Popular commercial radio stations Scala Radio, Jazz FM, Planet Rock and Kerrang! Radio are to launch subscription services as owner Bauer Media Group bets that listeners will pay to skip advertisements.
The audio arm of the German publishing conglomerate said on Tuesday that the premium online offerings would target “music super fans” who are passionate about their favourite genres and stations.
“We are embarking on this to explore how significant of a revenue stream this can be,” Paul Keenan, Bauer audio president, told the Financial Times.
The move into subscriptions by Bauer, which reaches 55m listeners across seven countries, is the first on this scale by a traditional European radio broadcaster. The Hamburg-based group’s other UK stations include Kiss, Absolute Radio and Magic.
Keenan declined to give specific figures but he said the company expected a substantial proportion of the four stations’ 2m UK listeners to pay £3.99 a month for an ad-free experience.
“I think [rival groups] will be fascinated to see how this plays out,” he said, adding that he hoped it would “unlock a meaningful opportunity to deepen the relationship with an important group of our listeners”.
Gill Hind, analyst at Enders Analysis, said she did not expect the move to cannibalise the network’s advertising revenues, adding that the cost of production will be “minimal”.
“It’s a good way forward, [Bauer] will get to know more about their consumers and get data back from that as well,” she said.
Broadcast radio has avoided the dwindling audiences that have afflicted much of traditional media. While younger people have largely turned to online options such as Spotify and other on-demand services, growing ranks of older generations still listen to live radio.
The medium reached 48.6m UK adults a week on average per week in 2019, according to Enders, which it said amounted to the same proportion of the population as a decade earlier.
Commercial broadcasters such as Bauer and Global Media & Entertainment, owner of Capital and LBC, have in the past decade outperformed the BBC and reach more people than the public service broadcaster’s radio arm, according to Enders’ data.
