In this article we explore Part 5 of the draft Media Bill (“Regulation of Radio Services”).
In February 2017, the Government initiated a consultation into proposals to deregulate commercial radio and to reform the legislation regulating commercial radio, which was largely developed in the late 1990s. Part 5 of the new draft Media Bill aims to deliver on the findings from the Government’s consultation by including significant changes to the regulatory landscape of the commercial radio sector and allowing for much greater flexibility in how stations deliver their services.
Changes to both national and local analogue radio services
Ofcom will no longer have to ensure there is a diversity of national analogue (i.e. FM and AM) stations or a range and diversity of local analogue services. This will lift restrictions imposed on Ofcom in terms of to whom they may grant analogue radio licences, allowing for much greater freedom for Ofcom to exercise its own discretion and to decide, for example, whether or not to re-license an analogue frequency at all, in light of a general shift towards national and local services being available via digital means. In this context, it is interesting to contrast the current law, where Ofcom has recently terminated Absolute Radio’s AM national licence after Bauer, Absolute Radio’s owner, ceased transmissions. Ofcom is currently evaluating what financial penalty to impose in this case (Ofcom having an obligation to impose some financial penalty in this situation).
Further, the draft Media Bill helpfully addresses the issue of analogue radio licences potentially ending before a licence holder is set for a digital switch-over. Now, Ofcom will be able to extend the licence holder’s existing analogue radio licence up until the date for the digital switch-over, thereby preventing the need for further legislation.
Scaling back of licence application requirements for local services
The draft Media Bill has either removed, or largely stripped back, the prescriptive requirements in applying for a licence for local analogue services. This means that application requirements for a local analogue licence are now largely left to the discretion of Ofcom.
In addition to the relaxation of application requirements, local analogue radio licences can now also be more easily renewed if Ofcom is satisfied that a licence holder is already providing a local digital radio service, or, where they are intending to do so in the near future. Where a licence holder is already providing a local digital radio service, they will only be required to satisfy Ofcom of this fact. In the event that the licence holder is not yet providing a local digital radio service, but it intends to in the future, it will be required to provide the following for the renewal to be considered:
- a statement of explanation to Ofcom explaining why it is not possible to broadcast a digital service;
- an assurance that they are intending to do so, as soon as such a digital service becomes possible; and
- a nomination of a suitable multiplex service as soon as the licence holder has secured one (noting that this will likely be a condition of any renewed licence that is granted in this circumstance).
Amendments to the character and coverage requirements for local services
Interestingly, the draft Media Bill has reflected a slight shift in attitude towards what listeners want to hear on the radio and the purpose for which radio is used. Currently, local radio stations must commit and adhere to various conditions in their licences that relate to ensuring they broadcast specific genres of content, for example spoken material or specific genres of music, as well as ensuring they target particular age groups. The draft Media Bill seeks to remove these requirements and instead imposes a requirement that programmes consisting of or including local news and information, such as traffic, weather or local events, must be included in local radio services on a regular basis and must consist of locally gathered news. To assist with this, the draft Media Bill also further removes the requirement to provide a certain amount of programmes from a studio within a station’s coverage area. Relevantly, the draft Media Bill does not require stations to employ journalists directly, but rather permits a station to enter into relationships with newspapers and media agencies in order to build more news and local information into their service offering. Again, this largely reflects the reality of today’s stations, sanctioned by Ofcom, where (with limited exceptions around breakfast and drivetime) many local radio stations have been merged into national brands, with limited presence in many local radio station service areas beyond news-gathering.
The draft Media Bill does not currently impose the same universal requirements on local digital services. Instead, it empowers the Secretary of State to be able to impose regulations in the future that could require Ofcom to ensure that at least one local digital radio service in a local multiplex area carries local news and information, or to ensure there is space reserved in a local multiplex for a local radio service that carries local news or information.
Scaling back of licence application requirements for radio multiplex licences
The draft Media Bill has also stripped back requirements when applying for a radio multiplex licence. An applicant no longer needs to include detailed proposals about the number and characteristics of all digital radio services that will be broadcast on the multiplex or the capacity of the services proposed to appeal to a variety of tastes and interests. Rather the applicant must satisfy Ofcom only of the other remaining requirements included in sections 46, 47, 50 and 51 of the Broadcasting Act 1996, such as specifying areas which would be within the coverage area of the service, the ability of the applicant to maintain these coverage areas and to comply with the general requirement to act in a manner calculated to ensure fair and effective competition.
Non-UK digital sound programmes may now fall to be regulated by Ofcom
The draft Media Bill also sets a framework for Ofcom to license overseas radio stations, by indicating which non-UK digital sound programmes will now fall to be regulated by Ofcom. These will be a digital sound programme that:
- is from a “qualifying country” with the list of qualifying countries being determined by the Secretary of State; and
- are or intended to be broadcast by means of a local radio multiplex service, or small-scale radio multiplex service.
According to the Government’s explanatory notes to the draft Media Bill, the Secretary of State intends to specify Ireland as a qualifying country. This would mean that Irish community and commercial radio station operators could apply for digital licences for their radio services, thereby allowing for those services to be broadcast in the UK. This mirrors the benefits afforded to certain Irish TV channels pursuant to the Good Friday Agreement (and already incorporated, by means of amendments, into the Communications Act 2003).
The CMS view – surprise score 3/10
Considering the consultation launched by the Government in 2017, as well as the release of the White Paper, we were not surprised by the draft Media Bill incorporating changes to the content and framework requirements of commercial radio (even though this apparently remained unresolved until quite late in the day). The team was, however, surprised by the extent of these changes, being more than a mere relaxation of licence requirements and instead better characterised as a total liberalisation of the regulatory framework. These changes are not only a reflection of a need to update some elements of applicable legislation, but also reflect the Government’s clear desire to further support and enable the commercial radio industry by providing stations with greater flexibility in the delivery of services without needing consent from Ofcom. The industry seems to have succeeded in driving home the message that commercial radio remains valuable and provides stronger support to UK culture than online-only streaming music services.
We will be watching this Media Bill closely as it passes through Parliament, so keep an eye out for our updates on our dedicated CMS Media Bill webpage. If you would like to discuss any aspect of the Media Bill or how it may affect you, please get in touch.