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Second National Radio Multiplex Licence Award
Ofcom's Broadcast Licensing Committee (“the Committee”)1 awarded the second national
radio multiplex licence on 24 March 2015.
Applicant awarded a national radio multiplex licence
The licence was awarded as follows:
Applicant: Sound Digital Limited
Registered Office: 1 Lincoln Court, Lincoln Road, Peterborough, PE1 2RF
Public Contact: Jimmy Buckland
Email address: [email protected]
Phone number: 0207 959 7814
Website: www.sounddigital.co.uk
Licence award process
Further to the publication of an Advertisement for a National Radio Multiplex Licence (“the
Notice”)2 Ofcom received two applications for the second national radio multiplex licence
from:


Listen2Digital Limited (“Listen2Digital”); and
Sound Digital Limited (“Sound Digital”).
After careful consideration, the Committee has decided to award the second national radio
multiplex licence to Sound Digital for the reasons set out below.
Background
The Notice was published on Ofcom’s website on 1 July 2014, and updated on 3 October
2014. The closing date for receipt of applications was 29 January 2015.
Non-confidential versions of the two applications were published on the Ofcom website3.
Ofcom also requested clarifications on certain aspects of the applications from both
applicants and non-confidential versions of these were also published4.
Ofcom invited representations on the applications by 2 March 2015. 216 representations
were received from a wide range of listeners and interested parties.
The applications, clarifications and representations were circulated to members of the
Committee which is a committee of the main Ofcom Board with delegated responsibility for
the discharge of certain functions in relation to, among others, radio multiplex licensing.
1
Broadcast Licensing Committee: http://www.ofcom.org.uk/about/how-ofcomisrun/committees/broadcast-licensing-committee/
2
Advertisement: http://licensing.ofcom.org.uk/radio-broadcast-licensing/digital-radio/advertisement2014/advertisement/
3
Applications: http://licensing.ofcom.org.uk/radio-broadcast-licensing/digital-radio/advertisement2014/mux-apps-feb15/
4
Ibid
1
Reasoning for the award decision
The Committee considered both of the applications on a comparative basis in accordance
with the requirements of section 47 of the Broadcasting Act 1996. In doing so it had regard
to the extent to which, taking into account the statutory criteria specified below and any
representations received by them with respect to those matters, the award of the licence to
each applicant would be calculated to promote the development of digital sound
broadcasting in the United Kingdom otherwise than by satellite. The statutory criteria
relevant to this assessment are:
(a) the extent of the coverage area, within the area specified in the Notice, proposed to
be achieved by the applicant as indicated in the technical plan submitted by it in its
application;
(b) the timetables proposed by the applicant in accordance with which that coverage
would be achieved and in accordance with which the broadcasting of each of the
digital sound programme services proposed would begin;
(c) the ability of the applicant to establish the proposed service and maintain it
throughout the period for which the licence will be in force;
(d) the capacity of the digital sound programme services proposed to be included in the
service to appeal to a variety of tastes and interests;
(e) any proposals by the applicant for promoting or assisting the acquisition, by persons
in the proposed coverage area of the service, of equipment capable of receiving the
service; and
(f) whether, in contracting or offering to contract with persons providing digital sound
programme services, television licensable content services or digital additional
services, the applicant has acted in a manner calculated to ensure fair and effective
competition in the provision of such services.
As explained in the Notice, in making this award decision the Committee has had regard to
Ofcom’s general duties, in particular as regards the extent to which they consider the
applicants’ commercial incentives are likely to support competition in relation to terrestrial
digital sound broadcasting. Having regard to existing regulation and the proposed licence
conditions, the Committee was satisfied that the commercial incentives of each applicant
were not inconsistent with supporting such competition.
The Committee noted that Sound Digital had submitted two technical coverage plans, the
SDL Compliant Plan (“the compliant plan”) and the SDL Enhanced Plan (“the enhanced
plan”), while Listen2Digital had submitted one technical plan. The Committee considered
Listen2Digital’s technical coverage plan offered a slightly wider geographic scope of
coverage of the UK than that offered by either of Sound Digital’s technical plans, but that
Sound Digital’s technical plans overall offered more contiguous and reliable coverage in
those areas where it was available. It also noted that Sound Digital’s application committed
to minimum coverage levels in each individual UK Nation, had wider coverage in Scotland,
and that its enhanced plan would further increase coverage, particularly in Wales and
Northern Ireland.
The Committee considered that there were no significant differences between either
applicants’ proposed timetable within which the proposed coverage would be achieved. The
Committee noted that both Sound Digital’s enhanced technical plan and Listen2Digital’s
technical plan would require international co-ordination; and in Listen2Digital’s case the
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proposed technical plan gave rise to some potential Adjacent Channel Interference issues to
other multiplexes. While these presented some risks of delay, overall the Committee
considered that the timetables proposed by both applicants for achieving the proposed level
of coverage were achievable.
The Committee considered that there were no significant differences between either
applicant’s proposed timetable within which the broadcasting of each of the digital sound
broadcasting services would begin. The Committee noted that providers of the proposed
services for Sound Digital have already signed contracts, whereas a number of the
Listen2Digital service providers were not confirmed at the time of application. While in the
case of Listen2Digital there was some risk of delay, overall the Committee considered that
the timetables proposed by both applicants for beginning broadcasting were achievable.
The Committee considered that both Listen2Digital’s and Sound Digital’s proposals to
establish the service were credible. In terms of maintaining the service, the Committee
considered that both applicants’ proposals to maintain the service were sound. However, it
considered that Sound Digital’s position was stronger by virtue of its shareholders
underwriting the costs and revenues for the duration of the licence, whereas Listen2Digital
were dependent on maintaining sufficient carriage fee revenues from service providers.
In terms of the digital sound programme services proposed, the Committee considered how
these were distinct from the existing national radio multiplex services as set out in the
Notice. The Committee considered that both applicants had put forward a strong bouquet of
services in terms of their capacity to appeal to a variety of tastes and interests. Both
proposals included services which the Committee considered would appeal to tastes and
interests not currently served on the existing national radio multiplex as set out in the Notice.
While the Committee considered that Listen2Digital proposed a slightly wider range of
programme services than Sound Digital, it noted that Sound Digital’s proposals used
extensions of existing brands to broaden the appeal of the proposed services which the
Committee considered gave Sound Digital’s proposals a greater capacity to reach and
appeal to listeners across the UK.
The Committee noted that both applicants had made proposals to promote or assist the
acquisition of digital radio equipment. The Committee noted that the value of Listen2Digital’s
proposals to match-fund service provider marketing spend would depend on its service
providers rather than Listen2Digital. The Committee considered that the commitments to
promotion offered by Sound Digital’s shareholders, including cross-promotion from the
service providers’ analogue radio services, (which the Committee noted was supported by a
representation from a digital radio manufacturer) would be likely to be more effective.
The Committee considered that there was no evidence to suggest that in contracting or
offering to contract with persons providing digital sound programme services, either
Listen2Digital or Sound Digital had acted in a manner that would not ensure fair and
effective competition in the provision of such services.
Having carefully considered both the applications, the Committee considered that they were
highly credible. However taking account of the above factors as a whole, and having taken
account of all representations received, the Committee considered that awarding the licence
to Sound Digital would be best calculated to promote the development of digital sound
broadcasting in the United Kingdom otherwise than by satellite.
The Committee decided to incorporate into the licence the commitments made by Sound
Digital in its application in respect of: coverage implementation under both the compliant
plan and the enhanced plan and associated timetables; the provision of digital sound
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programme services; the timetable for commencement of digital sound programme services;
and promoting or assisting the acquisition of equipment capable of receiving the service.
The membership of the Committee for this licence award was as follows:
Tim Gardam, Ofcom Deputy Chairman (Chair)
Glyn Mathias, Content Board member
Peter Davies, Director of Content Policy
Tony Close, Director of Content Standards, Licensing and Enforcement
Neil Stock, Head of Radio Policy
4