By Clive Dickens – Chief Operating Officer

Ofcom’s new rules “will enable commercial broadcasters to access new sources of revenue, whilst providing on-going protection for audiences,” but as the pictures shown on British television of American Idol with the Coca-Cola logo blurred out demonstrate – we’ve really had a long way to come here in the UK and could it be said that these changes are out of date already?

Here at Absolute Radio we welcome the changes – we’re well on the way to moving radio into the modern world, where conversation and opinion about brands is commonplace – and about time too

The digital economy continues to disrupt traditional business models and the unprecedented economic climate has certainly given the advertising & media community a roller-coaster ride over the last two years.

These changes undoubtedly open the marketplace up for commercial radio, a small 4% industry in comparison to the mammoth land of TV – meaning there are fewer legislative hurdles to producing integrated branded content which enables brands to be closer and achieve deeper engagement with audiences. And these changes could mean a lot of additional revenue for the radio industry – estimates could put it at around £50 million pounds per annum within a few years. Radio offers a lower investment entry level to brands in comparison to Broadcast TV and these changes mean significant opportunity for those wanting to invest in the medium.

The RAB reports that 20% of radio revenues are now non-spot, Absolute Radio’s branded content is now over 40%, and these changes could lead to the radio industry striving to receive revenues of 30% from branded content as its overall share. A huge opportunity for the radio industry as a whole.

However, these changes still mean there are significant differences between the radio and TV industries – and could it be said that it should be left up to audiences to decide where they put their loyalty. Consumer views should be canvassed on how far they feel commercial brands can go to bring them engaging and interactive content – I would imagine fans of Alan Partridge aren’t moaning about Fosters bringing it the much-loved character back with fresh episodes for their viewing.

Of course relevancy is important and, as is the case with anything, these opportunities need to be exploited with care. Commercial messages are only a turn-off when not relevant and not engaging and therefore not fun. Non-spot advertising delivers exactly to this aim, and delivers embedded and clever messaging – the very fact that we have ‘commercial free BBC in this country will ensure that we, as an industry, do not fall foul of over-commercialisation to the detriment of the listener consumer.

A forward-thinking future would see Government & Ofcom allow information that is relevant, useful, wanted and more importantly – needed by the consumer –  is brought to users by commercial partners, who will be an important part in the creation of more exciting and innovative content by investing in it.

These changes came about after a year’s lobbying – we will continue to work with the RAB and the rest of the radio industry to bring about further relaxations to look ahead to an ever brighter future.

See the Broadcast article here

http://www.broadcastnow.co.uk/comment/in-my-view/ofcom-changes-open-up-the-marketplace-for-radio/5022230.article