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Commercial radio stations could close without extra government support
By Chris Cooke | Published on Tuesday 14 April 2020
The Chair of the All-Party Parliamentary Group On Commercial Radio has written to ministers calling for special support for commercial radio stations in the UK during the COVID-19 pandemic, warning that some stations could close if such support is not forthcoming.
There have been a number of reports in recent weeks showing that radio listening is up as a result of the COVID-19 shutdown, in many cases to the detriment of the streaming services. It’s assumed that the human element of radio has become more important to audiences as the pandemic has heightened, plus people are seeking more regular news updates.
Some have speculated that this means the COVID-19 pandemic could ultimately be good news for a radio sector that has lost listeners and listening hours to online services in recent years, especially among younger consumers. The logic goes that radio stations might be able to recruit long-term new listeners via their COVID-19 programming.
However, in the same way that the commercial success of the premium streaming services is linked to subscription sales not consumption levels (mitigating the impact of any short-term listening dip), commercial radio stations are entirely dependent on advertising sales, so that more listeners doesn’t necessarily mean more money.
In the short term the advertising market is wobbling as a result of COVID-19, hence the concerns of the APPG On Commercial Radio. In letters to the Treasury, Cabinet Office and Department Of Digital, Culture, Media & Sport, it reports that many radio stations have seen ad sales fall significantly since the COVID-19 shutdown began.
Those local radio stations still independently owned have been worse hit, as they are more reliant on ad sales to small local businesses which are either shut entirely at the moment, or facing severe cash flow challenges meaning things like advertising are on hold.
According to Radio Today, the APPG’s Chair Andy Carter MP said last week: “The government has taken extraordinary steps to protect businesses, yet there is a risk that without further help that some commercial radio stations could end up being forced off-air”.
Specific support the government could provide, the APPG says, includes relief on high fixed transmission costs, an extension of current financial schemes to commercial broadcasters and an increase in spend on radio advertising by government departments.
Noting that the public service role of even the most commercial music radio stations increases during things like the COVID-19 pandemic, Carter added: “The APPG recognises the significant public value provided by broadcasters and so it is right that ministers review ways in which they can support the stations across the country which have millions of listeners relying on them for vital news and information”.
