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'UK DAB Radio Receiver Unit Sales Fell In 2009 & 2010 Though Digital Radio UK Claims "They Are Flat"'

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Analysis of declining DAB digital radio receiver sales in the UK indicates declining consumer interest, written by Grant Goddard in August 2011 for Grant Goddard: Radio Blog.

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'UK DAB Radio Receiver Unit Sales Fell In 2009 & 2010 Though Digital Radio UK Claims "They Are Flat"'

  1. 1. UK DAB RADIO RECEIVER UNIT SALES FELL IN 2009 & 2010 THOUGH DIGITAL RADIO UK CLAIMS "THEY ARE FLAT" by GRANT GODDARD www.grantgoddard.co.uk August 2011
  2. 2. For an organisation that has been charged with marketing DAB radio to the British public, Digital Radio UK has managed to remain remarkably invisible during 2011. This alone made the appearance of Digital Radio UK’s chief executive on 'BBC Radio 4’s ‘You & Yours’ show notable. The fact that nothing new was said was hardly surprising – there is nothing new to say about DAB. Out in the real world, as opposed to the imaginary world inhabited by Digital Radio UK, the notion that ‘DAB radio’ will replace AM/FM radio is already a dead duck. The only believers still worshipping ‘DAB’ seem to be Digital Radio UK, RadioCentre, Ofcom and government civil servants. The evidence is transparent. The number of DAB radio receivers sold in the UK fell year-on- year in both 2009 and 2010 (by 6% and 2% respectively). These data are collected by GfK and supplied to Digital Radio UK. These numbers, together with a nice colour graph, were distributed at last month’s RadioCentre members’ get-together. These are industry data of which Digital Radio UK is perfectly aware. Yet, Digital Radio UK’s chief executive insisted in this interview on national radio that “digital radio sales have actually held up – they are flat year-on-year.” This is untrue. ‘Down’ is not ‘flat.’ ‘Down’ is ‘down.’ DAB radio receiver sales peaked in 2008 and have been falling since. DAB receiver sales in 2010 were 8% below that 2008 peak. That is clearly not ‘flat.’ I wonder how it is that:  The chief executive of a high-profile marketing organisation can appear on Radio 4 (audience: 11m adults per week) and flatly state something that he must know not to be true?  The board of Digital Radio UK does not haul him in and remind him that his job description is to ‘persuade’ consumers of the value of DAB, not deceive them?  A substantial proportion of this organisation’s funding is derived from the BBC Licence Fee, so the public is effectively paying for an executive to tell them untruths about consumer take-up of DAB radio? You & Yours BBC Radio 4 29 July 2011 @ 1200 Ford Ennals, chief executive, Digital Radio UK [FE] William Rogers, chief executive, UKRD [WR] Q: Are you not disappointed with the lack of a rise in [DAB] radio sales? UK DAB Radio Receiver Unit Sales Fell In 2009 & 2010 Though Digital Radio UK Claims "They Are Flat" page 2 ©2011 Grant Goddard
  3. 3. FE: No, I think what the Ofcom report confirms is the solid progress that is being made. We see growth in overall digital listening, we see growth in terms of the number of homes that have a digital radio receiver in there. So, 40% of all homes now have a DAB receiver in them, we know that 47% of all listeners are listening to digital radio every week, and we have seen growth in digital listening. So I think progress is being made. I think we are in a difficult sales period for overall retailers and we have seen a decline in overall consumer electronics sales. Digital radio sales have actually held up – they are flat year-on-year. We have now sold 13 million DAB digital radios, but the key thing, just lastly, to remember is that you can receive digital radio via digital television, via a computer or, indeed, via a smartphone and many, many households and consumers have those. Q: William Rogers, are you surprised by the lack of increase in interest in digital radio? WR: No, not in the least. And I think we have to remember that Ford, with respect to him, is being a little disingenuous because, of course, the switchover is about people being forced to move way from analogue and onto DAB. So that’s the issue we need to focus on. And what this report highlights, and I’m personally delighted to see it, is it really does shine a light on the shambles that is this proposed DAB migration. Q: But things aren’t that bad. There are increases in radio usage, as Ford has just indicated. WR: Well, hang on a minute. The whole premise behind the switchover is that it will be, quote, consumer led. And the one thing we know from these statistics is that, whatever else it is, it’s not being consumer led. As your reporter quite rightly said earlier, of the eight-and-half million radio devices sold in the twelve-month period we are talking about, four out of five of them did not have a DAB receiver capacity. And, more interestingly, of those people who were asked whether they were likely to buy a DAB set at any time in the next twelve months, four out of five of them said they were not likely to. So the consumer is making it very clear what they want and, after eleven years, it’s time this thing was put to bed. Q: Ford Ennals, one of the things that we constantly hear from listeners is the whole issue of reception. That’s really what, I think, the message is that we get from people. That is what they are worried about. Whether they approve or not [of DAB], what they say is an awful lot of people can’t get them [DAB radio signals] and, if they can get them, they can’t get them consistently. FE: Well, I think, where the industry and the broadcasters are absolutely unified and agreed is that digital is the future of radio in the UK. And I think it’s just a matter of the timetable and the transition path for that. One of the big issues is, as you have said, is about coverage and about the ability of everyone to get a strong [DAB] signal. Now, what Ofcom have done is developed a plan to extend coverage, both of the local services and the national services, so that people can receive those services and get more confidence. But there is a direct parallel here with TV and digital television – I ran the TV switchover programme – and, back in 2006, the majority of TV sales were analogue and only 75% of the population could get digital television. Now, what happened over the next few years is we saw a very swift transition and we saw transmitters built out that so everyone could get digital TV. We’ll see the same on radio. Q: What about that, William? We don’t jump ‘til we have to. We don’t buy ‘til we have to. WR: Look, look. Let’s be clear about this. Ford Ennals is paid to market the DAB switchover, so I understand why he has to say what he has to say, because the message from this report is clearly embarrassing for him to make a case which clearly doesn’t exist. There are a number of points we have to remember. First of all, the UK DAB Radio Receiver Unit Sales Fell In 2009 & 2010 Though Digital Radio UK Claims "They Are Flat" page 3 ©2011 Grant Goddard
  4. 4. UK DAB Radio Receiver Unit Sales Fell In 2009 & 2010 Though Digital Radio UK Claims "They Are Flat" page 4 ©2011 Grant Goddard comparison with TV switchover is plainly an absurd point to make. They are not remotely, in any way shape or form, similar. And people are choosing not to endorse DAB as an alternative [to FM/AM]. The critical thing we have to understand here is three elements. First of all, …. Q: You’ll have to confine yourself to one because we are really tight for time. WR: Okay, the fundamental problem with this whole process is that you cannot migrate an entire sector if the [DAB] platform you have chosen does not have the capacity to allow you to do so. And there are scores of radio stations in this country who will be denied the opportunity to move to a DAB platform, because the choice was wrong in the first place. Q: A ten-second response. FE: Just finally. People love digital radio. We’ve seen it with '[BBC] 6 Music' and we saw the campaign to save 6 Music. We’ve seen it with the response to 'Radio 4 Extra'. And they’ll continue to enjoy it in the future. Q: I’m sure our postbag and our e-mails will be as big as usual. William Rogers and Ford Ennals, thank you both very much indeed. Point of information: Ford Ennals was chief executive of Digital UK, the TV switchover marketing organisation, from April 2005. He announced his departure in November 2007, the same month that only the first UK region of many entirely switched off analogue television broadcasts. [First published by Grant Goddard: Radio Blog as 'UK DAB Radio Receiver Sales Fell In 2009 And 2010, But "Digital Radio Sales Have Held Up – They Are Flat" Insists Mr Switchover', 5 August 2011.] 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

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