BBC vs Emap: The Commercial Radio Battle


Code : COM0057

Year :

Industry : Entertainment

Region : UK

Teaching Note:Not Available

Structured Assignment :Not Available

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Introduction:The British commercial radio sector has been traditionally over shadowed by the public funded British Broadcasting Corporation (BBC). BBC has a larger amount of analogue radio frequency (spectrum) and other programming resources that enable it to dominate other radio operators. Besides, BBC also has the ability to cross-promote its radio services on its television channels and the Internet. During the 1990s, the commercial operators hoped that the advent of digital radio would challenge the dominance of BBC on the spectrum. The commercial operators had also anticipated that the digital radio, through better quality broadcast, would lead to fragmentation in the audience and enable them to increase their customer base. On the contrary, BBC started investing heavily in digital radio. Further, to add to the woes of the commercial radio operators, with the auctioning of radio licences, the number of stations is increasing, leading to fragmentation of the audience even further. This in turn is adversely affecting the advertising revenues of the commercial radio operators. Simon Mays-Smith, an analyst at Credit Suisse First Boston, opined, "[Commercial] radio is caught between the rock of fragmentation and the hard place of increased investment to ensure a sustainable future"...

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