Capital Says No To National Digital Radio

Capital Radio today dealt a blow to digital radio by saying that it will not be bidding to run the national commercial digital multiplex which is currently being advertised (see Radio Authority Advertises National Digital Licence).

The company said that transmission costs are too high and, with limited consumer benefit and lack of receivers, it expects take-up to be slow. Capital is, however, more keen on local digital radio and it will “continue to assess” its options in this area. This would be of particular benefit to its AM stations, where the increase in sound quality would be noticeable.

The radio group made the announcement as part of its interim results for the six months to 31 March. Turnover was up 11.7% to £55.6m while pre-tax profits rose 7% to £18.1m. Radio advertising revenue was up 12% during the period.

There were also encouraging results for the group’s website. Ad sales were reported to be up and Capital expects to break-even on its interactive business within two years. Turnover in the division was £301,000, up from £65,000 last year.

Ian Irvine, chairman of Capital, commented: “We are pleased to report an encouraging first half. The prospects for growth in radio advertising continue to be strong and our second half has started well.”

Capital Radio: 0171 766 6000