The commercial radio industry is outraged at the Government’s plans to give Ofcom the power to regulate the amount of advertising on local radio.
In an attempt to protect the content of local radio following the relaxation of the media ownership regulations, the Government is proposing to give the new super-regulator the power to determine how local radio stations generate their revenue.
If it is approved, clause 304 of the Communications Bill will give Ofcom free-reign to regulate the amount and type of regional advertising on local radio stations, to ensure that local companies and services are given proper access to the airwaves in the newly deregulated and potentially more consolidated market.
The Radio Advertising Bureau (RAB) and The Commercial Radio Companies Association (CRCA) are strongly opposed to the proposals and are currently lobbying for the Bill to be amended.
Douglas McArthur, chief executive of the RAB, registered his opposition to the clause with the Prime Minister’s special policy advisor, Ed Richards, at ISBA’s annual Advertising Event earlier this week.
Richards refused to comment on the intricacies of the proposal, saying only that the Government was committed to making Ofcom a light-touch regulator in its approach to radio advertising.
However, the industry is far from satisfied and the CRCA claims to be “dismayed” that there was no consultation over the proposals. It states: “The new rules proposed in clause 304 are not focused on listeners, they instead seem determined to allow Ofcom to interfere in how companies run their businesses.”
The CRCA argues that there is no need to regulate the amount of advertising on local radio, as competition in the market remains fierce. It is urging the Government to abandon the proposal on the grounds that it: “Threatens to stifle innovation and set in aspic how to make local radio rather than safeguarding the product that listeners receive.”
Late last year the Government confirmed plans to further relax the radio ownership regulations, in a move that clears the way for greater consolidation within the sector. Culture Secretary, Tessa Jowell, announced that the local radio ownership rules will be revised to ensure that there are at least two commercial radio operators, in addition to the BBC, in each local area (see UK Radio Industry Given Further Deregulation).
