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To: elmatador who wrote (103555)	9/2/2001 1:43:46 PM
From: S100	Respond to of 152472

Mobile giants eye the radio tiddlers By Heather Tomlinson 02 September 2001 Radio companies will soon be able to offer high-speed mobile internet services at a price telecoms companies can only dream of. The revelation will cast yet another cloud over the five UK telecoms companies that collectively forked out billions on third-generation licences last year. Radio companies have paid just thousands of pounds for digital licences that will let users download music and video through handheld computers and mobile phones. But the telecoms companies, Vodafone and Cellnet, One2One, Orange and Hutchison 3G, have forked out £22.5bn for their high-speed internet "3G" licences. The contrast between the sectors could soon prompt the telecoms companies to bid for radio companies with strong digital assets, because it is also cheaper to provide the internet services via radio, say analysts. Takeover targets could include GWR, Jazz FM and Chrysalis, that have significant digital radio interests. Mobile operators could use the radio spectrum to send content out cheaply. Then the more expensive 3G network could be used for interactive services such as buying online. This is an interesting prospect in the fragmented radio sector. Some City deal-makers have begun touting proposals to mobile phone companies. Simon Mays-Smith, media analyst at JP Morgan Chase, is writing a report on the subject to be published next week. He said deals are possible, "not least because regulations governing ownership between media companies is onerous. The regulation does not prevent it happening between mobile operators and radio companies". Digital radio offers better sound quality than traditional analogue broadcasts, but enthusiasts say its real selling point is its combination of the radio stations and internet data. DigitalOne, a joint venture between NTL and GWR, pays only £10,000 a year for the only national digital radio network. GWR, which owns 67 per cent, expects to invest only £1m a year into DigitalOne. Computer games and ITN news are already available through a service called Digizone, which hires radio spectrum from DigitalOne. But digital radio is available only via a personal computer and a special receiver. Next year the price of digital radio receivers is expected to fall dramatically, and they could soon be included in handheld computers, mobile phones and laptops. The Culture Secretary, Tessa Jowell, said the receivers will be available for under £100 before Christmas, but industry experts say that will not happen until at least next year. Simon Cole, chief executive of UBC Media, the quoted company that owns Digizone, said: "This blows 3G into a cocked hat in terms of the price you paid for the spectrum and what you can do on it. What digital radio data services offer is 'always on wireless broadband' which is what 3G is offering but will find difficult to deliver economically and technically." news.independent.co.uk