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DESPERATION TO SELL THE UK
DAB RADIO 'SUCCESS' STORY
(AND SELL DAB HARDWARE) IN
NEW OVERSEAS MARKETS
by
GRANT GODDARD
www....
In amongst all the jubilant public statements from media stakeholders following Assent of the
Digital Economy Act 2010 thi...
UK QUARTERLY DAB RECEIVER SALES ('000)
39
53
183
111
102
134
510
245
205
294
681
338
287
308
796
382
299
363
964
489
358
3...
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'Desperation To Sell The UK DAB Radio "Success" Story (And Sell DAB Hardware) In New Overseas Markets' by Grant Goddard

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Analysis of declining UK consumer sales of DAB radio receivers and the imperative of DAB stakeholders to market the UK as a 'success' story overseas, written by Grant Goddard in April 2010 for Grant Goddard: Radio Blog.

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'Desperation To Sell The UK DAB Radio "Success" Story (And Sell DAB Hardware) In New Overseas Markets' by Grant Goddard

  1. 1. DESPERATION TO SELL THE UK DAB RADIO 'SUCCESS' STORY (AND SELL DAB HARDWARE) IN NEW OVERSEAS MARKETS by GRANT GODDARD www.grantgoddard.co.uk April 2010
  2. 2. In amongst all the jubilant public statements from media stakeholders following Assent of the Digital Economy Act 2010 this month, one press release stood out for taking wild optimism to new heights. It said: “The Digital Economy Bill is linked to the government’s Digital Britain report which defines a digital radio switchover plan lasting two years. The migration start date for this is triggered when DAB coverage reaches the same as today’s FM and when 50% of all radio listening is via a digital platform. Based on current digital listening projections from Rajar, and the roll out of new DAB transmitters from Arqiva and the BBC, the UK market is set to achieve both of these milestone [sic] in 2013 …” Will 50% of radio listening in the UK be delivered via digital platforms by 2013? Not a chance. Even our politicians have admitted this will not happen. Look at the graph below. DIGITAL PLATFORMS SHARE OF TOTAL UK RADIO LISTENING (actual and Digital Britain forecast) 5.9% 11.0% 12.5% 16.6% 18.3% 26% 31% 36% 43% 50% 58% 68% 20.9% 0% 50% 2004Q4 2005Q4 2006Q4 2007Q4 2008Q4 2009Q4 2010Q4 2011Q4 2012Q4 2013Q4 2014Q4 2015Q4 2016Q4 2017Q4 2018Q4 historical data (RAJAR) Digital Britain (drive to digital) historical data trendline The government’s Digital Britain report, published in mid-2009, had forecast that digital listening would be 26% by year-end 2009, which proved to be wide of the mark. The actual figure was 20.9%. What is the chance of 50% being reached by 2013? Zero. So why is this press release so determined to tell us that “the UK market is set to achieve” a milestone that is so obviously impossible? The answer lies in this next graph which shows that DAB radio receiver sales in the UK were lower in 2009 than in 2008, and lower in 2008 than in 2007. Desperation To Sell The UK DAB Radio 'Success' Story (And Sell DAB Hardware) In New Overseas Markets page 2 ©2010 Grant Goddard
  3. 3. UK QUARTERLY DAB RECEIVER SALES ('000) 39 53 183 111 102 134 510 245 205 294 681 338 287 308 796 382 299 363 964 489 358 366 863 483 335 828 162 153 179 121 101 119 5 17 13 4 18 21 28 20 1 -10 -1 -6 -4 40 34 38 0 250 500 750 1,000 2003Q2 2003Q3 2003Q4 2004Q1 2004Q2 2004Q3 2004Q4 2005Q1 2005Q2 2005Q3 2005Q4 2006Q1 2006Q2 2006Q3 2006Q4 2007Q1 2007Q2 2007Q3 2007Q4 2008Q1 2008Q2 2008Q3 2008Q4 2009Q1 2009Q2 2009Q3 2009Q4 -20 0 20 40 60 80 100 120 140 160 180 200 quarterly DAB receiver sales ('000) [left axis] year-on-year change (%) [right axis] The market for DAB radio receivers in the UK has been slowing since the end of 2007. DAB radio unit sales are now less than 2m per annum, a volume last seen in 2006. For financial stakeholders in the UK DAB radio receiver sector, this is very bad news. Frontier Silicon is one of those main stakeholders, a private UK-based semiconductor company that supplies 70% of the global DAB receiver market. With the UK market for DAB drying up, and the European market never having really developed at all, companies such as Frontier Silicon are having to look further overseas for DAB sales. Trade shows such as last week’s Hong Kong Electronics Fair become significant events to convince new territories of the advantages of DAB radio. So the Frontier Silicon press release quoted earlier, though datelined “London”, is not intended for domestic consumption at all. Yes, it might seem laughable in the UK to believe that digital listening will reach 50% by 2013. But, for Frontier Silicon, this ‘success’ story will help convince overseas markets that DAB is already a raging success in the company’s homeland. This is ‘sales patter’, not fact. Who at the Hong Kong event would want to learn that the commercial radio industry in the UK has been brought financially to its knees by its decision more than a decade ago to pursue the DAB dream? [First published by Grant Goddard: Radio Blog as 'Selling The UK DAB Radio "Success" Story Overseas', 17 April 2010.] Grant Goddard is a media analyst / radio specialist / radio consultant with thirty years of experience in the broadcasting industry, having held senior management and consultancy roles within the commercial media sector in the United Kingdom, Europe and Asia. Details at http://www.grantgoddard.co.uk Desperation To Sell The UK DAB Radio 'Success' Story (And Sell DAB Hardware) In New Overseas Markets page 3 ©2010 Grant Goddard

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