Bauer Radio talks the DAB talk, but walks its ‘Magic’ brand off DAB

Bauer Radio is the second largest commercial radio group in the UK. It publicly supports the government’s plans for DAB radio switchover. Only this month, Paul Keenan, chief executive of Bauer Media, told The Guardian: “What part if any is the BBC going to play on the local DAB level?” He went on to ask:

“Will there be some form of seismic content innovation or intervention that really pulls listeners across [to DAB]?”

Keenan need have looked no further than his own company’s DAB radio strategy to discover a form of “seismic content intervention” that might well result in pushing existing listeners away from DAB, rather than pulling them in. While Keenan was talking to The Guardian, Bauer was busy pulling the plugs on its ‘Magic’ brand from the DAB platform in the following areas:
* Aberdeen
* Ayr
* Birmingham
* Bradford & Huddersfield
* Cambridge
* Dundee & Perth
* Edinburgh
* Glasgow
* Kent
* Northern Ireland
* Norwich
* Peterborough
* Stoke
* Sussex Coast
* Swansea.

If you were a loyal listener to Magic in one of these areas, your favourite station simply disappeared from the DAB menu in January 2011 (Magic had 1 million out-of-analogue-area listeners per week, contributing 24% of the brand’s total hours listened, according to RAJAR). This change is surprising given that, as recently as May 2008, Bauer Radio decided to add its Magic brand to the DAB platform in the following areas:
* Aberdeen
* Ayr
* Birmingham
* Bradford & Huddersfield
* Cambridge
* Dundee & Perth
* Edinburgh
* Glasgow
* Kent
* Northern Ireland
* Norwich
* Peterborough
* Stoke
* Sussex Coast
* Swansea.

In 2008, in most of these areas, Magic had replaced another Bauer brand, ‘Kiss’, which could not have pleased existing Kiss listeners. Now, in 2011, it is the Kiss brand that is replacing the Magic brand in all but three of these areas. Musical chairs, anyone?

In 2009, Bauer had said that it was investing in the “right long-term platforms for the right stations at the right time.” So, in 2008, Kiss was right for DAB whereas, in 2011, now Magic is right?

It is hard to believe that such precipitous content changes inspire consumer confidence in the DAB platform. But, sadly, the DAB platform has never really been about ‘radio’ and ‘listeners’. Loyalty to DAB radio? What’s that? For commercial radio, its pursuit of the DAB platform had been about the exercise of power, the expectation of profit and the promise of automatic renewals for the industry’s most valuable analogue radio licences.

It was also about a much coveted transfer of the power to determine which stations are broadcast to a cartel of commercial DAB multiplex owners, and away from the regulator. This is why station changes on DAB, such as Bauer’s (Kiss to Magic to Kiss) can be executed without a public consultation or impact assessment.* The regulator merely nods its head and makes a quick note in a file. So what role does Ofcom play in ensuring that the DAB radio platform “furthers the interests of citizens and of consumers” as mandated by law? The answer is: absolutely none. We might as well have a scarecrow in charge of digital radio at Ofcom.

The reason that Bauer Radio (with a 25% listening share of commercial radio) made these latest changes to DAB is that it is locked in a war with arch rival Global Radio (38%). Neither company has a track record of developing its own successful radio stations from the ground up. Both companies are piled high with acquisitions and mergers of other radio businesses. As a result, the two compete with each other by moving their radio pieces around the chess board, rather than by innovation.

In January 2011, Global Radio extended its ‘Capital’ brand outside London, replacing the former ‘Galaxy’ brand and some local FM stations. Global describes the brand:

“Capital’s target audience of 15-34 year olds are big fans of popular music, they are media savvy and are on trend.”

To compete, Bauer Radio extended its Kiss brand to every available local DAB multiplex (replacing Magic). Bauer describes the brand:

“Kiss evolves around ever changing lifestyles and trends of the UK’s young 15-34 market … Every part of their day revolves around music.”

If, like me, you think that these two brands sound almost identical, understand that this phenomenon is the outcome of long understood business practice in the radio sector. In 1951, American economist Peter Steiner wrote:

“If, as is often suspected, [radio] broadcasters exaggerate the homogeneity of audiences and their preferences for certain program stereotypes, the tendencies towards [programme] duplication will be increased. … The problem, of course, is that a series of competing firms, each striving to maximize its number of listeners, will fail to achieve either the industry or the social good. Here, then, competition is providing a less than desirable result.”

In the UK, this is precisely why we have a regulator for radio broadcasting – to ensure that consumers benefit from a wider choice of content than a free market would provide. However, with its hands tied in DAB policy by the Broadcasting Act 1996, and its laissez-faire ‘do nothing until someone complains about it’ strategy, Ofcom has had no more impact on the DAB station menu than having no regulator at all.

DAB is the Wild West of radio where anything can, and often does, happen. Seemingly, it often happens with little concern for listeners or for those who paid good money for a DAB receiver. Without a sheriff in sight, or a cavalry about to ride over the horizon, the danger is that the public might come to view DAB radio as nothing more than a bunch of cowboys locked in a private war of one-upmanship.

Yet the radio industry wonders why the DAB platform is not stimulating more listening or more receiver sales.

[*Footnote: There was an Ofcom consultation in November 2010 about a change of format for the Kiss brand, but this did not touch upon Magic being dropped from DAB. Magic continues to be simulcast on DAB in nine areas where it is already available on FM or AM, as a contractual condition of its automatic analogue licence renewals.]