UK radio industry 2010 2011 2012 2013 2014 2015

Weekly reach of radio (% of population) 90.6% 90.8% 89.5% 90.4% 89.5% 89.6%

Average weekly hours per listener 20.1 20.5 22.2 21.5 21.4 21.4

BBC share of listening 55.2% 54.7% 54.7% 54.6% 53.8% 53.6% Total industry revenue* £1,137m £1,164m £1,203m £1,177m £1,248m £1,248m Commercial revenue* £452m £457m £475m £461m £512m £519m BBC expenditure £675m £697m £717m £705m £725m £717m Community radio revenue £10.0m £10.5m £10.8m £10.9m £11.5m £11.6m

Radio share of advertising spend 3.3% 3.3% 3.3% 3.1% 3.2% 3.0%

DAB digital radio take-up (households) 38.2% 42.6% 44.3% 47.9% 49.0% 55.7%

Digital radio listening share 24.6% 27.8% 31.2% 35.6% 37.3% 40.7%

Figure 3.1

Source: RAJAR (all adults age 15+), Ofcom calculations based on figures in BBC Annual Report and Accounts 2015-16 (www.bbc.co.uk/annualreport), AA/Warc, broadcasters. Revenue figures are nominal. DAB take up - Q1 of the following year. *Commercial and total revenue figures for 2010-2013 are not wholly comparable to 2014 and 2015 due to an amendment to the data collection methodology. Digital listening share 12 months to December.

UK radio industry key metrics

1

Figure 3.2

2

71

29 59 71

85 84 88

3

2

5 2

3 10

26

16 11

3 3 7

25 8 8 6 6

5 8 5 4 8 6 3 12 4 3

0%

20%

40%

60%

80%

100%

Adults16+

16-24 25-34 35-44 45-54 55-65 65+

Music videosCD/vinylStreamed musicPersonal digitalOn-demand radioLive radio

Source: Ofcom Digital Day 2016, Data book 1: C2. Adult diary: Chart shows the proportion of all listening time (B2) attributed to each activity (D) by age group. The average weekly minutes figure is among those who did any listening activity across their diary week and also includes simultaneous activity. Base: Adults aged 16+ (1512) 16-24s (129) 25-34s (189) 34-44s (282) 45-54s (299) 55-64s (259) 65+s (354).

Proportion of time spent listening, by age group Proportion of listening time (%)

945 883 817 931 1062 1116 879

Average weekly minutes listening:

Figure 3.3

3

Figure 3.4

Source: RAJAR

4

Breakfast Morning Afternoon Evening Night

Source: RAJAR, all adults (15+), 12 months to Q1 2016, Monday-Sunday, average audience. Base: National Total Survey Area.

Radio - average listening audience – 2016 BBC vs. Commercial

•Av

erag

e lis

teni

ng a

udie

nce

(%)

0

5

10

15

20

0600

-063

006

30-0

700

0700

-073

007

30-0

800

0800

-084

008

40-0

900

0900

-093

009

30-1

000

1000

-103

010

30-1

100

1100

-113

011

30-1

200

1200

-123

012

30-1

300

1300

-133

013

30-1

400

1400

-143

014

30-1

500

1500

-153

015

30-1

600

1600

-163

016

30-1

700

1700

-173

017

30-1

800

1800

-183

018

30-1

900

1900

-193

019

30-2

000

2000

-203

020

30-2

100

2100

-213

021

30-2

200

2200

-223

022

30-2

300

2300

-233

023

30-0

000

BBC

Commercial

Figure 3.5

5

The shift of audio consumption from albums and singles streaming

Streaming services unique audiences (millions)

4.6 5.4

9.9

2.9 3.1

5.7

279.4 245.5

217.1

0

50

100

150

200

250

300

0

2

4

6

8

10

12

2013 2014 2015

Spotify Soundcloud Music sales (digital & physical)

Music sales (million units)

Figure 3.6

Source: Entertainment Retailers’ Association / Official Charts 2016; comScore MMX Multiplatform UK, total digital population 15+, May 2016. Note: Spotify and Soundcloud only. The unique audiences from these two sites account for the largest take-up of the streamed music unique audience. 2013 data are based on May to December 2013, averaged.

6

13

38

14 11 11 7

2

19

51

26 25

8 8 3

0

10

20

30

40

50

60

Adults 16+ 16-24 25-34 35-44 45-54 55-64 65+

2014 2016

Source: Ofcom Digital Day 2016, Data book 1: A1. Adult diary: Chart shows the proportion of adults who recorded activity (D) at any point across their diary week. Base: 2016: Adults aged 16+ (1512), 16-24 (129), 25-34 (189), 35-44 (282), 45-54 (299), 55-64 (259), 65+ (354); 2014: Adults aged 16+ (1644), 16-24 (101), 25-34 (225), 35-44 (348), 45-54 (400), 55-64 (311), 65+ (259)

Weekly reach of streamed music, by age group: 2016 vs. 2014

Figure 3.7

7 • Base: Adults aged 16+ in UK (1512)

Source: Ofcom Digital Day 2016, Data book 1: B4(2) Adult diary: Data is taken from a combination of activities (D) and devices (E) recorded. The calculations are made by netting all grouped activities together and averaging the time spent. Zeros are included so as to reflect the whole UK population..

Average time spent on grouped activities per day Among adults 16+ in the UK

3h 47m

0h 18m

0h 7m

1h 14m

0h 14m

0h 31m

0h 25m

1h 30m

0h 28m

TV Or Films On A TV Set

TV Or Films On AnotherDevice

Other Video

Radio On Radio Set

Radio On Another Device

Other Audio

Voice Comms

Text Comms

Games

Change from 2014

- 9 mins

+ 5 mins

+ 2 mins

+ 7 mins

+ 1 mins

+ 2 mins

- 7 mins

- 9 mins

- 2 mins

Figure 3.8

8 8

Figure 3.9

Radio industry revenue 2010-2015 Revenue (£m)

Source: Ofcom / operator data / BBC Annual Report 2009-2016 Note: BBC expenditure figures are estimated by Ofcom based on figures from the BBC Annual Report (www.bbc.co.uk/annualreport); figures in the chart are rounded and are nominal. Total includes community radio, but community radio is not shown on the chart. Total commercial includes all sources of revenue - national, local, sponsorship and ‘other’, but ‘other’ is not shown on the chart. Commercial and total revenue figures for 2010-2013 are not wholly comparable to 2014 and 2015 due to an amendment to the data collection methodology.

1,137 1,164 1,203 1,177 1,248 1,248

675 697 717 705 725 717

452 457 475 461 512 519

211 220 222 207 261 267 136 130 139 141 136 133 92 92 98 95 94 95 0

200

400

600

800

1000

1200

1400

2010 2011 2012 2013 2014 2015

Total

BBC expenditure(estimated)

Total commercial

Nationalcommercial

Local commercial

Commercialsponsorship

9

Source: Ofcom / operator data

Radio expenditure and revenue percentage change, year on year

Figure 3.10

Source: RAJAR, all adults (15+), Q1 2016. Base: National Total Survey Area. Note: UTV Radio commenced trading as Wireless Group in March 2016 and Orion Media Group was acquired by Bauer in May 2016.

Share of all radio listening hours: Q1 2016

BBC network radio, 46.6%

BBC local/regional, 7.5%

Global, 18.5%

Bauer, 14.0%

Orion, 1.1%

Communicorp UK, 2.5%

UTV, 2.8% Other, 7.0%

Percentage share of listening hours

Figure 3.11

Commercial radio by weekly audience reach: Q1 2016

Source: RAJAR, all adults (15+), Q1 2016. Base: National Total Survey Area * Q1 ‘15 and Q1 ’16 Note: UTV Radio commenced trading as Wireless Group in March 2016 and Orion Media Group was acquired by Bauer in May 2016.

21,989 16,675

4,172 3,394 1,294 930 603 0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

0

5,000

10,000

15,000

20,000

Global Bauer UTV Communicorp Orion UKRD CeladorWee

kly

reac

h (th

ousa

nds)

Annual change in reach*

Weekly UK audience reach

Figure 3.12

41.0% 31.1% 7.8% 6.3% 2.4% 1.7% 1.1%

+1.9pp +1.0pp -0.6pp +0.3pp +0.2pp +0.1 -0.2pp

12

Digital Audio Broadcasting UK radio services broadcasting May 2016

UK Commercial

90% coverage

UK Commercial

75% coverage

BBC UK-wide

Local Commercial

Total

Multiplexes 1 1 1 54 57

Services 12 18 11 396* 437*

* Includes simulcast services (205 unique services). Excludes BBC local radio services

Figure 3.13

Source: Ofcom, May 2016

Analogue UK radio stations broadcasting May 2016

Type of station AM FM AM/FM total

Local commercial 51 235 286

UK-wide commercial 2 1 3

BBC UK-wide networks 1 4 5

BBC local and nations* 35 43 43

Community radio 6 233 239

TOTAL 95 516 576

Figure 3.14

Source: Ofcom, May 2016 Note: the conditions of each licence will determine the amount of programming that may be shared between these licensed services. Here we have taken the view that a service providing at least four hours a day of separate programming (even if the same brand has other services) equals one service. * Includes simulcasts.

Figure 3.15

Income 2010 2011 2012 2013 2014 2015

Average (mean) income

£65,750 (-12.9%)

£60,250 (-8.3%)

£57,000 (-5.4%)

£55,500 (-2.7%)

£55,750 +0.8%

£53,500 (-4.2%)

Median income £42,500 (-7.14%)

£40,500 (-4.8%)

£35,250 (-13.1%)

£33,250 (-5.6%)

£35,750 +6.9%

£32,500 (-8.5%)

Source: Ofcom analysis of community broadcasters’ returns Note: The data collection period changed from the financial year to the calendar year as of 2011. Data from previous years has been adjusted to reflect this.

Average income for community radio stations: 2010 to 2015

Figure 3.16

15

Source: Ofcom analysis of community broadcasters’ returns. Figures rounded.

Distribution of total income levels across the community radio sector Proportion of stations (%)

11

17 21

13

8 5 6 5

2 3 4 1 3

1

13

23

9 9 8 8

4 7

3 3 7

3 4 1

15 18

12 12 9

6 7 6 2 1

6 2 2 2

16 18

11 13

4

9 7

5 2 2

8

2 2 2 0

10

20

30

2012 2013 2014 2015

Community radio income, by source

Income by source (%)

Figure 3.17

26 29 30 26 30

33 29 25 26 25

10 7 6 4 5

13 14 13 15 14

18 20 26 28 25

0%

20%

40%

60%

80%

100%

2011 2012 2013 2014 2015

Other income

Donations

SLAs

Grants

On airadvertising andsponsorship

Source: Ofcom analysis of community broadcasters’ returns

17

Figure: 3.18

Average income by type of community served

Source: Ofcom analysis of community broadcasters’ returns

30% 45%

37% 24%

0

30% 29%

25%

24%

27% 35% 33%

14%

11%

8%

8% 37% 25%

15%

22%

24%

100%

23%

22%

£53,558

£69,860

£37,057

£57,796 £59,638

£73,035

£50,579

£0

£20,000

£40,000

£60,000

£80,000

£100,000

Sectoraverage

(216stations)

Minorityethnic (28)

Geographic- town/rural

(102)

Geographic- urban (28)

Military (9) Religious(12)

Youth (22)

Other

Donations

SLAs

Grants

On-air ads

12%

Figure 3.19

Source: Ofcom analysis of community broadcasters’ returns Note: The data collection period changed from the financial year to the calendar year as of 2011. Data from previous years has been adjusted to reflect this.

Average expenditure for community radio stations: 2010 to 2015

Expenditure 2010 2011 2012 2013 2014 2015

Average (mean) expenditure

£67,000 (-12.3%)

£64,250 (-4.1%)

£58,000 (-9.7%)

£55,000 (-5.0%)

£53,500 (-2.7%)

£54,800 2.3%

Median expenditure

£43,000 (-17.5%)

£41,000 (-4.9%)

£35,500 (-15.4%)

£35,750 2.7%

£33,250 (-6.8%)

£33,250 0%

Community radio expenditure, by type

Expenditure by source (%)

Figure 3.20

47 49 51 49 50

12 13 13 13 14 11 12 11 12 11 9

9 9 11 10 21 17 15 15 15

0%

20%

40%

60%

80%

100%

2011 2012 2013 2014 2015

Other

Technical

Admin andmarketing

Premises

Staff

Source: Ofcom analysis of community broadcasters’ returns

20

Figure: 3.21

Average expenditure by type of community served

Source: Ofcom analysis of community broadcasters’ returns

50% 40% 44%

53% 80%

45% 52%

14% 19%

14%

10% 0

15% 10%

11% 14%

13%

9% 5% 17%

9% 10%

8%

10%

9% 10% 6%

13% 15%

20%

19%

19% 17%

16%

£54,817

£66,831

£36,862

£66,180 £59,638

£71,061

£53,731

£0

£20,000

£40,000

£60,000

£80,000

£100,000

Sectoraverage

(216stations)

Minorityethnic (28)

Geographic- town/rural

(102)

Geographic- urban (28)

Military (9) Religious(12)

Youth (22)

Other

Technical costs

Admin andmarketing

Premises

Staff

Figure 3.22

Sector average

Total original hours per week 90

Number of volunteers 79

Total volunteer hours per week 186

Number of volunteers trained 51

Source: Ofcom analysis of community broadcasters’ returns

Community radio hours and volunteers

90.8% 89.5% 90.4% 89.5% 89.6% 89.3%

67.6% 66.4% 67.1% 65.6% 65.3% 65.1% 64.9% 63.5% 64.9% 63.9% 64.5% 64.0%

61.3% 60.3% 61.1% 59.9% 59.8% 59.8% 52.0% 50.5% 51.4% 50.8% 49.7% 49.7% 30.5% 30.9% 32.5% 31.6% 33.3% 34.0%

18.7% 17.8% 17.8% 16.8% 15.1% 15.3% 6.0% 6.2% 6.2% 7.6% 7.3% 7.1%

0%

20%

40%

60%

80%

100%

2011 2012 2013 2014 2015 Q1 2016

All radio

All BBC

All commercial

BBC network

Local commercial

NationalcommercialBBC nations /localOther

22

Source: RAJAR, All adults (15+), calendar years 2011-2015, Q1 2016

Reach of radio, by sector

Figure 3.23

Percent of population

54.7% 54.7% 54.6% 53.8% 53.6% 54.1%

46.0% 46.3% 46.2% 46.0% 46.1% 46.6%

43.0% 42.8% 42.8% 43.1% 43.8% 43.2% 31.2% 30.2% 29.7% 30.1% 28.5% 27.7%

11.8% 12.5% 13.1% 13.0% 14.4% 14.6%

8.7% 8.4% 8.4% 7.8% 7.0% 7.1% 2.3% 2.5% 2.6% 3.1% 2.7% 2.7%

0%

20%

40%

60%

2011 2012 2013 2014 2015 Q1 2016

All BBC Radio

BBC network

All commercial

LocalcommercialNationalcommercialBBCnations/localOther

23

Source: RAJAR, All adults (15+), calendar years 2011-2015, Q1 2016

Percent of listening hours

Share of listening hours, by sector

Figure 3.24

14.5 17.9 20.2

23.4

24.5 25.4

22.5 20.3 20.2 22.8

0

5

10

15

20

25

30

15-24 25-34 35-44 45-54 55-64 65-74 AdultMen

AdultWomen

ABC1Adults

C2DEAdults

Average listening per week 21.4 hours

Weekly listening hours

Source: RAJAR, all adults (15+), year ending Q1 2016, average weekly listening hours per listener

Average weekly listening by demographic, year ending Q1 2016

Figure 3.25

Figure 3.26

25

0

5

10

15

20

25

30

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

65+55-6445-54Adults 15+35-4425-3415-24

Source: RAJAR, all adults (15+), Q4 of each year, 12 month weighted, all radio TSA

Average weekly listening, by age: 2005-2015 Average listening hours per week

26 26

23.9 23.0 23.4 23.7 24.1 24.5 25.2 25.9 26.7 27.7 27.7 30.9

5.3 5.2 5.2 5.0 4.8 5.0 4.7 4.8 4.7 5.0 4.9 5.4

1.5 1.7 1.7 1.6 1.7 1.8 1.8 2.1 2.1 2.3 2.4 6.0 5.7 5.8 6.4 6.2 6.4 6.1 6.8 6.4 6.9 6.8 7.8 36.7 35.6 36.1 36.7 36.8 37.7 37.8 39.6 39.9 41.9 41.8 44.1

0%

10%

20%

30%

40%

50%

Q22013

Q32013

Q42013

Q12014

Q22014

Q32014

Q42014

Q12015

Q22015

Q32015

Q42015

Q12016

Internet

Digitalunspecified

TV

DAB

Source: RAJAR Note: ‘Digital unspecified’ relates to listening to digital-only stations where the survey respondent has not specified the listening platform used. With effect from Q1 2016 this term has been eliminated. ‘Internet’ is classified as ‘Online/Apps’

Figure 3.27 Digital radio’s share of radio listening, Q1 2016 Digital radio platforms’ share of all radio hours

27

Figure 3.28

Listening to radio via TV, internet and mobile phone

Source: Ofcom Technology Tracker. Data from Quarter 1 of each year 2012-2014, then Half 1 2015-2016 Base: All adults aged 16+ (n = 6090 UK 2009, 9013 UK 2010, 3474 UK 2011, 3772 UK 2012, 3750 UK 2013, 3740 UK 2014, 3756 UK 2015, 3737 UK 2016) QP11D/E/C: How often, if at all, do you access the radio via – Digital radio via: TV, Internet, mobile phone? *NB 2013-16 measures for internet combine responses across radio listeners and internet users, 2013-16 measures for mobile phone combine responses across radio listeners and mobile phone users

Proportion of respondents (%) who have listened to radio via digital television, internet or mobile phone

25 25 27 27 27

24 22 23

15 16 14

16

22 23 24 25

10 10 10 13

20 21 22 21

0%

10%

20%

30%

40%

2009 2010 2011 2012 2013 2014 2015 2016

TV Internet Mobile Phone

28

Source: RAJAR / Ipsos MORI / RSMB Q1 2009-2016

Figure 3.29

Ownership of DAB sets: Q1 2016

32.1% 34.5% 38.2% 42.6% 44.3% 47.9% 49.0% 55.7%

0%

15%

30%

45%

60%

Q1 2009 Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016

Percentage of adults who claim to own a DAB set / have a DAB set in the home

58% 55% 77%

32%

71% 59% 57%

43%

69% 63% 57% 56% 50%

42% 45% 23%

68%

29% 41% 43% 57%

31% 37% 43% 44% 50%

0%

20%

40%

60%

80%

100%

Digital

Analogue

Source: RAJAR, year ending Q1 2016, adults 15+ Note: With effect from Q1 2016 the term ‘not stated/specified’ was been eliminated.

100% 46% 7% 15% 29% 3% 2% 2% 6% 18% 1% 12% 4%

Overall radio sector National commercial BBC network Share of radio listening

Platform split by sector and station: year ending Q1 2016

Figure 3.30

Most popular digital-only stations - UK, Q1 2016

Source: RAJAR, year ending Q1 2016 adults 15+

Average weekly reach year ending Q1 2016 (millions) % change year on year

2.2 2.0 1.6 1.5 1.5 1.4

1.1 1.0 0.9 0.8 0.8 0.7 0.6 0.5 0.5 0.3 0.0

0.5

1.0

1.5

2.0

2.5 +6%

+2% -4%

+16%

+13% +11%

+10%

+12%

-11%

+33% +42%

+1% +6% +2%

Bauer BBC

Radio group

Independent

Figure 3.31

-2% +43%