On behalf of the Federal Office of Communications (OFCOM) and the industry associations (VSP, RRR, Telesuisse), Publicom examined the economic situation of licensed private radio stations and regional TV stations in Switzerland. Among other things, Publicom did this on the basis of the respective annual accounts for 2010 and traced these back to 2002. In parallel, discussions were also held with experts and broadcasters, and the advertising market was analyzed.
The most important finding was that most broadcasters have performed significantly better since the revised RTVA, which came into force in 2007, especially as the licensing areas were expanded and the proportion of fees increased. Specifically, the 31 fee-based and non-fee-based radio stations surveyed generated a total advertising turnover of just over CHF 150 million in 2010. If the sponsorship of SRG radio stations and the revenues of foreign broadcasters are also included, the Swiss radio market amounted to around CHF 180 million. In contrast, the 13 regional TVs together generated a mere CHF 36 million - not including the non-licensed Tele Züri. This means that the private broadcasters are of course completely overshadowed by the SRG, which has around six times more money than all licensed private TVs and radios combined.
Many private radio stations healthy - despite the crisis
According to the study, the majority of private radio stations were financially healthy in 2010, shortly after the crisis year of 2009. They had an average equity ratio of 42%, but six of them were underfunded. The radios had more problems with profitability: only ten radios achieved a target cash flow of 9% or more, including small fee-based radio stations.
The situation for regional TVs is more difficult. At the end of 2010, half of the stations were underfunded and profitability was unsatisfactory with an average cash flow of 4%, with only two stations reporting positive figures.
Publishers are not better radio producers
According to study director René Grossenbacher, no clear reasons for the success or failure of a station can be derived from the study - the results are too mixed. For example, neither the size of the licensing area nor the competitive situation is apparently decisive for radio stations, nor is the question of whether a station receives fees or not. However, there are some slight tendencies: if the advertising revenues of the 31 radios are compared to the population in the respective license area, it can be seen that radios in French-speaking Switzerland and Ticino exploit their advertising market better than those in German-speaking Switzerland, stations in major cities do better than those in rural areas, and independent stations do better than those belonging to a media association (publisher radios).
Quality is helpful
The authors of the study also point out another connection: broadcasters who invest in their programming and provide a service that is attractive to audiences in a highly populated license area have a good chance of generating high advertising revenues, even if competition in the coverage area is fierce. They also clearly state that fees remain indispensable for regional TV stations and for radio stations in peripheral areas, at least if they are to continue to fulfill service mandates. This is because the scope for development is narrow in view of SRG dominance.
At yesterday's press conference in Bern, neither OFCOM nor the associations wanted to comment on the study. The results were still too recent and they had not yet been able to read the study, they said in unison. However, the publication coincides with the start of the consultation on the partial revision of the RTVA. As is well known, this provides for a new fee structure - and thus more fees for SRG and higher fee shares for private broadcasters. In other words: the private broadcasters are eyeing the fee pie, which is growing, while the radio advertising market has been stagnating for years and the regional TV market is only growing at a low level.
Western Switzerland with radio pool for all
But why do radio producers in French-speaking Switzerland get more out of their small market than their colleagues in German-speaking Switzerland? Philippe Zahno, President of the French-speaking Swiss radio association RRR, could only speculate: For one thing, he said, the radios in French-speaking Switzerland today cultivate the market in a highly professional manner and also provide intensive support for small, local customers. Furthermore, they identify strongly with their own region - Zahno even spoke literally of a kind of "regional nationalism". He said that he felt less of this in German-speaking Switzerland. He also mentioned the "Jura Plateau Alpes" advertising pool, which includes all stations in French-speaking Switzerland and allows advertisers to cover the whole of French-speaking Switzerland. There is nothing comparable in German-speaking Switzerland. Finally, Zahno pointed out that the private broadcasters in French-speaking Switzerland had come to an arrangement with the SRG. "We have no problems with the SRG - and are not aware of the disruptive factor of regional journalism," said the RRR President.
Markus Knöpfli