Mark Thompson’s speech to Radio Festival

BBC Director General Mark Thompson gave this year’s opening keynote speech at the Radio Festival 2011 in Salford.

Read the full text of his speech below – and continue to follow live coverage of the Festival at www.radiotoday.co.uk/live

Mark Thompson, BBC Director General – addressing delegates at Radio Festival 2011:

Tomorrow marks the 75th anniversary of the launch by the BBC of the world’s first continuous television service. By any standards, a landmark in broadcasting and an event which you’d have thought that any DG would have been only too proud to preside over.

Not John Reith. When the great day arrived, he decided to give it a miss and, when the first transmission took place, he was nowhere to be seen.

The truth is that Reith detested the idea of television – somehow, even back then in 1936, he’d managed to look into the future and seen the The Only Way is Essex gazing back at him with a strange orange gleam. But, perhaps even more importantly, he was terrified that TV would drag radio down, by debasing its standards or stealing its audiences or both.

So this week marks another anniversary: of the first time the brilliant, vibrant young medium of radio looked nervously over its shoulder at some other, even younger, device or platform – TV, the Walkman, the i-Pod, Spotify, i-Tunes (let’s face it, it’s a long list) – and wondered if radio was about to go the way of the horse and cart.

For decades, people in Broadcasting House worried, not just about whether the voracious cuckoo in Television Centre would leave any of the Licence Fee for them, but about whether they’d be able to sustain the distinctive and precious culture of BBC radio.

Even just a few years ago, I remember the reaction of one of our most distinguished radio critics when Jenny Abramsky and I appointed a radio controller whose entire previous career had been in television.

‘Ooh dear no,’ she said, ‘bad mistake – he’s TV through and through. He just won’t get it.’ This was that flagrant demon of dumbing-down, Mark Damazer, by the way.

The anxiety was such that it’s really only in the past few years that we’ve begun serious editorial collaboration between BBC Television and Radio beyond news and current affairs.

But nor have the fears about the economic and cultural fragility of radio been restricted to the BBC. For understandable reasons, given the disproportion between the two industries and whether competing for advertising pounds or for key talent, independent radio has always seen itself as a plucky David facing not just the BBC in all its pomp but a whole series of commercial Goliaths from TV and the internet.

And, more recently, the whole of radio has wondered whether it stood any chance of getting for its digital ambitions, the political clout, the technical innovation and ithe ndustry-wide coordination that drove through digital switchover in television.

Now I know that radio people like to worry, so I’ll try to keep my congenital optimism under control.

And I know that British radio faces all sorts of real economic and technological issues and that you’ll be discussing many of them here over the next day and a half.

But I can’t help observing that, if you look at the facts, this is not an industry facing inevitable decline or eclipse. In fact it’s an industry in the middle of a palpable creative and strategic revival, with new, more confident programming and branding almost everywhere you look. But above all it is an industry that is bringing its audiences with it.

Consider last week’s RAJARs. 91% of the UK adult population listening to the radio every week. That’s 47 million people consuming over a billion hours of live radio. Radio’s natural advantages – the fact that it’s live, mobile, above all that it’s personal, that it becomes an indispensible part of your life – give it an intrinsic resilence in the digital environment.

I’m going to talk this morning about some of the issues we face, including the impact of the current Licence Fee settlement on the BBC’s radio services, but I also want to focus on the question of how we can ensure that British radio seizes its opportunities, maintains its relevance, finds new forms of monetization and that it grows.

Salford

And I’m glad to be making these remarks this morning here in Salford [where, as you can see, the sun always shines].

Since the radio industry met here last year, the BBC has begun broadcasting live radio and Television from MediaCity just over the canal.

Last week, Radio 5 Live’s Victoria Derbyshire, Shelagh Fogarty and Richard Bacon joined Tony Livesey and Stephen Nolan to broadcast from here and all of 5 live will be based here from the end of November.
A few weeks ago Blue Peter made the move north and we recently announced, as part of our Delivering Quality First plans, that programmes such as You and Yours as well as BBC Three will be based in Salford and that a further 1000 staff will be moving here.

We’re building the BBC of the future here – with a long-term commitment to radio at its heart.

You’ve not doubt read a good deal about those colleagues of ours who, for entirely understandable personal reasons, can’t make the move here. One fact that the London press have for some reason forgotten to print is that we’ve had more than two thousand volunteers from across the BBC who, though they weren’t slated to move to Salford, want to come anyway. There’s a real buzz here and they want to be a part of it.

The move to Salford is an obvious example of how the BBC is changing. Not only in the way it listens and relates to its audiences across the UK, but also in the way it generates growth by being a partner and by creating a vibrant public space.

Take the BBC Philharmonic Orchestra which, thanks to a partnership with Salford City Council, can have a big impact not just on the BBC’s airwaves but also on the whole community.

In these economically testing times, and particularly at this moment in the digital story, working together in successful partnerships will be critical to all of our futures.

The BBC and partnerships

Radio is perhaps the part of media where partnership comes most naturally – and nowhere typifies that more than local radio. Every successful local station, whether commercial or BBC, sits and has always sat at the centre of a web of relationships and connections.

Recently, the Gillard Award for BBC local station of the year went to BBC Newcastle and the judges citation tells us something about how closely they work with their community. The judges commended the station’s unique reporting of events from the manhunt for Raoul Moat to the way in which it marked the thirtieth anniversary of the light railway system that runs through Tyne and Wear.

But the notion of “public space” and partnership stretches beyond traditioanl on-the-ground collaborations and into the new creative space that digital technology now offers us.

The BBC is clearly not alone in this space; there are many other organisations, institutions and individuals who passionately believe in the idea of this space and its potential. But in terms of the radio industry, the BBC, as the single largest player carries huge responsibilities.

BBC radio cannot and indeed would not be allowed to thrive in splendid isolation. We need a strong commercial radio sector and so does the British public. That is why, as the industry looks to unlock the potential of digital growth, the relationship between the BBC and Commercial Radio must move beyond just competition to deliver real partnership and collaboration.

Even over the past seven years or so, things have changed beyond recognition. When I started in this job, the relationship between BBC and Commercial radio felt like three parts competition to one part collaboration. Today that ratio is close to being reversed.

Radioplayer

A good example is the Radioplayer. From the moment Tim first outlined the idea to me, it was clear that a pan-industry online player was a simple but very powerful idea that could boost all of British radio: bringing every licensed UK radio station together on one online console – showcasing the strength in depth and sheer range of its collective offering, making radio as a medium greater than the sum of its parts.

It wasn’t necessarily in the BBC’s narrow competitive interests – to be honest, we were already fairing pretty well in the digital space – but Tim knew and convinced me that it would help the industry as a whole. We also knew it would take the combined efforts of the entire industry to make it work.

The Radioplayer now has 6.7 million users – all of whom can search and switch between BBC and commercial stations and appreciate a radio experience that combines the best of modern technology while showcasing the breadth of UK radio. With this in mind, it’s particular pleasing to the healthy grow of online listening in the latest RAJARs.

Digital radio

I’m pleased that, as we gather in Salford this year, a clearer roadmap for digital broadcast radio is also emerging. It’s easy to forget that, little more than two years ago, there was no industry body like Digital Radio UK, and no government-backed joint industry action plan.

The establishment of the Radio Council and subsequently DRUK, marked a new era of collaboration, acknowledging that digital radio could not succeed without the coordinated efforts of broadcasters, retailers, manufacturers and Government.

The industry’s efforts – and the Government’s commitment to move radio to digital – led to the Digital Radio Action Plan which has been endorsed by the BBC and the major commercial radio companies and has already made a real difference, though we know that there is still significant work to do.

The BBC has announced that we will build out DAB coverage for our national stations from 90% to 97% of the UK population between now and 2017. This will cover all towns with a population of five thousand or more as well as delivering more robust coverage to the largest twenty-five large cities and towns. The whole motorway network will have very good coverage, and we’re aiming to get close to FM equivalent coverage for all primary roads.

On local DAB, we have been working with Government and Commercial Radio to agree a plan for the funding of further build-out, and again we’ve made substantial progress. I’m confident we will agree a Memorandum of Understanding by the end of the year.

I know that we remain some way from full switchover and that not everyone of the industry is convinced of the merits of a complete FM switch-off. Let me assure you that we want to work with the whole commercial sector, at every level, to find a pragmatic, deliverable roadmap that maximizes the benefits to the industry as a whole, smaller players as well as larger ones – and which, above all, maximizes the benefits to our audiences.

YouView/IPTV

But, as we have proved in Radioplayer, digital partnership goes beyond solving DAB’s future. Digital radio needs to be much more than that. Radio needs to play its part in another major strategic partnership, YouView, which is the collaboration between the BBC, ITV, Channel 4, Five, BT, TalkTalk and Arqiva.

The aim is to offer a new subscription-free internet-connected TV service for the UK. It is due to launch next year and how radio appears on it will be another critical decision for the industry. Radioplayer is already on the case. Good: but this is the start of a bigger task – which is to ensure that radio as a whole has a strong presence on all the major IPTV platforms as they emerge, whether mobile or fixed.

Broader collaborations in digital public space

I’ve talked about partnerships within the radio industry, but just as important is the role we play in enabling public space outside the industry. In recent years, some of the most visible partnerships between the BBC and other great national institutions have come via BBC Radio.

One which showed the way ahead and has now passed into folklore is A History of the World, which began as a partnership between the BBC and the British Museum. Global downloads for the core Radio 4 programmes currently stand at twenty-four million.

But A History was never just about a cosy collaboration between two elite cultural institutions – literally hundreds of other museums across the country were involved as well.

Later this week Radio 3 will be at the Sage in Newcastle for the sixth Festival of Free Thinking and Community Radio will be setting up “camp” there and broadcasting many of the sessions live.

And we have plans next year for further broad collaborations around Shakespeare’s anniversary and the Queen’s Jubilee, as well as around major music events like Radio 1’s Hackney Weekend 2012 which is part of London 2012 and will involve particularly close partnerships with the communities of the Olympic boroughs.

Archive

Beyond these initiatives, we’re also exploring other more ambitious ways of sharing audio content in ways which could further extend the reach and value of what the radio industry produces.

Imagine a world in which all the content the BBC created was available online and, critically, linked to and shared with numerous partners. A sort of “Audiopedia” that would give listeners access to much of our speech content and which listeners would be able to search for by programme, subject or person.

For example you can now go on to the Desert Island Discs Website and see the choices of every castaway who has ever appeared on the programme. You can already download five hundred episodes of the programme and by the end of this year we will make a further five hundred editions available.

So far, there have been five million successful downloads of archive episodes.

Listeners can also now access every edition of Melvyn Bragg’s In Our Time as a download. In the first month this was available, there were one million successful downloads.

One listener wrote: “I’m now busy downloading these 500 programmes which my wife and I will use to continue our education when we retire. All that content in 16 gigabytes! An undreamt-of possibility when I was born.”

As far as possible, we want to share the technologies and audience-learnings behind projects like these with the rest of the radio industry: we know that few, perhaps no commercial broadcasters can call on the scientists, engineers and audience specialists at our disposal. I’d go further. In television, shared platform development – Freesat and Youview are examples – has meant BBC involvement in helping to enable new pay and monetisation models for commercial TV. There’s no reason why shared platform development in radio couldn’t involve our technologists and others in exploring new commercial models for radio as well.

DQF

The BBC is an important engine of innovation across TV, radio and the web and, as we debated our future plans in the light of last year’s Licence Fee settlement, the need to go on investing in that innovation and in the next chapter of the digital story was front and centre for us.

But, like nearly all public and private enterprises in 2011, we also had the task of working out how to live within our means.

We believed that new technologies and new digital centres like Salford and the new BH did offer the prospect of further productivity gains between now and the end of 2016. But we didn’t believe we could hit all the required savings through productivity efficiencies alone. That’s why we’ve decided to make some structural reductions as well: withdrawing BBC2’s daytime commissioning budget, for instance, or sharing the TV rights for Formula 1 with BskyB.

We considered dropping one or more services in their entirety, but it was quite clear that – while members of the public will sometimes suggest that the BBC close services that they don’t actually use themselves – every
BBC service has a fiercely loyal audience who really rely on it.

We were mindful of our experience with 6Music as well. Suggesting closing it turned out to be not just one of the most effective, but probably the cheapest marketing campaign in radio history. 6Music’s audience promptly doubled, has remained strong, and the value-for-money case for closure evaporated.

We were also determined not to salami-slice, in other words not to apply indiscrimate one-size-fits-all savings to every bit of the BBC, but to assign priorities and make choices. Radio 4 and BBC One both received special protection – though even they will need to find some productivity savings over the next few years.
As a whole, radio faces smaller savings than either TV or the web – let alone the deep savings we’re striving to make in overheads and in senior management layers and costs.

But that doesn’t mean that BBC radio is somehow being let off the hook. Radio budgets are traditionally far lower and discretionary spend a fraction of the equivalent in TV. As a result I believe that the targets, while achievable, are stretching and difficult.

The planned savings in BBC Local Radio have been particularly widely discussed since we unveiled our proposals a few weeks ago. Let me spend a few minutes on them.

At the beginning of the process, all sorts of possible futures for BBC Local Radio were discussed – up to and including some kind of merger with Radio 5Live. We rejected all of these ideas. BBC Local Radio’s strength is that it is local and that it provides a vital, life-line service for audiences who in many cases consume no other form of radio.

In the end, we decided to propose a package of measures which sees a concentration of our resources on key dayparts – breakfast, mid-morning, drive time, &c – with some sharing in the afternoon and evening, but a continued commitment to all forty English stations.

The headline savings number for BBC English Regions is 14% – somewhat below the average for the BBC as a whole, so it’s not true that local radio has been in any way singled out or victimised. Nonetheless it’s true that the high fixed costs and low discretionary spend in BBC Local Radio budgets mean that the impact on jobs will be significantly higher than that 14% overall headline suggests. So I recognise that – just as with many of the other proposals affecting other parts of the BBC – the challenge we’re setting our colleagues in Local Radio is very tough. The BBC Trust are currently consulting the public about these as well as the rest of our proposed changes to BBC services and both they and I will of course listen carefully to what the public have to say about them.

More generally, we will try to build our plans for productivity in radio by taking up some of the suggestions made by John Myers when he came in to benchmark our popular music networks against commercial radio. John will have already recognised some of his ideas in our proposals.

You will also see us trying to build on our unfolding new strategy for our digital-only networks, which is to align them more closely to a ‘parent’ station and to try wherever possible to encourage regular listeners to the parent to sample what’s on offer on the digital-only partner. The success of this approach is already apparent in the RAJAR numbers, most notably with Radio 4 Extra – rebranded from Radio 7 earlier this year and now the UK’s biggest digital network with a weekly reach of just over a million and a half. Indeed this approach is now being adopted by BBC TV – bringing both BBC1 and BBC3, and BBC2 and BBC4 rather closer together and with the intent of moving both programmes and audiences more fluidly between them.

Finally, as you’ve already heard, we decided to protect our investment in DAB roll-out because it too is a critical part of the future, both for us and for the whole of the radio industry.

Conclusion

The Licence Fee settlement means some difficult and sometimes painful choices for the BBC, but everyone inside the Corporation also has to accept that it will still leave us with resources and capabilities and strategic options far greater than those enjoyed by almost all of our commercial counterparts.

It will be a BBC which is smaller in many ways – with a smaller headcount, many fewer senior managers, a much smaller property footprint – but with a breadth of services and a creative fire-power which remain formidable.
It will be a BBC which is more clearly focused on what it does best and on the programmes and services which best complement what commercial media provides.

And it will be a BBC still firmly focused on innovation and on the future. People who hoped that tight funding would encourage the BBC to retreat back into traditional linear media will, I’m afraid, be sadly disappointed.
But I hope that it will also be a BBC whose commitment to be a partner and team-player – across the board but in radio in particular – goes from strength to strength.

We believe in radio. We want BBC Radio to continue to be that senior service that John Reith believed in so passionately, the undiminished jewel in the BBC’s crown.

But we know that our success depends on the success of an industry that extends far beyond the BBC. That’s why we want to play a full part in helping all of you succeed as well. Thank you.