Australia’s oldest commercial radio station has been dropping advertorials into the 9am to 1pm timeslot, a trial of the new format it wants to introduce across the entire station from September 1.
The changes have caused disquiet in the industry. It’s attracted attention from both the Australian Communications and Media Authority as well as from competitors wary of losing advertising. ACMA has been skittish around radio advertorial since the cash for comment scandal in 1999, in which key hosts were given cash payoffs to mention advertisers favourably.
The advertorial on 2UE will see hosts in various timeslots doing news items followed by a “live read” of an ad from a client that is somehow related. At 9.16am yesterday, presenter Luke Bona talked about the benefits of dual housing: he told listeners the Brisbane property market was doing fine, and then read out an ad by a mortgage broker.
In that broadcast, it would have been tricky for listeners to know the live read was an advertorial. The commercial radio code of practice says that all advertising must be clearly distinguishable to the average listener — that is, they should be able to tell what’s paid for and what isn’t. The code currently allows incidental favourable mentions to advertisers. ACMA is undertaking a review of the radio code of practice, so the exact regulations on allowable advertorial may change.
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An ACMA spokesperson told Crikey this morning that the body “expects 2UE (as it does with all licensees) to comply with this code requirement”. ACMA also confirmed it’s had what it describes as “informal discussions” with Macquarie Radio Network about the new format.
According to Crikey‘s sources and previous reports in the News Corp press, 2UE will from September 1 become a “lifestyle” station — spruiking food, travel, gardening, property, home products, etc — much like Seven’s The Morning Show and Nine’s Today Extra where chat is separated by on-air advertorials.
The ultimate owner here is Fairfax, which has since March last year owned 54.5% of Macquarie Radio Network. It’s hard to see how the advertorial format squares with that company’s professed belief in quality journalism.
Mike Carlton, a former presenter at 2UE from 1998 to 2009, says he’s “very sorry to see it happening”. “It’s one of the great radio stations. But as Fairfax have no idea how to manage radio stations … I suspect they’ll stuff this up,” he told Crikey today.
“They’re doing this to 2UE, I suspect, because they can’t sell it.”
Macquarie Radio controls the three main AM stations in Sydney: 2GB, the market leader, 2UE (which Fairfax Media used to own) and 2CH, an AM music (“golden oldies”) station. Macquarie Radio has a strategy of directing as many listeners and mainstream advertisers to 2GB as it can, to improve its reach and profitability as people interested in news and news-based talkback leave 2UE and head for the only other station doing it in Sydney. FM music-based formats dominate, with the two stations owned by Lachlan Murdoch (Smooth and Nova) among the more popular. The FM stations are only now starting to worry about the Macquarie strategy — if it’s successful it could drain advertisers looking for easy and compliant coverage away from them.
Macquarie has been strangling 2UE of resources. It closed 2UE’s newsroom last year — it now shares resources with 2GB. Now Macquarie is forcing the introduction of this controversial format change which many mainstream advertisers won’t support for fear of public criticism and regulatory action. Meetings have been held at 2UE and with potential advertisers to try and get agreement on a timetable for the new format to start and ad contracts finalised. It is proving harder than thought.
But the main game goes on. This will all boost the performance of 2GB.