Media: Stations waiting for a gravy train: Contenders are queuing up to make money from local radio frequencies, but Jim White wonders if listeners will benefit

YESTERDAY 48 fat brown envelopes landed in the in-tray of Lord Chalfont, chairman of the Independent Radio Authority. Over the next three months, his Lordship and a small team of researchers will become well versed with their contents as they decide which of the senders will be awarded what is potentially one of the most profitable media opportunities in Britain.

Up for grabs are eight commercial radio frequencies in London, the most populous local radio area in the country. Two former BBC AM frequencies have been allocated to the commercial network and the six frequencies occupied by Kiss FM, Jazz FM, Melody, Spectrum International and LBC (which has two: Newstalk on FM and Talkback on AM) are up for renewal.

'The percentage of listeners tuning in to commercial radio in London has rocketed from 27 to 54 per cent in the last four years,' explained Douglas McCarthur of the Radio Advertising Bureau. 'There is no doubt this is the media growth area. Get it right, and there is real money to be made.' To underline his point, Capital Radio made pounds 4.6m profit on pounds 16m turnover last year.

Get it wrong, however, and you can end up in the kind of financial plight that has dogged LBC, the station whose chairman is Dame Shirley Porter, former leader of Westminster Council. LBC's problem is that its appeal is generally thought to lie with the over-50s, taxi drivers and phone-in callers from Dagenham, which is not the most attractive of markets for advertisers. As the most vulnerable of the existing licence holders, it is likely to lose one of its frequencies. Charlie Cox, the station's managing director was clearly not convinced of his organisation's chances. He resigned five days before the bids were due.

Fortunately for those bidders hoping to fill LBC's wavelength, the radio franchise round is not as byzantine in its workings as that for television licences last year, which reduced Bruce Gyngell, chairman of TV-am, to tears. There will be no sordid financial auction extracting huge licence fees like those that have hamstrung new television operators such as Carlton. Instead each bid has been accompanied by a cheque for pounds 2,500 - an entrance fee which, in the fashion of election deposits, is there to deter time-wasters and loonies (the bid from a station called Radio Barking, incidentally, is as blue chip as any, and is backed by, among others, Angus Deayton.)

The bidders have also had to provide business plans indicating how they will keep their stations financially solvent for the eight-year period of the licence. Several, backed by wealthy media conglomerates - Emap, Reuter, Associated Newspapers - will have no problems meeting that stipulation as they scramble for a place on the dial. But Lord Chalfont, a free marketeer and historian of the Cold War, has another criterion on which to make his pick: will the new stations extend listener choice? His selection is not, as has been implied in the build-up, a straight one between two media doyennes, Joan Bakewell and Lynne Franks, and their bids aiming output predominantly at women.

'That is a typical male fantasy,' said Ms Bakewell, chairman of London AM, the consortium backed by the publishing group Emap. 'A sort of media mud wrestling. There is a lot more to it than that.'

Indeed. As well as the Bakewell and Franks consortia (the latter backed by the literary agent Debbie Owen), others hoping to impress Lord Chalfont include a Christian station backed by Cardinal Basil Hume, at least five rock outfits, three country and western teams, an all-sport station supported by Sebastian Coe, 13 ethnic operations, a couple of heavyweight news efforts, the comedy station Radio Barking, and one from London Transport giving details of its services, 24 hours a day.

And will choice be extended? Well, if you are between 30 and 45 and reasonably affluent, these people are after your ears, offering you everything from non-stop humour to non-stop sport, via non-stop adult rock and non-stop news.

'Ours will be the kind of station I want to listen to,' said John Lloyd, inventor of Spitting Image and Blackadder and the man behind Radio Barking. He is in his early forties.

'Ours will be the station for people like me,' said Sarah Greene, the television presenter and a director of London AM. She is in her mid-thirties.

'London Rock Radio has identified a huge number of people not presently served by radio - people like me,' said Paul Smith, whose adult music consortium is backed by Jasper Carrott and Time Out magazine. Mr Smith is 46.

'Those born between 1946 and 1964 are the most fertile area for new radio,' said Tim Schoonmaker of London AM. 'They have been ill-served up till now, they are media literate, used to making their own choices, and they are happy to set the agenda.'

They are also, and this is no coincidence, the kind of people advertisers want to reach. London AM has invested huge amounts researching this market, discovering its foibles and interests and tailoring its output to accommodate them.

'Obviously you don't let research design your product,' said Mr Schoonmaker. 'But we have got back a lot of stuff from research - little nuggets of thought - which have really shaped our thinking.'

If you are over 50 or under 18, the choice is less extensive, although John Lloyd maintains that his comedy channel is extending everyone's choice. 'Not everyone is interested in sport, not everyone is interested in women,' he said. 'But everyone wants a laugh.'

The problem for niche stations such as London Country Radio or Sunrise, the Asian operation which currently broadcasts in a limited area of west London, is that while they clearly offer a different kind of choice, they are less able to meet Lord Chalfont's other requirement of sustained commercial performance. They might well end up like LBC.

'Radio is a difficult medium for advertising agencies to plan and buy for,' explained Dominic Mills, editor of Campaign, the advertising trade magazine. 'Agencies are not really interested in being given 100,000 dedicated country and western fans. They are much more interested in big numbers. Those who can promise and deliver a big audience, such as Capital, are the ones that will prosper.'

And so, although some bids have come up with ingenious ways around a potential shortfall of advertising revenue (London Christian Radio will appeal to the committed for subscriptions, London Arab Radio is backed by Gulf potentates), the likely outcome is that the big conglomerates will win, and start broadcasting next April. Which is an interesting interpretation of expanding choice.

(Photograph omitted)

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
people
Life and Style
President Obama, one of the more enthusiastic users of the fist bump
science
Arts and Entertainment
Peter Griffin holds forth in The Simpsons Family Guy crossover episode
tv
Life and Style
Upright, everything’s all right (to a point): remaining on one’s feet has its health benefits – though in moderation
HealthIf sitting is bad for your health, what happens when you stay on your feet for a whole month?
News
Kristen Stewart and Rupert Sanders were pictured embracing in 2012
people
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Media

ERP Business/ Implementation Analyst

£40000 - £45000 per annum + competitive: Progressive Recruitment: This is an e...

Software Developer / Software Engineer

£Neg. (DOE) + Excellent Benefits: Guru Careers: Combining a passion for Softwa...

Lead Software Developer / Senior Software Developer / Technical Architect

£Neg. (DOE) + Excellent Benefits: Guru Careers: Lead Software Developer / Seni...

Digital Designer / Web Designer

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Digital Designer / Web Desig...

Day In a Page

A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on
It's the best of British art... but not all is on display

It's the best of British art... but not all is on display

Voted for by the British public, the artworks on Art Everywhere posters may be the only place where they can be seen
Critic claims 'I was the inspiration for Blanche DuBois'

Critic claims 'I was the inspiration for Blanche DuBois'

Blanche Marvin reveals how Tennessee Williams used her name and an off-the-cuff remark to create an iconic character
Sometimes it's hard to be a literary novelist

Sometimes it's hard to be a literary novelist

Websites offering your ebooks for nothing is only the latest disrespect the modern writer is subjected to, says DJ Taylor
Edinburgh Fringe 2014: The comedy highlights, from Bridget Christie to Jack Dee

Edinburgh Fringe 2014

The comedy highlights, from Bridget Christie to Jack Dee
Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

The woman stepping down as chair of the Heritage Lottery Fund is worried