Ofcom cuts cost of Classic FM and UTV licences

By | Published on Friday 21 January 2011


Media regulator OfCom has slashed the fees charged to Global Radio and UTV Radio for the use of the frequencies on which they broadcast Classic FM and TalkSport respectively.

Both will now pay £10,000 a year for their licences. Global Radio previously paid £50,000 and 6% of ad and sponsorship revenue, while TalkSport paid a set charge of £100,000 each year. Back in the day the Classic FM licence was costing £1.2 million a year, while TalkSport were paying over half a million.

Both the Classic FM and TalkSport licences, which would soon have been up for renewal – a process which would have seen others compete for them – were extended in the Digital Economy Act last year. The government were keen for the likes of Global and UTV to invest in the shift from analogue to digital radio services, and didn’t really want the radio industry to get into a big bidding war for frequencies ministers hope to soon phase out.

OfCom said the cuts in the licence fees Classic FM and TalkSport would pay reflected the decreasing value of the licences – ie what new bidders would be willing to pay if the licence was put up for auction. It’s also probably a further attempt by government and their regulator to focus radio industry attention onto the digital future, even though conventional FM services are still the cash cow for most radio companies.