DAB slowing down in UK

John Plunkett writes in The Guardian:

Digital radio rocked?

Is digital radio in danger of losing its momentum?
November 20, 2007 1:30 PM

It has not been a good few days for digital radio. Virgin Radio is closing one of its digital stations, Virgin Radio Groove, and is not even going to bother launching Virgin Radio Viva, planned for the new Channel 4 DAB radio platform, while UBC Media has written off its 49% investment in digital speech station Oneword. What next?

Channel 4 put a brave face on the loss of Viva, saying it had signed "nearly all its long-term carriage agreements" and had secured agreements with nine podcast partners.

But it will inevitably be disappointed to lose the Virgin station - aimed at 15 to 29-year-old women - coming a month after Charles Allen's Global Radio pulled out of its joint venture with Sky to launch Sky News Radio, also due to launch on the Channel 4 platform.

Digital radio hasn't lost its appeal among listeners - 28.4% of the population listened via DAB radio, digital TV and the web in the third quarter of this year, according to the latest Rajar figures, and there are DAB sets in around 6 million homes.

But the big radio groups have begun to rationalise their investment in digital, looking at what works, what doesn't, and cutting their cloth accordingly.

For the private equity groups who are owning a bigger and bigger chunk of the radio industry, it is about getting a return now, not five years down the line, and digital does not necessarily fit that mindset.

That poses a danger for the momentum behind digital radio, and as one source pointed out, it does not help that the Digital Radio Development Bureau, or DRDB, is currently without a chief executive following the exit of Ian Dickens.

Sources say there is no shortage of potential partners queuing up to fill the berth left by Virgin Radio Viva. National Grid Wireless, for example, which had designs to run the new DAB multiplex itself, had a number of partners who were not part of the Channel 4 bid.

Ofcom is due to publish the results of its long-anticipated Future of Radio consultation on Thursday. But how much of the future of radio will be on DAB?