Scaling down
The Cambs Times: Fen Radio expected to close by the end of July
As of today this story may not be widely reported, but it seems that radio group UKRD is on the verge of handing back a second local radio licence, namely Wisbech-based Fen Radio (in Cambridgeshire), staffed by four people and having a service area of just 77,000 potential listeners.
UKRD was the first radio group ever to hand back a UK local radio licence (Star Stroud), and River FM (a Kingdom Group station in Scotland) later followed suit in the same fashion, so Fen Radio will be the third station to throw in the towel as opposed to the previously usual practice of selling the licence on to someone else.
So what went wrong this time? It's not quite as simple as merely just having a radio station that was too small to work properly hence becoming unprofitable in a worsening economic climate (even though that's undoubtedly the main cause of failure) - the station supposedly had a 20% reach within its service area.
However Fen Radio was originally known as X-Cel FM and had a service area that extended into Ely, although the Ely service was subsumed into Star Cambridge in 2002. This could be the real root of the problem, namely that the original radio service area was scaled down to a size that was too small to be separately viable when things get tough.
According to Ofcom documents (map, station format), Ely's Star Cambridge simulcast is still part of the Fenland licence, so when the licence is handed back this will cease at the same time. Therefore both areas must have been viewed as jointly unprofitable by UKRD management.
We could also assume that UKRD had privately asked Ofcom whether Fen Radio could be replaced by a simulcast of another UKRD station (if not a relocation request as with Star Stroud), and presumably the answer was "No". So UKRD ultimately decided that the only way out was to hand back the licence for the whole Fenland area.
In the Star Stroud case there were geographical restrictions that helped to complicate matters, but this time it just seems that UKRD simply held too many licences for local radio in a particular area. Maybe Ofcom needs to revise much more than just expectations if local radio (analogue or digital) is to be truly successful in the long term.
More blog posts about: Ofcom, UKRD
