The Association of European Radios (AER) is a Europe-wide trade body representing the interests of private radio operators in Germany, France, Spain, Portugal, Italy, Greece, Holland and the UK

AER's main objective is to develop and improve a suitable framework for private commercial radio activity. AER encourages co-operation between its members and with other European radio stations and associations, in order to preserve and develop freedom of speech, freedom of enterprise, private initiative and the protection of listeners.

Furthermore, AER intends to promote the diffusion and use of new technologies in radio transmission (in particular, the DAB system - Digital Audio Broadcasting).

Concerning the debate that is taking place in the European Union on Public Service Broadcasting, AER wishes to bring to the attention of the Austrian Presidency, the Council of the European Union, the European Commission and the European Parliament and Member States, some important points we believe are important to maintain a free market and defend the right of listeners to a wide choice of programmes.

Some of the conclusions that will be reached during the meeting of the Culture/Audiovisual Council that will take place on 17 November 1998, and in general in the debate open in Europe, may affect directly the interests and the services offered by private radio.

Role played by Private Radio in Europe

• Currently, in the EU there are approximately 8,000 active private radio stations in an environment of great pluralism and democracy.
• Radio offers to all people in each Member State a range of programmes containing entertainment and informational services of increasing quality, which reflect the culture and languages of the different nations and especially regional and local interests.
• Radio is embracing new technology, presenting itself as a digital media through the DAB (Digital Audio Broadcasting) system. More than any other media, it will lead the way to a truly portable “information highway”.
• The reality of Radio in Europe is different than that of Television. Radio has different structures, and offers distinctive types of services. It may be taken for granted on occasions because of its reliability and multi-station provision but, unlike television, it is a useful secondary medium which engages listeners while they are doing other things. Therefore, AER asks that EU Institutions consider and treat Radio as separate and different reality from Television.

Public Service vs. Private Broadcasting in an era of Convergence

Convergence requires us to reappraise a number of things about the broadcasting business which have, up to now, been held to be universal truths.

At the moment all countries of the European Union have different media ecologies. Convergence will erode these differences, however, will require us all to answer the same questions. As we prepare for a time when digital platforms will contain audiovisual products of all kinds, currently licensed, funded and regulated in different ways and to different degrees, we need to reconsider the purpose and nature of service licensing and regulation. We also need to reassess what public service broadcasting is and how it will be paid for.

From AER's point of view the notion of public service has nothing to do with whether a programme is commercially funded or not. It means simply "broadcasting which informs and entertains the public". Private radio is in the public service. It has to be. Shareholders of private broadcasting companies can only expect reward from advertisers if their output serves the public. That being said, they may not choose to serve a particular audience if it is not sufficiently large or demographically interesting to attract advertisers. Therefore, if such audiences are to be served, we need to find a non-commercial way to do it. This is where public subsidy comes into play. The problem is not public service broadcasting but whether and how aspects of it should be publicly funded.

The important discussion then is not about "public service vs. commercial broadcasting" but about how and at what cost broadcasting in general can be enhanced by "public funding".

Wireless spectrum resource will always be limited. Despite digitisation and compression, there will never be enough of the parts of the spectrum that potential users most want. Because of this, it is difficult to object to the idea that all those who use spectrum resource to broadcast (as digital radio multiplex owners will do) should be subject to positive programming requirements. Current legislation in many European countries achieves this and we see no reason to change the basic concept.

A licensor of the airwaves responsible for issuing a broadcasting licence should have an idea, before issuing the licence, about how it is to be used and whether it will add to the sum total of human knowledge and/or happiness. This should not lead to subsequent micro-management of output by a regulator but should allow action to be taken is the end result is substantially not what was anticipated at the outset. Where this output is to be publicly funded in some way, then the element of accountability to the general public and the national or local government concerned should be greater.

The people appointed to ensure that any public funds used for broadcasting are properly spent should be tough and independent of both government and those who do the broadcasting.

In the European Union, up until now, we have had two types of publicly funded broadcasters. Those that are not funded by advertising at all and those that are essentially publicly subsidised commercial services (who will describe themselves as commercially subsidised public broadcasters).

Pressures from government and the human desire to maintain and develop importance are subtly moving all publicly funded broadcasters towards being partly commercial in one way or another. This inevitably changes their nature, introducing commercial interests into those that influence their programming decisions, and so calling into question their value as providers of something different. AER is against the concept of any of our competitors being able to use public subsidy to develop programmes and services which compete directly for commercial income. This leads to unacceptable distortion of markets.

The trouble with publicly funded broadcasters from commercial broadcasters' points of view is that they are very large. They have roots that extend way back into history and are enormously influential. But even though there may be no votes for governments which try to change a country's broadcasting environment, it seems likely that digital technology will slowly do the job for them.

In the digital era, radio listeners will continue to be loyal to a radio station not because it is the only way they can hear music, commentary, news or other information but because it is an accompaniment to life, something they identify with personally and can do while doing something else.

In AER's opinion, people will continue listening to radio stations rather than merely programmes. The radio channel/station context will therefore continue to exist in the digital world and publicly funded programmes will still need to find themselves in an attractive context if they are to do the most good.

In this context, AER suggests that publicly funded broadcasters will need to be firmly and independently regulated to meet closely defined purposes. They must not to be allowed to build or sustain media empires at public expense, distort markets or pursue audience share at the expense of their public obligations.

Based on all this, AER wants to draw attention once again to various advantages enjoyed by public radio so that EU Institutions and Member States can take them into account when considering the roles played by private and public radios in society.

Historically,

• Public radios generally have priority to access frequencies.
• In most cases, they benefit at the same time from public funding (article 92 of the EU Treaty) and also receive revenues from advertising (double funding).
• In the Information Society, the development of new technologies is critical for the sector. The funding cushion afforded to public radio out of licence fee or taxation represents a huge investment advantage as the transfer to digital takes place. The development of DAB depends on the joint effort of private and public radio.
• The existing disparities between national legislation provoke not only distortions to competition, but also restrictions to free movement of radio services (article 59 of the EU Treaty), and to the free establishment of economic operators (article 52 of the EU Treaty).

Equilibrium of opportunity between private and public radios is necessary to guarantee a minimum level of pluralism and to ensure the development of the European radio sector.

Therefore, AER invites the EC Institutions:

• To recognise the important role-played by private radio in the European Union.
• To recognise private radio as a supplier of “Services of General Interest”.
• To support the coexistence of private and public radio stations under fair and impartial conditions that allows the development and enrichment of this media.
• To recognise that private radio, no less than public radio, must satisfy listeners’ choice and information requirements.
• To appreciate that public funding beyond a certain point that gives unfair advantages to public radios does constitute state aid and is anti-competitive.