`Youth radio' bid tipped to win Yorkshire licence

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The Independent Online
The Radio Authority is poised to announce the winner of the regional radio licence for Yorkshire, in one of the most competitive franchise rounds yet seen in the fast-growing commercial radio market.

A full-day meeting is scheduled for tomorrow, with the winning bid expected to be unveiled by the authority's 12-member board by early evening.

A field of 13 applicants has entered the race, with the big radio groups Capital, GWR and Chrysalis all represented. The applications fall into several camps according to proposed format, with dance and other youth- orientated programming a clear favourite.

Of the main commercial radio groups, both GWR's consortium, K-Max, and Chrysalis's Galaxy 105, promise dance music, which the companies believe is a clear winner in a market already well served by adult contemporary and hits channels. Kiss FM, a private company which has leased the Kiss name from Emap, the media giant, is also proposing a dance station.

One insider said: "If the Radio Authority wants to broaden choice and safeguard diversity, I think they will see that the missing strand is youth programming."

All the same, at least one of the bidders, Saga, is targeting the over- 50 age group, with a mix of talk and music. There is even a bid to present multi-cultural music, from Arrow Broadcasting.

The authority is required by statute to choose a winner on three broad criteria: broadening choice; ensuring fair and effective competition; and financial viability.

According to some bidders, a key issue will be the amount of money applicants intend to spend to promote the service. Capital's YFM bid includes a promise to spend at least pounds 500,000, while Chrysalis, which operates the Heart stations in Birmingham and London and the Galaxy service in Bristol, could put as much as pounds 1m behind its Yorkshire launch if it wins the bid.

Financial viability, a prime concern of the authority, could tip the balance. K-Max, 40 per cent owned by GWR, has estimated capital expenditure of pounds 255,000, next to pounds 697,000 for Capital. The K-Max figure is viewed by competitors as being too low to finance the service properly.

Other imponderables include the authority's view of competition in the marketplace. MSM, the national sales house owned by Capital, currently handles as much as 60 per cent of commercial radio advertising in the UK, following the decision by Emap to transfer extensive business, including its Metro radio from its competitor, IRS.