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GCap makes a bad situation even worse

Posted in General, Media, Arif Durrani June 26th, 2008 by Arif Durrani

Charles Allen can be forgiven for wondering what the hell he has got himself into as chairman of Global Radio, following today’s damning report from Ofcom about dodgy practices at GCap Media.

Having paid £375 million for GCap, the UK’s largest commercial radio operator, less than three months ago, the findings - complete with a record £1.1 million fine - will make grim reading for the former ITV chief.

The monster penalty for “unfair conduct” involving 30 local stations running Secret Sound, a premium text/phone-in competition at the beginning of 2007, is unlikely to be his primary concern however.

Allen had been made aware of the ongoing investigation before the Global/GCap deal had been realised. But what he couldn’t have known about at the time, is how GCap has tried to lie, scheme and generally blag its way out of trouble; resulting in a bigger fine and scathing condemnation from the regulator.

The actions of the GCap employees involved were labelled as “inexcusable” and said to represent a gross failure of senior management.

Early attempts to blame a “system error” for an “isolated incident” did not go down too well either, nor GCap’s half-hearted move to refund listeners through a message on its corporate website, resulting in just one £2 refund.

“For GCap to describe this deliberate and repeated unfair conduct as ‘an isolated incident’ and a ‘system error’ was fundamentally misleading and inaccurate and represented, in OfCom’s view, an inept attempt at ‘news management’ on GCap’s part,” read today’s ruling.

“The decision not to broadcast details of this refund on the stations’ websites where listeners would have been more likely to see them, but instead to publish the statement only on GCap’s corporate website was, in Ofcom’s view, wholly inadequate…”

All very messy indeed.

Accusations of competition abuse within the radio industry have long been muttered in the quieter, cosier media haunts, but it is GCap; home of Classic FM, XFM and The One Network, which is the first to be truly caught with its pants down.

Global has been quick to highlight all the incidents happened more than 16 months ago and that the group has undergone two senior management changes and a change of ownership since then.

But with no actual names shamed, mud, as we know, can still stick. Global will now need to determine how it goes about trying to win back that most precious of all listener traits, that delicate thing called trust.

Read the full Ofcom report here

The 30 stations which ran Secret Sound:
Beacon FM (Shropshire) Beacon Broadcasting Ltd
Beacon FM (Wolverhampton) Beacon Broadcasting Ltd
Broadland 102 Radio Broadland 102
Wirral’s Buzz 97.1 Marcher Radio Group Ltd
Champion FM Marcher Radio Group Ltd
Coast 96.3 Marcher Radio Group Ltd
Fox FM First Oxfordshire Radio Company Ltd
Gemini FM (Exeter) Gemini Radio Ltd
Gemini FM (Torbay) Gemini Radio Ltd
GWR FM (Bristol) GWR (West) Ltd
GWR FM (Swindon) Wiltshire Radio Ltd
102.7 Hereward FM Hereward Radio Ltd
Horizon FM The Milton Keynes Broadcasting Co Ltd
Lantern FM Lantern Radio Ltd
Marcher Sound (Wrexham) Marcher Radio Group Ltd
Mercia FM GWR Group Plc
Mercury FM (Crawley) Radio Mercury Ltd
Northants 96 The Northamptonshire Broadcasting Co Ltd
Orchard FM Orchard FM Limited
Plymouth Sound Plymouth Sound Ltd
Q103 FM Cambridge and Newmarket FM Radio Ltd
RAM FM (Derby) GWR Group Ltd
Severn Sound FM Cotswold Broadcasting Ltd
SGR Colchester East Anglian Radio Ltd
SGR FM (Ipswich) Suffolk Group Radio Ltd
Ten 17 Harlow FM Ltd
Wyvern FM Radio Wyvern Plc
2CR FM Two Counties Radio
97.6 Chiltern FM (Dunstable) Chiltern Radio Ltd
96.9 Chiltern FM (Bedford) Chiltern Radio Ltd