Law Sparks Ownership Changes

Michael Hedges March 1, 2008

Swiss Federal Council granted public broadcaster SSR-SRG idée suisse a new concession. SSR-SRG operates 18 terrestrial radio channels in the four Swiss linguistic regions. It is the country’s largest broadcasting organization, employing about 5,800 persons, with an annual budget of about CHF 1.5 billion (€950 million).

The recently enacted Swiss Law on Radio and Television (LRTV), after two years of debate, marked a shift within the Swiss government toward SSR-SRG’s market dominance. Under the revised mandate SSR-SRG will be forced to undergo an independent review of its corporate governance in 2008. The new concession prescribes an emphasis on culture, education and training. Some commercial activities will be limited, as will Web-based projects unless specifically connected to current broadcast offerings. SSR-SRG is to remain ‘distinct from commercial offerings.’ The new concession was granted November 28, 2007, valid for ten years.

Organizationally, SSR-SRG idée Suisse is a holding company for regional radio and television companies, SwissTXT and news agency Swiss Info, the successor to short-wave service Swiss Radio International (SRI). Under previous mandates the principal chairmen of the four operating companies held positions on the SSR-SRG governing council. The new concession creates a new nine member governing board, seven nominated from the House of Delegates and two from the Federal Council.

The previous SwissTXT and SwissInfo concessions expired, a new mandate created for SwissTXT and a services agreement for SwissInfo between the Swiss Federal government and SSR-SRG.

The new SSR-SRG concession replaces three concessions in effect since 1992, expiring December 31, 2007.

SSR-SRG launched in November one national and one new regional Digital Audio Broadcasting (DAB) channels, authorized before the previous SSR-SRG concession expired. The national channel, World Radio Switzerland (WRS), is an English-language service that emphasizes integrating foreigners into Swiss society. It functionally replaces WRG FM, a local Geneva station partially owned by French-speaking public broadcaster Radio Suisse Romande and the BBC World Service, which has been liquidated. WRS is heard on the same FM frequency once used by WRG as well as the DAB multiplexes operated by SSR-SRG.

DRS 4 News is the new 24/7 rolling news channel for the Swiss-German audience. The channel is available on the DAB multiplex serving Swiss-German cantons as well as satellite, internet and cable. Both DRS 4 News and WRS were authorized by the Swiss Federal Council in July as part of a DAB development plan for SSR-SRG.

Private broadcasters re-group

Provisions in the recently changed Swiss Law on Radio and Television (LRTV) have resulted in several station ownership changes, primarily among newspaper groups. The LRTV limits privately held companies to majority interest in two radio stations. The new law came into effect in April 2007 and Swiss regulator BAKOM granted only short-term waivers leading to considerable trading among owners, including newspaper publishers that have increased interest in the radio broadcasting sector in recent years.

Ringier, Switzerland’s largest privately owned media company, purchased a substantial majority shareholding in Bern radio station BE1 from Freie Presse Holding (FRH). The deal was announced November 21st , financial details remaining confidential. PubliGroup continues to hold a 19% stake in BE1.

BE1 is a general interest music and information station targeting 15 to 49 year olds.

Freie Presse Holding (Free Press Holding) is wholly owned by another giant Swiss publisher, NZZ Groupe, publisher of Neue Zürcher Zeitung. FPH continues to own both majority and minority stakes in several radio stations.

For its Blick newspaper website, Ringier launched three internet radio channels. The channels are produced by Radio Energy (Zürich), in which Ringier became the majority (51%) shareholder in April. Ringier received a concession for a DAB radio channel in July but because of LRTV restrictions it was returned to the regulator BAKOM in November.

Another big Swiss publishing group Tamedia, publisher of Tages Anzeiger, merged with Espace Media in October. Again, the result was too many radio stations owned by one company – Radio 24, Radio Basilisk, Capital FM and Canal 3. In November a substantial majority (67%) of Canal 3 was sold to local Biel company RadioBilingue. Tamedia sold Radio Basilisk to Basel lawyer Martin Wagner in September. Wagner also acquired 50% of sales house Radio vision, which represents Radio Basilisk, Radio Basel 1 and Radio Regenbogen.

And the ownership shuffle isn’t limited to publishers. Swiss broadcasting legend Roger Schawinski purchased Zürich station Radio Tropic. In December he announced the launch of a new station in Aargau with local partners.

Schawinski launched the first privately owned radio station in Switzerland, Radio 24, beaming in from Italy in 1979 as a pirate station, selling it later to Tamedia. Until recently he was managing director of German cable channel Sat.1.

Radio Tropic has been a target of investor interest since its launch in 2000. Owner Frederic Dru steadfastly held out, citing concerns about program changes. Schawinski made clear that changes would take place. The new station, renamed Radio 1 and on the air since January, targets 30-60 year olds.

“I have always fought against monopolies,” he told local press, broadly hinting that the public broadcasting channels in the Swiss German region are in his sights.

Local Geneva community station Radio Cité was saved from bankruptcy by a new financial backer in November. Non-profit Fondation des Chênes, established by local art collector Viviane de Witt, will contribute financially, Mrs. de Witt becoming board chairman. Radio Cité was the first local station licensed to Geneva in 1984.

Local radio concessions in Switzerland will soon change as BAKOM redraws the allocation map. Incumbent private sector broadcasters face their first re-licensing test since commercial radio was introduced. Few surprises are expected though as many as 10 new stations may receive concessions. BAKOM will announce the licensing decisions in early summer, according to spokesperson Caroline Sauser.

Updated from an article previously published in Radio World International, February 2008, in a slightly different form.