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UK regulator reveals ongoing concerns over Bauer’s local radio acquisitions

By | Published on Monday 9 December 2019

Bauer Media

The UK’s Competition & Markets Authority last week published an update on its investigation into a flurry of local radio acquisitions by Bauer Media that occurred earlier this year.

The radio division of Bauer in the UK announced deals to buy Celador Radio, Lincs FM Group, UKRD and the local stations of the Wireless Group all within the first quarter of 2019. The CMA subsequently announced an investigation into whether or not that flurry of deals posed any competition concerns in each local radio market.

In its update last week, the regulator said that, with regard to the local markets where Bauer had acquired stations, there were now only concerns about Wolverhampton. There the Signal 107 station it acquired from the Wireless Group competes with an outpost of its existing Free Radio network. It seems likely that Bauer will have to sell the Signal station to satisfy the regulator.

However, the bigger CMA concern relates to an advertising business called First Radio Sales, which sells national advertising for various independently owned commercial radio stations. Bauer acquires 50% of the business via its UKRD deal. Meanwhile, by bringing ad sales for all its newly acquired stations in-house, Bauer also reduces the power of FRS.

The CMA stated last week: “If FRS were to shut down, local radio stations would have to seek sales representation from Bauer or Global, leaving local radio stations with little choice when trying to sell national radio advertising airtime and potentially leading to them paying higher commission rates”.

The CMA is seeking more information about the future of FRS before making any final decision.

Responding to last week’s CMA statement, Bauer told reporters: “We firmly believe that these transactions are pro-competitive and will benefit both the acquired stations and the broader local commercial radio industry as we look to invest in the radio industry’s digital future. Our focus now is on agreeing a route forward with the CMA that supports a strong and sustainable future for the local commercial radio sector”.

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