Achieving digital radio Britain

The number of listeners to digital radio has increased significantly over the last five years, driven by increased choice of stations and sales of DAB radio sets, which have just hit five million. Listening is also increasing via other technologies such as digital TV, mobile phones, MP3 players such as the iPod and through the internet. The move to digital is seemingly inevitable and the planning for this move is of crucial importance for DAB set manufacturers and others alike.

While a date has been set for the switch-off of the analogue television signal, we are still waiting to find out when, or even if, switch off will be for the analogue radio signal. When you consider that on average each household has between five and seven radio sets, the importance of a clear, agreed plan for the move to digital radio becomes evident. Ofcom has recently published a consultation document on the future of radio. Although the instigation of an industry-wide debate and Ofcom's commitment to DAB are very welcome moves, we do not believe the proposals that Ofcom has put forward provide enough certainty or clarity on the transition from analogue to digital radio. This is vital for DAB radio manufacturers and broadcasters alike if they are to support the move.

The Ofcom document does not even mention European harmonisation, yet we need to recognise that individual markets, including the UK, are too small to interest global manufacturers. This is particularly true of car manufacturers who are likely be a key ingredient when it comes to digital radio take-up: 16 per cent of all current UK radio listening takes places in the car, yet there is no incentive for car manufacturers to build in DAB as standard just for the UK. If we continue with a fragmented European market because of differing digital broadcast standards, we will effectively be holding back competition, innovation and all the associated consumer benefits. Efforts towards synchronised standards and timetables have been made across Europe for the digital television switchover, so why can't the same happen for radio?

In addition, greater clarity regarding the date of the analogue switch-off is required as we know that this level of certainty will drive an important shift in the market. At the time the switchover date for digital television was announced in September 2005, we were only selling a few hundred thousand digital television in an annual market of six million, yet 18 months after the announcement we are now expecting annual sales of digital televisions to be over four million.

A natural migration has helped but the clarity of the timetable was the catalyst for change and the same can be true for radio. If the government wants the move to digital radio to be a success, it needs to ensure as many people as possible have access to it. A clear plan and timetable will bring about the support of manufacturers and retailers which will in turn offer consumers more choice and better value when purchasing digital radios.

All those involved in the digital radio supply chain - broadcasters, radio manufacturers and infrastructure companies - must come together and agree a common view of the road to digital. Historically, these groups have been rather fragmented. Given the number of potential digital broadcast standards, it is imperative that they all have a joint vision for digital radio in the UK and work together towards realising it. Without a common plan we will remain in the current 'chicken and egg' situation where broadcasters wait for more DAB sets to come onto the market before producing more digital content, and manufacturers wait for more digital content to be available before producing more sets. We hope that Ofcom's consultation will instigate a cross-industry dialogue on the future of radio.

Uncertainty over broadcast standards only exacerbate this situation. Currently the UK, and in particular the radio manufacturers, are committed to the DAB standard and therefore it seems reasonable that this is where we should continue to focus. DRM (another digital standard) trials are underway and while it may be a good solution for the AM band, it is too early to say whether it would really be the best solution for the UK. DAB+, yet another potential standard, would create legacy problems for the those five million households who have already purchased a DAB radio. Ofcom's consultation document mentions multi-standard sets, but they are far from common anywhere in Europe. The additional cost of manufacturing multi-standard sets would necessarily create a premium priced product - not an outcome that would attract more consumer take-up of digital radio. The market for radio sets is price sensitive so this is not commercially viable . However a harmonised European market would create volume and would take away the price premium.

It is clear there are still several issues that need to be resolved in order for a clear and timely path to digital radio switchover to be established. Equally it is clear that once that path and timetable have been created industry and the market will be given great impetus to act upon it. The Ofcom consultation might not currently provide the clarity we need , but it certainly provides the drivers for the industry to work together to achieve a digital radio Britain, giving us all a much wider choice of radio programmes.