Wednesday, 5 November 2014

Public Funding Inevitable for DAB Radio Survival

Citizens forced to pay for DAB+ introduction via taxes and licenses
The state funding of digital radio in Norway is being covered up
Public funding of DAB in Norway is estimated to 3 billion kr NOK. The public service broadcaster NRK or the Ministry of culture has not been able to present more precise sums. Adding to this the households are estimated to pay 2 billion NOK for new receivers.
A recent inquiry from Poland to the Ministry of Culture reveals the lack of interest by stakeholders to present the costs of the whole introduction and who is going to pay for it.  The DAB introduction has not yet been presented in an open and democratic way to the citizens of Norway.

The ministry claims that there is no state subsidies; the introduction of DAB+ is industry-driven and are financed by NRK and private companies such as P4 Radio Hele Norge, SBS Radio Norge og Norking. 

However, it is not the industry or private financing behind this introduction. NRK is a public corporation fully owned and controlled by the government. Norkring, the broadcast provider which is building the DAB network, is fully owned by Telenor in which  the government has a majority ownership.

The media authority Medietilsynet is working with this introduction as well as Digitalradio Norge which is a DAB promotion organization 50 % owned by NRK. Digitalradio Norge is also a broadcast license holder for DAB+ (!).

Private financing, here SBS and MTG, has no decisive role for the introduction of DAB+ in Norway. Without a powerful government involvement it would not be possible to launch DAB+ on a free market.

NRK is fully financed by a license fee (also named special tax). In October NRK announced that there must be budget cuts. One of the reasons is the costs for the DAB+ transition.

Norway is not the only country where public funds have been plowed down in order to launch the DAB transmitter networks. It has been decisive in Denmark, Switzerland and the U.K.  BBC launched DAB already 1995. In France the government has put a stop to DMB/DAB developments for the public Radio France because it would be too expensive.


For some years Norway has been known as the first country intending to switch off the FM radio - and this not later than 2019.

However, there are strong indications that FM will be retained for local broadcasting also in the major cities. NRK will probably end up being forced to also retain its FM network together with a nationwide DAB network. This will be necessary for emergency planning. Also foreign visitors to Norway cannot be expected to buy DAB receivers upon entering the country.

The present government has a sparingly attitude towards extra funding of NRK which probably will be forced to cut program operations and staff in order to keep two parallel transmitter networks. In the end tax and license payers will pick up the bill.

The DAB system has not yet been introduced in any country on a free market without any state subsidies and funding. It has also been necessary for an introduction with political regulations force radio stations and listener to shift from FM to DAB/DAB+

Also read
Norway Might Reconsider FM Radio Closure