Radio industry ponders analogue 'scrappage' subsidy

The radio industry is considering a “scrappage” subsidy to persuade listeners to upgrade from analogue to digital.

The plan is one of several possibilities being pursued by Digital Radio UK, the company tasked with establishing digital as the majority radio format. And although it is at an early stage, talks are going ahead with broadcasters, manufacturers and retailers.

“One of the ideas under review is scheme whereby consumers who upgrade to digital will receive a discount on a new digital set in exchange for their analogue set, with the analogue sets going to a good cause,” a spokeswoman for Digital Radio UK said. “No decisions or commitment has been made as.”

The car scrappage scheme helped boost the ailing auto industry by offering drivers a £2,000 discount on a new car if they traded in an old one. Although the Digital Radio UK plan borrows the concept of part-exchange from the scrappage scheme, the proposal is to ship the obsolete analogue models for use in the developing world.

“It is not really scrappage at all, we want them to go to a good cause and be usefully deployed, so if the programme does go ahead we will definitely not refer to it as scrappage,” the spokeswoman for Digital Radio UK said.

There are anything up to 100 million analogue radios in British homes, around half of them regularly used. But there are only around 10.5 million Digital Audio Broadcasting (DAB) sets.

There are compelling commercial reasons for a national switch to digital, but there is a less obvious case to be made for listeners. The analogue television signal will be turned off in 2012. But unlike television – where digital offered vastly more channels - there is less to gain in radio because the majority of digital stations are also available in analogue.

The government wants all national and regional stations on digital only by 2015, leaving the analogue spectrum available for local and community radio. But there are two consumer-led criteria to be met first: half of listening must already be on a digital set, and the signal must be available across as much of the country as the existing FM band.

In the meantime, broadcasters are forced to bear the cost of simulcasting on analogue and digital, with no extra revenue because there is still only a single audience.