---Apologies for cross-posting---
Full report available at
Community Radio: Annual Report on the Sector 2008/2009
1.1 Community radio stations are a new type of not-for-profit radio
service, designed to operate on a small-scale and to deliver community
benefits (‘social gain’) to one or more communities. The legislation to
enable community radio services to be licensed was introduced in 2004,
and the first station launched in November 2005. This is Ofcom’s second
annual report on the sector.
1.2 Ofcom has now licensed 214 stations over two rounds of licensing.
159 of these are broadcasting, 12 have either decided not to launch or
have handed their licence back and the remainder are preparing to start
broadcasting. The second round of licensing is ongoing - Ofcom is
currently considering 13 applications from groups based in the southeast
of England (excluding London and other areas within the M25) and a
further 31 applications from groups based in London or other areas
within the M25 motorway.
1.3 Community radio serves a wide range of communities; the majority
serve a general audience in either an urban area (17%) or a town / rural
area (44%). However, many others serve smaller communities of interest
including those aimed at minority ethnic groups (14%), young people (9%)
and religious groups (7%). 170 of the stations awarded a licence are in
England, 14 in Northern Ireland, 20 in Scotland and 10 in Wales.
1.4 The legislation governing community radio sets out the
characteristics of community radio services and defines social gain.
Each station has a set of ‘key commitments’ which forms part of its
licence and details how the station will meet these characteristics and
deliver social gain, including for example, its core aims and
commitments in respect of training, access and accountability.
1.5 The legislation also provides for Ofcom to set licence conditions
that limit the amount of income that can be generated from on-air
advertising and sponsorship. For most stations this limit is 50%;
however, two stations have a lower limit (25% and 10%) and a further 18
stations are not allowed to receive any income of this type. The
additional restrictions are in order to protect smaller commercial
services with whose coverage areas the community services overlap.
1.6 Every station that has been broadcasting for more than a year is
required to complete an annual report; this report details how a station
has performed against its key commitments and also identifies its
sources of income and expenditure, in part to ensure that the station
has met the legislative requirements on funding. For the period April
2008-March 2009 Ofcom received reports from 99 stations (92% of those
required to complete a return). Seven reports are outstanding in full or
part (stations that launched during this period or later are not
included in this report).
1.7 The average station’s income in 2008/09 was around £79,000, although
the median figure (the mid-point in the distribution of stations’
incomes) is significantly lower at £50,000, suggesting a small number of
stations earn significantly more than the majority. (The reported income
of the four highest income stations is as large as the 50 lowest income
stations combined, at around £1.4 million. If we exclude these four
stations the average income drops to around £67,000, with no significant
change in the median.) Stations serving particular communities reported
a higher income then the sector average - those serving general
audiences in urban areas (an average income of £92,000) and those
serving minority ethnic communities (an average income of £106,000).
1.8 The average income is down by around 20% on the previous year’s
reported figures (the average for 2007-2008 was £101,000) and similarly,
the median income is also down by around 20%. The relative contribution
of different types of income does not appear to have changed
substantially in comparison with the previous year. Although we cannot
be certain as to the reason for the drop in reported average incomes,
the indications are that the recession has had an impact and community
radio stations themselves often reported that they believed the
recession was a major factor impacting not just on advertising but also
1.9 The most significant type of income for the sector is grant funding,
which accounts for around 41% of the total. Income from on-air
advertising or sponsorship is the next most important, accounting for
around 23% of the total (23% of stations in this year’s report did not
seek income from advertising or sponsorship at all either because (1)
they choose not to (16 stations) or (2) because they were prohibited
under their licence from doing so (seven stations)).
1.10 Public sources of funding – usually in the form of grants - account
for around 43% of the sector’s total income. Local authorities are a
major source of public funding, accounting for around 17% of the
sector’s total income whilst the Community Radio Fund, administered by
Ofcom on behalf of the Department for Media, Culture and Sport, accounts
for around 4% of the sector’s total income. The Community Radio Fund
remains the individual largest single source of income for the sector
although we are aware of a number of other grants in excess of £100,000
that have been paid to individual stations.
1.11 Community radio stations are, on average, spending a little more
than their income – on average stations cost £81,000 to run. The major
item of expenditure is staff at around 52%; premises and technical costs
are the next most significant items at around 10% each. The sector
average is a deficit of just under £3,000, but this disguises a wide
range from surpluses of £83,000 down to a deficit of £133,000. 40% of
all community stations which have returned annual reports were in
deficit and 23% of stations had deficits in excess of £10,000. In
general, large deficits are being funded by parent organisations whilst
any surpluses are invested in the operation of the service.
1.12 Community radio stations broadcast live on average for around 77
hours a week, and typically broadcast a further 10 hours per week of
original pre-recorded material. On average, around 32% of stations’
daytime output is speech, featuring a diverse range of local
organisations and community members. Music output is similarly broad:
some stations focus on particular genres that are not commonly heard on
the radio whilst others take a more mainstream approach during the
daytime but then branch out into specialist genres in the evening.
1.13 The average station has around 75 volunteers – although again there
is a wide variation, from 1 to 287 – who together give around 222 hours
a week of their time in total. There are now some 159 stations
broadcasting and Ofcom therefore estimates that volunteers contribute
nearly 150,000 hours a month to community radio.
1.14 Ofcom is addressing a number of regulatory issues following receipt
(or non-receipt) of individual reports. Ofcom is seeking further
information from three stations with respect to the statutory 50% limit
on the amount of income that is received from on-air advertising and
sponsorship, seven stations have not yet returned their reports in full
or part to Ofcom, which is a potential breach of a station’s licence,
and Ofcom has written to one station with respect to its ‘key
commitments’ where Ofcom considers that the station has not provided
enough information to allow Ofcom to assess whether it is meeting its
commitments. If we are not satisfied with the steps taken by stations
then we may consider regulatory action.
MeCCSA Policy mailing list
Please visit this page to browse list's archives, or to join or leave the list.