Recession delays third national radio franchise

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The Independent Online
ONE WEEK after the debut of Classic FM, Britain's first national commercial station, the Radio Authority said the third national franchise will not come on air until spring 1995, at least a year later than expected.

Lord Chalfont, chairman of the authority, said it had decided to apply a new policy of 'orderly development' to commercial radio because of the recession. In the past three years the authority had been more concerned about the need to license new stations to provide choice.

'We don't want to license stations which immediately come under competitive threat and are difficult to operate,' Lord Chalfont said. 'Independent radio can only operate with finance from advertising.'

The problem, he said, was that radio was stuck in the groove of a 2 per cent share of advertising, and there was no confidence in this changing quickly. The danger was that new stations would steal the advertising from existing ones.

The third national franchise, yet to be advertised, must be predominantly speech, a more difficult and costly format to support than music. It will use the medium wave frequency currently occupied by Radio 1.

The second franchise is Independent Music Radio, a joint venture between TV-am and Virgin featuring rock and pop music. Due to begin in March 1993, IMR will be broadcast on the medium wave. The BBC has jumped in to announce the start of Radio 6, a 24-hour news service, by the beginning of 1994.

The Radio Authority is pressing ahead with five FM licences for regional stations, taking in larger areas than current local commercial radio. These are:

The Severn Estuary, covering Cardiff, Newport, Bristol and Somerset (adult population 2 million) to be advertised next month.

North-West, covering most of Greater Manchester, Merseyside, Central Lancashire and parts of Cheshire including the Wirral (4- 4.5 million).

Central Scotland, covering Glasgow and Edinburgh (2.5 million).

West Midlands, covering Birmingham, Wolverhampton and Walsall (2-2.5 million).

North-East, covering Tyne and Wear, Teesside and part of North Yorkshire (2 million).

It will be possible for one operator to hold all five licences and broadcast a single format, jazz for example, provided there was news or information tailored to the region. But the authority said the applicant could not also hold a licence for London, and so create an effective national network 'through the back door'.

There will also be two medium wave (AM) licences for Greater London, one on the present frequency used by the BBC's Greater London Radio, and an extra AM service for Manchester, Birmingham and Wolverhampton. There will also be a new local licence for east London.

The authority said that only a few parts of the country, west Cumbria, Southwold, Darlington and parts of Scotland, were without local commercial radio.

The authority is starting to re-advertise and invite applications for new eight-year licences for all the established local stations.