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29 October 2014
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Mark Thompson


Mark Thompson


Speech given to the Radio Festival 2006

Monday 2 July 2006
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Thank you Bob and good afternoon everyone. It's a privilege to address this year's Radio Festival.


This afternoon I'm going to try to address the question which underpins much of the current debate about market impact: is a creatively strong, popular and properly-funded BBC necessarily incompatible with a thriving commercial radio sector? Or is another future possible – one built on partnership and mutually-reinforcing success?


A distinctive mission


Last week the Chairman of the BBC, Michael Grade, and I signed the Agreement between the BBC and Government which, alongside the Charter, sets out the BBC's mission for the next decade. They and the White Paper will be debated in the Commons next week.


These documents lay out the public purposes which the BBC should strive to further – and the new framework within which the BBC's performance against those purposes will be measured and the boundaries of its activities both set and enforced.


They certainly call for the BBC to play a distinctive role in the UK broadcasting landscape, delivering the highest possible net public value with the minimum possible adverse market impact. Complementarity to that which the market provides will be closely monitored by the BBC Trust – and this monitoring will focus on areas of real concern. This is why, for instance, the BBC Governors have already decided to concentrate their independent monitoring of the music played by Radios 1 and 2 on the output during daytime where market impact is potentially greatest and criticism from commercial competitors tends to be loudest.


Distinctiveness in any event should be a goal for every BBC service on every medium. Greater investment in original work than you find elsewhere – whether it's our colossal commitment to new music and music-making across radio or our support for genres – documentary, comedy, drama and so on – which, so far at least, are almost unheard of on commercial radio stations. More opportunities for creative experimentation. A collective obsession with accuracy and excellence.


For the past few years, we believe we've been on a path of greater distinctiveness. Speech and built programming has become more not less important on our music networks. Religion is more salient on Radio 2 than it's been for years. But there's more we can do: we want, for example, to find new slots for comedy on both Radios 1 and 2.


There are those, of course, who take a far more restricted view of what distinctiveness should mean. Ever since Peacock, some have argued that the BBC should be restricted to those services and programmes which pass what you could call a narrow market failure test. Popular programmes – programmes for which there is a market – should be stopped and popular services closed down or sold off. In the past few weeks, we heard once again that old chestnut about privatising Radios 1 and 2 – though I have to say that if anyone seriously believes that floating two new formidably popular advertising-funded national radio networks is going to help the rest of the commercial radio industry, they really do need their heads examined.


Anyone of course is entitled to make any theoretical economic case they want, but to expect the narrow market failure argument to be taken seriously by policymakers or the British public is to misunderstand the way in which public service broadcasting has developed in this country. In survey after survey, not just those done for the BBC but in recent surveys commissioned for DCMS and Ofcom, the public have made it plain that they expect entertainment from the BBC just as much as they expect information and programmes which build skills and knowledge. Yes, they want editorial diversity and range but they want the popular to be part of that range. If you've got a problem with a popular BBC, the people you're picking a fight with are the British public.


This year's White Paper, Charter and Agreement are quite explicit about the duty to entertain – indeed the Secretary of State went out of her way to emphasise entertainment when she introduced the White Paper to the Commons.


Distinctiveness is critical, then, but it is not a synonym for the unpopular: it should imply distinctiveness across the range. 1Xtra and Radio 3 collaborating on Urban Classic, the result of six months hard work by Grime producer DaVinChe, young musicians from Hackney and the BBC Concert Orchestra. Radio 2's 2006 Radio Ballads. The Five Live Shorts writing competition. Radio 4's Great Debates.


But it's also the distinctive wit, the distinctive sound worlds, of Chris Moyles, Jonathan Ross, Terry Wogan, Chris Evans. Over the past few years, BBC Radio has taken a different creative path from most of commercial radio, focusing on talent and intelligent, exciting speech on its music networks just as much as on 4 and Five Live. Radios 1 and 2 have been successful not because they've become more like their competitors but because they've become less like them.


A lively market


But commercial radio in this country is also creatively vibrant, just as capable within its own mission of discovering great talent and reaching wide audiences. The RAJAR headlines don't tell anything like the full story of what's going on in our towns and cities. In the major urban areas, for instance, where some of the biggest advertising revenue is to be found, Radio 1 often takes second or even third place to the established commercial radio stations. Radio City in Liverpool for example, the Galaxy stations in Newcastle, Manchester and Birmingham, Kiss in London.


And even Ralph Bernard, that long-time scourge of Radio 2, has admitted that it is a myth that the BBC is more dominant than commercial radio in the audience that matters to them, those all-elusive and all-important 15-44s.


It's certainly true that over the past decade both 1 and 2 have modernised and that Radio 2 in particular has started to attract more listeners in their fifties and forties. In both cases though they were making up for a process of ageing-up that had been going on for the previous 30 years: it's difficult to prove because we don't have good data, but I suspect that both radio stations have older average audiences today than on the day when commercial radio first launched in this country.


But you shouldn't think that we obsess about demographics at the BBC – we're very proud of the passion and commitment that went into Making Tracks, a programme which aims to open up the world of classical music to children and which attracted a loyal audience with an average age of 61! Interestingly – and this makes the point rather well about demographics – although the programme itself failed to get a large children's audience, no less than 35,000 youngsters were introduced to live orchestral music through the concerts that went with it.


When we look at commercial radio, we see a sector which is facing a currently unstable ad market, but which is fundamentally strong. Which is learning to create major events and to punch its full weight by linking up to make and broadcast network output. Which is developing major new stars like Christian O'Connell. And which of course is attracting some interesting new entrants – not least Channel 4.


Commercial radio launched in this country despite the very substantial presence of BBC Radio. Channel 4 and many others want to launch new radio businesses – again despite the fact that they know they will be competing for audiences with the BBC.


British radio, in other words, is a success story because of the combined creative efforts of the commercial sector and the BBC and, in quite a few areas, the healthy competition between them – something captured rather well in the line-up of winners at this year's Sonys. Let's take a moment to listen to just a sample of this combined achievement in output from across the UK over the last year.


(audio clip)


New players, new challenges


One of the most tangible results of the partnership between the BBC and commercial radio so far has been the successful launch of digital radio. Building out our DAB transmitter chain and delivering BBC digital radio to as many other platforms and devices as possible is a key part of our commitment to help deliver a Digital Britain in the next Charter period.


But change in the radio and audio landscape means much more than a straightforward transition from analogue to digital linear radio. People are also listening via DSat, DTT and WiFi radios. On demand audio to PCs, with applications like the BBC's Radio Player, and to mobile devices like the iPod herald presage a world in which consumers can pull audio when and where they want rather than waiting for the broadcasters to push it to them.


The threat that radio stations face from instantly available personal playlists is obvious. But the creative and marketing potential of podcasting is also rapidly expanding the competitor-set for audio in the UK with almost every national newspaper from the FT to the Sun following the lead set by the Guardian. Individual artists like Ricky Gervais are also discovering that – at least when your name and reputation are already made – you may not need anyone, a broadcaster, a newspaper, a record company, anyone – to help you deliver your audio content directly to a paying customer.


BBC Radio's own experiments in downloading and podcasting give some sense of the enormous hunger from audiences – 4.5 million downloads in May on a restricted list of 50 programmes from across our output, covering only speech and unsigned music. We've learned a lot from the trial but we're still learning so we've decided to extend it – using a similarly limited range of content – for some months to come. A decision on whether podcasting should become a permanent service or should be discontinued will be taken by the BBC Governors towards the end of this year after a Public Value Test, including a full Market Impact Assessment, has been completed.


There is of course yet another challenge to radio around the corner. Portability has always been audio's USP, but now mobile TV is almost here and, what's more, it may well use DAB technology and bandwidth to reach its customers. I've just come back from Japan where simulcast TV to mobile phones has been available since April: many players there are convinced that ubiquitous delivery of TV as well as radio to mobiles is inevitable.


What will the raising of the data threshold on DAB multiplexes to 30% mean for the future of DAB as a radio platform? More broadly: to what extent will consumers continue to regard radio as a discrete, independent medium accessed through a discrete device? Will many of them think of it rather as one strand in a multimedia content continuum?


It's a moment which is potentially more disruptive for radio than the advent of television. But the opportunities – both for new revenue streams and for new creative partnerships – are there as well.


We're already seeing some new and intriguing alliances. Take the current Mostly Mozart festival at the Barbican in London – put on by the Barbican, publicised by media partner Classic FM, with an independently produced film In Search of Mozart broadcast on TV by five with a film soundtrack made available as podcasts with links through to each of the participating orchestras. Cross-platform, cross-promoted events are no longer the preserve of the BBC, though there's more we can do too to create broadcasting landmarks like The Beethoven Experience and A Bach Christmas.


We want to enter this new chapter in radio's development in a spirit of collaboration. Independent radio production is a great source of innovation and diversity for us. Its contribution to the BBC has grown significantly over recent years and I hope will continue to do so on the back of its own creative merits over the next charter period. We believe in it, just as we believe in a strong and well-supported in-house production arm not only as a vital part of our own programme supply but as a training and talent resource for the whole industry. We want a closer, more strategic relationship with key indie suppliers and we want to demonstrate to the whole sector the fairness and effectiveness of our commissioning process.


But we also want to work more closely together with independent radio broadcasters as well.


Success for radio of any kind in this emerging world will depend on consumers being able to find our content as easily as possible on any device or platform they want to use. We should work together with rights-holders to develop the right Digital Rights Management to protect their intellectual property but also to recognise the formidable marketing potential of the new radio and audio environment. There was a great deal of anxiety within and beyond the BPI about the downloads which formed part of the Beethoven Experience last Spring. In fact the figures suggest a substantial increase in the numbers of Beethoven CDs sold during and after the season, including copies of the Beethoven symphonies. We should continue to experiment in partnership with the record industry. We should also continue to campaign for content – especially music – to be available to the public on open as well as closed platforms.


We should also work together to ensure that our radio programmes can be discovered as easily as possible. Again, as far as possible we should seek an industry-wide approach to an EPG for radio. To create new ways of finding radio content, new entry points beyond the radio dial to ensure that those – and there are plenty of them, especially among younger audiences – that those for whom radio is often an afterthought find compelling music and audio on the platforms which are front and centre for them.


We've done a good deal of thinking not just about EPGs but about the future of personalised radio – MyBBCRadio is its working title – in which peer-to-peer and other technologies could be used to provide thousands, ultimately millions, of individual radio service created by audiences themselves, all of them based on the extraordinary wealth of existing BBC content, but as relevant to individual users as the playlists they assemble for their ipods. Again, this is thinking we want to share with the industry.


Indeed we want to share more information with the commercial sector across the board. We've already promised to share the results of our local TV trial with the local and regional newspaper groups. The same principle applies to all of our experiments and new service trials and proposals in radio.


Finally we could work better together to ensure a great future for radio. We already have three industry bodies where we work together: The Radio Academy, RAJAR and the Digital Radio Development Board. The DRDB has done an outstanding job driving the take-up of DAB, but both its title and mission should now reflect the much wider technological and marketing challenges which radio now faces. An invigorated Radio Development Board could then expand its role and become a truly pan-industry body looking well beyond DAB to the whole future of radio and audio. The BBC is already a partner in the DRDB and we would welcome the chance for it to widen its remit.


A consistent BBC


Of course there will be those who will say that this is all very well but that the most important piece of confidence-building the BBC could do is not to do with new digital developments – where partnership is already proven and trust relatively high – but in the matter of its existing services and their complementarity with the market.


As you've heard, I don't accept some of the specific criticisms that are made of our services. But the broad point is well taken: licence-payers and commercial rivals alike should be consulted and their views taken into account before the BBC makes major changes to its services or launches new ones. From the beginning of 2007 onwards, a new system will be in place to ensure that that is exactly what happens.


Now of course it's impossible for me today to produce irrefutable proof that the BBC Trust, the framework of Service Licences, the Public Value Test or the Market Impact Assessment, will live up to their promise. The proof is in the pudding. But you should be in no doubt that I and the BBC want them to work. Endless friction with the commercial sector isn't good for business: it's not good for the BBC. There is no level of scrutiny or safeguard that would satisfy some people of course, people who would much prefer it if the BBC and the licence-fee disappeared tomorrow. But it is essential that the BBC builds a better relationship and a higher level of confidence with the reasonable majority in the commercial sector.


That means the mechanisms of accountability and control. It also means a BBC that accepts that – though it should be ambitious and should seek its own lively destiny in the digital space – it can't and shouldn't expect to do everything. Our role in promoting DAB, which meant a handful of new channels for us and hundreds for the wider industry, points to the kind of positive market impact an ambitious but distinctive and focused BBC can have.




Every part of BBC radio is in the midst of change at present. Local radio as we think through what cross-platform means for local provision. The World Service, going through the biggest strategic shift in its history. Our domestic networks, as they contemplate the impact of on-demand, podcasting and the new competition which the internet brings.


This autumn we celebrate the 80th anniversary of the BBC's first Charter – the 80th anniversary of the confirmation of BBC Radio as a public service, dedicated to the provision of outstanding content not to make a profit but to enlighten and enrich the lives of its listeners. It's the continued ability of BBC Radio to deliver outstanding content – and to attract and motivate the outstanding talent who can make it – which gives me such confidence about its future. The final piece in the jigsaw is the licence-fee – which is why a strong licence-fee settlement, one which reflects the scale of the mission laid out for us in the White Paper – is so important.


But where I believe the BBC is changing is in recognising that we are part of a bigger story about radio and media. Success for us will not be lasting if it comes at the expense of others. So when I look to the future, I see not a zero-sum game in which if the BBC is up, commercial radio must be down, but a partnership which generates new ideas and new audiences and in which everyone can enjoy a share of success. Thank you.


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