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Global GMG Deal - Competition Commission


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Old 13-02-2013, 12:59
casaboy22
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http://radiotoday.co.uk/2013/02/prov...obal-gmg-deal/

"The Competition Commission has released its provisional findings for the Global Radio / GMG Radio takeover inquiry .

The Commission has objected to parts of the takeover on competition grounds, particularly where stations overlap.

The Commission believe there may be an issue, which they define as a Substantial Lessening of Competition in seven areas. These are: East Midlands, Cardiff, North Wales, Manchester, The North East, South & West Yorkshire and Scotland.

The seven areas mentioned are pretty much every area where GMG Radio operates. The CC will publish a Notice of Possible Remedies which sets out ways the loss of competition in the seven areas identified might be addressed. These include Global selling the whole of the acquired business, the whole business apart from those stations in London and the West Midlands or selling individual stations in the affected areas. The full provisional findings report will be published on Friday, 15 February.

However, Global Radio has been provisionally cleared to sell the merged company’s national sales, the merged company’s national S&P and to keep both parties stations in London & the West Midlands.

Simon Polito, Chairman of the Global/GMG Radio inquiry and CC Deputy Chairman, said: “The advertisers most likely to lose out from this deal are those who do not use national media agencies, and so includes smaller and medium-sized companies. These advertisers rely on the presence of competing commercial stations in order to negotiate a good deal.

“Whilst in many cases advertisers do have alternatives through other media, radio is often an integral part of a wider media campaign and there remain campaigns for which radio advertising is important.

“We will now look at ways in which we can preserve competition and look after the interests of advertisers in these areas.”

Further engagement will take place between Global Radio, Real and Smooth Ltd and the CC over the next couple of months ahead of a final decision which is expected in April or May.

Historically, provisional findings by the Competition Commission have been significantly different to final decisions
."

I know there's some posting in the Smooth Radio thread about this but I thought it deserved its own as it gives us a heads up on developments. I read this to be that they'll have to sell Smooth, apart from the crap one in London that loses millions. Anyone?
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Old 13-02-2013, 13:02
GeorgeS
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Would Smooth get any other buyers? Especially without the London frequency?
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Old 13-02-2013, 13:04
omnidirectional
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Would Smooth get any other buyers? Especially without the London frequency?
Bauer might like it to expand Magic, which is already on FM in London so there's no issue - but Global would probably prefer someone else to buy it.

The Marcher stations in North Wales will probably be sold too; UTV?
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Old 13-02-2013, 13:08
GeorgeS
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Bauer might like it to expand Magic, which is already on FM in London so there's no issue - but Global would probably prefer someone else to buy it.
So in that instance would Bauer put the Magic AM output on FM or try to network the London output? Not that its likely to happen anyways of course.
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Old 13-02-2013, 13:30
radiodad
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I know there's some posting in the Smooth Radio thread about this but I thought it deserved its own as it gives us a heads up on developments. I read this to be that they'll have to sell Smooth, apart from the crap one in London that loses millions. Anyone?
And Brum has been aloud, at a guess they will keep London and Brum try and sell Real XS in Manchester and get rid of Gold on AM and try and see if they can keep Smooth there. Then at a guess Smooth will be rebranded to Gold with it on FM in London, Brum and maybe Manchester.

North Wales is a simple fix of selling the marcher stations to either UTV or maybe Orion may be interested ? Failing that i guess it would be a private group like Orion was. I can't seem them wanting to sell to Bauer
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Old 13-02-2013, 13:35
Martin Phillp
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Would Smooth get any other buyers? Especially without the London frequency?
I suggested in the Smooth thread that Global could offer Gold's 1548 AM frequency for the new owner to keep an advertising presence in the capital if Global divest the Smooth licences in the north of England, East Midlands and Glasgow.

Smooth would make a good bedfellow for UTV as they already have studios in Manchester (the Wish/Tower hub) and London (talkSPORT) and seem to be the kind of company who'd accept the existing music policy.
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Old 13-02-2013, 13:36
SouthCity
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According to RT the Gold AM licences are not part of the CC reports:


http://radiotoday.co.uk/2013/02/cc-o...r-global-radio
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Old 13-02-2013, 13:48
p_c_u_k
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I'm not entirely surprised by this, to be honest, and if Global has any sense it'll have been prepared for it.

Global was unlikely to come a cropper under Ofcom. As long as there is any competition in a local area it'll generally be happy. The Competition Commission was always going to be the big barrier, as it would inevitably result in a lessening of competition.

Taking Scotland as an example, Global would then own Capital, Real/Heart, Smooth and Real Radio XS, leaving Bauer with the heritage offerings and a few smaller scale players to chase up the scraps.

This isn't a programming issue for me in terms of choice as a listener - it offers plenty - but it would affect the prices paid by advertisers.

I can't imagine Real Radio XS is core to Global, and if Bauer is obsessed with rock music at the moment (for some reason) it could give them an FM outlet for Planet Rock, or the likes of Kerrang. While Smooth is succeeding in the north, it is a failure in London, and that's what matters to Global. That may well have done too much damage trying to sell that brand to London-based advertisers. Again, Bauer could try to get that frequency up here for Clyde 2 or heritage offerings down south, kill off the MW frequencies and give these Gold stations a fighting chance.

And as a pathetic geek I'd love Clyde 1 on 102.5 and Clyde 2 on 105.2.

That, of course, assumes two things:
1. Bauer would see past the fact they were helping Global's acquisition, which will happen one way or another, for their own benefit and to maintain their stranglehold on the areas.
2. Global would be willing to pass that much of the market to its strongest competitor. To be honest though, again taking Scotland as the example, the realisation of having the two key brands - Heart and Capital - across great swathes of the country would make up for losing a non-core rock station. Smooth's a bit trickier though, and FM could make a younger sounding Clyde 2 a bit of a competitor for Heart. (Which of course is the point of the ruling)
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Old 13-02-2013, 13:58
AllBran
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The Marcher stations in North Wales will probably be sold too; UTV?
Why? The Marcher stations have 250,000 listeners from 2 stations/4 transmitters.

Real N and Mid Wales has multiple transmitters with 60,000 listeners.

Global will keep the Hearts in the North, Capital SW and Real South Wales... and then sell/hand back Real North and Mid Wales.
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Old 13-02-2013, 14:04
wns_195
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I think Global will either sell Real Radio Wales or the other stations in Wales it owns. There was a campaign for a national Welsh commercial radiostation before REal Radio expanded, and I don't think the campaigners had the extention of an English network in mind.
Smooth Radio Northeast doesn't have the same level of coverage as the other regional stations there, so that too will probably be sold.
I hope in the East Midlands, the three radio stations that were merged to form Capital will be sold and demerged. Maybe Orion could be persuaded to adopt an older format on 106 then the 106.6 licence could be heartened.
Rock Radio should be sold to Bauer to either become Kerrang or Planet Rock.
If Gold is moved to FM where there is Smooth, it would be good to have more speech radio on AM so a new speech network or an extention of other speech networks.
UTV getting Real Radio may be good for sports fans if the Real Radio stations get sports rights.
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Old 13-02-2013, 14:05
omnidirectional
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Why? The Marcher stations have 250,000 listeners from 2 stations/4 transmitters.

Real N and Mid Wales has multiple transmitters with 60,000 listeners.

Global will keep the Hearts in the North, Capital SW and Real South Wales... and then sell/hand back Real North and Mid Wales.
The Real licence offers much better coverage and a simplified format; especially as no Welsh language content is required. This would allow Global to free themselves of the Welsh output on ex-Champion which involves extra local shows and prevents it taking the full Heart network output. Just my thoughts, you might be right of course.
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Old 13-02-2013, 14:08
Musicmasterprox
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I can't see the Bauer Am Stations going on the Smooth Frequencies, Magic, Clyde 2, Forth 2 playing around 12 hours of specialist output per week? I'm sure they'll keep the smooth brand and flip the AM stations to smooth 70s no? (excluding magic)

predictions
Real XS - Sold to Bauer/rebrand to planet rock (that'll happen before the Real/Heart rebrand)
Smooth FM - Sold to ether Bauer or Orion/keep the name

For the merged Capital East Midlands, I can see Bauer launching The Hits radio or relaunching one of the former stations.
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Old 13-02-2013, 14:09
Les Wires
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Why has the CC highlighted the East Midlands but not the West Midlands?
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Old 13-02-2013, 14:10
Kierankay
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I can't imagine Real Radio XS is core to Global, and if Bauer is obsessed with rock music at the moment (for some reason) it could give them an FM outlet for Planet Rock, or the likes of Kerrang. Bauer could try to get that frequency up here for Clyde 2 or heritage offerings down south, kill off the MW frequencies and give these Gold stations a fighting chance.
I'm certain that Global will get rid of Real XS and most likely Bauer will buy it and change it to Kerrang. However even though I think it would be great for Clyde 2 to come onto 105.2as it fits into Smooth's license perfect I don't think this would happen as Global will want to sell it to somebody who as other people have said "Don't know what they are doing."
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Old 13-02-2013, 14:17
russellelly
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Slightly confused about the idea of Bauer buying the Smooth Glasgow or Real XS licence. Would that really increase competition? Bauer are already the competition - a new player would give both Global and Bauer competition.
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Old 13-02-2013, 14:18
Musicmasterprox
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I hope in the East Midlands, the three radio stations that were merged to form Capital will be sold and demerged.
if that does happen, surely they'll need to buy the Trent/Ram FM/leicester sound names from Global?

Maybe Orion could be persuaded to adopt an older format on 106 then the 106.6 licence could be heartened.
or could Orion see if they could bring back Galaxy FM? Real XS paisley was originally a hit music station (Q96) and I'm sure Ofcom would be happy, as long as it's not another 'hit music' format.

Rock Radio should be sold to Bauer to either become Kerrang or Planet Rock.
That'll hapen for sure!

UTV getting Real Radio may be good for sports fans if the Real Radio stations get sports rights.
Real Radio Wales or NE? Possibly! No doubt can see UTV trying to revive the phone-in show.
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Old 13-02-2013, 14:49
p_c_u_k
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I'm certain that Global will get rid of Real XS and most likely Bauer will buy it and change it to Kerrang. However even though I think it would be great for Clyde 2 to come onto 105.2as it fits into Smooth's license perfect I don't think this would happen as Global will want to sell it to somebody who as other people have said "Don't know what they are doing."
That may indeed be the best way to deal with the 105.2 licence.

In retrospect the sale of a prized Glasgow licence will attract quite a few bidders, and it would be in Global's interests to sell to private bidders or some anorak who would programme it to their personal tastes and alienate the audience, or a slightly daft company that would run it as a standalone without the economies of scale of having several services.

Also, selling to Bauer may well not solve the competition issue as you've got the same number of players in the market, albeit that it's more balanced.

But hey, I imagine Global will fight to keep Smooth to start with and they may come up with a viable alternative.
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Old 13-02-2013, 14:50
p_c_u_k
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The Real licence offers much better coverage and a simplified format; especially as no Welsh language content is required. This would allow Global to free themselves of the Welsh output on ex-Champion which involves extra local shows and prevents it taking the full Heart network output. Just my thoughts, you might be right of course.
The only problem is you'd have to encourage passive listeners to actively make the switch to another frequency, which is a tricky deal.
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Old 13-02-2013, 15:06
omnidirectional
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The latest article on Radio Today says the CC have given Global three options:

http://radiotoday.co.uk/2013/02/cc-o...-global-radio/

There is only one realistic option, which is to sell at least one station in each area except London/West Mids. So either Capital or Real will be going in South Wales, and Yorkshire can have Capital or Real/Heart but not both. In most other areas they can just sell Smooth.

In the North West they can perhaps hold on to Smooth and Real/Heart if sacrifices are made in Manchester like XFM and Real XS.. but that might not be enough.
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Old 13-02-2013, 15:26
dpb
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Initial thoughts are:

Smooth in the East Midlands and the North East are the most obvious to go there and in Yorkshire Real Radio.

In Manchester I'm sure Global would be happy to sell Real XS - I don't think that would be enough though. It might not be enough with Xfm as well. Out of the other licences left I think they would sell Smooth which potentially means that Global would only have the "Smooth" licences in London and the West Midlands.

I'm interested to see what exactly the ruling is for "Central Scotland." As that term has been used it could mean that one of the regional licences might have to be sold. If it is just Glasgow and Paisley they I imagine they would be happy enough to sell Smooth and Real XS.

I think what ends up being sold depends on what evidence people present to the Competition Commission before the end of the month. For example, one of the initial submissions published argues against Global selling their existing interests in Wales and keeping Real because the new owner of Capital South Wales and Heart North Wales would have to rebrand etc. I wouldn't be surprised if that argument comes up again preventing Global owning Real in Wales.
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Old 13-02-2013, 15:41
p_c_u_k
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In terms of Smooth Glasgow, I wonder if Wave 102/Original 106 owner Adam Findlay is looking on? Not sure that such a move would be an ideal fit, but it may be tempting.

It would be extremely harsh if it was a central belt licence that had to go (ie Capital). I imagine the sale of Smooth, in Scotland's biggest city, and the Paisley licence which covers a huge swathe of the city would be more than enough to rebalance the situation, especially given there are more local players in the east.
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Old 13-02-2013, 15:47
darkknight77
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I think Global will have expected a lot of this, but the spanner in the works seems to be Yorkshire, they really need Real Radio yorkshire for Heart or they miss out on the largest county in the north for their flagship brand.

I'm sure they won't care losing Smooth or Real XS etc. but they need all the Real licences to be part of Heart to make the purchase worth-while, interesting times.
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Old 13-02-2013, 15:55
casaboy22
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I think Global will have expected a lot of this, but the spanner in the works seems to be Yorkshire, they really need Real Radio yorkshire for Heart or they miss out on the largest county in the north for their flagship brand.

I'm sure they won't care losing Smooth or Real XS etc. but they need all the Real licences to be part of Heart to make the purchase worth-while, interesting times.
Agree with you on that. It seems odd that the CC are happy with two of three regionals in the NE to be held by one company but not two of out two in Yorks. Capital Yorks is a monster though and I can't see them getting rid of that. Heart NE will have a good coverage of North Yorks (although iirc it only surveys down to Thirsk/Northallerton) but it still gives Global a considerable largest-county-in-Britain sized gap in the coverage of Heart.
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Old 13-02-2013, 16:48
Martin Phillp
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I think Global will have expected a lot of this, but the spanner in the works seems to be Yorkshire, they really need Real Radio yorkshire for Heart or they miss out on the largest county in the north for their flagship brand.
Real Yorkshire's FM TSA is smaller than Capital's which also covers North. East Yorks and North Lincs. They'll lose Leeds/Bradford and Sheffield, but when you compare it to the North West which it seems they'll still be able to keep by selling another station with larger urban populations such as Manchester and Liverpool/Merseyside, Yorkshire isn't a big loss after all.
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Old 13-02-2013, 17:51
SouthCity
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Real Yorkshire's FM TSA is smaller than Capital's which also covers North. East Yorks and North Lincs. They'll lose Leeds/Bradford and Sheffield, but when you compare it to the North West which it seems they'll still be able to keep by selling another station with larger urban populations such as Manchester and Liverpool/Merseyside, Yorkshire isn't a big loss after all.
Agreed, Real Yorkshire has never covered Humberside or Lincolnshire on FM so it wouldn't be a great loss really.

In Wales I think there is no chance of them offloading Real and keeping Capital Cardiff. The former has just had huge listening figures while the latter is struggling badly.

That provisional offer of the enhanced news on Real Wales (including a dedicated Welsh Assembly reporter and a 20 minute daily news roundup) will almost certainly never materialise.
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