The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

RADIO stations have warned of “a huge problem” if regulators use the opening of currently-closed spectrum bands to issue more FM broadcasting licences. Galen Saunders, More 94 FM’s principal, told Tribune Business that the FM broadcasting market was already over-saturated as a result of the Utilities Regulation and Competition Authority (URCA) issuing too many broadcasting licenses since 2009.

This is effectively confirmed in URCA’s recently-unveiled proposal to obtain ‘fast-track’ authority to ‘open up’ more radio spectrum bands, as this discloses that individual operating licenses and Class Spectrum licenses have more than tripled in the past eight years.

URCA’s consultation justifies opening ‘standard spectrum bands’ that are currently closed on the basis that this will meet increased frequency demand, thereby boosting “growth and competitiveness” in the radio broadcasting sector.

The regulator is also seeking industry approval to open ‘closed’ spectrum bands on its “own volition”, and do away with the current eight-month public consultation process that is currently required before doing so, as this is a “significant barrier to entry” for new participants.

The URCA consultation document makes no specific reference to opening up new spectrum in the FM Broadcasting Band, instead focusing on new mobile communications spectrum, onboard maritime communications, fixed satellite and earth stations.

However, Mr Saunders told Tribune Business: “As it relates to FM and radio, I think it would be a huge mistake if they consider doing it for the FM radio simply because the FM radio market has contracted by 50 per cent in the last three years.

“They [URCA] issued too many licences in New Providence. They claim everyone should have an opportunity to participate in an open market, but they should ensure there’s a sustainable market for businesses to exist and thrive.

“I would have a huge problem if they do anything to increase the proliferation of FM licenses, and be concerned if they open FM frequencies to allow for digital FM broadcasting. It’s just that the market is very saturated already, and those in it should be given an opportunity to operate digitally, not someone new in the market.”

Mr Saunders’ position is supported by research previously conducted for The Tribune Radio Ltd, the affiliate of this newspaper and owner/operator of five FM stations - 100 Jamz, KISS FM, Joy FM, Y98.7 FM and Classical FM.

This revealed that the Bahamas, with its 377,374-strong population, has more radio licences - at 47 - than New York City, with its 16.278 million people, at 42. This was enough to deem the Bahamas’ FM broadcasting market as “unsustainable” due to the number of licences issued by URCA.

The regulator, in its latest November 9 consultation, effectively confirms this by revealing: “Since 2009 there has been a 43 per cent increase in Individual Spectrum Licences; 200 per cent increase in Individual Operating Licences; 242 per cent increase in Class Spectrum licenses (Requiring Registration); and 10 per cent decrease in Class Operating Licences (Requiring Registration).

“Therefore, URCA is satisfied that the market is more competitive than it was when it published the first NSP (National Spectrum Plan), and that there is significant justification for regulatory intervention at this stage to make new spectrum readily available.”

Another radio industry source, speaking on condition of anonymity, said they had been unaware of URCA’s ‘spectrum opening’ consultation until informed about it by Tribune Business on Friday.

They added that they had attended a meeting of URCA’s broadcasting content working group on November 2, but the new consultation was never mentioned despite its launch being a week away. “That’s been their MO (modus operandi,” they said of URCA.

“The reality is in our small population and our economy, to issue more licenses will be a death knell for a lot of small companies,” the source added. “I’m blown away by this. I’m gobsmacked.”

The regulator said it had “received an overwhelming interest from prospective licensees to offer wireless communication services in bands that are presently closed”, while existing companies - especially the two mobile operators - needed more spectrum to offer data and mobile broadband services.

“URCA believes that making additional spectrum available can help service providers respond to competitive pressures,” it said. “URCA is aware that the increasing demand for cellular mobile spectrum has resulted in the near exhaustion of premium spectrum. As it relates to spectrum in the Bahamas, the introduction of competition in the cellular mobile market resulted in the assignment of over 75 per cent of the available Premium Spectrum.

“Further, since 2009, URCA has also observed sufficient take-up of FM Broadcasting services in New Providence and an increased take-up on the Family Islands, which has resulted in a robust and well-diversified FM broadcasting market.

“In addition to the growth in demand for Premium Spectrum, URCA has observed an increase in demand in some of the Standard Spectrum Bands, including FM Broadcasting Band, the 2500 MHz and 3500 MHz bands.”