UK DAB radio receiver sales fell in 2009 and 2010, but “digital radio sales have held up – they are flat” insists Mr Switchover

For an organisation that has been charged with marketing DAB radio to the British public, Digital Radio UK has managed to remain remarkably invisible during 2011. This alone made the appearance of Digital Radio UK’s chief executive on BBC Radio 4’s ‘You & Yours’ show notable. The fact that nothing new was said was hardly surprising – there is nothing new to say about DAB.

Out in the real world, as opposed to the imaginary world inhabited by Digital Radio UK, the notion that ‘DAB radio’ will replace AM/FM radio is already a dead duck. The only believers still worshipping ‘DAB’ seem to be Digital Radio UK, RadioCentre, Ofcom and government civil servants.

The evidence is transparent. The number of DAB radio receivers sold in the UK fell year-on-year in both 2009 and 2010 (by 6% and 2% respectively). These data are collected by GfK and supplied to Digital Radio UK. These numbers, together with a nice colour graph, were distributed at last month’s RadioCentre members’ get-together. These are industry data of which Digital Radio UK is perfectly aware.

Yet, Digital Radio UK’s chief executive insisted in this interview on national radio that “digital radio sales have actually held up – they are flat year-on-year.” This is untrue. ‘Down’ is not ‘flat.’ ‘Down’ is ‘down.’ DAB radio receiver sales peaked in 2008 and have been falling since. DAB receiver sales in 2010 were 8% below that 2008 peak. That is clearly not ‘flat.’

I wonder how it is that:
• The chief executive of a high-profile marketing organisation can appear on Radio 4 (audience: 11m adults per week) and flatly state something that he must know not to be true?
• The board of Digital Radio UK does not haul him in and remind him that his job description is to ‘persuade’ consumers of the value of DAB, not deceive them?
• A substantial proportion of this organisation’s funding is derived from the BBC Licence Fee, so the public is effectively paying for an executive to tell them untruths about consumer take-up of DAB radio?

You & Yours
BBC Radio 4
29 July 2011 @ 1200

Ford Ennals, chief executive, Digital Radio UK [FE]
Wiiliam Rogers, chief executive, UKRD [WR]

Q: Are you not disappointed with the lack of a rise in [DAB] radio sales?

FE: No, I think what the Ofcom report confirms is the solid progress that is being made. We see growth in overall digital listening, we see growth in terms of the number of homes that have a digital radio receiver in there. So, 40% of all homes now have a DAB receiver in them, we know that 47% of all listeners are listening to digital radio every week, and we have seen growth in digital listening. So I think progress is being made. I think we are in a difficult sales period for overall retailers and we have seen a decline in overall consumer electronics sales. Digital radio sales have actually held up – they are flat year-on-year. We have now sold 13 million DAB digital radios, but the key thing, just lastly, to remember is that you can receive digital radio via digital television, via a computer or, indeed, via a smartphone and many, many households and consumers have those.

Q: William Rogers, are you surprised by the lack of increase in interest in digital radio?

WR: No, not in the least. And I think we have to remember that Ford, with respect to him, is being a little disingenuous because, of course, the switchover is about people being forced to move way from analogue and onto DAB. So that’s the issue we need to focus on. And what this report highlights, and I’m personally delighted to see it, is it really does shine a light on the shambles that is this proposed DAB migration.

Q: But things aren’t that bad. There are increases in radio usage, as Ford has just indicated.

WR: Well, hang on a minute. The whole premise behind the switchover is that it will be, quote, consumer led. And the one thing we know from these statistics is that, whatever else it is, it’s not being consumer led. As your reporter quite rightly said earlier, of the eight-and-half million radio devices sold in the twelve-month period we are talking about, four out of five of them did not have a DAB receiver capacity. And, more interestingly, of those people who were asked whether they were likely to buy a DAB set at any time in the next twelve months, four out of five of them said they were not likely to. So the consumer is making it very clear what they want and, after eleven years, it’s time this thing was put to bed.

Q: Ford Ennals, one of the things that we constantly hear from listeners is the whole issue of reception. That’s really what, I think, the message is that we get from people. That is what they are worried about. Whether they approve or not [of DAB], what they say is an awful lot of people can’t get them [DAB radio signals] and, if they can get them, they can’t get them consistently.

FE: Well, I think, where the industry and the broadcasters are absolutely unified and agreed is that digital is the future of radio in the UK. And I think it’s just a matter of the timetable and the transition path for that. One of the big issues is, as you have said, is about coverage and about the ability of everyone to get a strong [DAB] signal. Now, what Ofcom have done is developed a plan to extend coverage, both of the local services and the national services, so that people can receive those services and get more confidence. But there is a direct parallel here with TV and digital television – I ran the TV switchover programme – and, back in 2006, the majority of TV sales were analogue and only 75% of the population could get digital television. Now, what happened over the next few years is we saw a very swift transition and we saw transmitters built out that so everyone could get digital TV. We’ll see the same on radio.

Q: What about that, William? We don’t jump ‘til we have to. We don’t buy ‘til we have to.

WR: Look, look. Let’s be clear about this. Ford Ennals is paid to market the DAB switchover, so I understand why he has to say what he has to say, because the message from this report is clearly embarrassing for him to make a case which clearly doesn’t exist. There are a number of points we have to remember. First of all, the comparison with TV switchover is plainly an absurd point to make. They are not remotely, in any way shape or form, similar. And people are choosing not to endorse DAB as an alternative [to FM/AM]. The critical thing we have to understand here is three elements. First of all, ….

Q: You’ll have to confine yourself to one because we are really tight for time.

WR: Okay, the fundamental problem with this whole process is that you cannot migrate an entire sector if the [DAB] platform you have chosen does not have the capacity to allow you to do so. And there are scores of radio stations in this country who will be denied the opportunity to move to a DAB platform, because the choice was wrong in the first place.

Q: A ten-second response.

FE: Just finally. People love digital radio. We’ve seen it with [BBC] 6 Music and we saw the campaign to save 6 Music. We’ve seen it with the response to Radio 4 Extra. And they’ll continue to enjoy it in the future.

Q: I’m sure our postbag and our e-mails will be as big as usual. William Rogers and Ford Ennals, thank you both very much indeed.

……………………………..
Point of information:
Ford Ennals was chief executive of Digital UK, the TV switchover marketing organisation, from April 2005. He announced his departure in November 2007, the same month that the first UK region entirely switched off analogue television broadcasts.

When is an FM radio not a radio? When it’s in a portable media player, says digital switchover group

Digital Radio UK is the new organisation funded by the BBC and commercial radio “to ensure that the UK is ready for digital radio upgrade”. In February 2010, Digital Radio UK submitted written evidence to the House of Lords Communications Committee informing it of the latest data for UK retail sales of radio receivers. Amongst other things, the data showed that:

• Sales of digital radios in 2009 were under 2 million units, their lowest annual volume since 2006
• Sales of analogue radios seemed to have dropped dramatically to 5.2 million in 2009 from between 7 and 8 million during 2008
• As a proportion of the total volume of radios sold, digital radios had apparently leapt to 28% in 2009 from 21% only a year earlier.

I was puzzled. Why had sales of analogue radios fallen so dramatically by year-end 2009 (see graph below)? There seemed to be almost no substitution effect by DAB radios, whose volume sales were also down, though not by as much as analogue radios. It appeared as if many consumers had just suddenly decided to stop purchasing radios. I wrote to [*****], the company that [***********************************************] Digital Radio UK, asking why the data had suddenly ‘jumped’ in Q4 2009.

The written response from [*****] was:

“The q4 2009 drop is more about the basket of products included as areas previously included such as set top boxes and portable media players were excluded from the data at that time.”

[*****] defines a ‘portable media player’ as any device that plays music and has a 3.5mm headphone jack: MP3 players, iPods, portable cassette players, portable CD players, etc. From Q4 2009 onwards, when any of these devices are sold in the UK and also include a radio, they are no longer counted as ‘a radio’. Now, every MP3 player sold that includes a radio is simply excluded from these statistics. This is why the number of radios sold appeared to drop so significantly (by around 2m units per annum) in the latest Digital Radio UK data.

Why was this change in definition made? It is hard to understand the logic because a radio within an MP3 player is still used as a radio and has no other purpose. It is a real radio, not a fake radio, but to [*****] it is no longer a radio.

The answer seems to be that a huge number of MP3 players are sold in the UK (value £666m in 2009) but almost none of them incorporate a DAB radio. When an MP3 player does include a radio, it is inevitably an FM radio. MP3 players are manufactured and sold globally by multinational electronics manufacturers who understand that FM remains the universal standard for listening to broadcast radio, while DAB is still confined to no more than a handful of countries. Global manufacturers are reluctant to mass produce an MP3 player incorporating a DAB radio because the sales market would be limited to a few, small territories.

I checked the Argos retail website this week and found it offered 82 models of MP3/MP4 player. None incorporated DAB radio, whereas there were 16 that included an FM radio and 66 that had no radio.

It seems that the last resort for Digital Radio UK to be able to demonstrate to a sceptical public (and increasingly sceptical members of the House of Lords) that DAB radio is ‘taking off’ with consumers is to fix the figures to make it look that way. If you cannot convince the public to stop buying analogue radios, you can ‘bend’ the figures to magically make it appear that the public is buying fewer analogue radios.

Earlier this month, I documented how Digital Radio UK had similarly fixed the same dataset from [*****] to declare in its publicity that “when buying a radio, more than 75% of people choose a digital radio”. This was not at all true. The real fact was that, in December 2009 alone (December always being the peak month for DAB radio sales), 76% of people who bought a kitchen radio bought a digital kitchen radio. That was an attempt to brazenly redefine ‘a radio’ as only ‘a kitchen radio’ so as to exclude clock radios, tuners, in-car radios, boomboxes, etc.

I can only repeat what I said then. However desperate you might be to try and make DAB radio a success, how is it justifiable to deliberately mis-state data so outrageously in print? And to Parliament?

DAB radio receiver sales: never let facts get in the way of a big number

A newsletter arrived in my in-box today from Digital Radio UK, the new organisation charged with making DAB radio a success. It told me some startling news:

“By the end of 2009, when buying a radio, more than three quarters of people chose a digital one.”

And, just in case I did not believe this fact, immediately beneath, it told me the same thing again:

“New sales figures reveal that, when buying a radio, more than 75% of people choose a digital one.”

I did not believe it. All the previous data from the radio industry had shown that DAB radios are around 22% of total radio sales, as demonstrated in the graph below.

A year ago, the government’s Digital Radio Working Group had set an ‘aspirational’ target for DAB radios to be 50% of total radios sold by the beginning of 2011. As this graph clearly shows, the odds of successfully coming anywhere close to that target are zero.

Maybe something revolutionary had happened in the consumer market for the proportion of DAB radios sold to have suddenly surged from 22% in Q1 of 2009 to 75% by year-end. It was extremely puzzling.

Then I read an extraordinary letter that Ford Ennals, chief executive of Digital Radio UK, had written to the House of Lords Select Committee on Communications on 15 February 2010. It said in part:

“I thought […] that it might be useful if I wrote with the very latest radio sales data. Encouragingly, it shows that, during 2009, consumers increasingly chose digital sets over analogue ones.

I thought it clearest to present the data in a simple table, which is attached, but it may be useful if I explain a couple of the terms used. Where the data refers to ‘kitchen radios’ it means the kind of sets that you and I would call ‘a radio’ i.e. a set whose sole function is to listen to the radio.

Where it refers to ‘all radios’, these figures include those pieces of electrical equipment which happen to have a radio chip in them (e.g. a hi-fi where the main reason for purchase may be to listen to CDs or an MP3 player where listening to downloaded music is the primary function).

As you can see, by Christmas 2009, 76% of people buying ‘a radio’ chose a digital one…… [emphasis added]”

Aha! Now I think I understand. The only way in which it is possible to contrive that more than three quarters of radios sold are digital radios is to arbitrarily create a completely new definition of ‘radio’. In this brave new world, only a ‘kitchen radio’ will now be called a ‘radio’. (The truth is: 76% of people who purchased a kitchen radio during December 2009 bought a digital radio, though the proportion for the whole of 2009 was 63%.) Every other type of radio is no longer defined as a radio. This new definition of ‘radio’ would completely exclude:
     • Micro systems
     • Clock radios
     • Tuner separates
     • Handhelds
     • Boomboxes
     • In-car radios
     • Audiovisual systems
     • Home cinemas
     • Docking stations
     • Dect phones [?]
     • Mobile phones
     • LCD TVs
     • Record players

This seems like a long list of products which, if they also happen to include a radio, will no longer be defined as having a ‘radio’. How can a ‘clock radio’ not be a radio? How can a ‘tuner’ not be a radio? I know this long list to be a comprehensive definition of ‘radio’ because it was the very definition of ‘radio’ used by the Digital Radio Development Bureau, the forerunner to Digital Radio UK, in its published data. Of course, that was last year. In 2010, ‘radio’ seems now to have a whole new definition.

What can I say? However desperate you might be to try and make DAB radio a success, how is it justifiable to deliberately mis-state data so outrageously in print? And to Parliament?