Chrysalis puts its Heart into London radio

Mathew Horsman talks to the head of the latest station to hit London's commercial airwaves

London radio listeners will see their choice expand once again on Tuesday when a new FM station, Heart 106.2, hits the airwaves.

If successful, the Heart concept, first developed by music, television and radio company Chrysalis for its Birmingham licence area, is to be rolled out to other radio franchises around the country. The company aims to bid for several licences soon to be advertised by the Radio Authority, including one each in Yorkshire, East Midlands and East Anglia.

Like its West Midlands counterpart, London Heart is aimed at the all- important 25-44 year-old age group, for which advertisers are fighting furiously. Radio advertising is the fastest growing of all media in the UK, expanding by 15 per cent last year, and by a forecast 10 per cent this year.

Media analysts say the prospects for the sector are particularly good in light of the Government's liberalisation of ownership restrictions. Companies can now hold as many as 35 licences, up from the previous 20, a change that has already led to two takeovers - the hostile offer by regional radio holding company GWR for Chiltern and, more recently, a bid by media group EMAP for Metro Radio.

Chrysalis is a relative newcomer to radio, following its early years as a music company. Created by Chris Wright, famous for his booking of bands at Manchester University in the 1960s and for his promotion of groups such as Jethro Tull, the company has since expanded into television production and studio operations.

It went public in 1985, through a reverse takeover of Management Agency and Music, jointly owned by Tom Jones and Englebert Humperdinck. Mr Wright has retained 50 per cent of the company.

Its radio business is run by Richard Huntingford, a former accountant and one of Mr Wright's advisers. Sporting the jeans and long hair preferred by even the very senior management at many media companies, Mr Huntingford looks nothing like the cropped-haired, suit-and-tie man who first walked into Chrysalis nearly 10 years ago. He is, in short, at ease.

The mandate Mr Wright gave him was straightforward. "I was asked to look at areas where Chrysalis might invest," Mr Huntingford said.

Television was an early favourite, and Chrysalis became one of the partners of a consortium that unsuccessfully bid for the Yorkshire Television licence in 1990, a deep disappointment to Mr Huntingford.

Commercial radio, then in its infancy, was second on the list. "Clearly, there was going to be an expansion of the industry," he said. "But radio really didn't have the same degree of management skills and creativity as other businesses."

In order to learn more about the business from the inside, Chrysalis took what ultimately became a 20 per cent holding in Metro Radio and, after a time decided that it wanted to own and operate its own stations. The company set about winning the regional licence for Yorkshire, where it had already done considerable research for its failed ITV bid.

But the licence went to a Jazz format, and Mr Huntingford decided to go for the Birmingham franchise and the Heart station went on air in September 1994, four months after the bids for the London licence had been due. "We didn't have an up-and-running station to point to, but we had done a lot of work developing Heart in the Midlands, which was useful in our bid for London. Heart attracted 269,000 listeners by the end of 1994, mostly at the expense of Radio One and Two.

"We thought the Radio Authority might give us London because it wanted a safe pair of hands. We had developed the Birmingham franchise and had recruited excellent management."

The company had also spent freely to increase awareness of the new station. A budget of pounds 2m was set aside for the launch and publicity campaign. In London, Chrysalis is spending up to pounds 3.5m, and hopes to win an initial audience of 885,000 adults, the bulk of them in the target demographic.

According to Chrysalis's own internal forecasts, the station would immediately claim the number three spot in the crowded local London radio market, following undisputed giant Capital FM and its sister station Capital Gold. There are another seven commercial stations now available in London, ranging from Virgin to Kiss FM to the easy-listening format of Melody.

Chrysalis is banking on attracting a well-heeled audience of music lovers, who prefer to hear songs they already know, but who nonetheless want to keep up with what is fashionable. That means plenty of Simply Red, Elton John, Prince, UB40 and other "soft" bands. "We aim to provide a less frenetic environment, less cluttered with promotions and games," Mr Huntingford said.

Advertisers are promised there will be no more than three spots in any commercial break, and no more than 12 in any hour.

Sticking with a winning formula, Chrysalis has brought in Keith Pringle, fresh from his stint as programme director at Heart in Birmingham, to perform the same task in London.

It has also poached Kara Noble, sidekick to radio star Chris Tarrant on Radio One, to co-host Heart's breakfast show with comic Lee Simpson, who co-devised Whose Line Is It Anyway?.

Chrysalis has plans beyond the next round of franchise awards. While it turned down a chance to join one of the consortiums bidding for Channel 5 (largely on the question of cost but also because "we wouldn't have had much control"), the company likes the prospects for digital radio broadcasting and would like to take the Heart concept to other metropolitan areas.

The London station is heavily digitally equipped, with a state-of-the- art hard-disc system that allows presenters to key up songs and adverts easily.

Indeed, so keen is the company on the digital revolution that Chrysalis is likely to join a working group, led by the BBC and Sony, to look at digital terrestrial television. The group, announced last month, may lead to investment in television broadcasting, an area that comes under Mike Pilsworth, chief executive of visual entertainment at Chrysalis. Mr Huntingdon said: "We view digital as much more of an opportunity than a threat."

The station is forecast to earn a small profit in the third year of operation.