As another Hong Kong broadcaster gives up on digital radio, when will the trigger finally be pulled on this idea?

A former RTHK veteran explains the plentiful reasons behind a failed media experiment

PUBLISHED : Monday, 12 September, 2016, 9:02pm
UPDATED : Tuesday, 13 September, 2016, 1:07pm

Metro Radio announced on Monday it would like to return its digital broadcasting licence to the government, ending years of trying in vain to open up a new market – one that nobody really wanted – with little success.

The audience was small; advertising revenue was even smaller. The writing was on the wall for Metro Radio’s digital broadcasting well before the station’s announcement – it became a matter of when rather than if after Digital Broadcasting Corporation (DBC) earlier decided to return its licence and wind up.

I am not sure if digital broadcasting should ever have started in Hong Kong at all. When I was working for RTHK in the 1990s, I attended an international conference on digital broadcasting in Europe.

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Having gathered the latest information globally and analysed the trends, I came to the conclusion that it was not worth wasting resources to research digital broadcasting, and made this recommendation to management.

The reasons were plentiful. I don’t think there is any example of a success, while failures are everywhere, and for many reasons. Hardly any consumer would be prepared to spend up to HK$1,000 to listen to a new station, so there is simply no mass market. The rise of internet radio eliminates any advantage digital broadcasting might have, and it costs a fortune to build new radio transmitting towers to broadcast. In fact, the radio market in Hong Kong is already saturated by the three existing stations. Fortunately, management agreed with my view.

But things took an abrupt turn after Donald Tsang Yam-kuen became chief executive and pushed for digital broadcasting for what I can only call “special reasons”. The result was predictable failure. When Leung Chun-ying became chief executive, he showed no interest in digital broadcasting. After Phoenix U Radio returned its licence last year, there was even an official policy review to fend off potential new investors. DBC was obviously very unhappy and, noting there was no future, decided to return its licence to avoid investing in an a bottomless pit.

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That puts Metro and RTHK in an awkward position, because the digital broadcasting market has shrunk to an embarrassing level. The huge investment the stations jointly made in building the radio transmitting tower may be totally wasted, while ongoing rent and maintenance costs run into hundreds of thousand dollars every month. With Phoenix U Radio and the largest participant DBC now gone, who can pay the bill?

Metro is a commercial station under Li Ka-shing’s group, and it needs to answer to shareholders. It does not make sense to run a radio service with a small audience and not much advertising income. For its management, the only rational decision is to close it down.

As for RTHK, it remains an embarrassing issue. Over a million dollars from the public purse are spent on digital broadcasting every month. It would make better sense if this money was used in more sensible channels of radio and television broadcasting.

Indeed, the future of digital broadcasting is grim both from the government and commercial perspectives. The only question is who will pull the trigger and when?

Luke Tsang Chee-wah is a veteran broadcasting professional who was with RTHK from 1978 to 2014. He is now a current affairs commentator.