the end of 2013.


The continued mixed use of “digital radio” sometimes meaning “DAB radio” and sometimes meaning “DAB, DTV, and Internet radio” (and now sometimes including Mobile radio) is inconsistent and muddling obfuscation.