We can’t compete with FM radio, admits DBC as it seeks to return digital licence

Broadcaster cites underdeveloped nature of industry and lack of government support; it is the second digital broadcaster to hand back its licence

PUBLISHED : Monday, 08 August, 2016, 5:23pm
UPDATED : Tuesday, 09 August, 2016, 10:33am

Amid growing problems in Hong Kong’s media industry, Digital Broadcasting Corporation is going off-air and has applied to return its licence to the government, citing “unsatisfactory” developments in the digital radio industry. Job losses will total 113.

The broadcaster’s shareholders and board members notified the Commerce and Economic Development Bureau of their decision on Monday morning.

DBC is the second broadcaster to surrender its digital audio broadcasting licence in a year, leaving only two others in the field – Metro Broadcast and government-owned RTHK. Phoenix URadio earlier returned its licence.

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DBC boss Loh Chan said the move was not due to immediate financial difficulties, but a lack of prospects in digital broadcasting and government policies that failed to help digital radio reach a wider audience, causing difficulties in attracting advertising.

“After six years we are still facing a lot of difficulties, especially in terms of distribution and a [lack of digital audio] reception in car radios,” he said, describing the situation as “unfair”.

“Even if the government requires all 50,000 imported cars every year to be equipped with both FM and DAB radio players, it would still take us 12 years to compete on the same footing with FM radio broadcasters,” he said.

“Under such circumstances ... I can say for sure digital broadcasting does not work at all.” He said the broadcaster had explored applying for an FM licence, but was told that spare frequencies were not available.

Contracts for most employees will be terminated on September 7. Staff will be notified individually regarding compensation arrangements.

The station’s fate was on shaky ground as early as October last year when it fired a third of its staff and restructured its operations.

DBC programme host Lo Sze-pui said she was saddened by the news as staff had worked “extra hard” after the restructuring. “It was very shocking for me to know the company made this decision [even] after all this hard work.”

The government’s implementation plans for digital radio were put in place in 2010.

DBC co-founder and former lawmaker “Taipan” Albert Cheng King-hon said neither policy nor the business model was to blame, but the station’s failure to make use of its digital platform and produce content that people wanted.

“Content is king,” said Cheng, who went on to found internet radio station D100. “People want an independent voice but that was gone with my departure.”

Tuned out: Hong Kong lawmaker slams government’s digital radio policy after broadcaster applies to return its license

Baptist University assistant professor of journalism To Yiu-ming believed the government’s policy had failed as it had introduced digital radio without at the same time shutting down analogue services.

The Office of the Communications Authority said on Monday it was requesting detailed information from DBC, which must continue to operate until it is permitted to go off air.

Commerce minister Greg So Kam-leung expressed regret at DBC’s “commercial decision” but said there was no plan to kill off analogue. “We can’t force residents to switch to digital audio from FM. We don’t think it’s something Hong Kong residents want either,” he said.

DBC first hit the digital airwaves in 2011 but faced troubles from the start. The station went off air in a year due to a dispute between Cheng and pro-Beijing businessman Bill Wong Cho-bau, its major investor.

There were claims that Beijing had intervened by asking Wong to press Cheng not to hire outspoken ex- Commercial Radio host Li Wei-ling. It sacked 100 staff and resumed services in January 2013 after Cheng sold his stake to Wong.

Wong’s role with DBC came under scrutiny again last year after it was revealed former chief executive Donald Tsang Yam-kuen had failed to reveal he was in talks with Wong to lease a Shenzhen penthouse when he approved DBC’s application for a digital licence, the surrender of its AM licence and the appointment of a former Executive Council member as chairman.