U.K. Consumers Being ‘Panicked’ Into Adopting Digital Radio, Panel Says

Consumers are being “panicked” into adopting digital radio by biased industry groups, a U.K. government panel said Tuesday. The Consumer Expert Group, formed to advise officials on digital switchover, issued a report on what benefits there are for consumers to use the new technology. The government planned to make the transition in 2015, but the CEG said setting a firm date will scare consumers into switching before numerous concerns are addressed. Industry groups criticized the report for being overly cautious and seeking to rewrite policy.

The criteria and target date for switchover were set by the former government. The panel said it welcomed the new coalition government’s decision to make the transition only “if, and it is a big if,” consumers are ready by then. The change isn’t to occur until 50 percent of radio listening is to digital sources and coverage of national digital audio broadcasting is comparable to that of FM. But the CEG said that, while the first criterion is consumer-based, it’s not enough to protect users’ interests.

The rush to digital radio is being driven by a commercial radio sector suffering in a market of high fixed costs and falling revenue, the CEG said. The industry estimates it’s losing $47 million each year, it said. But there’s evidence the government has already put mechanisms in place under the Digital Economy Act that have improved the financial situation, making the need for digital switchover questionable, the panel said.

The panel found “no discernable benefits” for consumers from digital radio, and questioned marketing strategies based on inaccurate and unbalanced information. “The CEG is concerned that consumers are being panicked into adopting digital radio rather than convinced by the digital offering,” it said. Most of the information available comes from the radio industry when what’s needed is an impartial, independent body, it said.

Despite the commitment to switchover, costs and benefits are “surprisingly unknown,” the panel said. There has been no cost-benefit analysis from a user perspective, it said. There isn’t enough emphasis on improving the basic usability of DAB sets, and the commercial sector must offer much more compelling content to convince consumers they need digital radios, it said.

Environmental costs are another concern, the CEG said. Recent research shows that the power consumption of DAB radios is 28 percent lower than older digital radios and they use on average only 0.38 watts more than analog models, it said. While energy efficiency is improving, developments won’t keep pace with the demands of more sophisticated digital functions and DAB sets aren’t likely to keep up with analog on energy consumption, it said.

A bigger environmental problem is what to do about millions of obsolete analog sets, the panel said. While they must be disposed of under EU waste electrical and electronic equipment rules, consumer behavior toward disposal is likely to be very different from TV switchover because radios are small and will be tossed out in the general waste, it said. WEEE regulations allow consumers to return obsolete equipment to retailers but the responsibility of sellers in the disposal of devices isn’t well understood, it said.

Other unresolved issues include the absence of preparations akin to those for the move from analog TV, lack of suitable equipment for making digital radio accessible to all, and the need to have DAB radios standard in all vehicles for at least two years before switchover is even announced. The report has sensible recommendations such as the need for a public information campaign, said RadioCentre Chief Executive Andrew Harrison. But the CEG is unhelpfully trying to revamp policy decided over a year ago, he said. The committee also underplayed the commercial sector’s continued innovation, he said.

The CEG took a “similarly cautious stance” before the successful rollout of digital TV, said a spokeswoman for the industry group Digital Radio UK, whose members include RadioCentre and the BBC. The industry-led TV switchover was effective in coordinating the changes required, something a body created from outside the sector will not be able to do, she said. The commercial sector believes it’s possible to meet the 2015 target date, she said. There are already significant changes in digital radio coverage, content, cars, communications and consumer electronics, she said.

The CEG’s findings mirror those in a report by the House of Lords’ Select Committee on Communications earlier this year (CD March 30 p6). There, lawmakers said that if qualms about consumer and environmental issues weren’t addressed, there could be a “public backlash.”