Speech given to the Radio Festival 2006
Monday 2 July 2006
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Thank you Bob and good afternoon everyone. It's a privilege to address this
year's Radio Festival.
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This afternoon I'm going to try to address the question which underpins much of the current debate about market impact: is a creatively
strong, popular and properly-funded ´óÏó´«Ã½ necessarily incompatible with a thriving
commercial radio sector? Or is another future possible – one built on
partnership and mutually-reinforcing success?
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A distinctive mission
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Last week the Chairman of the ´óÏó´«Ã½, Michael Grade, and I signed the Agreement
between the ´óÏó´«Ã½ and Government which, alongside the Charter, sets out the ´óÏó´«Ã½'s
mission for the next decade. They and the White Paper will be debated in the
Commons next week.
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These documents lay out the public purposes which the ´óÏó´«Ã½ should strive to
further – and the new framework within which the ´óÏó´«Ã½'s performance against those
purposes will be measured and the boundaries of its activities both set and
enforced.
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They certainly call for the ´óÏó´«Ã½ to play a distinctive role in the UK
broadcasting landscape, delivering the highest possible net public value with the
minimum possible adverse market impact. Complementarity to that which the
market provides will be closely monitored by the ´óÏó´«Ã½ Trust – and this monitoring
will focus on areas of real concern. This is why, for instance, the ´óÏó´«Ã½
Governors have already decided to concentrate their independent monitoring of
the music played by Radios 1 and 2 on the output during daytime where market
impact is potentially greatest and criticism from commercial competitors tends
to be loudest.
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Distinctiveness in any event should be a goal for every ´óÏó´«Ã½ service on every
medium. Greater investment in original work than you find elsewhere – whether
it's our colossal commitment to new music and music-making across radio or our
support for genres – documentary, comedy, drama and so on – which, so far at
least, are almost unheard of on commercial radio stations. More opportunities
for creative experimentation. A collective obsession with accuracy and
excellence.
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For the past few years, we believe we've been on a path of greater
distinctiveness. Speech and built programming has become more not less
important on our music networks. Religion is more salient on Radio 2 than it's
been for years. But there's more we can do: we want, for example, to find new
slots for comedy on both Radios 1 and 2.
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There are those, of course, who take a far more restricted view of what
distinctiveness should mean. Ever since Peacock, some have argued that the ´óÏó´«Ã½
should be restricted to those services and programmes which pass what you could
call a narrow market failure test. Popular programmes – programmes for which
there is a market – should be stopped and popular services closed down or sold
off. In the past few weeks, we heard once again that old chestnut about
privatising Radios 1 and 2 – though I have to say that if anyone seriously
believes that floating two new formidably popular advertising-funded national
radio networks is going to help the rest of the commercial radio industry, they
really do need their heads examined.
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Anyone of course is entitled to make any theoretical economic case they want,
but to expect the narrow market failure argument to be taken seriously by
policymakers or the British public is to misunderstand the way in which public
service broadcasting has developed in this country. In survey after survey, not
just those done for the ´óÏó´«Ã½ but in recent surveys commissioned for DCMS and
Ofcom, the public have made it plain that they expect entertainment from the ´óÏó´«Ã½
just as much as they expect information and programmes which build skills and
knowledge. Yes, they want editorial diversity and range but they want the
popular to be part of that range. If you've got a problem with a popular ´óÏó´«Ã½,
the people you're picking a fight with are the British public.
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This year's White Paper, Charter and Agreement are quite explicit about the duty
to entertain – indeed the Secretary of State went out of her way to emphasise
entertainment when she introduced the White Paper to the Commons.
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Distinctiveness is critical, then, but it is not a synonym for the unpopular:
it should imply distinctiveness across the range. 1Xtra and Radio 3
collaborating on Urban Classic, the result of six months hard work by Grime
producer DaVinChe, young musicians from Hackney and the ´óÏó´«Ã½ Concert Orchestra.
Radio 2's 2006 Radio Ballads. The Five Live Shorts writing competition. Radio
4's Great Debates.
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But it's also the distinctive wit, the distinctive sound worlds, of Chris
Moyles, Jonathan Ross, Terry Wogan, Chris Evans. Over the past few years, ´óÏó´«Ã½
Radio has taken a different creative path from most of commercial radio,
focusing on talent and intelligent, exciting speech on its music networks just
as much as on 4 and Five Live. Radios 1 and 2 have been successful not because
they've become more like their competitors but because they've become less like
them.
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A lively market
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But commercial radio in this country is also creatively vibrant, just as capable
within its own mission of discovering great talent and reaching wide audiences.
The RAJAR headlines don't tell anything like the full story of what's going on
in our towns and cities. In the major urban areas, for instance, where some of
the biggest advertising revenue is to be found, Radio 1 often takes second or
even third place to the established commercial radio stations. Radio City in
Liverpool for example, the Galaxy stations in Newcastle, Manchester and
Birmingham, Kiss in London.
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And even Ralph Bernard, that long-time scourge of Radio 2, has admitted that it
is a myth that the ´óÏó´«Ã½ is more dominant than commercial radio in the audience
that matters to them, those all-elusive and all-important 15-44s.
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It's certainly true that over the past decade both 1 and 2 have modernised and
that Radio 2 in particular has started to attract more listeners in their
fifties and forties. In both cases though they were making up for a process of
ageing-up that had been going on for the previous 30 years: it's difficult
to prove because we don't have good data, but I suspect that both radio stations
have older average audiences today than on the day when commercial radio first
launched in this country.
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But you shouldn't think that we obsess about demographics at the ´óÏó´«Ã½ – we're
very proud of the passion and commitment that went into Making Tracks, a
programme which aims to open up the world of classical music to children and
which attracted a loyal audience with an average age of 61! Interestingly – and
this makes the point rather well about demographics – although the programme
itself failed to get a large children's audience, no less than 35,000 youngsters
were introduced to live orchestral music through the concerts that went with it.
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When we look at commercial radio, we see a sector which is facing a currently
unstable ad market, but which is fundamentally strong. Which is learning to
create major events and to punch its full weight by linking up to make and
broadcast network output. Which is developing major new stars like Christian
O'Connell. And which of course is attracting some interesting new entrants –
not least Channel 4.
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Commercial radio launched in this country despite the very substantial presence
of ´óÏó´«Ã½ Radio. Channel 4 and many others want to launch new radio businesses –
again despite the fact that they know they will be competing for audiences with
the ´óÏó´«Ã½.
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British radio, in other words, is a success story because of the combined
creative efforts of the commercial sector and the ´óÏó´«Ã½ and, in quite a few areas,
the healthy competition between them – something captured rather well in the
line-up of winners at this year's Sonys. Let's take a moment to listen to just
a sample of this combined achievement in output from across the UK over the last
year.
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(audio clip)
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New players, new challenges
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One of the most tangible results of the partnership between the ´óÏó´«Ã½ and
commercial radio so far has been the successful launch of digital radio.
Building out our DAB transmitter chain and delivering ´óÏó´«Ã½ digital radio to as
many other platforms and devices as possible is a key part of our commitment to
help deliver a Digital Britain in the next Charter period.
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But change in the radio and audio landscape means much more than a
straightforward transition from analogue to digital linear radio. People are
also listening via DSat, DTT and WiFi radios. On demand audio to PCs, with
applications like the ´óÏó´«Ã½'s Radio Player, and to mobile devices like the iPod
herald presage a world in which consumers can pull audio when and where they
want rather than waiting for the broadcasters to push it to them.
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The threat that radio stations face from instantly available personal playlists
is obvious. But the creative and marketing potential of podcasting is also
rapidly expanding the competitor-set for audio in the UK with almost every
national newspaper from the FT to the Sun following the lead set by the
Guardian. Individual artists like Ricky Gervais are also discovering that – at
least when your name and reputation are already made – you may not need anyone,
a broadcaster, a newspaper, a record company, anyone – to help you deliver your
audio content directly to a paying customer.
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´óÏó´«Ã½ Radio's own experiments in downloading and podcasting give some sense of the
enormous hunger from audiences – 4.5 million downloads in May on a restricted list of
50 programmes from across our output, covering only speech and unsigned music.
We've learned a lot from the trial but we're still learning so we've decided to
extend it – using a similarly limited range of content – for some months to
come. A decision on whether podcasting should become a permanent service or
should be discontinued will be taken by the ´óÏó´«Ã½ Governors towards the end of
this year after a Public Value Test, including a full Market Impact Assessment,
has been completed.
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There is of course yet another challenge to radio around the corner.
Portability has always been audio's USP, but now mobile TV is almost here and,
what's more, it may well use DAB technology and bandwidth to reach its
customers. I've just come back from Japan where simulcast TV to mobile phones
has been available since April: many players there are convinced that
ubiquitous delivery of TV as well as radio to mobiles is inevitable.
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What will the raising of the data threshold on DAB multiplexes to 30% mean for
the future of DAB as a radio platform? More broadly: to what extent will
consumers continue to regard radio as a discrete, independent medium accessed
through a discrete device? Will many of them think of it rather as one strand
in a multimedia content continuum?
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It's a moment which is potentially more disruptive for radio than the advent of
television. But the opportunities – both for new revenue streams and for new
creative partnerships – are there as well.
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We're already seeing some new and intriguing alliances. Take the current Mostly
Mozart festival at the Barbican in London – put on by the Barbican, publicised
by media partner Classic FM, with an independently produced film In Search of
Mozart broadcast on TV by five with a film soundtrack made available as podcasts
with links through to each of the participating orchestras. Cross-platform,
cross-promoted events are no longer the preserve of the ´óÏó´«Ã½, though there's more
we can do too to create broadcasting landmarks like The Beethoven Experience and
A Bach Christmas.
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We want to enter this new chapter in radio's development in a spirit of
collaboration. Independent radio production is a great source of innovation and
diversity for us. Its contribution to the ´óÏó´«Ã½ has grown significantly over
recent years and I hope will continue to do so on the back of its own creative
merits over the next charter period. We believe in it, just as we believe in a
strong and well-supported in-house production arm not only as a vital part of
our own programme supply but as a training and talent resource for the whole
industry. We want a closer, more strategic relationship with key indie
suppliers and we want to demonstrate to the whole sector the fairness and
effectiveness of our commissioning process.
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But we also want to work more closely together with independent radio
broadcasters as well.
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Success for radio of any kind in this emerging world will depend on consumers
being able to find our content as easily as possible on any device or platform
they want to use. We should work together with rights-holders to develop the
right Digital Rights Management to protect their intellectual property but also
to recognise the formidable marketing potential of the new radio and audio
environment. There was a great deal of anxiety within and beyond the BPI about
the downloads which formed part of the Beethoven Experience last Spring. In
fact the figures suggest a substantial increase in the numbers of Beethoven CDs
sold during and after the season, including copies of the Beethoven symphonies.
We should continue to experiment in partnership with the record industry. We
should also continue to campaign for content – especially music – to be
available to the public on open as well as closed platforms.
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We should also work together to ensure that our radio programmes can be
discovered as easily as possible. Again, as far as possible we should seek an
industry-wide approach to an EPG for radio. To create new ways of finding radio
content, new entry points beyond the radio dial to ensure that those – and there
are plenty of them, especially among younger audiences – that those for whom
radio is often an afterthought find compelling music and audio on the platforms
which are front and centre for them.
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We've done a good deal of thinking not just about EPGs but about the future of
personalised radio – My´óÏó´«Ã½Radio is its working title – in which peer-to-peer and
other technologies could be used to provide thousands, ultimately millions, of
individual radio service created by audiences themselves, all of them based on
the extraordinary wealth of existing ´óÏó´«Ã½ content, but as relevant to individual
users as the playlists they assemble for their ipods. Again, this is thinking
we want to share with the industry.
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Indeed we want to share more information with the commercial sector across the
board. We've already promised to share the results of our local TV trial with
the local and regional newspaper groups. The same principle applies to all of
our experiments and new service trials and proposals in radio.
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Finally we could work better together to ensure a great future for radio. We
already have three industry bodies where we work together: The Radio Academy,
RAJAR and the Digital Radio Development Board. The DRDB has done an outstanding
job driving the take-up of DAB, but both its title and mission should now
reflect the much wider technological and marketing challenges which radio now
faces. An invigorated Radio Development Board could then expand its role and
become a truly pan-industry body looking well beyond DAB to the whole future of
radio and audio. The ´óÏó´«Ã½ is already a partner in the DRDB and we would welcome
the chance for it to widen its remit.
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A consistent ´óÏó´«Ã½
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Of course there will be those who will say that this is all very well but that
the most important piece of confidence-building the ´óÏó´«Ã½ could do is not to do
with new digital developments – where partnership is already proven and trust
relatively high – but in the matter of its existing services and their
complementarity with the market.
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As you've heard, I don't accept some of the specific criticisms that are made of
our services. But the broad point is well taken: licence-payers and commercial
rivals alike should be consulted and their views taken into account before the
´óÏó´«Ã½ makes major changes to its services or launches new ones. From the
beginning of 2007 onwards, a new system will be in place to ensure that that is
exactly what happens.
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Now of course it's impossible for me today to produce irrefutable proof that the
´óÏó´«Ã½ Trust, the framework of Service Licences, the Public Value Test or the
Market Impact Assessment, will live up to their promise. The proof is in the
pudding. But you should be in no doubt that I and the ´óÏó´«Ã½ want them to work.
Endless friction with the commercial sector isn't good for business: it's not
good for the ´óÏó´«Ã½. There is no level of scrutiny or safeguard that would satisfy
some people of course, people who would much prefer it if the ´óÏó´«Ã½ and the
licence-fee disappeared tomorrow. But it is essential that the ´óÏó´«Ã½ builds a
better relationship and a higher level of confidence with the reasonable
majority in the commercial sector.
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That means the mechanisms of accountability and control. It also means a ´óÏó´«Ã½
that accepts that – though it should be ambitious and should seek its own lively
destiny in the digital space – it can't and shouldn't expect to do everything.
Our role in promoting DAB, which meant a handful of new channels for us and
hundreds for the wider industry, points to the kind of positive market impact an
ambitious but distinctive and focused ´óÏó´«Ã½ can have.
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Conclusion
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Every part of ´óÏó´«Ã½ radio is in the midst of change at present. Local radio as we
think through what cross-platform means for local provision. The World Service,
going through the biggest strategic shift in its history. Our domestic
networks, as they contemplate the impact of on-demand, podcasting and the new
competition which the internet brings.
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This autumn we celebrate the 80th anniversary of the ´óÏó´«Ã½'s first Charter – the
80th anniversary of the confirmation of ´óÏó´«Ã½ Radio as a public service, dedicated
to the provision of outstanding content not to make a profit but to enlighten
and enrich the lives of its listeners. It's the continued ability of ´óÏó´«Ã½ Radio
to deliver outstanding content – and to attract and motivate the outstanding
talent who can make it – which gives me such confidence about its future. The
final piece in the jigsaw is the licence-fee – which is why a strong licence-fee
settlement, one which reflects the scale of the mission laid out for us in the
White Paper – is so important.
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But where I believe the ´óÏó´«Ã½ is changing is in recognising that we are part of a
bigger story about radio and media. Success for us will not be lasting if it
comes at the expense of others. So when I look to the future, I see not a zero-sum game in which if the ´óÏó´«Ã½ is up, commercial radio must be down, but a
partnership which generates new ideas and new audiences and in which everyone
can enjoy a share of success. Thank you.
