SRH’s spending spree saw it buy Today FM, FM 104 and Highland Radio, along with a brace of provincial newspapers. These purchases showed little sign of a coherent strategy: it bought Today FM at just the right moment, but buying FM 104 for €30m and the tiny Donegal station Highland Radio for €7m were expressions of extreme but misplaced optimism. As SRH glumly noted when reporting a 7% fall in Irish radio revenues in April, the market remains difficult.
Its entry into the market, however, greatly increased the incentive for stations and operators to bend rules and gild lilies. Many were happy to do so and secured licences based on extravagant programming commitments which they quickly abandoned, safe in the knowledge that the regulatory body would impose no sanction.
With SRH boasting it had €50m to spend, stations became highly tradable and were turned over with unseemly haste, as with Lite FM’s sale to UTV after just 30 months on air and FM 104, sold to SRH just six months after renewal of its licence.
Such has been the disregard of stations for programming commitments that the message has finally sunk in even at the BCI, which announced 10 days ago that its ownership and control policy is to be reviewed before any further licences are issued.
The move is a face-saving exercise rather than a measure driven by concern for the radio market. The BCI has its eyes on the bigger prize of independent television licensing, which it is eager to control. The policy review is a belated effort to gain some credibility, following withering criticism of it by Cathal Goan, the RTE director-general.
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Goan’s main point was that the BCI should not be allowed to supervise both RTE and the commercial sector in any new regulatory environment, as it is a cheerleader for the commercial stations and would have a conflict of interest. Conor Maguire, the BCI chairman, rejected this, but the commission’s serial failure to make commercial stations accountable undermines his position.
Goan, in any case, outlined only half the problem. The other half is the distorted nature of the commercial radio market.
Given the shortcomings of the BCI, the only way to allow market forces to operate more cleanly — necessary to remove the incentive for commercial operators to lie in order to get licences, and to abandon promises once licensed — is to free up part of the radio spectrum, allowing anyone who wants to launch a low-powered, local station to do so.
The existing libel and decency laws would be adequate to control content and within a short time the true value of commercial licences would be apparent.