BBC keeps spending on radio

A market report published by Ofcom this morning reveals the BBC's expenditure on radio is at its highest level in five years. The corporation spent £637m in 2006, compared to commercial radio, standing at it's lowest level since 2002 at £512m.

So whilst the commercial radio sector suffers from declining revenue and listening hours, BBC Radio is enjoying more money to invest in big names personalities and promotions. In the first three months of 2007, four out of the five most listened to stations were all BBC. The top five were: BBC Radio 2, Radio 1, Radio 4, Classic FM and Five Live.

However, commercial radio is leading the way with digital listening, with troubled Emap holding two of the top three most listened to digital-only services. The Hits, Smash Hits Radio and BBC7 hold the top spots.

While the total number of radio stations in the UK has increased through the expansion of DAB (in June 2007 there were 389 radio stations in the UK, 169 of which were available on DAB), the report shows that the total number of radio listening hours declined to an average of 19.8 hours per week per listener in 2006. This fell further to 19.4 hours in Q1 2007. This decline has been felt most in the commercial local radio sector. Between April 2005 and April 2006, average listening to local commercial radio fell by 4.1%.

As listening has declined, so has commercial radio advertising revenue. Between 2001 and 2006, radio's share of total advertising revenue in the UK fell by 14.3% and in 2006 stood at £480m. Total revenue for local commercial stations fell by 9.5% from £169m in 2005 to £153m in 2006.

More details on radio trends, along with television, Internet and mobile phone usage can be found in The Communications Market Report – which is a 330 page report drawing on a mix of Ofcom's own consumer research, operator data and third party sources. The data covers the year 2006 although where available more recent data is provided.

The full report is available online [link=http://www.ofcom.org.uk/research/cm/cmr07]here[/link].

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