The conservative party wants taxpayers to save commercial radio.
If a right-wing coalition takes replaces the red-green government next year it is likely that the Moderaterna (the Conservatives) will get through the reform proposals in their media policy program. One of the proposals for commercial radio which, among other things, means that the state should take over the cost of the infrastructure for all terrestrial radio across the country. In the background are the high costs that the two commercial radio companies have for their terrestrial distribution on both FM and DAB, while at the same time having a smaller and continuing declining share of radio listening in Sweden.
The proposal emphasizes that the commercial radio and television of the future need predictable and long-term rules of the game and technology-neutral legislation. Increased state responsibility and a lower bar for obtaining a broadcasting permit would mean that commercial radio would have more leeway to develop new forms and business models, without abandoning parts of the country.
The private radio industry has been under increasing financial pressure, due to the combined effect of high broadcasting license fees and costs for broadcasting infrastructure, shrinking advertising markets and the advent of Spotify and other streaming services for voice and music. Today, the existence of radio besides public service (SR) throughout the country is threatened, as the stations are unable to finance their broadcasting infrastructure outside the large population areas in the long run.
The moderates also believe that a nationwide infrastructure for radio should be a national and state responsibility, regardless of whether it is used by public service or commercial broadcasters. The radio industry should be given as clear and long-term conditions as possible. There is also reason to review the requirements for obtaining a license to broadcast commercial radio. Today, for example, only broadcasters that have the financial and technical muscle to broadcast during the entire permit period are given - ie. 8 years - permit. Furthermore, relatively extensive requirements are set for how large a part of the population is to be reached.
- The conclusions regarding commercial radio are thus that
- The state should take over the cost of the infrastructure for terrestrial radio across the country.
- The requirements for broadcasting commercial radio should be reviewed before the next permit period.
- The license periods for analogue and digital commercial radio should be synchronized.
Analysis
Commercial radio in Sweden is mainly operated by German Bauer Media and Swedish NENT (formerly MTG). which broadcasts national analogue FM as well as digital DAB+. The two radio companies together have a daily listeners range of about 30% (to be compared with public broadcaster SR 50%). Bauer's main channel Mix Megapol and NENT's Rix each have a daily range of 10% (to be compared with SR P4 40% and SR P1 15%).
Bauer Media is a privately owned media group with radio operations, in the United Kingdom, Germany and the Nordic countries. NENT is a listed company that primarily conducts television operations (Viasat etc). NENT also has radio operations in Norway. The Group's results in the radio area are not specified in its annual report.
Radio listening in general has declined in recent years - about 10% over ten years - but to a greater extent for commercial radio than for public service. In addition, a rapidly increasing proportion of radio listening now takes place on the Internet, primarily via smartphones and connected cars.
Listening via DAB radio is still marginal despite the fact that the system was launched in Sweden already 25 years ago. Audience figures for the DAB platform have never been reported. Almost all radio listening in Sweden is on FM or on-line. However, Moderaterna avoids mentioning anything about this outdated broadcasting system is becoming a financial burden for the radio companies.
If the government will finance the total costs for the terrestrial FM and DAB networks for both public service and commercial radio - and possibly also community radio - profitability can increase significantly for the two commercial broadcasters. The question then is whether this will benefit program quality. Today’s output is almost exclusively music and commercial breaks without any publicistic content. Or if this significant contribution by the tax payers only will please the shareholders.
A total state financed distribution of all terrestrial radio - commercial and public service -1 is still a unique setup in any Western marketdriven economy.
Read more
Sverige behöver en ny mediepolitik (Report by Moderaterna WG. In Swedish)
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