Local Commercial Radio Licence Renewals: Consultation on New provisions Introduced by the Media Act 2024

Ofcom's New Licence Renewal Proposals: What They Mean for Local Radio

The Media Act 2024 has introduced notable shifts in the regulatory framework for local analogue commercial radio licences.

With the introduction of a new route for licence renewal, Ofcom is now consulting stakeholders to refine how these changes will be applied.

This article unpacks the key proposals and their implications for the commercial radio sector.

Background: How Licence Renewals Worked Until Now

Local commercial radio in the UK has a long history, tracing back to its analogue roots in the 1970s. Initially, stations competed for fixed-term licences, which required reapplication at expiry.

The arrival of Digital Audio Broadcasting (DAB) technology in the late 1990s changed the game, providing radio with a more efficient platform that expanded listener choice. To encourage investment in DAB, the Broadcasting Act 1996 allowed analogue licensees to renew their licences if they broadcasted on a relevant DAB multiplex.

The criteria for renewal were straightforward: a DAB multiplex had to cover at least 25% of the population served by the analogue licence. This ensured the steady growth of DAB, but the framework left little room for licensees unable to meet these criteria, especially in areas lacking a suitable multiplex.

A New Renewal Pathway

The Media Act 2024 introduces a critical alternative: the "New Renewal Route." Under this provision, licensees can now apply for renewal even if a suitable DAB multiplex is unavailable. This aims to address gaps in coverage and enable more stations to remain operational.

Key conditions for this route include:

1. No Relevant DAB Multiplex: If a licensee cannot nominate a DAB multiplex due to unavailability, they may still qualify for renewal.
2. Unsuitability of Available Multiplex: A licensee can also qualify if an available multiplex is deemed unsuitable, typically when there is a significant mismatch in coverage areas.

What Defines a "Suitable" Multiplex?

Determining the suitability of a multiplex is central to the consultation. Ofcom proposes that suitability should hinge on the coverage area. For example:

• Coverage Mismatch: If a multiplex’s reach is significantly larger or smaller than the analogue station’s, it may be unsuitable. This is particularly relevant for smaller stations with limited geographical reach.
• Digital Commitment: Licensees using this route must commit to nominating a DAB multiplex as soon as a suitable one becomes available.

Ofcom emphasises that affordability or past renewal history will not be grounds for claiming unsuitability. The focus remains on ensuring that digital services continue to expand, reflecting Parliament’s intent to prioritise DAB provision wherever feasible.

Balancing Analogue Stability with Digital Growth

The proposals aim to strike a balance: allowing analogue stations to maintain their presence while continuing the transition to digital. Ofcom highlights that most renewals will still require DAB provision, reinforcing digital adoption.

The New Renewal Route is envisioned as a targeted solution for exceptional cases, ensuring that local radio remains accessible, particularly in underserved areas.

Stakeholder Input: A Chance to Shape the Future

Ofcom is inviting responses to its proposals, particularly on two questions:

1. Do you agree that a multiplex should only be considered unsuitable if there is a substantial coverage mismatch?
2. Are there other factors Ofcom should consider when assessing suitability?

The consultation runs until 5 February 2025, giving stakeholders ample time to share their perspectives. By engaging with this process, licensees, listeners, and other stakeholders can help shape a framework that balances innovation with inclusivity.