Radio Authority Proposes New Ownership Rules

The Radio Authority has announced proposals for a new set of ownership rules for local analogue radio licences. The changes would include the abolition of the ownership points system and the removal of the “cap” on the number of local radio licences a person can own. The new formula for ILR ownership would also allow a person to own two overlapping radio licences.

Tony Stoller, chief executive of the Radio Authority, said that proposals, which have been developed in partnership with the Commercial Radio Companies Association (CRCA), would offer “Further liberalisation nationally, while at the same time ensuring local plurality and diversity.”

The proposals have been sent to the Department of Culture, Media and Sport (DCMS) and are summarised below:

Agreed Key Ownership Principles

• The UK-wide ownership points system should be abolished
• Normal competition rules should apply for UK ownership of Independent Local Radio (ILR) stations
• A clear and transparent formula should be implemented for in-area concentration of local radio ownership
• Where the market is sufficiently developed, local plurality rules would ensure at least three separate owners of ILR stations, irrespective of waveband, in addition to the BBC
• There should be no ‘cap’ on the number of local radio licences a person can own

ILR Ownership Formula

• A person is able to own two overlapping radio licences, on any waveband, in a single locality without restriction (even when there are only two licences in an area)
• Where there are three or more licences operating in any locality, then the principle of plurality of ownership and diversity in the sources of information available is achieved by a detailed but transparent formula using data freely available online
• Overlapping areas are defined as at present: where the adult population of the Measured Coverage Area (MCA) of one service contains 50% or more of the adult population of the adult population of another
• The rules will be waveband neutral. This is because the rule are designed to address plurality and diversity issues rather than market competition issues
• A person will be deemed to ‘own’ a radio licence if he/she has a shareholding which confers control or has a material interest in that licence
• The formula will be applied to overlapping licences held by (or to be acquired by) a person in a relevant area
• Each of these licences will have a value assigned to them
• An aggregate number of local points, allocated to each, would then be calculated
• A person may own licences with a points value of up to 45% of the total points in question

Whether or not the proposals are accepted, their submission should prompt a debate which sheds light on what many regard as the “woolly” proposals with regard to radio ownership which were set out in last year’s White Paper (see White Paper Paves Way For Communications “Revolution”).

Radio Authority: 020 7430 2724 www.radioauthority.org.uk

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