We believe Ofcom s role should be to licence, nurture and protect in relation to Community radio.

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1 Question 1: What role should Ofcom have in respect of community radio, beyond the licensing of new services? We believe Ofcom s role should be to licence, nurture and protect in relation to Community radio. Given that the community radio sector in the UK is being developed within a mature commercial radio landscape and in a country where the BBC has established itself (financially and in the public consciousness) as the primary provider of public service broadcasting, emergent community radio will need protective policies and measures that will enable it to establish and grow. In this regard, one of the key areas in which Ofcom could develop measures is in assisting the Community Radio sector with the development and funding of an independent lobbying/development body of sufficient strength and finances to effectively promote the interests of the sector in the same way that the BBC and CRCA lobby on behalf of their own and their members interests. Due the small scale, very local and scattered nature of the proposed community radio sector, it will be extremely difficult for an effective body to emerge without Ofcom s active assistance. Whilst the CMA have acted in the past to promote Community radio and may indeed be an appropriate organisation for taking this role forward, we feel that stakeholder (ie. Community) interests must be the guiding tenets of any representative body and an assessment should be carried out to ascertain the most appropriate structure and method of setting up and funding such an organization. Issues which would be of immediate interest in terms of lobbying could include: talks with funding bodies such as The Arts Council to raise the profile of radio as a creative medium, discussions with PPL, MCPS and PRS concerning reduced licence fees which could encourage the growth of community radio, involvement with the development and policy of Cultural Industry s National Training Organisations and input on skills needs for the sector to the Learning and Skills Council and Regional Development Agencies. Question 2: Do you agree with our proposed policy for the allocation of spectrum and the size of coverage areas for community radio services? The broadcasting of low power signals in either high-density population areas or hilly areas causes problems of coverage. One possibility is the use of more than one FM transmitter in an area that is hard to serve by one single low power transmitter. With the placement of transmitting equipment in positions chosen to eliminate coverage of areas other than the chosen footprint, a chain of very low power directional transmissions could more effectively serve geographically difficult areas. This option would only be required for a few stations that require coverage over difficult areas or to reach a small but widespread listenership.

2 We are not in favour of allocation of the AM spectrum to Community Radio as we feel that its lower quality and the current reduction in the manufacture and availability of AM receivers would marginalise the Community Radio Sector from the outset. Question 3: Do you agree that community radio should be an applicant-led process with an annual 12-week period when applications can be submitted for any neighbourhood or community in the UK? Yes Question 4: Do you agree with Ofcom s proposal to invite submissions from commercial radio operators if they consider that their economic viability might be affected by the provision of a community radio service, based on the application proposals? Changes in the local radio landscape will inevitably impact on commercial radio and especially that of small-scale commercial stations. However, this should not prevent community stations from setting up to broaden the listening choice available to the community and the purchasing choice available to businesses. It is likely that commercial radio operator s primary concerns for their economic viability will be either in relation to perceived competition from community radio for listeners and advertisers with a resulting reduction in their income, and/or they will be concerned about a reduction in the value of their shares. Any business will face changes in their market for a variety of reasons, including general economic downturns, the launch of a new local publication seeking advertising, the introduction and pricing of new technologies, changing consumer interests and habits and so on. The professional management of an investor s interests should include strategies to manage these impacts and the introduction of community radio should be regarded as an impact (and not exactly an unforeseen one) rather than a threat. We believe the onus should be on business managers to protect and build their own private profits themselves without an automatic recourse to Ofcom in order to protest against a new impact from a sector which has long awaited this opportunity. The airwaves are a natural resource and many millions of pounds of profit have been generated from them in the past largely through the restriction of their ownership and the climb in the value of shares. Conversely, in terms of economic impact in an area, local employment, exportability and so forth, local commercial radio stations rarely feature as significant economic generators. The commercial radio sector overall is not a large employer. In 1996, the Department of Culture, Media and Sport 1 estimated that of the 3,800 people employed in radio nationally, only 1,600 were employed by commercial radio. Updated figures from Skillset (Skillset census 2002) show total radio employment in 2002 to be 2,200 and while the Skillset data does not show the ratio of BBC employees to those in commercial radio, it

3 is likely to continue to be less than half the current total with very small numbers of employees actually working in local commercial radio. With an initial remit to reflect localness, many local commercial radio stations were set up under strict promises of performance which investors bought into. Through lobbying to change the promise which was then relaxed to the lighter format regulation, we feel that the local commercial radio sector has already profited through regulatory changes in a way which has enabled them to prosper. Indeed, in many cases the result was that these businesses were able to increase their profits by reducing their expenditure on the production of local content. Whilst we feel commercial radio has a particular role in the UK radio landscape and radio overall hits above its weight in terms of social and cultural impact, it would seem unfair that the commercial sector should then be given the right to protest against new services created by the community to serve the community and for the profit and benefit of the community. It is our belief that the business plan of a proposed community radio station should stand up to extreme scrutiny by Ofcom and its community stakeholders. This scrutiny should be able to determine its economic viability within the existing panoply of local radio and media providers. Community radio has the potential to deliver enormous social benefits from education and training to inclusion, information and access. There is a definite need for community radio offering the complete package of advantages as outlined by Professor Everrit and many of these advantages are in direct competition with the aims of a commercial organisation. As such, any economic viability submission should be balanced against the greater social impact presented by the community station. 1.Section 13, Television and Radio, Creative Industries Mapping Document 1998, DCMS. Question 5: Should there be a general limit of 50% of annual income that community radio stations are permitted to obtain from the sale of advertising and sponsorship, or should this be decided on a case by case basis? This should be decided on a case by case basis. If the audience for community radio is different from that of commercial radio, it is logical to conclude that the requirements of the advertisers will differ. A community station with numerous groups represented and producing targeted output will garner small but highly targeted audiences for each show. This will be of interest to retailers with a limited range of goods mainly of interest to the audience served. When the total potential audience is not at total capacity, then the total potential advertising opportunity is also not at capacity and thus advertising spend still has a growth margin. As such, an over protectionist approach to survival by an evolved industry should not be allowed to be imposed on an emerging industry. Imposing a 50% limit should be justifiable and the onus should be on local commercial radio stations to explicitly prove the current level of the available commercial revenue and the risk that a

4 community station in the marketplace would pose. Furthermore, the onus should also be on the commercial operator to show that any risk to them will result in a significant risk to the wider community and economy. The potential for acquiring commercial revenue should not be automatically removed from community radio because it represents competition. It is important that all sectors of radio work together to maintain the value of radio as an advertising medium and it is in no provider s long-term interest to price-cut other radio services. The most important part of the equation is the station output and its adherence to its stated aims. Question 6: Are you content with Ofcom s proposals for the submission of applications? Paragraph 56 defines the ownership of multiple community stations but not multiple stations including commercial and community or directorships of other stations or other media outlets in the locality. Community radio can integrate and co-exist harmoniously in the current radio landscape and will work at its most efficient with links with the current radio operators but community radio must retain its ultimate autonomy to protect its stated goals. Question 7: Are you content with Ofcom s proposals for the order in which it will consider applications in the first year? Yes Question 8: Aside from the Government s selection criteria, what other criteria should Ofcom use when deciding between applications? The stated aims of community radio are different from those of commercial radio and, as such, the selection criteria should be different. The emphasis in the initial round of applications at least must be on social inclusion and broad community access rather than perceived demand for the service. Demand will only be truly quantifiable once the concept of community radio is understood by the community. Question 9: Are you content with the proposal for listing a station s key commitments in its licence? Yes (also see answer to Q.11) Question 10: Are you content with Ofcom s proposal that each station should produce an annual report?

5 Yes Question 11: Do you have suggestions on how we might research the impact of community radio services on target communities or on other methods of seeking feedback from communities? Due to the nature of community radio, no clear definition of what community radio consists of can be defined. This leads to the problem of quantifying feedback to judge the success of the station where no universal single criteria exists. To circumvent this problem, each station could effectively define its own criteria. This would take the form of a charter or constitution with defined goals and set achievement points or benchmarks. These points should be rigid enough to clearly state the objectives of the station but not to the extent of locking the station on a course that is irresponsive or irrelevant to the community served. The second benefit of the charter is to clearly demarcate the relationship between the community and commercial stations in the area and reduce tension between the different operators. The commercial operators "format" (previously, promise of performance) would define their limitations of operation. As with a commercial operators format, the charter of the community station would be fixed for the duration of the licence unless explicitly authorised by Ofcom.