Saturday 13 October 2018

Commercial Radio in Sweden Activates 2014 DAB Permit

Media company takes strategic step, but few will listen IRL
NENT Nordic Entertainment Group (formerly MTG) has noticed the Swedish Press, Radio and Television Authority their intention to start the digital radio DAB+ broadcasting from January 1, 2019. According to the license terms, broadcasts must reach 35 percent of the population already April 1, 2019. However, there are no political plans in Sweden to replace FM with DAB as in neighbouring Norway. Rather, there are strategic corporate reasons behind this announcement.

The licenses for DAB radio are valid from 2014 to 2022. The major broadcaster Bauer Media together with NRJ Sweden have requested further deferral with a launch. All license holders have repeatedly requested transmission start deferral because of the uncertain future for a digital terrestrial transition in Sweden.

In 2015, a political united parliament - Riksdagen - rejected the proposal to replace FM with DAB+ and still there are no plans or even discussions to close FM in Sweden. On the contrary, both Bauer and NENT, with some assistance by the government have successfully expanded their nationwide FM networks.

There is no listener demand for DAB. Today listeners increasingly use mobile and fixed broadband as the natural alternative radio platform to FM. An estimated 40% of all listening to the public broadcaster Sveriges Radio (SR) is already online and the young people only listen on their smartphone for music or radio. The mobile 4G networks are new covering the whole country awaiting the 5G introduction net year.

With the upcoming new charter period starting 2020 there are no plans by the government to finance a regular DAB service by the public broadcaster SR which temporary permission for experimental DAB broadcasting will end December 31, 2019. The broadcaster has in a statement to the politicians expressed a desire to rather transfer the costs for those trials - SEK 8 million annually -  to its online activities. SR has approx. 55% of the radio listening in Sweden.

If NENT and other actors who want to go DAB do not get started next year, they may lose their permits issued four years ago. An ongoing government investigation is now looking into the use of radio frequencies in Sweden, among other things find more space for mobile broadband. It has been discussed to go the Finland way; put a stop to DAB and simply allocate the entire VHF band III (174-240 MHz) for television (DVB-T2). Against this there is heavy EBU lobbying because this frequency band is the only currently available for DAB.

In the Norwegian perspective, NENT's message can be contradictory because, in Norway, with its company P4, NENT has been at the major promoter for an FM closure in order to secure a success for DAB. This would probably also put an end to local radio as competitor. In Sweden, on the other hand, it would be acceptable for the same broadcaster be on both FM and DAB.

NENT is now an international acquisition target. According to Bloomberg News major foreign media giants as Disney and Comcast are on the buying track and NENT is mentioned as likely taget. Powering up the company with nationwide radio permissions for both FM and DAB is likely to "dress up the bride" to become attractive.

Bauer and NENT are the two major commercial radio broadcasters in Sweden without any other serious national market challenger. Bauer is ahead of NENT when it comes to number of listeners.

Media Authority Pressrelease (in Swedish)

Also read
Why DAB Radio in Norway, But Not in Sweden?
Heavy Lobbying Behind DAB Radio EU Proposal
Norwegian MP: DAB Radio in Norway Is a Tragedy
BBC: No Switch-Off Plans for FM Radio