Global buys Atlantic FM: There are no winners here.

I am disappointed at the recent news that Global Radio is buying Atlantic FM and rebranding it to Heart.

Programming will no longer come from Atlantic's studios in St Agnes but from the old Gemini FM studios in Exeter.  Programmes from Exeter, for a Cornish audience.  That's really going to get an audience... NOT!

You see Heart's owner, Global Radio, is a combination of all the worst parts of UK broadcast history.
It goes all the way back to 1980.  Back then, a radio station called Radio West started broadcasting in Bristol.  By 1985 though, it and nearby station Wiltshire Radio were losing money hand over fist.  The IBA, the regulator at the time, examined the situation and was presented by the stations with a proposal.  Allow the two stations to merge, and broadcasts could continue, otherwise, both stations would have failed and the licences would have to be readvertised. 

The IBA knew that re-adveritisng licences for areas where stations had failed could be problematic.  The IBA had previously disallowed a takeover of Centre Radio in Leicestershire in 1983, and the station had gone off air.  The owners of Radio Trent offered to start a new station in Leicestershire, called Leicester Sound, and 11 months after Centre Radio went off air, Leicester Sound signed on.  So the IBA had previous experience of the difficulties of re-advertising a licence.  They were determined not to make the same mistake again.

So the IBA basically allowed the merger to go ahead.  But in the process, a monster was born, that thought that expansionism was the way to go.  Once the IBA had been replaced by The Radio Authority and the ITC by Margaret Thatcher's government, GWR began expaniding it's reach.  GWR teamed up with Capital to buy Plymouth Sound and DevonAir Radio.  DevonAir was replaced by Gemini FM in a franchise auction, and Capital basically sold the rest of Plymouth Sound to GWR.  GWR continued to pick up stations including the Chiltern Radio network and would begin the process of slowly eroding localness from it's output.  First, all the AM stations were replaced by a networked Classic Gold service with just 4 hours of local output per day for 6 days out of 7, a total of 24 hours of local programming a week.

Then GWR tried to get local programming cut down to just 13 hours a day across their network, but the regulator said that it had to be 16 hours a day.  As a deliberate move, they made 3 of the local hours 3am to 6am in the morning, at the most unprofitable time of the day.  It was as though they were trying to send a message to the regulator that local doesn't work.  Network programming ran from 7pm till 3am.

Eventually, OFCOM backed down and basically local programming has been slashed on Heart ever since.  There is now only 7 hours of "local" programming on Heart on weekdays, and 4 hours at weekends, a total of 43 hours a week.  The company behind Heart, Global Radio, basically these days is a mixture of the GCap attitudes and the attitude of Charles Allen, who basically oversaw the downgrading of ITV from a serious regional broadcaster with a unique selling point, to a company that is little different from the myriad of digital TV broadcasters.  In short, it is the worst of all media worlds, joined together in one place.

People have said this will increase choice.  It won't.  Heart were already broadcasting in Cornwall via DAB Digital Radio, relaying the Devon service with Plymouth ads.  The least I can hope for is that on the Cornwall mux they arrange to playout the Cornwall ads instead.  Other than that, there would be no discernable difference in output, and we have lost the Atlantic FM sound on FM, to make way for Heart.  Jermey Scott called this an upgrade for Atlantic.  it is not, it is a downgrade, and most listeners in Cornwall will know this.
Expect the listenership figures for Atlantic/Heart to plummet from the current 71,000, to a level nearer 17,000 or even maybe nearer 7,000.

Pirate FM and BBC Radio Cornwall will undoubtedly be the beneficiaries.  There's enough history as well to back that up.  In 1999, Plymouth Sound AM was replaced by Classic Gold.   The figures dropped from 67,000 to 20,000.  Pirate FM picked up most of the listeners who deserted.  Now, history will repeat itself, and Global Radio haven't learned the lessons of the past.  If you don't learn from the past, you are destined to repeat the mistakes of the past, which is what Global will do.

The worst part is whilst Atlantic FM never made a profit, they were almost as well respected as Pirate FM.  They knew they were coming into a tough market with both Pirate FM and BBC Radio Cornwall being long established and successful stations.  That Atlantic FM couldn't be profitable despite their best efforts is regrettable, and understandable.  But the fact that Global haven't understood the dynamics of the area they are proposing to move into and are going to output to Cornwall from Exeter and London, shows how much the company is out of touch with actuality. 

Global Radio haven't even been profitable the last 2 financial years, yet Ashley Tabor has taken home about £6million in bonuses.  Bonuses for failure.  Failing to grow in terms of listeners, and failing to grow in terms of credibility and respect.

Global is about as hated as GWR Group and GCap Media were before them.  That sort of baggage only weighs a company down.  Global is a company that needs to change it's whole direction and priorities.  Being overfocused on cutting costs, does not lead to making profits.  Their whole mindset, has to turn towards growth, growing the company and investing in its future.  ITV know all about that.  Since Charles Allen left ITV, they have been trying to grow their business, but the market does not have faith in ITV.  It was in 2007 that ITV last saw their share price above the £1 level that indicates market confidence in a company, and even though they have recovered from their March 2009 lows of around 18p per share, they have still yet to recover above the £1 level.  Global is not a plc, unlike ITV, so it's shares do not trade.  But I would imagine that if they did trade on the stock exchange,they would similarly trade below £1.

This move is not good for commercial radio as a whole, and further reinforces the image that Global, through their actions, are slowly destroying local radio, in the same way that ITV decimated regional television.  And whilst that definitely isn't what they are trying to do, that is the perception they are giving off, and as I always say, perception IS reality.

Disney buys Marvel - more corporate conservatism?

Imagine this: you are webslinging across the New York city skyline, just like Spiderman. You swing round to see the famous Baxter Building, home of the Fantastic Four, twith its big "4" rooftop landing pad. But as you swing by, you notice something unusual. The circle 4 logo, has suddenly got Mickey Mouse ears!

Okay, this is not likely to happen! But, it does highlight the strangeness of this whole deal. Disney is buying Marvel Entertainment for $4 billion. Sounds like a lot of money for a comic book company. But when you look at this in detail, like I have, you notice there are things about this whole deal that seem to be totally wrong here.

First off, is a simple one. The reputations of each company. Disney is well known for it's family friendly image. It's not well known for edgy, controversial and rosky storylines, like Marvel does in its comics. Will we end up seeing a Disney-fied Marvel as a result, with comics more aimed at younger children than at the current teen market? Only time will tell. But that must be a worry for the artists that work for Marvel.

Secondly, when you look at the indivdual properties that Marvel owns (most of these being characters and their related franchises), it would seem that Disney has got somewhat of a bargain, maybe even significantly underpaid the real value of Marvel. Marvel has over 5000 characters across its multitudes of comic books, and many years of history too.

Spiderman for instance, has been around since 1962. He made his first transition to television in the late 1960s cartoon, with perhaps the most memorable sung theme tune lyrics in history. "Spiderman, Spiderman, does whatever a spider can...". He made his first live action appearance in 1978 TV specials, which were actually very well produced, and filmed, managing to achieve the effect of having him crawl up walls and make it look good. He had since also appeared in another 6 animated shows, including two running simulataneously in 1981, and the hit "Spiderman:The Animated Series" which ran from 1994 to 1998.

But it's been the recent Spiderman films that have made Spiderman a huge franchise. Since 2002, Tobey Maguire's Spiderman has catapulted the character into the stratusphere. Without doubt the Sam Raimi directed films have done more for the character than all the previous versions put together, taking almost $2.5 billion in box office revenues worldwide. Two films featuring another Marvel character, The Incredible Hulk, in the same time period, have taken over $500 million. Two films featuring The Fantastic Four in 2005 and 2007, grossed over $600 million. Put together the earnings from these three franchises alone, and it comes to $3.6 billion. Put that next to the $4 billion that Disney is paying, and it doesn't half look like Disney seriously underpaid for Marvel.

But the biggest concern I have in all this, is will we see the taming of the risk taking Marvel, by the more conservative Disney? It's been a growing trend across news media, broadcast media and entertainment media over the past 20 years. Corporations do not like taking risks. But Marvel had taken many risks over the years, including the purchase in 1981 of DFE Films, the company that produced the Pink Panther cartoons, which then became Marvel Productions.

The 1994 animated Spiderman series was a big risk, as they used a lot of new techniques in order to achieve the look that they wanted. But it cost a lot of money. So they started resorting to all the usual tricks to save money, such as repeating animations, a favourite trick of Filmation. Also, multi-part stories became the order of business, in order to cut down on the number of characters that they would have to animate.

Despite the success of Spiderman, Marvel went bankrupt in 1996. The fear of bankruptcy is what makes corporations very conservative. They will not take a risk. We've seen corporate conservatism at work already. In 1993, there were 15 ITV companies, each with their own ideas. Now, there is 1 dominant ITV company - ITV plc, and 3 smaller ones. ITV companies used to take risks with shows they had no idea if it would even work. Now, everything has to be in profit before it even aires. 15 diverse broadcasters have been replaced by 1 large broadcaster that seems scared of its own shadow.

Then there is the GWR/GCap/Global situation in commercial radio. In the late 1980's, commercial radio was forced to split FM and AM programming, creating two stations where there had previously only been one. The ILR heritage stations remained on FM< whilst new oldies stations were created on AM. GWR created Brunel Classic Gold on AM and as GWR bought up stations, they imported the Classic Gold name and format. In 1998, GWR sought the approval of the Radio Authority to network Classic Gold for 20 hours a day. They were granted this, and so began the process of creating a semi-national network, cutting expenses and local programmes, because of their growing corporate conservatism. Classic Gold is now Gold. But of course it didn't stop there.

They increased their networking arrangements on FM. Evenings and Overnights became the first easy targets for FM network programmes. It was understandable. In the early days of commercial radio, some neighbouring stations would get together to provide a mini network for evenings and overnights. The Yorkshire Radio Network, combinig Pennine Radio, Radio Hallam and Viking Radio, provided programmes most evenings and for a bit longer at weekends. Other little networks also emerged, so it was an easy target for GWR, or as they would later become, GCap.

But it took until Global had taken over GCap, for FM network to reach into daytime, with OFCOM allowing a rule change that allowed stations to broadcast just 10 hours of locally originated programming a day on weekdays. The Heart FM network would simulcast Toby Anstis between 10am and 1pm, in order, as they would say, to allow a big name personality to generate revenue across the network. Unfortuantely, Toby is such a bad radio presenter, that the only thing keeping him on air is his supposed star power.
That's the root of the thinking of corporate conservatism. Big names + big audience = profit. But it doesn't always work that way.

Now corporate conservative Disney is going to buy Marvel, and will we see the same corporate conservatism infect Marvel, like it has infected many other media corporations over the years? I hope not, but I'm not confident.

Capital Life closes

I turned on Capital Life earlier to listen to the music, and all I found was silence. The scrolling message on my DAB radio says, "We're sorry, but Capital Life has closed down. Thanks for listening to the station over the past few years."

So, just as Global buys GCap, Capital Life closes. I used to enjoy that station. Oh well, Capital Life's demise might be a good thing in the long term, but confidence in DAB is low. What with 4 Digital being put back until November, it seems that a lot will be on the shoulders of established stations. Is there no-one with the guts to try something new on Digital 1? I guess we'll see in time.

Dead And Buried?

I am nothing if not a realist. In the many years that I have been following the media, I've seen the them do a lot of silly things. But the way industry insiders such as Ralph Bernard have recently talked down DAB (Digital Audio Broadcasting) digital radio is almost nothing short of deliberate sabotage. Thankfully few others have gotten in on the act, though DAB does have its problems. But then, so does GCap, the company Ralph Bernard worked for. So maybe, it was telling that Mr Bernard did everything he could to hide GCap's problems behind the façade of a DAB crisis. After all, almost all of GCap's radio stations broadcast simultaneously on analogue AM or FM and on DAB Digital Radio.

But now, a group of analysts have bought into this façade and are trying to suggest that there is a real crisis in DAB, a crisis that - by the way - doesn't actually exist except in the minds of bean counters who are looking for profit all the time. The name of this group of analysts: Enders Analysis. Now, this analytical organisation has tried to claim that in fact DAB is about to become the next Betamax!

First of all, the analogy is way off the mark. DAB is not in competition with FM, or AM, or even DRM (Digital Radio Mondiale) which is fairly new on the scene. If that were the case, then LW would probably have been closed off years ago. Secondly, to look at how long it takes for something to bed in to the public consciousness, you only need to look at VHF/FM. The band was opened up in the 1950s, but it didn't become popular to listen on FM until the 1980s. Even when Radio 1 had to hand over 1053 and 1089 AM to commercial radio in the 1990s, there were still plenty of people to convert over to listening to Radio 1 on FM.

The report's writer then goes onto suggest that DAB's financial health is looking grim by saying:..

"With three of the largest radio groups having reduced their commitment to the DAB platform in recent months, their stations having been replaced by a mix of ethnic, religious and non-commercial broadcasters, the future health of the DAB platform must be under question."

I really think this guy needs to wake up and actually do a little research. There are other issues at work here than just DAB. First, Yes, GCrap GCap is closing stations, not because DAB is a failure, but because of their own lack of confidence in both finances and in broadcasting itself. Remember they tried to sell off 9 stations as a bundle, that they felt were "non-core stations". They failed, miserably. GCap's Gold Network is in danger of collapsing. The whole network of 40 stations gets less than 1.5 million listeners, with some stations doing incredibly pathetic numbers. Gold's Plymouth station gets a mere 7,000 listeners. It's because the product being offered, whether by DAB, FM, AM or online, is one that people think is not up to scratch. It doesn't mean the platform will fail.

Virgin Radio may have closed one digital only station and put the brakes on launching another, but that again has little to do with DAB. SMG, who own STV and Grampian as well as Virgin Radio, are trying to sell Virgin Radio, but again, there are few interested parties. It's an attempt to make the Virgin Radio company more attractive to possible investors. It's got nothing to do with any possible failure of the DAB platform.

People were saying similar things about Digital Terrestrial Television when On/ITV Digital collapsed in 2002. I remember it well, I was reporting on it at Transdiffusion. Now, with Freeview as the base of the platform, the platform is thriving. Commercial Radio went into the platform without looking at how long it takes to establish one. They were looking for a quick 5-year or so turnaround to profits, rather than the 15-20 years it takes to properly establish a new radio platform.

DTT went from being a commercial platform to being a public service platform and has thrived. DAB needs to go down the same route and it won't as long as GCap are in charge of national and local multiplexes. GCap's Digital One and Now Digital are the DAB equivalent of ITV Digital. The daft thing is, this moronic writer of this report, whose name is Grant Goddard, also referenced the ITV Digital debacle!

"Ofcom faces a public outcry if the DAB platform were to fail, with owners of the 6.45 million DAB receivers sold to date demanding a refund of their purchases (remember ITV Digital?)."

Yes, I do. As I mentioned earlier, I reported on it, first hand, you can find the articles over in Bitstream on EMC, along with those of some of my colleagues who also reported on it at the time. And in all honesty, I do not see how over 6 million people would demand refunds for something that they HAVEN'T subscribed to, but just bought a piece of equipment for. Believe it or not, there are still ITV Digital digiboxes out there working, albeit not brilliantly, but they are working, just. But the most moronic statement of them all has to be the one that follows:

"Channel 4 is faced with the task of imminently launching a brand new DAB multiplex in the middle of a snowstorm around the future of the whole platform,"

A 'snowstorm' that has been created predominantly by two people. GCap's Ralph Bernard and Enders Analysis's Grant Goddard. Channel 4 got a taste of running a digital radio station in the recently demised Oneword, and it obviously didn't put them off because they chose to bid for a new national multiplex. And they won. 4 Digital group's stations represent the freshest ideas for DAB ever. All Digital One seems to have done is trotted out the same old tired sound, time and time again, and Joe Public is bored with it. With the growth in online listening, listeners can tune in to stations the world over, and find the cream of the crop.

Sadly for commercial radio, the UK's best stations are run by the BBC. British commercial radio barely flickers across the online 'dials' at all. But stations in the US, Canada, Australia, and Europe are all providing a far superior product to almost anything we have here in the UK. The reason is simple. Whilst our commercial radio stations have cut back content to the bare bones of music, commercials and news, other stations across the world have upped their content levels and because of this, are able to take advantage of the Podcast medium, which out of necessity, has to be speech based.

DAB as a platform is not at fault. It's the stations themselves that have shot themselves in the proverbial foot. Yes, we've lost a number of radio stations on DAB, but they've closed because their business plans were not realistic, in much the same way that a multitude of stations have closed on digital television, not because of the platform, but because their business plans were not realistic, not designed for the new digital broadcast environment that exists these days. And because they aren't making money as quickly as they want to, they want to abandon a broadcast platform. And you, Grant Goddard of Enders Analysis, are actively encouraging them with this piece of anti-DAB propaganda!

The report reads like the kind of hit job that I would expect from Fox News covering a Democrat, rather than an analysis of DAB. It has so many inaccuracies, that I have detailed and more, and come to so many erroneous conclusions, that I have to consign this report to the only file where it seems to fit in. The waste paper bin!

Ralph Bernard and words of wisdom... Not!

This one crossed the wires whilst I was at the RMC newsdesk, and once again, it had me shaking my head in pure disbelief at how out of touch with reality outgoing GCap Chief Executive Ralph Bernard really is.

He gave an interview to Marketing Week, and some of the things he has said in that interview just leave me stunned with disbelief.

He says digital radio is facing a crisis. Wrong! There is no crisis in digital radio. Over 5 million sets have been sold, and almost 20% of the country can be counted as living in DAB households. DRM is now being added to the digital radio portfolio and it won't be long before combined DAB/DRM sets are available.

The Sirius/XM model of satellite radio is coming to Europe, and those broadcasts are digital too. Put simply, digital radio is looking very healthy.

What is truly in crisis right now, is GCap itself. Not all of GCap, though. Classic FM is continuing to be the dominant force in the national commercial radio market, and is the fourth most listened to national radio station, according to the latest RAJARs.

But GCap's local operations are very definitely in crisis. GCaps' One network of FM stations is stagnating at best. They tried to sell off 9 stations, including all their interests west of Bristol. No one bought them, and they took them off the market. All their local FMs sound far too samey. A localised "Morning Crew" at breakfast, a midday host and drivetime show, then networked from 7pm. Most others local stations are also guilty of sounding far too samey as well, but there are some exceptions. GCap stations take this to the extreme, with just about everything sounding almost exactly the same, no matter which GCap station you listen to.

Their AM operations, under the brand of "Gold", are in real crisis. With over 40 stations around the UK, with a TOTAL listenership of under 1.5 million according to the latest RAJARs, Gold is the biggest complete failure in the history of UK broadcasting. The Plymouth operation of Gold is the best example of this. Back in 1999, when it was Plymouth Sound AM, the station had a listenership of 67,000. Not stellar, but fairly stable. The latest RAJARs had Gold Plymouth showing a total listenership to the station of JUST 9,000! A pathetic, paltry 9,000. Around about an 80% DROP! Failing so miserably and completely, that it is no wonder, that Ralph Bernard wants to close analogue radio down, and have only digital radio. But even digital radio isn't realy a saving grace for GCap.

Digital One, GCap's national digital radio operation, is looking dangerously fragile. D1 is supposed to air 10 radio stations. Other than the 3 INRs on analogue, the other stations on there are Core, Life, The Jazz, Oneword and Planet Rock. That means there are 2 gaps that need to be filled when the BT mobile TV service ends. And with the added fact that GCap are removing Core and Life from the platform, that will leave 4 massive holes in the Digital One portfolio.

The second national digital radio multiplex is due on air in 2008, and whilst their progress to launch hasn't been completely smooth sailing, there is every sign that their full portfolio of stations including Sky News Radio will launch on time. This, if it happens as expected, will only serve to further highlight GCap's total and utter incompetence when it comes to radio. NTL and Telewest used to be the laughing stocks on the media industry. Since becoming Virgin Media though, they seem to have gotten their act together. Right now, GCap in the BIGGEST laughing stock in the history of UK broadcasting, since Lord Haw Haw!

Let us hope, somewhat forlornly, that the NEXT GCap Chief Executive, is a LOT more in touch with the reality of GCap radio than Ralph Bernard.