Australia got a policy about digital radio in 1998, but no digital radio services. Then it got another policy in 2005. In January next year, it will finally get digital radio services, 14 years after the UK. But one of the biggest commercial radio operators there has just announced it is quitting the medium. In its view, Digital Audio Broadcasting [DAB] “is not an economically viable platform for the Company”.
Some are interpreting this as a dreadful vote of no confidence in digital radio by a commercial organisation uniquely placed to understand its possibilities and pitfalls. Others are suggesting the company is jumping just as digital radio is finally starting to work.
The UK is not the only market having problems. In Canada, where services started in 1998, the communications regulator concluded a year ago that “the adoption of the new digital radio technology by consumers and the switch-over by the radio industry to digital is now effectively stalled”. Some digital stations had ceased operations, the extension of services had halted, and promotion of them was token.
Across the border in the United States, two operators have been fighting for subscribers to digital radio delivered by a mix of satellite and terrestrial transmission. Charging $US12.95 a month each and offering a total of more than 300 channels, they’ve both been growing rapidly, and now have more than 8 million subscribers each. But they are losing a fortune (one just announced a loss of $US565 million for 2007) and are planning to merge if regulators will let them.
What went wrong with radio’s digital future? And should Australia’s radio stations, currently investing millions of dollars to embark on their own DAB mission, be worried?
When Australia’s policies about digital TV and radio were released in March 1998, the two were treated like urgent, overdue twins as the Dot Com boom approached its zenith. All media were going digital. TV and radio would have to be part of it.
Existing broadcasters would get extra spectrum to introduce digital services alongside their continuing analogue ones. They also got a guarantee of no more commercial competitors for several years. Analogue services would be shut down sometime in the future. The spectrum would be handed back and reallocated for new kinds of service, although that expectation was much more clearly stated for TV than for radio.
Free-to-air digital TV services started on time in 2001. Digital radio dropped off the agenda. Commercial stations couldn’t see where the extra revenue was going to come from to pay for the transmission infrastructure. The ABC couldn’t imagine a hostile government giving it more money for anything. Non-profit community radio stations were flat out paying for the technology they already had.
Audiences, however, got new radio services without the need for digital transmission. Since the early 1990s, about 100 new commercial stations, 200 community stations and more than 250 special interest “narrowcasting” services have been licensed to use mainly FM frequencies. The ABC and SBS established new networks and expanded existing ones with hundreds of new transmitters. These operators all had an eye on the prospect of digital transmission, but were more worried about making their new analogue stations successful.
Doing without digital radio didn’t mean Australian audiences had to do without new digital listening choices. The Internet increasingly delivered streamed and podcast audio files from anywhere in the world to personal computers and portable MP3 players. This was a boon for the creators of music and talk as well as the listeners, although it presented profound challenges to music and radio industry incumbents.
The radio industry was terrified of an audio future where radio is much less central, and where someone other than incumbent radio broadcasters might be allocated the spectrum they want to keep available for digital transmission. Some radio broadcasters particularly feared the emerging powerhouse of broadcast transmission in Australia and the UK, Macquarie.
In 2005, the Government announced another policy about digital radio. It gave the commercial industry most of what it wanted. From January 1, 2009, listeners in Sydney, Melbourne, Brisbane, Adelaide, Perth and Hobart should be able to tune in to digital radio services. They’ll start asking themselves the same question broadcasters have been asking for a decade-and-a-half: why would you want it?
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