An Overview of the Australian Commercial Radio Broadcasting Sector

Introduction

The commercial radio sector is one of the oldest and most vibrant of the media/communications sectors in Australia. The first radio broadcast in Australia was by a commercial radio station called 2SB in Sydney on 13 November 1923. It’s reported that the first radio broadcast was a concert featuring vocal performances by a soprano, a bass, a contralto and a baritone plus a string quartet.

Since those first days, the Australian commercial radio sector has continued to play a vital role in the Australian music industry. The two sectors share something of a symbiotic relationship.

However, it’s worth noting that non-music programming has also been an integral part of the history of Australian commercial radio. In July 2007, the industry celebrated 40 years of talkback radio in Australia. Today, some of the leading commercial radio stations in their markets are talk stations.

The Industry

There are approximately 260 commercial radio broadcasting stations currently operating in Australia. Most of those are located in non-metropolitan areas of Australia.

The commercial radio sector is a AUD $947 million a year industry (2004-05 revenue figures) which is funded primarily through advertising and sponsorships. According to industry body Commercial Radio Australia (CRA), advertising expenditure on the commercial radio sector accounts for around 8% of total media advertising expenditure in Australia.

Commercial radio stations compete for audiences with the national broadcasters (ABC and SBS), over 350 community radio stations and nearly 2000 low powered and high powered open narrowcasting radio services.

This makes the radio sector the most competitive media sector in Australia today. The large number of radio stations can be attributed to the enactment of the Broadcasting Services Act 1992 (Cth) (the “BSA”). The BSA streamlined the process for allocating radio broadcasting licences and created additional categories of radio services (e.g. narrowcasting services).

Another by-product of the BSA was an increase in the level of concentration within the commercial radio sector. Today, most of Australia’s commercial radio stations are part of networks. The major networks include:

Ace Radio: which owns 13 stations (mostly) in regional Victoria.
Australian Radio Network (ARN): which owns 12 stations including:
- the Mix FM Stations
- the Classic Hits Stations
- the Edge 96.ONE (an ‘urban’ music station)
Austereo: which owns 10 stations including:
- the Today Network
- the Triple M Network (iconic Australian stations which built their reputation on rock music in the early 1980s)
Capital Radio Network: which owns 7 stations mostly in rural NSW
DMG: which owns 9 stations including:
- the Nova Stations
- the Vega Stations in Sydney and Melbourne
Grant Broadcasters: which owns approximately 15 stations mainly in regional areas in NSW and Victoria
Supernetwork: which owns 32 stations including:
- 2SM in Sydney
- stations Throughout Regional NSW and Queensland
Macquarie Radio Network: which owns Sydney stations 2GB and 2CH
Macquarie Regional Radioworks: which owns and operates the largest commercial radio network in Australia, with 87 commercial radio stations in 45 licence areas in Queensland, New South Wales, Victoria, Tasmania, South Australia and Western Australia
Southern Cross Broadcasting: which owns 7 radio stations made up of:
- a talk radio network with stations 2UE, 3AW, 4BC and 6PR
- music stations Magic 1278 (Melbourne), 4BH (Brisbane) and 96FM (Perth)

Music on Commercial Radio Stations

One of the key features of radio in Australia is the high level of diverse programming that can be heard across all the different categories of radio services. The commercial radio sector contributes to this diversity by providing a wide cross section of programming including music from different genres such as rock, pop, urban, contemporary and classic hits and country music.

Unlike some of the other sectors, commercial radio broadcasters are not restricted from broadcasting (or required to broadcast) particular genres of music. Like other forms of programming, music on commercial radio stations must fit within acceptable standards of taste and decency. Other than that, programming decisions relating to genre of music are determined solely by each station or its network owner.

Naturally, most of the music on commercial radio stations tends towards the more popular genres as this fits the commercial radio business model. The BSA envisages that the other radio sectors (i.e. community, narrowcasting and the national radio services) will round out the programming choices for Australian audiences by providing different or more narrowly focused types of programming including music genres that are less likely to be heard on commercial radio stations.

‘Australian Music’ Quotas

Notwithstanding their programming freedom, commercial radio stations that broadcast music have a mandatory obligation to broadcast minimum quotas of music performed by Australian artists. These obligations are set out in Code 4 of the Commercial Radio Codes of Practice (the “Codes”).

The quotas range from 5% to 25% of music broadcast. The percentile bands correspond to 5 broad categories of music (from A to E) into which all commercial radio music stations fit.

The actual ‘Australian music’ quota obligation is in 2 parts:

firstly, an overall quota for all commercial radio broadcasters that broadcast playlist music
secondly, for Category A to C stations, a subset of the overall quota must consist of ‘new’ Australian performances – i.e. musical performances by Australian artists that are not more than 12 months old

The Codes are part of the broadcast sector’s co-regulatory scheme which is set out in the BSA. The Codes are developed by CRA and registered by the broadcast regulator: the Australian Communications and Media Authority (ACMA).

A voluntary body called the Australian Music Performance Committee (AMPCOM) monitors the operation of Code 4. AMPCOM is made up of various organisations from the Australian music industry and its secretariat is provided by the Australian Recording Industry Association (ARIA).

Embracing New Technology

The Australian commercial radio sector has been very active in embracing new technology in recent times. Like all the other media sectors, commercial radio stations are morphing into multimedia companies. This is reflected in a number of recent strategic partnerships such as that between Austereo and Fairfax Digital referred to in the following media release¹ and article.²

At a very basic level, most commercial radio stations have a website with contact details, presenter bios and competition terms. However, some commercial radio stations have begun to use the Internet to do interesting things in terms of programming. For example:

simulcasting their broadcast programs over the Internet; or
providing ‘podcasts’ (selected highlights) of their programs for download to portable music players.

Radio airplay has always played a key role in promoting sales of music. A natural extension of that relationship is for radio stations to actually become retailers of music. There is evidence that this is now occurring. For example:

DMG’s Nova stations have developed the “Nova iTunes Store” through which listeners can buy and download songs or albums from the live playlists of the Nova stations; and
ARN’s The Edge 96.ONE has a service that allows listeners to find out the name of a song playing on the station (via a return SMS message) and to download that song as a mobile phone ringtone.

Talk stations are also using technology to extend their programs to other mediums and listeners. For example:

Sydney radio station 2GB (which has a predominantly over 55 audience) provides a daily video podcast from leading radio announcer Alan Jones and also has webcams set up to enable listeners to see live footage of presenters in the studio, and
Southern Cross Broadcasting, which has set up a comprehensive online portal called MyTalk.com.au through which it provides up-to-date news, podcasts of popular programs and (in a new twist on talkback radio) provides a forum where online users can publish comments on a variety of topics or respond to those published by Southern Cross’ journalists.

Digital Broadcast Radio

The most anticipated technology development in the Australian radio sector is digital broadcast radio. In May 2007, the Australian Government introduced legislation which provides a framework for the introduction of digital broadcast radio in Australia.

Digital broadcast radio is considered to be the most fundamental advance in radio broadcasting technology since FM stereo radio in the 1970s. Digital broadcast radio will deliver many benefits to listeners including:

better quality audio – with the potential for CD quality sound
interference free reception
ease of tuning – listeners can search for stations by name rather than by a frequency
additional radio stations – digital radio uses spectrum more efficiently which means radio broadcasters will be able to broadcast more than one radio channel at the same time
multimedia capability – radio stations will be able to broadcast data, text and images along with their audio broadcasts
the ability to pause, rewind and record live radio

A number of trials of digital radio broadcasting are currently taking place around Australia including a Sydney trial which is co-ordinated by CRA and includes all the Sydney commercial radio stations and the ABC and SBS.

The first official broadcasts will commence by no later than 1 January 2009 in Sydney, Melbourne, Brisbane, Perth, Adelaide and Hobart. For other licence areas, the start date will be determined by the Commonwealth Minister for Communications.

Listeners will need to buy new receivers to tune into digital radio broadcasts. It’s envisaged that those receivers will have display screens to take advantage of all the multimedia capabilities of digital radio. A UK company called the UBC Media Group has also been begun trials with technology that will allow listeners to hear a song on a digital radio broadcast and instantly buy and download the song to their digital radio receiver – the ultimate impulse buy!³

For more information on all the features of digital broadcast radio including developments in receiver technology and the progress of the rollout of digital radio services across Australia, you can refer to the website of Digital Radio Australia.

Training for a Career in Commercial Radio

There are a number of pathways for a person seeking a career in the Australian commercial radio sector. Some of the tertiary institutions and the courses they provide are listed below:

Australian Film Television & Radio School (Sydney, NSW):
- Graduate Certificate in Commercial Radio Programming
- Graduate Diploma in Commercial Radio Broadcasting
Charles Sturt University (Bathurst, NSW):
- Bachelor of Arts (Communication – Commercial Radio)

Swinburne University of Technology (Melbourne, Victoria):
- Graduate Diploma of Arts (Commercial Radio)
West Australian Academy of Performing Arts (Perth, WA):
- Graduate Certificate in Broadcasting (Radio)

Author

Moses Kakaire. Last updated 22 August 2007.

References

Moses Kakaire

Simpsons Solicitors

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