A Future for Community Radio in Australia:

Funding, licensing and legislative issues

Saba El-Ghul

Submitted in partial fulfillment of requirements for KK51 Master of Arts (Research)

Creative Industries Research and Applications Centre

Queensland University of Technology

2004

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Keywords Community, radio, funding, licensing, sponsorship, philanthropy, marketing,

legislative issues.

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Abstract

The community radio sector is an important cultural resource for the Australian

community. It is experiencing rapid growth with an increase in the number of

licensed radio stations, however, government funding has not proportionally

increased and this is threatening the financial viability of many stations. The key

issue addressed in this research is the need to find ways to enhance community

radio’s sources of funding without imperilling its status as a not-for-profit sector.

This study argues that there is no inherent conflict between entrepreneurial

principles and not-for-profit principles, and as long as all revenue is invested

back into the station, then there should be no limit on income generation for

community radio. Overseas community radio experience supports this argument.

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Table of Contents Chapter One – Introduction .................................................................................6

The Argument.............................................................................................6 A Short History of Community Radio........................................................14

Funding: strategies and case Studies ......................................................20 Chapter Two – International Models of Community Radio.................................26

Radio Popolare.........................................................................................31 Chapter Three – Pathway 1: Government Grants..............................................35

3ZZZ..........................................................................................................41 Chapter Four – Pathway 2: Sponsorship............................................................48

Radio Metro...............................................................................................52 Chapter Five – Pathway 3: Subscription.............................................................61

PBS...........................................................................................................62 Chapter Six – Pathway 4: Philanthropy..............................................................71 Jupiters Casino.........................................................................................75 Chapter Seven - Pathway 5: Marketing ............................................................81

Life FM......................................................................................................88 Chapter Eight – Pathway 6: Training ...............................................................93 3CR ........................................................................................................100 Chapter Nine - Licensing ................................................................................102

SYN FM...................................................................................................105 Chapter Ten – Summary and Conclusion ........................................................109 References........................................................................................................117 List of Interviews..............................................................................................121

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Statement of Original Authorship The work contained in this thesis has not been previously submitted for a degree or diploma at any other higher education institution. To the best of my knowledge and belief, the thesis contains no material previously published or written by another person except where due reference is made.

Signed: Date:

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Acknowledgments

I would like to thank my supervisors Professor Stuart Cunningham for having

faith in me and for guiding me through this thesis, and Dr Christina Spurgeon for

giving me alternative solutions to obstacles that faced me on the way.

I would like to acknowledge staff and students at the Creative Industries Faculty

at Queensland University of Technology for their constructive advice and

support, in particular Dr Jo Tacchi for sharing her research outcomes. I would

also like to acknowledge all interviewees who contributed to this research.

Many thanks go to Sam Bebawi, who is a Business Strategy Consultant, for

sharing his expertise. Finally, I would like to thank my family for their support: my

mother, brother and especially my father Dr Ali El-Ghul for providing his

academic review.

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Chapter One Introduction

“Community [Radio] is a not-for-profit organization and we do not deliver [profit] to shareholders, that is the major difference between commercial and community. We give our dividend back to the community in various different forms whereas commercial radio delivers dividends to shareholders or owners. Everybody has their particular role to play. The pure nature of the economy we sit in demands that we go in the direction of commercialisation.”

Jim Seymour Life FM Station Manager

The Argument

It is not easy to predict a future for community radio in Australia, yet based on the

difficulties the sector is currently experiencing, it is possible to acknowledge the

threats that lie ahead for community radio and the need for new strategies to be

adopted in order for community radio stations to survive and perhaps flourish.

The community radio sector as a whole is an important cultural resource for the

Australian community. It fulfils a broad but largely unacknowledged role in the

Australian mediascape, particularly as a source of local content. A current study,

entitled Commitment Community: The Australian community radio sector by

Forde, Meadows and Foxwell, reveals that in the 1999/2000 financial year the

sector reported a turnover of $50 million (Forde et al, 2002: 99). However the

visibility of the sector to audiences is not high. In 1995, the Australian

Broadcasting Authority commissioned a report, Radio Research – Listening to

the Listeners, that asked respondents if they had heard of community radio and if

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they knew how to access it. Only 38% of the respondents were aware of the

existence of community radio, while 83% and 88% of the population were aware

of the existence of AM commercial and FM commercial stations respectively.

And yet the community radio sector is experiencing a time of rapid growth where

the number of licensed stations has grown by more than 60% in the past five

years (CBF Annual Report, 2002: 2). The current expansion rate for the sector is

around 10% per year and it is estimated that there will be 300 licensed

community stations by 2005 (Price-Davies and Tacchi, 2001: 16) from a current

276 permanently licensed radio stations (Our Stations, 18 Feb 2003). The

process of licensing in Australia will be addressed in detail in Chapter Nine.

In recent years independent research by Roy Morgan Pty. Ltd. showed that the

national community radio listener base had grown to almost 8% of the population

over the age of 14. This is suggestive of a growing appreciation of the value of

the diverse and specialised programming the sector provides (CB Online, 2 Oct

2002). However, a major issue affecting the sector is the decrease of

government financial support through the Community Broadcasting Foundation

(CBF) for existing community radio stations. Core funding levels per station have

declined by 36% over the past years as a direct result of increase in the number

of licensed stations (Forde et al, 2002: 95). During the 2001/2002 financial year,

the CBF made 479 grants to 193 stations, which added up to just over $5 million.

Funding is not difficult to obtain, but most CBF grants are relatively small and are

devoted to specific purposes. According to the CBF’s estimates, government

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funding currently represents less than 8% of the total revenue of the community

broadcasting sector (John Martin, 10 Dec 2002). This small percentage of

government funding is often distributed as seed funding, where grants are

directed to newly licensed stations to assist them in the foundation stage. As

more stations are licensed the amount of funding per station decreases. Chapter

Three will focus on government grants.

While community broadcasting participants generally welcome the sector’s

growth and the availability of new licences, they have expressed concern over

the lack of proportionate funding increase from the Federal government. The

increase in newly licensed community radio stations has resulted in a decrease

of government funding per station. The issue, then, to be dealt with in this study,

is the absence of financial security for community radio.

This issue may be addressed through increased government funding to the

sector, although this is not a likely scenario as the full cost of government support

for the sector, such as direct grants and licence subsidy, is yet to be costed.

According to the Productivity Commission Broadcasting Inquiry Report, released

in April 2000, there is a need for a detailed study into costs of the community

sector in the future, in addition to the necessity of focusing on the social and

economic effects (Productivity Commission, 2000: 276). The Commission states

that “the major cost to the general community of community broadcasting is the

opportunity cost of the spectrum they use. Community broadcasters receive ‘free’

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access to scarce radiofrequency spectrum and thus exclude other potential

broadcasters” (Productivity Commission, 2000: 275). Consequently,

recommendation 6.7 of the report stipulates that “the value of broadcasting

services bands spectrum reserved for non-commercial broadcasting services

should be estimated and reported publicly” (Productivity Commission, 2000:

206).

In light of this recommendation, the sector is compelled to develop or explore

alternative sources of funding as uncertain times lie ahead for community radio.

Some stations are already showing a tendency towards operating in a more

entrepreneurial manner in order to obtain the necessary funds. This trend is

causing some division within the sector. The future path of community radio is

divided between those who support the move in the direction of commercialism

and others who are firmly against it on the grounds that “stations cannot be seen

to be too successful – to attract large levels of sponsorship would challenge that

station’s ‘not for profit’ status, and negatively impact on commercial radio’s

market share’’ (Forde et al, 2002: 96). This division was echoed in the interviews

conducted for this research, where most respondents admit that there is a strong

and contested, but necessary, push within the sector towards commercialisation.

The Australian Broadcasting Authority (ABA) has investigated community radio

stations for breaching the sponsorship codes. Examples of these include the

case of 6NR FM in Perth, which is licensed to Curtin University of Technology.

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On 19 August 2000, the ABA determined that the station was in breach by

broadcasting advertisements rather than sponsorships. The investigation

concluded that during an interview on a home handyman program with a

representative from Coates Hire, and on another occasion a promotional

announcement by the Tasmanian Holiday Centre, material was broadcast that

was not of a community information nature and did not acknowledge that the

advertiser was a financial supporter for the station. This broadcast material took

the format of an advertisement because a sponsorship tag was not attached to

the announcement, and did not contain material that promotes the services

provided under the licence (ABA Investigation Report 6NR, 20 Mar 2004). The

regulations concerning sponsorship announcements under the Broadcasting

Services Act shall be outlined in Chapter Four. Other breaches occurred during

the Vietnamese language program on 3WRB, which broadcast advertisements

that were not tagged and therefore could not be regarded as sponsorship

announcements (ABA Investigation Report 3WRB, 19 Mar 2004).

It is clear from these examples that there is some tension in the industry

indicating the need to find a more practical approach to ensure that stations

commit to a unified application of the code that addresses valid concerns

regarding commercialisation in the sector. However this thesis focuses on finding

strategies for community radio survival in a burgeoning media market, and

therefore looks into diversifying income streams for community radio as a not-for-

profit sector.

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This study argues that the current funding arrangements for community radio in

Australia are barely sustainable. Therefore, the key issue addressed in this

research is the need to find ways to enhance community radio’s sources of

funding without imperilling its status as a not-for-profit sector.

With non-profit organisations, revenue is reinvested back into the organisation

whereas with for-profit, revenue is distributed to the shareholders and this is what

makes the operation commercial. This research suggests that as long as all

revenue earned is invested back into the station, then there should be no

government-imposed methods on income generation for community radio. This

lifting of restrictions does not mean that community radio stations are operating in

a commercial manner, but rather in an entrepreneurial manner. There is a fine

distinction between the two categories of non-profit organisations: ‘welfare’ not-

for-profit which are charity based organisations such as World Vision, and

entrepreneurial not-for-profit such as community radio.

I argue that there is no inherent conflict between entrepreneurial principles and

not-for-profit principles. However there are some obvious disruptive tensions

within the sector that can be seen in some case studies handled in this thesis.

These tensions arise from differing interpretations of the mission and ethos of

community radio. This tension could be treated by taking an entrepreneurial

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open-minded approach to community radio operation that would ensure a

positive direction towards financial success rather than operating within

restrictions that would result in the station’s struggle to survive. Profit-making that

is rendered towards the development of the station itself does not mean that

community radio stations are becoming commercial. The ethos of community

broadcasting lies in the heart of its mission which is to cater for its community by

providing a service that goes back to the community.

This study suggests that the deregulation of sponsorship time presently limited to

5 minutes per hour for radio may enhance income generation for community

radio. It will be argued that deregulation of sponsorship time is not a violation of

the ethos of community radio nor would it contradict the mission of community

radio. While this may conflict with current licensing regulations, I argue that

regulations should be changed to ensure a secure future for community radio

without jeopardising its ethos.

I argue that the differences between community and commercial radio are not

limited to the differences in funding sources and profit objectives. A key

difference is that commercial radio focuses on larger aggregate audiences and

listener groups. The difference can manifest in varied programming formats,

music selection and talk content. The role of community radio addresses

community needs in ways that commercial radio does not intend to cater for, as

each community radio station targets a specific segment of the population.

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Failing to do so can lead to the decline of this community service for no obvious

gain. If community radio was to benefit from the easing of restrictions on

sponsorship limitations, its mission and not-for-profit status is unlikely to be

harmed and the sector is more likely to enjoy financial success as a

consequence.

Following are the main findings of the project that are connected to the future

viability of community radio. The findings suggest the sector should:

Apply more entrepreneurial principles, in particular marketing principles;

Lobby for more favourable licensing requirements including the elimination of

sponsorship time limitations;

Promote sharing of resources among stations such as facilities, rentals and

airtime for those stations that share a geographical location;

Promote the use of barter payments;

Promote long-term philanthropic relationships between community radio

stations and donors.

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A Short History of Community Radio

Broadcasting in Australia is organised as complementary sectors of public,

commercial and most recently, community broadcasting. Community

broadcasting is called the third tier of the country’s broadcast ecology. It was

known as the public broadcasting sector until the Broadcasting Services Act,

1992, designated the Australian Broadcasting Corporation (ABC) and the Special

Broadcasting Service (SBS) as ‘public broadcasters’ (previously known as

national broadcasters), and the not-for-profit non-government owned third sector

as community broadcasting. This sector was established to address gaps in

service, not addressed by the commercial sector or the government funded

public sector, particularly in the areas of access and special interest

programming.

The ABC has four national network radio stations (Radio National, Classic FM,

Triple J and News Radio which is only available in capital cities and Newcastle,

or as streamed audio), an international network (Radio Australia), an Internet

station (DiG Radio) and 46 local radio stations (Contact ABC Radio, 10 Oct

2002). SBS, the other government-funded multicultural and multilingual

broadcasting service and which also includes a television service, broadcasts in

68 diverse languages on its national radio service and is networked nationally

from Sydney and Melbourne (Language Groups, 6 Oct 2002). As for the

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commercial radio sector, there are 241 commercial stations around Australia,

108 broadcasting on AM and 133 broadcasting on FM (Commercial Radio

Broadcasting Licences, 10 Oct 2002). In addition to these three main sectors, the

industry includes subscription broadcasting, open narrowcasting and subscription

narrowcasting.

The need for community radio in Australia arose in the 1960s. “Radio

broadcasting had remained almost unchanged since before the War... While

many people thought there was a need for reform, the only thing these people

had in common was a belief that current broadcasting services were defective”

(Thornley, 2001: 3). Educational interests were prime movers towards community

radio. Music Broadcasting Societies that had formed in Sydney and Melbourne

were seeking permission to broadcast as independent FM services, and be

funded by listener subscriptions. The lobby for the extension of radio services

broadened out to include other specialist music, ethnic programming, and

educational and political information.

The early 1970s saw a range of new radio services created and it was in the mid-

1970s that a third tier was finally created. According to the CBAA “[i]n 1972, and

under a Liberal government, the Australian Broadcasting Control Board

recommended… ‘a new type of service, comprising FM stations, to be known as

Public Broadcasting Stations which would be conducted on a non-profit basis to

cater for the needs of educational, religious, professional, musical and other like

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interests, but which would be available to the general public’” (CBAA Handbook,

History of Radio: 2).

There was pressure for change as a consequence of both this government

inquiry and recommendation. According to the CBAA “[t]he pioneers of

community broadcasting had three shared motivations and objectives: (1) to

make broadcasting accessible to individuals and sections of the community

seeking access, particularly those who did not obtain access to other media; (2)

to expand meaningful programming choice to satisfy a wide diversity of needs

and interests of listeners, whether numerous or not; and (3) to enable community

organisations to own, operate and control their own independent broadcasting

services, thereby diversifying control of the media” (CBAA Handbook, History of

Radio: 2). These objectives now constitute the mission of community radio.

The Public Broadcasting Association of Australia (PBAA), later to become the

Community Broadcasting Association of Australia (CBAA), was formed in mid-

1974 when the Whitlam government was going through procedures to legislate

for public broadcasting. Signs of a government intention to develop the sector by

prescription rather than in response to community demand, motivated key

activists to establish the PBAA, a national public service broadcasting secretariat,

Which would “lobby for the establishment and development of public

broadcasting...” (Thornley, 2000: 3).

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In 1976 amendments to broadcasting legislation were introduced to parliament,

partially to provide for public broadcasting. In early 1978 the amendments came

into effect and a third distinct public radio sector came into existence alongside

national and commercial sectors. By 1988, there were 79 public radio licences,

with many of the new licensees representing regional and sub-metropolitan

communities.

Within the public radio licence category there were three sub-categories. Stations

were classed as either ‘Community’, ‘Educational’ or ‘Special Interest’ public

broadcasters. ‘Community’ public stations had a charter to provide a community

service, designed to serve a geographical area, and provide for the participation

by a variety of community groups and interests in that area. ‘Educational’

licensees were usually affiliated with a university and carried a high proportion of

educational content, and ‘Special Interest’ stations served a clearly defined

interest group such as musical, sporting, ethnic and religious. In 1985,

educational stations were brought under the umbrella of ‘Special Interest’, but all

of these legislative sub-sectoral distinctions were eventually abandoned,

although specialisation continues to be represented within the sector.

With the development of specialist community radio stations, came the

development of national bodies to represent these specialist interests. These

now include: Australian Christian Radio (ACR), National Ethnic and Multicultural

Broadcasters Council (NEMBC), National Indigenous Media Association of

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Australia (NIMAA) and Radio for Print Handicapped Australia (RPHA). In 1984

the Community Broadcasting Foundation (CBF) was established to act as a

funding agency for the development of community broadcasting in Australia. The

role of the CBF will be dealt with in detail in Chapter Six which focuses on

philanthropy.

In the early 1980s, in response to a call from stations wanting quality

programming produced by other community stations, the National Program

Service was established by the PBAA to distribute taped program material via

post. In 1993, with over 130 permanent licensees, the CBAA (as the PBAA had

become by this time) took advantage of more affordable satellite technology and

launched the Community Radio Satellite Service (ComRadSat). Today 140

community radio stations are linked to ComRadSat and can select programs

from a 24-hour schedule for re-broadcast on the station (ComRadSat, 28 Nov

2002).

The year 1992 heralded a new era not just for Australia’s 130 public radio

licensees but also for the entire media industry. The Broadcasting Services Act,

1992, provided for a new deregulated media environment. Three new licence

categories were introduced: subscription broadcasting, open narrowcasting and

subscription narrowcasting; the Australian Broadcasting Authority replaced the

Australian Broadcasting Tribunal; and the public broadcasting sector became the

community broadcasting sector.

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The old Act presumed spectrum was scarce. The new Act took a different

approach to technical planning and allowed a more pro-active approach on the

part of the regulator in identifying demand for community broadcasting licences.

The ABA allowed aspiring groups to test broadcast under the open narrowcasting

licence category. In 1997, due to long delays in the licensing schedule for

narrowcast category, the Act was amended to provide for Temporary Community

Broadcasting Licences (TCBLs). This amendment gave way to the administration

of test broadcasts by aspirant community broadcasting groups. The issuing of

over 200 Temporary Community Broadcasting Licences between 1997 and 2000

by the ABA is a strong sign of the demand for community broadcasting (CBAA

Handbook, History of Radio: 4).

In early 2003, there were 276 permanent licensed radio stations, in addition to

150 aspirant radio community broadcasters, with 81 holding Temporary

Community Broadcasting Licences. Out of the 276 permanently licensed radio

stations, 94 were in NSW, 63 in Victoria, 45 in Queensland, 26 in Western

Australia, 25 in South Australia, 13 in Tasmania, 5 in the Northern Territory and 5

in the Australian Capital Territory (Our Stations, 18 Feb 2003). This distribution of

community stations across Australia is indicative of the need for this broadcast

service on a national scale.

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Within the community radio sector, there are vast differences among stations in

size, audience and location, particularly between metropolitan and regional

stations. Some stations, such as 3RRR in Melbourne, operate in highly

competitive metropolitan markets whilst other stations, such as Bordertown

community station 5TCBFM, offer the only radio service in their region. More

than 60% of community radio services are in regional areas (Forde et al, 2002: i).

This indicates that community radio is fulfilling a necessary role in the broadcast

sector.

Mark Lyons states distinctive characteristics of third sector organisations to

include: centrality of values, complexity of revenue generation, reliance on

volunteers and difficulty in judging performance (Lyons, 2001: 22). These

characteristics are especially evident in community radio in Australia.

Funding: strategies and case studies

Community radio in Australia has three main sources of income: government

funding, sponsorship and subscription. The Community Broadcasting Association

of Australia (CBAA) estimates that government funding makes up between 7-

10% of the sector’s total operating revenue, sponsorship makes up 46% of the

sector’s income, whereas subscriptions make up around 20% (CBAA Handbook).

Although government funding makes up the lowest of the three main sources of

overall income for community radio, the sector is highly reliant on this source for

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seed funding. Additionally there are some stations for which the main source of

recurrent income is government funding, as is the case with 3ZZZ, discussed in

Chapter Three.

Other methods of income generation that community radio utilises include

fundraising events, promotions, philanthropic associations and audio production

such as CD copies, recordings and audio copies.

For some stations, a main source of funding is the sale of airtime to local

organisations, that wish to run their own programs on a permanent basis and for

outside broadcasts. This provides assurance for stations that programs

presented directly reflect community interest. Another popular source of income

generation is radiothons. Making community radio stations visible through public

events such as theatre and film opening nights as well as other cultural events

has also proven to be an effective way of generating income, as this visibility

increases listenership which in turn affects subscription and sponsorship.

Broadcast training often acts as source of income for some community radio

stations. Training is an under-developed income stream that could potentially

become a substantial source of funding for community radio in the future. This

will be discussed in further detail in Chapter Eight.

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This thesis will first describe overseas experiences of funding community radio,

especially where there are not the same legislative restrictions on revenue

sources as there are in Australia. A case study from Italy’s Radio Popolare

serves as a model for the recommendations of this thesis. The main argument in

this study, that a not-for-profit radio station can remain true to its ethos while

raising funds through more sponsorship than currently allowed, is exemplified by

the funding strategy of Radio Popolare.

Subsequently, six main pathways of funding for community radio in Australia will

be investigated in six separate chapters with case studies representing each

funding source, beginning with 3ZZZ Melbourne Ethnic Community Radio which

relies on government grants. Stations like 3ZZZ which depend on government

grants must start finding alternative sources of funding in order to sustain their

operation in the future if government subsidies continue to decrease.

This study then investigates the case of Radio Metro on the Gold Coast, a newly

licensed community radio station that relies on sponsorship. Radio Metro’s case

highlights the difficulties in attracting sponsorship, such as the expense of

providing independent survey data and marketing campaigns.

Chapter Five includes the third case study, Melbourne’s PBS, a station that relies

on subscription. PBS is an example of a community radio station successfully

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supported by a strong listener base. The potential to increase this listener base

will be examined.

A fourth source of funding for community radio, largely untapped in Australia, can

be found in philanthropic associations. Chapter Six examines the Community

Broadcasting Foundation (CBF), in addition to the philanthropic relationship

between Jupiters Casino Community Benefit Fund and community radio.

Philanthropy is a source of income that needs to be further explored.

The role of marketing in enhancing funding sources for community radio, the

application of marketing strategies for non-profit organisations and the limitations

of marketing in community radio will be explored in Chapter Seven through a

study of Life FM that broadcasts from the Gold Coast.

Chapter Eight will be looking into the possibility of adopting training as a

substantial source of income, and taking 3CR in Melbourne as an example.

Finally, Chapter Nine will explain the licensing procedures in Australia, and then

a study of a station in Melbourne, SYN FM that merged with another station in

order to apply for a full time licence, will be used.

Cases in this thesis were chosen because of the high reliance of each station on

the corresponding funding pathway investigated in each chapter. They function

as concentrated models for each funding source. The particular cases used here

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were selected because of their capacity to clearly illustrate specific financial

issues that are less distinctive but nevertheless common to many other stations

in the sector. The exclusion of other possible examples was a necessary limit to

this study, for resource research reasons. Australian community radio stations

discussed are situated in Melbourne and the Gold Coast, this is due to the fact

that choices were restricted to stations that were physically accessible to me

while also ensuring the geographic diversity of stations and the demographic

diversity of their audiences is represented.

The case studies are based on a range of information sources, such as

government reports, academic analysis, including interviews with key personnel.

The questions asked during interviews were related to general information about

the stations, sources of funding, financial issues facing the stations and ideal

solutions to these issues according to management. These aimed to gain a

realistic and practical understanding of financial issues in the field, and were

accordingly used in the thesis to reflect the problems, solutions and desires in the

sector on a workable level. Organisations such as the CBF, CBAA and NEMBC

were also interviewed for this research for the purpose of including the views of

policy makers in the area, thus providing multiperspectival insights.

Forde, Meadows and Foxwell have produced an extensive analysis of the

Australian community radio sector in 2002 entitled Commitment Community: The

Australian community radio sector, which I have referenced at several points for

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current data. However, in this study, I focus more on the necessity of adopting

more entrepreneurial principles and unrestricted sponsorship time within the

sector, than is noted in the Forde et al research.

This thesis works towards the conclusion that extra private funding and the non-

profit community radio station ethos can exist side by side. The scope of the

thesis does not suggest that unlimited sponsorship arrangements will not result in

more commercially-oriented stations. It only makes the argument that the non-

profit community ethos and mission mitigate against this by extra sponsorship

that can enhance community broadcasting and this is deserving of serious

consideration.

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Chapter Two International Models of Community Radio

This chapter focuses on community radio outside Australia. This chapter argues

that the elimination of restrictions on sponsorship is common and is being

successfully applied using examples from South Africa, Holland, Ireland and

Canada. These models suggest that the policy framework within which

community radio now operates in Australia is unnecessarily restrictive. The case

of Radio Popolare in Italy is included towards the end of the chapter to illustrate

how a non-profit radio station can operate with no restrictions on advertising.

In developing countries, community radio is seen as a powerful tool for conflict

management and conflict resolution. It is seen as a potential agent for social

change, and perceived as an engine for democratisation. It is also an important

tool for development. With a high rate of illiteracy in many developing regions,

radio is, in many cases, the only affordable medium reaching large numbers of

the population. A distrust of government or state-owned public media in some

countries has paved the way for a rising number of local community radio

stations. In the West, community radio is often a small player in the wide media

landscape, but it aims to fulfil the specific needs of certain community groups

(Community Radio, 15 Nov 2004).

27

Throughout the world, grassroots organisations have established their own

means of communication where the necessary technical and/or financial means

could be procured (World Broadcasting, 18 Aug 2002). Community radio can

thus be seen as part of a broader struggle for access to communications media.

The idea of a right to communicate has gained support in the past 25 years and

“includes the principles of access, participation and self-management in

communications” (Lewis, 1984: 17) it is based on a conception of media as

instruments for social groups to reproduce and represent their cultural identity, to

voice their social and economic demands and to create new social relations.

Canada has acknowledged the importance of community radio since the early

1970s and consequently has a well-developed model for community radio. There

are currently around 65 licensed community radio stations in Canada.

Community stations are operated by non-profit organisations and rely heavily on

volunteers for programming and other station operations. In the early years of

community radio in Canada only restricted advertising was allowed. Today, the

Canadian Radio-television and Telecommunications Commission eliminates all

restrictions on the amount of advertising broadcast by community stations, which

are categorised as Type B stations. The Commission “continues to believe that if

Type B community stations are to fulfil their intended role and mandate, they

must have adequate, more secure and consistent revenue streams to enable

better planning. The Commission also believes that placing limits on advertising

is not the most effective way to guarantee that community stations offer

28

programming that differs in style and substance from that provided by other types

of stations. The Commission considers that simple and effective programming

requirements will achieve this objective” (Community Radio Policy, 14 Jan 2003).

Reliable revenue streams are fundamental to the emergence of quality

broadcasting, which would ultimately appeal to greater numbers of listeners

which in turn increases subscription, sponsorship and other marketing

opportunities.

Until relatively recently South Africa had a tightly controlled broadcasting

environment that was monopolised by the state-controlled South African

Broadcasting Corporation (SABC). In 1988 the Film and Allied Workers

Organization (FAWO) was formed to focus on the question of how to rid the

broadcasting environment of the effects of apartheid and to promote a

progressive broadcasting culture to provide for a diversity of voices from a broad

range of communities (Dowmunt, 1993: 90). Since the early 1990s, following the

democratisation of the Republic of South Africa, the airwaves have been opened

up. Community radio is rapidly being recognised as playing an important role in

the development of civil society in South Africa by widely reaching the poor.

Despite all this, community radio is a struggling sector largely because of funding

and skills shortages in many areas of the country. The amount of advertising and

sponsorship that a station may take is unrestricted at present. There is an

Independent Communications Authority of South Africa (ICASA) requirement to

make clear the distinction between advertising and sponsorship announcements,

29

and to ensure that sponsors of programs do not influence the content of those

programs. Some stations are able to cover running costs through advertising and

sponsorship revenue, but often need seed funding for training and equipment.

Some begin with start-up grants and then run with a mix of advertising revenue

and donor support (Independent Communications Authority of South Africa

Broadcasting Act, 21 Jan 2003).

In Holland local broadcasting is part of the public broadcasting sector which

although it is not regarded as non-profit because it is government-funded, it is in

fact struggling. Up until 1983 local broadcasting was operating on an

experimental basis where some stations were government-funded sporadically.

The Dutch Federation of Local Public (OLON) was formed from 15 of these local

stations in 1981 to act as an official body for local broadcasting. OLON is funded

through annual government grants from the national media budget, which makes

up 50% of the organisation’s income. There were 336 licensed local stations in

1999, and despite being occasionally funded by OLON, these stations need to

rely on other sources of income such as advertising, sponsorship, membership

fees and donations. Advertising is allowed as long as it caps paid

announcements at 12 minutes per hour (Price-Davies and Tacchi, 2001: 32-35).

In Ireland community radio was a product of a pilot project that was established

by the Irish Radio and Television Commission (IRTC) in 1994. This resulted in

the licensing of 11 stations that were originally only allowed to broadcast until the

30

end of 1996 but were then granted a one-year extension. The project lead to the

conclusion by the IRTC that community radio is a vital sector of Irish

broadcasting. Support for community radio was sought through membership

fees, sale of services, collections, general fund-raising. The IRTC currently

permits community radio stations to air sponsorship announcements, as long as

sponsorship announcements do not go over 6 minutes per hour and amount to

no more than 50% of the station’s income (Price-Davies and Tacchi, 2001: 38-

40).

In summation, these experiences of community radio overseas illustrate the

prevalence of minimal funding restriction models. In the early years of community

radio in Canada only ‘restricted’ advertising was allowed; today, however,

community stations have limitless advertising time. In South Africa, the amount of

advertising and sponsorship that a station may take is unrestricted. In Holland,

advertising is permitted on the basis that it does not exceed 12 minutes per hour.

Finally, in Ireland, stations are allowed to broadcast advertisements and

sponsorship announcements with restrictions on the total value of revenue from

these sources.

In general, community broadcasting in the world continues to struggle with a

range of obstacles imposed on it such as the scarcity of licence opportunities and

the shortage of funds. However, developments in some areas of Europe have

shown that different routes can be adopted to establishing a third sector between

31

the state-owned and the fully commercial. One of these examples is Radio

Popolare in Italy.

Radio Popolare

Radio Popolare began broadcasting in 1976 in Milan. During the 1980s the

station moved away from its links to left organisations and trade unions to adopt

a more independent stance. It was born from the convergence of interests

between the broad and extreme left and the parliamentary left, in the autonomy

of information (La Storia, 17 Jul 2002). It is now considered to be one of the most

important independent sources of information in the country.

As a result of its commitment to the public interest, Radio Popolare functions as a

community radio station despite operating on a commercial licence, as all profit

made is returned to the station. Radio Popolare therefore acts as an example of

how various financial practices a radio station undertakes do not necessarily

compromise its not-for-profit objectives.

Radio Popolare started off as commercial radio. However, not wanting to rely on

advertising alone, the station called on its audience to support Popolare by

buying shares. Shares were issued to create a democratic structure in which the

shareholders of Radio Popolare would have a say in the policy of the station

(Laureys, 28 Apr 2002). In 1980 the station needed 120 million lire a year, of

32

which about 50 million was raised by advertising, 22 million from individual

subscriptions, 10 to 12 million from fundraising events, and 8 million from an

annual lottery (Downing, 1984: 289).

Starting from the early 1990s, Radio Popolare became controlled by the

cooperation of workers and collaborators. Around 12,000 shareholders own

40,000 stocks of the company. Other sources of income are generated through

advertising and listener subscriptions. The statement of account of Radio

Popolare indicates that 13,000 subscribers each contribute around 80 US dollars

a year, with 45,000 listeners each week (Radio Popolare, 16 Sep 2002). This is

an indication of the importance of listener support as a fundamental source of

income for the station.

Around 40 paid staff are employed at Radio Popolare and there are almost as

many volunteers. Journalists constitute the majority of employees as news plays

an important part of the station’s broadcasts, although music takes up around

60% of programming (Laureys, Radio Popolare Milan, 28 Apr 2002). Popolare

broadcasts 24 hours a day (Marcello Lorrai, 5 May 2002).

Based on an interview conducted by Francois Laureys with the station director

Marcello Lorrai in January 1999, one of the most popular programs broadcast on

Popolare since 1976 is Microfono Aperto (Open Microphone), in which listeners

33

respond via talkback to specific themes related to the news, thus involving the

community since 1976 at a time when talkback radio was not common.

In 1981 Radio Popolare established a network to exchange news programs with

other radio stations elsewhere in Italy. This service started out with radio stations

around Milan, and since 1995 the network has expanded via satellite to most of

the major cities in north and central Italy. Currently 20 Italian radio stations make

up the Popolare network, in Rome, Florence, Bologna, Venice, Verona, Torino

and Bari. Stations from southern Italy were not included as there were fewer in

quantity and most had extremely low budgets. However, Popolare aims to

expand the network both geographically and in terms of input by raising the

quantity and quality of regional news (Laureys, Radio Popolare Milan, 28 Apr

2002).

In conclusion, Radio Popolare is an example of entrepreneurial not-for-profit

radio. This model is not present in Australia for the following reasons:

There is a limit on the amount of sponsorship permitted for community radio.

This minimises potential income generation that Radio Popolare operates as

a non-profit organisation suggests that advertising does not jeopardise the

mission of the station, while the income ensures that the service offered to its

community of listeners remains intact.

34

There are not enough substantial marketing strategies adopted to enhance

awareness of the existence of community radio in Australia, thus limiting the

number of subscribers. Popolare enjoys the support of 13,000 subscribers,

and there is no restriction preventing Australian community radio stations

from lifting their subscriber numbers to a similar level.

The increase in the number of community radio stations licensed in Australia

limits each station’s resources and listeners. The use of resources more

effectively for this purpose than at present between stations in Australia, like

that of the Popolare network, may expand community radio’s opportunities by

cutting cost on production and programming expenses.

Although Radio Popolare is a bigger station in comparison to Australian

community radio stations in general, this overseas experience and others

portrayed in this chapter, demonstrate that obstacles to a more entrepreneurial

approach to community radio viability need to be questioned.

35

Chapter Three Pathway 1: Government Grants

This chapter will take a closer look at how Australia’s government grants are

distributed to community radio and will identify the reasons why government

funding to the sector is unlikely to be substantially increased. 3ZZZ, a community

station that relies heavily on government grants, will be used as an example.

Government grants are distributed to community radio stations in Australia

through the Community Broadcasting Foundation (CBF). The Community

Broadcasting Foundation Ltd was established in 1984 as an independent and

non-profit funding body following widespread consultation with community

broadcasters and the government. The primary aim of the organisation is to act

as a funding agency for the development of community broadcasting in Australia.

The CBF receives an annual grant from the Department of Communications,

Information Technology and the Arts (DCITA), and a smaller grant from the

Aboriginal and Torres Strait Islander Commission. It is independent from the

government and from the community broadcasting organisations that it funds. A

study of CBF will be presented in further detail in Chapter Six.

36

The government determines the proportion of annual grants that should be

allocated to general community broadcasting and to the different sub-sectors of

community broadcasting according to social justice, access and equality criteria.

The CBF then assesses applications for funding and distributes grants for

development, programming and infrastructure support using the following

categories: Aboriginal community broadcasting, ethnic community broadcasting,

Radio for the Print Handicapped (RPH), general community broadcasting, the

Australian Ethnic Radio Training Project (AERTP) (which is now facing a

shortage in funding) plus sector coordination and policy development.

The CBF solicits and administers other grants for special projects as the

government introduces new policy initiatives. These grants include the

Contemporary Music Initiative for community broadcasting that is managed by

the CBAA. In line with general grant distribution guidelines, special funds are

divided between licensed stations, new licensees, program production, training

and development and sector coordination.

President (1999-2003) of the CBAA, David Melzer, says that “it is important to

note that community broadcasting is not government broadcasting, even though

it provides valuable services. While community broadcasting cannot expect

ongoing funding - only 10% of national annual revenue for the sector comes from

the government and [it] is an important source of seeding funds” (David Melzer,

10 Dec 2002). The CBF makes sure that when a community radio station is

37

licensed, seed funding is made available immediately to get it started. “This

would mean that as more and more stations are being established, some of the

ongoing support has had to be decreased as more of the financing goes to seed

funding” (John Martin, 10 Dec 2002). Yet most newly licensed community

stations complain of the lack of government financial assistance, and this was

evident in the case studies included in this research.

President of the CBF, John Martin, points out that government financial support

for the sector has always been a small part of community radio’s income. He

believes that due to the thin spread of financial support for community radio,

there is pressure on the community broadcasting sector to find revenue

elsewhere. Martin states that “the CBF believes that the sector is at a crossroads

in its development. The contribution the sector currently makes, and the potential

it has to broaden its value to Australian society, is threatened by a lack of

adequate resources to meet the challenges of rapid expansion and balanced

development. The Foundation will continue to press these arguments with the

Commonwealth Government and other potential funding sources” (CBF Annual

Report, 2000: 2).

This lobbying effort is ongoing. The CBF campaigned for more adequate funding

during the 2001 election campaign. As a result a major new funding initiative was

developed and proposed to government as it was preparing for the 2003/2004

budget, however this initiative has not yet been funded. The proposal includes “a

38

nationally accredited broadcast skills training program, a nationally accredited

radio management training program, a regional and rural radio business

incubator project, a community radio establishment, recapitalisation and training

development fund, and a continuation of the Australian Radio Airplay Project and

regional development of radio for print handicapped services” (John Martin, 10

Dec 2002).

Community radio stations also apply for additional grants from other government

funded agencies. Larger stations have successfully applied for funding on a

regular basis through various arts and music initiatives – usually associated with

the cultural contribution made by the station. Community-based grant programs

of local and state governments are also a regular target for community radio

stations (Forde et al, 2002: 104).

In the study conducted by Forde, Meadows and Foxwell, the statistics in the

sector reveal that:

In 1985, around $1.27m was provided by DCITA to 56 stations, representing a little more than $22,000 per station. This funding level increased until 1995, when it peaked at an average of about $25,000 per station. In 1996, core funding began to decrease as a result of the introduction of a new ‘targeted’ funding regime. Core or ‘guaranteed’ annual funding is now down to a level of just under $17,000 per station per year, well below the 1985 levels... If we take targeted funding into account – which is not guaranteed, and which has to be justified by the sector each three years – the figures are still low. Including targeted ($4.5m over three years) and core funding ($3.3m), the per station amount in 2000 was $24,600, lower than the per station figure for core funding in 1993-94 and in real terms lower than the 1985 figure of $22,000 per station (Forde et al, 2002: 93-94).

39

An analysis of government funding allocation to the CBF in the 1999/2000 and

2000/2001 financial years, reveals that this trend is continuing. Although there

have been modest increases in government funding year to year, the average

distribution back to stations has actually decreased, as rapid increase in the

number of stations means government funds need to be spread further than ever

before. In 1999/2000 $4.8 million was distributed to community radio in the form

of government subsidies (Forde et al, 2002: 94).

The level of government funding provided to the CBF in 2000/2001 for

disbursement to the community broadcasting sector amounted to $5.462m. In

addition to $3.313 million for ongoing funding, $0.973 million was provided for the

funding of special projects. These included ongoing development of the

Community Access Network (CAN) and Community Broadcasting Database

(CBD), support for Multicultural Community Broadcasting, support for the satellite

network, the Australian Ethnic Radio Training Project (AERTP), the National

Transmission Network Grant (NTN), the Australian Music Radio Airplay Project

(AMRAP) and the Digital Delivery Network (DDN) (CBF Annual Report, 2000: 2).

Funding to permanently licensed stations from DCITA for the 2002/2003 financial

year is around $5.28 million (Forde et al, 2002: 94). Core funding levels per

station declined by 36% over the past years as a direct result of increase in the

number of licensed stations by 60% (Forde et al, 2002: 95).

40

Many community stations do not receive any CBF assistance due to the

difficulties they encounter in applying for grants. The CBF is criticised by

applicants for its lengthy funding application process. One industry insider is

reported to have said:

I don’t apply for any of the CBF grants because of a) the sort of paperwork they want to put me through. The time spent doing what they want me to do I can make twice as much money out of local sponsors. And b) I think they want me to compromise my radio station to the point that the value of what they give me is lessened by what I have to compromise on the program (Forde et al, 2002: 104).

However, the CBF says it is not to blame for the rigorous demands of funding

applications:

To some extent it is a result of increasingly onerous obligations placed on the CBF by the government, requiring higher levels of accountability for disbursement of public monies. It is also partly a function of the highly targeted nature of most of the CBF's funding. At the same time, [the CBF] is keen to keep things as simple and clear as practicable, and is currently going through a major review of the forms and processes (John Martin, 10 Dec 2002).

Yet the belief persists within the sector that even if stations applied for

government subsidies through the CBF, they would not be successful because

the CBF already has the grants allocated before the stations apply for them

(Roger Jones, 17 June 2002). Some stations are concerned that when they

appear to be successful in raising funds, they are also unofficially excluded from

receiving government funds through the CBF. They feel the CBF prioritises those

stations that are struggling to raise funds in other ways. The government is also

being criticised from within the sector for its minor contribution to community

radio. As one insider reported to other researchers in the field: “[the government]

41

gives millions to the ABC, they give a lot of money to commercial media in

various ways and they give a teeny weeny little bit to community radio” (Forde et

al, 2002: 95).

Major benefactors of CBF funding are stations offering ethnic programming, as

they are perceived from within the sector to be receiving sufficient funds for their

programs. The CBF has been praised for funding stations providing ethnic

programming (Forde et al, 2002: 104). One of these stations is 3ZZZ Melbourne

Ethnic Community Radio, which is a good example of how government grants

can make a difference to the financial status of a community station.

3ZZZ

As an ethnic community radio station, 3ZZZ services 58 ethnic communities with

specialist programming. 3ZZZ started broadcasting on a regular basis in June

1989. Working from studios in the Melbourne suburb of Fitzroy, the station

broadcasts 24 hours a day. It is estimated that more than 400,000 people listen

to 3ZZZ every week (History, 7 Oct 2002).

The beginning of ethnic broadcasting in Australia goes back to 1973. The Ethnic

communities began to work together with sections of the wider Australian

community, and threw their considerable strength and influence into the

42

campaigns for access to the nation’s airwaves. The ABC had been encouraged

by the Whitlam Labour government to open an ethnic ‘access’ station in

Melbourne in 1975, and opened 2JJ in Sydney as a sister station. The

community access radio 3ZZ came into existence, owned and assisted by the

ABC, with 20 ethnic communities being the first to broadcast in their ethnic

languages (Dugdale, 1979: 37). In 1977 the Fraser government closed down 3ZZ

and eventually set up the Special Broadcasting Service (SBS) twelve years after

3ZZ’s closure. In August 1989 3ZZZ, a community offshoot of 3ZZ, obtained its

licence.

Many other community stations now provide ethnic access programming.

According to the CBF “[t]here are 75 stations (35 metropolitan and 40 regional

stations) in Australia that provide in excess of 1,200 hours per week of local

programming in 86 languages. Over 2,500 volunteer broadcasters are involved in

ethnic community radio in Australia” (CBF Annual Report, 2000: 2).

At 3ZZZ, up to 400 volunteers broadcast in 58 community languages. Some of

these volunteer announcers have been with 3ZZ since its beginnings, hence

representing the older generation. Some ethnic language groups have tried to

accommodate a younger generation of broadcasters into their programs within

their youth programming sections. Ethnic community stations are also providing

an essential service to the new wave of migrants to Australia (Forde et al, 2002:

ii).

43

The 16-member Council of the Ethnic Public Broadcasting Association of Victoria

(EPBAV) is the governing body of 3ZZZ. A minimum of 25 people from an ethnic

community can form an ethnic community broadcasting group at 3ZZZ, but

groups need to have at least 40 financial members to be eligible for an hour of

airtime.

To comply with funding guidelines, ethnic programming must be mainly in a

language other than English, contain no more than 50% music content, have a

spoken word content of no more than 25% religious material or references, be

locally produced under the auspices of a recognised local ethnic community

language group and broadcast between 6am and midnight (Ethnic Grant

Funding, 6 Dec 2002).

There have been concerns from within the sector over the programming

restrictions placed on these stations. As part of the study conducted by Forde et

al, one ethnic broadcaster states that “once you start putting all [the] rules in

place, you’re losing the way you intend to do your program”. Another broadcaster

says: “if we go in excess of 50% foreign language nobody will listen …so every

year or two we get a letter from Melbourne saying send us a tape of this

program. We get deducted $1000 because they say we didn’t have enough

[language] in it” (Forde et al, 2002: 58).

44

The CBF offers the support of an hourly rate for ethnic funding. “The CBF has a

total amount of money in each funding round which is divided by the number of

hours of approved programs around Australia. In each round the hourly rate will

vary. Since 1995 the rate has varied from $28.27 to a high of $51.82. As more

eligible programs go to air the hourly rate tends to reduce” (Guidelines for Ethnic

Grants, 12 Apr 2004: 4).

This source of funding, paid for each hour of a language program, is extremely

important and provides financial security for a station like 3ZZZ which schedules

only ethnic programming. “In capital cities and specific stations which are

licensed to do multicultural broadcasting, … there is substantial enough audience

and it is justified there but …the more general community stations have gone for

the ethnic funding because it is easier to get and yet there may or may not be

that audience there to justify that” (Forde et al, 2002: 57).

For the financial year 2000/2001 and under the Ethnic Program Grant, 3ZZZ

received $108,920 for Round 1, $111,833 for Round 2, and $220,753 for Round

3 (CBF Annual Report, 2000/2001: 11). Totalling $441,506 for the financial year,

this was far greater than the average grant value for the same financial year

which was by my calculations was $31,533.26.

In addition to the above grant and for the financial year 2000/2001, 3ZZZ also

received other CBF grants which included the Multicultural Youth Program

45

Grants ($3,986), National Transmission Network Subsidy Grants (NTN) ($2,700),

Australian Ethnic Radio Training Project Grants (AERTP) ($12,700), and an

ethnic music compilation CD under the AMRAP Distribution and Recording

Grants ($3,000) (CBF Annual Report 2000/2001). These grants totalled $22,386

bringing the total amount of grants received by 3ZZZ from the CBF for the

financial year 2000/2001 for 3ZZZ to $463,892.

A closer look into 3ZZZ’s financial resources reveals that it has more than 5,000

financial members. Full membership is $15 and is $10 for concession. This

amounts to a minimum annual income of $50,000 from membership.

Another source of funding for 3ZZZ has been its annual radiothon fundraising

event. In 1999 3ZZZ raised just over $120,000 during Radiothon, and in 2000

3ZZZ raised $144,000 (El-Ghul, 2000: 34). Every language group that

broadcasts on 3ZZZ is required to raise $1,000 per hour; if this is not achieved

then language groups are in danger of losing their hour of programming. This

amount has proved to be an easy target for language groups that enjoy the

support of large communities in Melbourne, such as the Greek community.

However, there are tensions over the entrepreneurial capacity as of different

ethnic groups relatively smaller and newer language groups, such as the

Hmongs, have not been successful in reaching this target and have been in

danger of losing their broadcast time, as the size of their community could not

support an entire hour of programming. This is a crucial issue, as it is the new

46

and small communities that are more in need of a broadcast program to keep

them in touch with their homeland, Australian society and each other.

Sponsorship is another important source of income and has been relatively

easier for 3ZZZ to accomplish than the average community radio station,

because small businesses that cater for ethnic local communities find advertising

on 3ZZZ an excellent way of reaching their communities. Ethnic broadcasting is

the principle conduit for information to ethnic communities at a local level; this

can be used as a means of developing solid sponsorship (Ian Stanistreet, 22 Jan

2003). Sponsorship has also been easier to achieve because the announcers

themselves often act as sponsorship agents by bringing in sponsors from their

communities to advertise on their programs.

Yet despite the financial comfort a station like 3ZZZ currently enjoys, it is at high

financial risk in the future if government grants begin to dry up as it is highly

reliant on government funding. Former 3ZZZ Sponsorship Manager (1992-2003),

Michael Smith, believes that if government funding were to decrease then the

station would need to focus on increasing income generation from other areas

such as sponsorship (Michael Smith, 11 Jun 2004). Should government funding

continue to decrease in the future, community stations not reliant on government

funding would find themselves at an advantage compared to those who depend

heavily on government funding.

47

There are other threats that 3ZZZ faces such as competition from SBS and 24-

hour commercial ethnic radio. There are two full-time Greek radio stations in

Melbourne, and several pay TV outlets. These commercial ethnic broadcasters

concentrate on younger generations as opposed to 3ZZZ’s older audience. 3ZZZ

is run by a majority of volunteer announcers who come from first and second-

generation migrants. Unless 3ZZZ caters for the mainly English-speaking

generation, the station is faced with a declining audience. The station will

therefore have to accommodate programs that are more in line with the lives and

aspirations of all generations, including some bilingual ones. The station will also

have to involve more young people for it to maintain its existence in the future.

3ZZZ is an example of a community radio station that is highly reliant on

government funding. Not all government-funded stations are able to secure as

many grants as frequently as 3ZZZ does. However, should government funding

for 3ZZZ decline, the station would find it harder to survive than other community

broadcasters. This is because 3ZZZ has not built experience in seeking

alternative funding sources.

48

Chapter Four Pathway 2: Sponsorship

In this chapter, the ways in which community radio in Australia views sponsorship

will be briefly described, and the rules and regulations on sponsorship of

community radio will be examined in detail. Radio Metro is included at the end of

this chapter as an example of a community station that derives its main income

from sponsorship, and illustrates the difficulties associated with attracting

sponsors.

Sponsorship is a paid announcement that broadcasts a business name and

service. The Broadcasting Services Act stipulates that a community radio station

shall not broadcast advertisements. Therefore, the modifications that distinguish

a sponsorship announcement from an advertisement are crucial to the

differences between community and commercial broadcasting. The Broadcasting

Services Act, 1992, defines a sponsorship as “a sponsorship announcement that

acknowledges financial support by a person of the licensee or of a program

broadcast on the service provided under the licence, whether or not the

announcement: (i) specifies the name and address of, and a description of the

general nature of any business or undertaking carried on by the person; or (ii)

promotes activities, events, products, services or programs of the person” (Part

1, Schedule 2).

49

According to the Broadcasting Services Act, 1992, a community broadcasting

licensee may not broadcast a sponsorship announcement that contains:

a) “material that publicises programs to be broadcast by the licensee;

b) material that promotes the licensee’s products, services or activities for

the broadcast of which the licensee does not receive any consideration in

cash or in kind;

c) community information or community promotional material for the

broadcast of which the licensee does not receive any consideration in

cash or in kind;

d) sponsorship announcements consisting of moving text that is overlaid on a

test pattern” (Part 5, Schedule 2).

Generally, a sponsorship announcement is tagged and describes a business or

service, but it cannot induce the listener to spend their money there. It also

implies that a business must have something of real interest to the listener, or

perceive a real benefit in associating its name with the community radio station.

The benefit of deriving funding from sponsorship is that community broadcasting

maintains a non-commercial, independent status.

The Act allows stations to use persuasive language in sponsorship scripts (CBAA

Handbook, Sponsorship, 1). The Act also permits the broadcast of prices,

bargain sales and special offers. However tobacco products and pharmaceuticals

50

are not allowed to be promoted on-air. Alcohol product promotion can be used in

sponsorship announcements that promote alcohol products as long as alcohol

abuse is not promoted. Medical services are also allowed to be promoted as long

as specific requirements are followed in the sense that sponsorship

announcements are true in all respects, do not contain any endorsement of skills

and do not being disrepute on the profession (Australian Medical Association, 16

Sep 2002).

Community service announcements are defined in The Act as an announcement

for which no payment is made, either in cash or in kind. Many stations offer free

broadcast of community service announcements because the station wants to

support the cause or initiative. If a station receives payment, in cash or in kind,

from a non-profit or community-based organisation, the announcement must be

handled as a sponsorship announcement. It should also be noted that a

‘community notice board’ segment, where individuals or organisations are

required to pay for the broadcast of a message, is treated as a sponsorship

announcement.

Community broadcasters are permitted to broadcast sponsorship

announcements that run in total of not more than 5 minutes in any hour of

broadcasting. The 5-minute time limit applies to any hour of broadcasting and

includes all sound elements of the sponsorship, including the music bed. The

time limit was amended from 4 minutes to 5 minutes in January 2000 following

51

representations to the Productivity Commission’s Broadcasting Inquiry. In May

1999, the CBAA made a submission to the Productivity Commission where it

stated that “[i]n line with the decline in government funding across many

community activities, rather than increase grant funds other than for specific tied

projects the Government chose to signal its preference for the future by

promising to raise the statutory limit for on-air sponsorship from four minutes in

the hour to five” (Community Broadcasting Association of Australia, 1999: 10).

This recommendation was followed up with legislative amendments in the next

year.

Community radio stations in Australia differ in their approach to sponsorship.

Some stations charge money for sale of airtime plus sponsorship and some

stations do not charge anything for airtime. Hence, there is no unified approach

to sponsorship in the sector. One third of community station managers have

refused to air some sponsorship announcements because they disagreed with

the content, while about one-fifth of station managers said they had refused

sponsorship announcements because they disagreed with the organisation

wanting to sponsor the station (Forde et al, 2002: 99). Radio Metro is a

community radio station that has adopted an open door policy towards sponsors,

and as a result has been faced with complaints from commercial stations. This is

an example of how there is tension over entrepreneurial approaches for

community radio.

52

Radio Metro

Radio Metro focuses on the selling of sponsorship announcements. It does not

receive government funding. Radio Metro is situated on the Gold Coast and

broadcasts from the heart of Surfers Paradise. It has been operating under a full-

time licence since 2001. Prior to that, Radio Metro held a temporary licence for

five years. Radio Metro is a youth community radio station that targets listeners

ranging from 12 to 29 years old. This age bracket had not been previously

targeted by radio services in the Gold Coast.

Radio Metro started broadcasting from a shed in Nerang as Hott FM. Hott FM

first appeared on the airwaves in July 1995. Its Temporary Community Broadcast

Licence (TCBL) only allowed the station to operate for three months over one

year, therefore for the first three years of activity the broadcasts went to air on

weekends with a mono signal thereby spreading its licensed time. They began

their programming by switching on at midnight Friday night and switching off

midnight Sunday night, thus maintaining consistency in their broadcasts.

Hott FM then moved to a house occupied by an AM station which also played

dance music. The complementary interests of the stations meant that this worked

well as both stations worked on different bands. September 1997 brought a

change in management and a move to Bundall, a suburb on the Gold Coast.

Another breakthrough occurred at the end of 1997 when the Australian

53

Broadcasting Authority granted Hott FM a full-time temporary broadcast permit

for a period of six months. The station was monitored for that period and their

licence was accordingly subject to renewal.

Sponsorship from local businesses provided the funds for the expansion Radio

Metro was undergoing. The local business community was rallying around Hott

FM as it was an opportunity for them to also be exposed. For example local

record retailers contacted the station, offering a foot in the door with the latest

music. This is a fine example of how “[I]n line with the sector’s commitment to

local businesses, more than 80 percent of sponsorship across the sector comes

from organisations in the licensed or local area... This is a fair indication of the

productive reciprocal relationship that exists between local businesses,

organisations and local radio” (Forde et al, 2002: 100).

Hott FM later moved to Cavill Mall in Surfers Paradise, and was granted a full-

time permanent licence at this time and also became Radio Metro. This name

change was necessary as Hott FM was already being used by another station in

Australia at the time. The station has recently moved to new premises on a 5-

year lease. New studios were built on these premises by volunteers.

Radio Metro has seven full-time paid staff and 42 volunteers working at the

station, with an average age of 21 years. Radio Metro considers itself a stepping-

stone for anyone who has aspirations in media, in particular those who would

54

want to work in commercial radio. The station trains the volunteers and ultimately

assists them in applying for jobs in the commercial sector. This, in itself, has

been a growing phenomenon.

Radio Metro is in need of capital expenditure to fulfil needed projects in the

future. The next project is a technical requirement that is a licence condition: the

station needs to address is the issue of its six-year-old transmitter which has had

no maintenance or rest and is starting to deteriorate. The station is currently in

the process of raising funds for a new transmitter, which costs in excess of

$100,000. As a condition of its permanent licence, Radio Metro is required by the

ABA to increase its signal to a certain level after a year. The management is

currently requesting an extension from the ABA to give the station more time to

raise funds for maintenance work on the station’s transmitter which is necessary

in order to meet this licence condition.

The station makes sure it uses up the full 5-minute sponsorship time per hour.

This is achieved by filling up the 5 minutes with ‘bonus spots’, which is

sponsorship airtime that has not been sold and that is, as a result, given to the

best sponsorship customers. This keeps the clients happy and is a good way of

ensuring business. Ideally, the station would want to sell the whole five minutes

of sponsorship time.

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Sponsorship is sold in $69 packages. For this sponsors get two sponsorship

announcements per day for a week as well as bonus spots depending on the

bookings. The only condition that accompanies this package is that the sponsor

must sign up for a minimum of three months. This deal is mainly aimed at

smaller local businesses that do not have the commercial budget needed for

advertising.

According to station management, the 5-minute sponsorship time bracket is a

matter of familiarisation for the listener, as the listener is acquainted with only

hearing 5 minutes of sponsorship an hour. Management believes that if the

listener were given more sponsorship time to listen to per hour, then the listener

would become used to it. On the other hand, for the station, the 5-minute

sponsorship limit attracts sponsors because the sponsor has less competition

with others. In spite of this, if Radio Metro had the option of increasing

sponsorship time it would adopt it because of expenses it continuously faces.

Radio Metro’s management believes that advertising agencies are another good

channel for improving the station’s financial situation by selling time through

agencies. However, advertisement agencies tend to avoid radio stations that do

not appear on surveys indicating high ratings. This is a common issue across the

sector as many community radio stations have been unable to be declared in AC

Nielsen audience surveys because they cannot afford the annual survey fee of

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$70,000 (Forde et al, 2002: 98). Commercial stations, on the other hand, always

participate in independent ratings.

Radio Metro had previously had audience research done by Griffith University

marketing students. The results were highly favourable to Radio Metro and, upon

a request by Radio Metro, the marketing lecturers involved (and by default

Griffith University) agreed to endorse the survey results. The Griffith University

students’ sample of 2,000 people found that 33% of Radio Metro listeners were

from the 18 – 25 year old age bracket.

However, when Radio Metro attempted to use the survey as a sales tool, it

claims that pressure was applied by a commercial radio station on the two Griffith

University marketing lecturers, and as a result the lecturers withdrew their

endorsement of the survey. Radio Metro was left with the numbers but without a

credible source. The following year Radio Metro approached Bond University,

and while the lecturers there were happy to oversee a survey, they were not

willing to endorse findings due to their knowledge of Griffith University’s earlier

experience with Radio Metro.

Radio Metro’s experience with surveys suggests a number of things: first, the

problems of getting endorsed, independent audience research done for the

sector; second, the hostility of the commercial sector to community stations that

are popular and effectively competing for audiences; and finally, that without

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authoritative independent audience research, sponsors have little choice but to

rely upon a station’s own claims about audiences.

Because the majority of Radio Metro’s listeners are young, the station does not

ask them to be paying subscribers but rather to be identified as supporters. This

allows the station to maintain a database which is mainly used as a tool to reach

listeners and promote the station. Only a minority of supporters are paying

members. Radio Metro claims to have 7,000 supporters on its database. During

the period Radio Metro was lobbying for its full-time licence, thousands of

supporters sent in letters of support. This ultimately assisted the station in

achieving its licence. There are three types of membership at Radio Metro: Free

Subscribers, mainly comprised of young listeners, who when they fill a form of

consent allows the station to send them information thus giving exposure to the

station; Full Members who pay $50 annually; and the third category is for

Business Members who pay $250.

Based on the fact that the majority of subscribers fall under the Free Subscriber

category, the station does not generate significant revenue from subscription.

Radio Metro’s station manager also believes that subscribers do not gain a lot of

benefit in return for their money; therefore the station does not focus on

subscription as a main source of funding. The subscription database is

maintained principally for promotional purposes.

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Radio Metro does not conduct radiothons either, as the management is worried

that the disruption to programming would affect subscription and the results

would not be fruitful. The station manager did not have much confidence in the

young listener base giving donations, and did not want to face a radiothon with

disappointing results. The possibility that Radio Metro does not have a loyal

listener base, due to its reliance on a changing audience consisting mainly of

tourists, could also be a reason.

It is worth noting other forms of income generation that have proven successful

for Radio Metro. The station conducts live broadcasts from nightclubs at the Gold

Coast, which it considers a lucrative market. The station has been able to tap the

under-eighteens market by organising dance parties called Freevolicious twice a

year in school holidays, and channelling a share of the door takings back into the

station. This has also proven to be a successful method of marketing for the

station, especially at a time when school students undertake their end of year

pilgrimage to the Gold Coast – schoolies week.

The station’s internet website has been under development for many months.

However, due to lack of sufficient funds the station has put the project on hold.

While the station approached four website designers, the cost was too high to

appoint any of them. This is a common obstacle facing many community radio

stations in Australia, as internet exposure is necessary to improving financial

status.

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The station has a good relationship with specific record companies who send

Radio Metro music within its format. Radio Metro’s music manager researches

what is played on other stations, what is in the charts and what is played in the

US and Europe. He then talks to the record companies and makes his

recommendations. The record companies often provide promotional copies

usually around three months ahead of commercial release. For Radio Metro this

is a guarantee that they play the latest hits before any other station does, and in

return the record company expands the promotion of its new music.

Radio Metro is starting to investigate new sources of funding. However, its

preoccupation with licensing, sorting out the premises and setting up the station,

has not allowed for this.

Radio Metro would ultimately like to attain a philanthropic association with a

corporation as such a relationship could give the station the financial security it

needs. There have been cases where other community radio stations on the

Gold Coast have successfully formed an alliance with a corporation which has

resulted in the purchase of new studios and equipment. This alliance was

achieved by Radio Hope Island during its association with the Commonwealth

Bank of Australia (Jon Gardner, 16 Oct 2002). Radio Hope Island is a community

radio station on the Gold Coast which targets retirees. Philanthropy for

community radio will be addressed in Chapter Six.

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Although Radio Metro caters for the youth market, the station has no aspirations

to obtain a commercial licence. As a commercial-sounding, non-commercial radio

station, Radio Metro poses an evident threat to commercial stations as illustrated

by the interference that Radio Metro experienced when it tried to compile a

survey. This, in turn, becomes a threat to Radio Metro.

A couple of magazines have approached Radio Metro to do ‘contra’ deals where

a magazine promotes the station in its edition and in turn the station offers the

magazine a sponsorship spot. This process does not involve actual cash

exchange, and the only cost to the station is airtime. Another successful deal that

has been achieved is the exhibition of station promotions on taxi tops around the

Gold Coast.

While Radio Metro consistently forecasts its needs and its costs, there is never

any guarantee that its goals will be achieved due to the difficulty of generating a

secure income in a competitive marketplace. Radio Metro relies heavily on

sponsorship. Despite possible listener dissatisfaction Radio Metro would still opt

for increases in allowed sponsorship time over other possible solutions to secure

its financial viability.

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Chapter Five Pathway 3: Subscription

This chapter focuses on how the sector is dealing with subscription, where

listeners pay an annual membership fee in support of the station. PBS FM is the

case study tackled in this chapter, as it is a strong example of a community radio

station successfully supported by a strong listener base. The potential to

increase this base by making more people aware of the existence of the station

will also be explored.

For community radio stations with a loyal listenership base of a significant size,

subscription can be a substantial source of funding. Through annual subscription

or membership fees, listeners can support a station that provides them with

innovative programming. This leads not only to the station ensuring the continuity

of its broadcasting through listener support, but also to the station regularly

receiving a mandate for its programming that is arguably stronger than a radio

ratings survey because it indicates active listening.

Roughly half of community radio stations in Australia have the support of 400

subscribers or less, while the rest have around 400-4,000 subscribers. A small

number of stations have more than 4,000 subscribers, on the other hand 15% of

the stations do not run a subscription system at all (Forde et al, 2002: 102).

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As mentioned in Chapter Two, Radio Popolare’s reliance on a noticeable

listenership base was one of the main factors behind the station’s success. Yet

as previously established at the start of this thesis, only a small percentage of

listeners in Australia are aware of community radio. There is, therefore, a need to

expand the listenership base for community radio stations in Australia, as

illustrated in the case study of PBS.

PBS FM

PBS FM is one of the community stations that relies on a strong subscription

base as a main source of funding. PBS FM is the Progressive Broadcasting

Service that was set up in Melbourne in 1979 as Victoria’s only radio station

licensed by the Government specifically to broadcast specialist music. This

comprises all music other than classical music. PBS’s licence is held by the

Progressive Broadcasting Service Co-operative Ltd. The station has an

independently surveyed cumulative weekly audience of more than 330,000

people. The annual turnover for PBS is around half a million dollars a year, with

$200,000 raised from sponsorship. Although PBS is eligible for government

funding through the CBF, the station receives no government aid. PBS finds it

difficult to obtain government money because according to station management

the applications are complicated to complete.

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PBS started operating from a garden shed in Carlton. In August 1978, PBS was

successful in its application for a full-time permanent broadcasting licence, after

which it set up in the Prince of Wales Hotel in Fitzroy Street in St Kilda. After a

couple of years the station relocated to the Ritz Mansions for 15 years until it

once again relocated to Collingwood where it is now situated. By late 1987, PBS

was broadcasting 24 hours a day across greater Melbourne.

PBS differentiates itself by adopting a programming cycle that depends on

seeking out new forms of music that do not have a wide appeal, such as new

forms of electronic music or industrial music. The music is then played on shows

that start out as experimental and later become well established with large

followings. When these new forms of music evolve and become mainstream,

PBS moves on to other forms of music. This gives PBS an original sound with

something new to offer all the time.

However, in the early 1980s PBS was in serious financial trouble and was a

week away from declaring bankruptcy and closing down. Emergency board

meetings were held to decide whether they should wind up the organisation.

Broadcasters went on air and told their listeners that the station was in financial

trouble, and likely to close down. As a result, PBS raised $40,000 in three days.

PBS would not have been able to achieve this had the station not had a large

listening audience, and has systematically relied upon its audience as its

principle source of financial support ever since.

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PBS currently has six full-time paid staff members. There are plans to further

reduce this number by replacing them with part-timers and casual workers. This

is a consequence of the financial changes that the station is going through, such

as cost of labour and the rise in superannuation payments. The reason behind

the need for full-time staff is the need to deal with the bulk of subscribers and

sponsors, especially in a metropolitan station. Yet according to station manager,

in the face of economic strife PBS could survive with three full-time staff, if

necessary.

Announcers at PBS work on a voluntary basis. In order for them to become PBS

announcers, they have to submit a demonstration tape sampling the type of show

that they would like to present. This can be recorded at PBS’s studios. They are

chosen based on the suitability of their proposed show within PBS’s

programming, the announcer’s delivery and sound, and the availability of the

material in order to guarantee the continuity of the program. Due to the scarcity

of financial resources and the particular programming policy of PBS, the station

does not maintain an extensive audio library, but relies upon individual program

producers to source music.

PBS has a volunteer board that the station manager reports to. The board is

comprised of a secretary who is a lawyer, a treasurer who is an accountant, and

a chairperson with a business background. The station manager also has a

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business background. It is critical to the operation of PBS that the board possess

a relative degree of expertise and business knowledge.

In 2002, a strategic planning meeting with the board was held. Future planning

had not been discussed for 10 years. PBS now has a 5-year detailed budget

examining capital expenditure, marketing directions and the need to expand the

station. PBS has a Program Planning group that meets with the board twice a

year. This is a strategic group focussed on programming directions, emerging

forms of music in the market and PBS music selections.

Due to the fact that PBS receives no federal or state support, funding must be

solicited from the public. The two main sources are subscriptions and

sponsorship. PBS has around 4,500 subscribers. The subscription fee is $66 per

year and $33 as concession. Around 60% of PBS’s income comes from

subscribers, which in turn covers salaries for full-time staff. However,

management believes that if government subsidies could cover the salaries, it

would give the station more financial flexibility.

PBS has loyal subscribers who are also active listeners. In its surveys of people

who attend band performances PBS found that 50% of the respondents were

subscribers and the rest were listeners. This reveals a high turn up of

subscribers. The marketing of a performance associated with a certain form of

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music is channelled through the relevant music show in order to reach a specific

audience.

According to the station manager, Roger Jones, community stations do a lot of

guesswork related to subscriber preferences and needs. Unlike commercial

stations where the advertiser is the key driver, for community stations, it is largely

the subscriber who matters.

PBS’s own assessment is that 4,500 subscribers are not enough. The bulk of

subscribers come from the centre of Melbourne and the bay area. PBS has only

23 subscribers in the whole of greater Dandenong. Given the fact that 900,000

people live in that area, this is a small number proportionately. The station

manager believes the reason for this is poor promotion for the station, and

argues that it is not good enough for a radio station these days to remain passive

about its number of subscribers. According to PBS management, 4,500

subscribers might be adequate today, but will not be in two years' time, and other

sources of income must be sought as a result. Alternatively better marketing

strategies would need to be adopted to increase the listener base by promoting

the station more effectively.

PBS also raises funds through the placement of sponsors’ messages on air. A

significant proportion of announcements are music related. This adds up to 70%

of PBS clients being music venues, touring agents and record labels. So it is the

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music industry that PBS is pushing and this suits its listeners. The programming,

styles and types of music played on PBS are crucial to the station’s income.

PBS could certainly pursue larger sums of money by taking on bigger companies

for sponsorship, but the station’s management believes this would seriously

affect the number of listeners and subscribers, as they would deem the station as

selling itself and losing its independence. For example, PBS had an opportunity

to cooperate with a beer company, Tooheys, as a sponsor. Yet Tooheys owns

40% of the music venues in Melbourne and what the station manager liked about

this particular sponsor was that Tooheys deliberately ban pokies at all venues

they own. The station manager’s view was that a Tooheys sponsorship

announcement did not involve talking up its product or encouraging alcohol

consumption. The announcement would merely state its support. However,

listeners and board members were uncomfortable with this opportunity, as it was

perceived that the station would be making potential compromises so PBS

decided not to go ahead with the deal.

In terms of sponsorship, there are ongoing tensions between PBS management

and the Board about what is acceptable to the Board and what is not, and

continuous management efforts to try to push the boundaries. This tension is not

just about station viability. It is also about listener control of the station, which

means ensuring that the bulk of income comes from subscription rather than

sponsorship.

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PBS station management believes that they are underachieving in sponsorship

and subscription. A lot of time is spent chasing small deals for sponsors, which

could be better spent on bigger deals. Yet it is part of their duty to service the

small sponsors too, and to encourage and support independent music. PBS also

makes deals with small artists who cannot afford to pay huge amounts for CD

recordings. PBS arranges for the sponsorship gig and recording at a pub venue.

PBS takes a percentage of door fees, and the pub makes its profit from the bar.

PBS would usually offer artists 10 sponsorship spots on air plus back

announcements from presenters, and sometimes have give-aways on air. This

leads to the event being talked up among listeners, which ultimately leads to a

high turn up on the night. So for the artist, it is worth getting support through

sponsorship with PBS or any other community station.

Station management would ideally like to adopt $40,000 sponsorship contracts,

because not only would this strategy bring large sums of money for the station

but it would also give PBS the opportunity to reduce the number of sponsorship

announcements that it broadcasts. The station produces a substantial amount of

little packages to make money. This means that it is crowding its one-hour shows

with a maximum amount of allowable sponsorship time of 5 minutes per hour.

However, PBS self-imposes a limit of 4 minutes per hour, due to the amount of

listeners who ring up and complain.

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There are other self-imposed rules regarding sponsorship announcements, which

aim to protect the sound of the station. According to Roger Jones, PBS is not

prepared to sell itself to any sponsor despite its financial needs. As an example,

when PBS was looking for a gospel show to include in its programming, an

announcer who represented a single gospel label made what was deemed to be

a very good submission. This proposal was rejected in spite of the station’s

expressed need for a gospel music presenter at the time. PBS could not take the

risk of being accused of promoting one music label ahead of others through any

implication that only one source of music was being used, and that only the

music from the presenter’s label was to be played.

Other sources of income include benefits, donations and running training courses

which together represent 10-15% of PBS’s annual income. PBS also organises

music workshops for specific instrument players. These workshops serve to pick

up potential members by exposing their music. It is crucial for the music industry

in Melbourne that PBS fills the role of nursing the under-represented end of the

music market.

There are several non-cash benefits that can be of assistance to community

radio in Australia. If community radio were to receive technical assistance from

appropriate persons, organisations or corporations, then this would free the

station to dedicate funds to more specific areas such as expanding and enlarging

its listening base. When PBS recently relocated from St Kilda to Collingwood,

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they built a new five-studio station with volunteer labour, costing just over

$60,000. With these new studios PBS have the capability to focus on production,

thus granting them the opportunity to grow in many different directions.

To conclude, the primary task of PBS is to broadcast what it deems to be avant-

garde music, yet according to PBS there are many people in Melbourne who

have not heard of PBS and who, if given the opportunity, could become regular

listeners and in turn subscribers. So a main focus for the next couple of years for

PBS could be to adopt a marketing approach, which will be addressed in Chapter

Seven, to attract a larger listener base.

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Chapter Six Pathway 4: Philanthropy

Philanthropy and community radio have a lot in common, as they are both

connected in their mission. Philanthropy involves active community capital

building and community radio is dedicated to offering media services to the

community. Common objectives can lay a solid foundation for a pro-active

financial relationship. This chapter goes into the nature of philanthropy as a

potential source of income. This chapter includes the different forms of

philanthropy with an example of Jupiters Casino’s association with community

radio.

Generally, corporations become involved in philanthropy for a variety of reasons.

These include building or reinforcing corporate and brand awareness, reinforcing

or changing the corporation’s image, positioning a brand in a new market,

targeting specific market audiences, building sales and distribution opportunities

and supporting advertising campaigns. Major corporate donors who already

possess a high profile in the community use philanthropy as a means of

perpetuating and reinforcing their corporate objectives and preventing their

competitors from gaining at their expense. As corporations are concerned with

their longer-term objectives, campaigns usually need to be constantly

emphasised to have any long lasting effects. Research, however, shows that

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consumer awareness of a corporation can fall dramatically once the campaign

ends or if it is only continued spasmodically. Therefore, it is possible that a long-

term philanthropic relationship will be beneficial to both parties (Macdonald,

1995: 25).

The Australian Directory of Philanthropy contains over 400 trusts and granting

bodies (Links, 27 Sep 2002), many of which are appropriate bodies for

community radio stations to approach. There are five broad types of foundation -

these types are mostly but not mutually exclusive. In other words, a foundation

may fall into more than one category (Philanthropy Australia, 2001: 5):

Private - endowed by private individuals or families;

Business sponsored - similar to above but established by businesses;

Operating foundations - running their own programs but may also make

grants to others;

Community foundations - receive funds and endowments from a variety of

sources; and

Government sponsored or initiated foundation – the Community Broadcasting

Foundation (CBF) might fall under this category as a philanthropic

organisation that receives its funding for grants from the government, and will

be addressed later in the chapter.

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The increasing number and variety of media outlets offering advertising

opportunities in addition to the amount of advertising they broadcast, can make it

difficult for corporations to get their message across. The cost of advertising can

also be prohibitive and so it is natural for corporations to look at other avenues.

Philanthropic relationships are therefore an attractive and cost effective method

for achieving this aim. The listenership of each community radio station could be

an audience that a company is targeting and which could only otherwise be

reached by an expensive advertising campaign.

Philanthropic foundations and trusts are a fundraising option for community

broadcasters. Grant disbursement organisations have different guidelines for

assessing who will be funded. Many trusts will direct their funds to specific target

groups, such as women, the aged, youth or the unemployed. Some will fund

specific functions where a need can be demonstrated. Others will have

geographic limitations to the organisations they will fund.

The term ‘charitable foundation' is used internationally to refer to organisations

whose primary purpose is to make grants to other organisations for charitable

purposes. Such a foundation is usually defined as “a non-governmental, non-

profit organisation with its own funds (usually from a single source, either an

individual, a family or a corporation) and program managed by its own trustees

and directors, established to maintain or aid educational, social, charitable,

religious or other activities serving the common welfare, primarily by making

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grants to other non-profit organisations” (Renz, 1991: 111). Most foundations

have built an asset base, invested to produce an income where all or some of

which is distributed in grants.

Estimates of the number and resources of foundations in Australia vary widely. In

the early 1990s the Industry Commission estimated that trusts and foundations

contributed $122 million to the total income of voluntary organisations estimated

at $840 million. The other sources for the $840 million were: $260 million

donated in bequests and $470 million from businesses (Industry Commission,

1995: 25).

The CBF has not taken on the task of seeking funds from other sources such as

corporations. It does not regard itself as a philanthropic organisation trying to

source philanthropic funding at its present phase of development; it is simply a

gatekeeper of government funding. Director of the CBF states that the foundation

is not planning philanthropic assistance for the sector at this stage. He says that

a natural process exists for an organisation like the CBF. The process starts off

with the organisation as a funding agency, then takes on a broader role by

looking into areas of development, and then is taken further into philanthropy.

The CBF is still at the funding agency end of the spectrum (Ian Stanistreet, 22

Jan 2003).

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The CBF, however, also faces many challenges in its role within the community

broadcasting sector. The CBF constantly faces tension in deciding whether to

spend allocated money on securing additional funds or to distribute it to the

sector, as every dollar spent and operated in the foundation is a dollar that is not

made available for distribution. The foundation also tries to balance funding to all

interest groups and ensure that all funding received reaches the appropriate

levels of support, as the sector is not monolithic. The CBF tries to balance a

consensus with various sub-sectors that make up the sector and consequently

achieve a common course of action.

Jupiters Casino

Many large corporations have specialised departments to handle grant allocation.

Their role is to examine proposals, manage them and ensure the company is

getting value for money. Jupiters Casino Community Benefit Fund (JCCBF),

which has previously funded Bundy FM Community Radio and Noosa District

Community Radio, also conducts its grant processing through a separate

department.

For the financial year 2000/2001, JCCBF supported 246 projects with grants

totalling almost $5.5 million. These projects are aimed at benefiting the

community through a variety of community non-profit organisations. The grant

funds have been used to purchase facilities, equipment, premises and vehicles;

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fund the cost of running limited time community training and education programs;

and fund the appointment of staff and associated costs to conduct pilot programs

(Jupiters Casino Annual Report, 2000:3).

The JCCBF was created by an act of Parliament under the Casino Control Act

1982. “To date $36.8 million has been allocated through 1,537 grants in normal

funding rounds. The smallest grant has been $300 and the largest single grant

$200,000” (Jupiters Casino Annual Report, 2000: 3). Grants are allocated

quarterly, with Trustees recommending suitable applications in line with the

Trust’s aims and objectives. Distribution of funds is monitored by local authority

area with the percentage of grants allocated against the area’s population as a

percentage of that of the Fund’s jurisdiction. Variables such as smaller

populations in rural and western Queensland are taken into consideration.

Bundy FM, in Bundaberg, was successful in its application for a grant to

purchase broadcasting equipment. JCCBF supported Bundy FM with providing a

transmitter link for a total of $6,700. This grant was part of the August 2000

round. JCCBF also granted Noosa District FM, in Tewantin, an amount of $9,363

for outside broadcasting equipment for the November 2000 round (Jupiters

Casino Annual Report, 2000: 15).

Although not all stations feel comfortable about benefiting from gambling, this is

an excellent source of income for community radio despite it not being a frequent

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procedure. Long-term philanthropic relationships would be of more benefit for

community radio stations in Australia, as this would provide more security for the

daily operation of a radio station. However, one-off grants come as a solution to

certain expenses community radio encounters, such as the purchasing of

equipment. A station like Radio Metro could save its licence by improving its

transmitter signal if it were successful in obtaining such a grant.

A successful example of philanthropic associations overseas is the Soros

Foundation Open Society for South Africa (OSF–SA) support to community radio

in South Africa. OSF–SA aims at promoting open society values across many

areas that include media; and has provided studio and transmission equipment to

seven radio stations. This assistance has enabled these stations to operate upon

being granted licences. This program joined forces with the Open Society

Initiative for Southern Africa and the World Association for Community

Broadcasters to develop and deliver workshops on community radio

development and planning. Countries such as Ghana, Mozambique, Namibia,

Senegal, Sierra Leone, Togo, Zambia and Zimbabwe attended these workshops.

OSF–SA has also been supportive of the National Community Radio Forum

(NCRF), which was created to lobby for the diversification of the airwaves in

South Africa (NCRF, 15 Nov 2004), in order to get policy makers to accelerate

licensing procedures, in addition to the drafting of a legislation to secure an

agency responsible for government funding promotion (Open Society Foundation

for South Africa, 2 Dec 2002).

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The ongoing corporatisation of government services has affected community

stations’ relationship with these bodies that is occurring in many countries

including Australia. In the 1970s and 80s community broadcasting often

depended on the principle of cooperative effort. For example, the local council

would provide premises at low rent; locally based Telecom technicians would

lend a hand constructing a transmitter; the Broadcasting Tribunal’s State

Engineer would offer help and advice without charge; or the Department of

Communications would permit access to government owned transmitter sites at

very low cost (Thompson, 1997: 17).

The traditional sources of assistance mentioned above have been on the wane

for some years. Practically all help from public institutions is now offered on a

cost-recovery basis only. Similarly the universities which operated community

radio stations in the past have either cut the stations loose to find their own way

or have reduced subsidies and required them to seek other sources of income,

as is the case with 2NCR Lismore which started out as part of Northern Rivers

CAE and was cut loose by Southern Cross University in 2002. Some stations

continue to receive subsidised rental in local council owned premises, but new

ones starting up have found such arrangements more difficult to secure. Today,

not only do community radio stations no longer receive assistance and low rates,

but they also face additional expenses in the future as a result of public policy

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shifts in the management of transmission sites and infrastructure, and radio

frequency spectrum.

An example of such future expenses is the Mount Dandenong tower, used as a

broadcast transmitter by community radio stations in metropolitan Melbourne. It

is now owned by Broadcast Australia. Previously called National Transmissions

Limited (NTL), Broadcast Australia is a telecommunications company that

provides transmission services to ITV channels and radio stations in the UK. NTL

bought transmitter sites in over 200 locations from the Australian government for

$980 million Australian dollars (Radio Bulletin Board, 5 Jan 2003) on condition

that for 10 years NTL would freeze transmission rents for community radio

stations. Community radio stations each currently pay Broadcast Australia

$16,000 a year in transmission site rental fees. With seven years left until the end

of the provision, according to Roger Jones, the rent on today’s scale will rise from

$16,000 to $100,000 a year (Roger Jones, 17 Jun 2002). This will be

unaffordable to community radio stations and they will undoubtedly fight to get

that rent down to a more reasonable figure. Yet even if the rent only doubles to

$32,000, community radio stations will still need to develop plans to cope with

this increase.

Community broadcasting organisations are aware of such future challenges, and

the funding strategy group at the CBF is trying to broker a common sector

position on the escalating costs of transmission site access. The CBAA is

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currently undertaking a survey of all costs connected to transmitters in order to

get a hand on the national perspective of transmission site costs, to work out

appropriate arguments (Ian Stanistreet, 22 Jan 2003).

Prime Minister John Howard has been emphasising the need for a policy of

social coalition with shared responsibility between government, business,

families, individuals and the philanthropic sector (Philanthropy Australia, 2001:

9), yet community radio has not been successful in obtaining funds through

philanthropy on a large scale. The examples presented in this chapter portray the

ability of community radio to secure funds for specific needs; yet these funds

cannot sustain a long-term radio operation. Therefore, philanthropic relations

must be further enhanced between corporations and community radio. However,

philanthropy will always remain complementary to main sources of funding.

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Chapter Seven Pathway 5: Marketing

There are many ways that marketing strategies could enhance community radio

funding opportunities. Marketing can assist in raising awareness of the existence

of certain community stations, finding new and alternative ways of income

generation and attracting more sponsors. This chapter will attempt to highlight

certain marketing strategies for non-profit organisations that could be more

widely used by community radio stations in Australia. The chapter will also look

into the weaknesses and limitations of marketing in the community broadcasting

sector.

Third sector organisations tend to be socially responsive and service oriented.

They specialise in the delivery of social services that are not adequately provided

by either a business or government. This is the essence of the role of community

radio. Generally within the non-profit sector there is some antipathy towards

marketing. Marketing has the image of being a tool of the commercial world. It is

strongly identified with selling and profit and therefore inappropriate for the non-

profit sector (Macdonald, 1995: 1).

The American economist Burton Weisbrod notes that not-for-profit organisations

are funded by people who want more of a particular product or a different feature,

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and are prepared to pay for it. However because of the ‘public’ characteristic of

the good, a not-for-profit organisation will emerge to supply it (Weisbrod, 1997). It

is these consumers with particular needs who pay for the good by making

donations to the non-profits that supply it. The good can be consumed by

themselves and others for free or at a price that is affordable to all. Their support

for the not-for-profit organisation thus involves an element of altruism (Lyons,

2001: 199). This is the basis of community radio, as community radio provides a

specialised service for a certain audience that commercial radio does not

typically target and does not aim to satisfy.

Economic theory tends to construct non-profits as being in other regards similar

to for-profit firms. Therefore, business techniques designed to improve the

performance of for-profits are deemed to be largely applicable to non-profits,

though some variations may be needed. This is where the need for community

radio to derive business techniques from corporate marketing strategies can be

useful; it is also essential for third sector organisations that have marketplace

problems. Their administrators are struggling to keep them alive in the face of

rapidly changing societal needs, increasing public and private competition,

changing client attitudes and diminishing financial resources.

In the late sixties, marketing professionals stressed the need for not-for-profit

organisations to engage in marketing-like activities. Having established the

applicability of business techniques for not-for-profit firms, marketing is one of

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these techniques that can be exploited to address funding issues for radio

stations. Various studies have been conducted on the marketing of non-profit

organisations, and the belief that third sector administrators must begin to think

like marketers is growing. Clearly marketing is not just a for-profit function, but a

valid function for non-profit organisations as well. That is to say that all

organisations have marketing problems and all need to understand marketing.

According to Kotler, despite the growing interest in marketing, many non-profit

organisations still resist it. Many groups within these organisations see marketing

as a threat to their autonomy or power. Eventually, marketing ideas will filter into

these organisations. “Marketing will initially be viewed as advertising and

promotion rather than as a revolutionary new way to view the institution and its

purposes. A few institutions will lead the others in developing an advanced

understanding of marketing … marketing will be a major and accepted function

within the non-profit sector” (Kotler, 1987: 18).

Still, some non-profit organisations adopt a no-sell style, in which clients are not

sought out. Instead, if they are lucky, they are permitted to find out about the

organisation and what it offers. The organisation that adopts this style simply

handles whatever clients come its way. This would be an ideal situation for

community radio, as the two case studies previously examined illustrate. PBS

and Radio Metro would both ideally want to be more exposed to listeners and

believe that higher level of income generation would consequently be achieved.

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Community broadcasters around Australia have been conducting marketing in an

ad hoc way. Their methods would include fundraising events, radiothons or a

raffle. The issue for community broadcasters is how to approach marketing in an

organised effective manner. Therefore the reason the station exists must be

clarified before any marketing program may be implemented (CBAA Handbook,

Marketing, 1).

In a paper commissioned by the CBAA, marketing consultant Celia Donovan,

found unanimous support for a professional, well-coordinated national campaign

for marketing community radio. Some responses from within the sector where

there were collective motivating factors can be summarised as:

frustration at invisibility of sector and desire to raise community awareness;

wish to dispel negative image and reinforce credibility;

pride in achievements and desire for recognition;

need to improve own sponsorship and fundraising activities;

increase competition (Marketing Campaign in Community Broadcasting, 19

Feb 2003).

For community radio, the audience is the main character identifier for the station.

It is the audience who serves as the reason behind community radio’s existence

and accordingly, it is they who will help it to maintain its growth. Marketing aims

to influence mass behaviour. However, Rados argues that mass behaviour is

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variable and constantly changes (Rados, 1981: 47). Therefore, non-profit

organisations will often be unable to use standard measures of performance.

They are prone to sanctify policies that have worked well in the past.

In general, non-profit marketers are challenged with problems that commercial

marketers would usually tend to avoid due to the fact that they can go through

other channels. In addition, non-profit organisations often market services for

which there is little demand. Businesses avoid this problem by estimating the

size of a market before they introduce a service. If there is no market, the idea is

abandoned. With non-profit organisations this is not the case as they are

mission-based.

Over the years reasonably substantial resources have been put into developing

generic marketing strategies for community radio but, beyond the level of

individual stations, they have generally not been sustainable or they have failed –

for reasons that are worth considering, such as the diversity of the sector

rendering coordination at metropolitan, state and national levels very difficult.

However, there are exceptions, as in the case of South Australian stations.

These stations form the South Australian Community Broadcasters Association

(SACBA) and have a common marketing strategy that extends to sponsorship

sales. The marketing arm of SACBA, the Active Radio Network (ARN), sells

sponsorship to SA community stations, generating income for stations. It acts as

a one-stop shop for major advertising agencies and media buyers in government,

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in addition to large and small businesses. A market research strategy was

adopted as one of a number of key decisions of the 2002 SACBA Conference.

These decisions focused on the need for stations to combine in order to fund a

survey of SA community broadcasters (SACBA Conference 2002, 27 Dec 2002),

as community radio stations are often made invisible by not appearing in the

regular surveys of commercial stations as previously mentioned. The CBF has

occasionally funded marketing arms such as the South Australian Broadcasting

Association’s ARN.

The CBF has conducted its own radio surveys through an arrangement with the

CBAA and with the assistance of a national research firm. Findings were made

available to radio stations over a period of time. The Director of the CBF believes

that:

Survey research is an extremely expensive method of assessment and not all stations agree that it is essential for their own marketing. Given that a substantial proportion of stations exist in very small communities, even the most competent national researching firms cannot presently accurately assess them. The studies that were undertaken through the CBF provided a good interim authority and tool that was accurate for larger stations in major metropolitan areas and significant regional cities, where information was provided about individual station audiences. Research is necessary to distinguish the different nature of the audiences that community broadcasting attracts (Ian Stanistreet, 22 Jan 2003).

The sector has had previous experience in national marketing schemes, some of

which have been successful while others have not. It is well recognised that the

sector has difficulty in dealing with the way in which the major advertising

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markets work with radio as a medium. Community radio is not well known to

advertising agencies and there is limited success in approaching those markets

through intermediary organisations. Research plays a key role in ensuring that

each station has access to large advertising agencies, and that the sector as a

whole is understood by those media buyers.

In rural regions it is extremely difficult for small stations to have any realistic

contact with metropolitan-based advertising agencies. A focus on government

policy towards the placement of government advertising, which forms a

significant proportion of the total advertising budget, could be beneficial.

However, the government advertising target limit is questionable and the CBF

could therefore play a more active role in ensuring that this target is achieved

(Ian Stanistreet, 22 Jan 2003).

What makes marketing difficult for community broadcasters is that their

programming formats are often complex in comparison to commercial radio, as

the demographics are more diverse. Existing community radio marketing

programs are also limited in that they are not likely to reach an effective

proportion of their target audience. This was the case with Radio Metro where

the station was aimed at the youth market, yet found difficulty in reaching the

majority of their target audience because the station had limitations in marketing

itself.

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There is this general conception that many insiders working in non-profit

organisations refuse to consider marketing, which in turn places limitations on

marketing opportunities. For many community radio professionals marketing is

unethical.

Finally, marketing is often costly. It does not always require large amounts of

money, but when it does, the costs in trial and error go up, as it is largely an

experimental process. Market research can play a role in audience and sponsor

awareness, in addition to new income generation opportunities, however it does

not substitute for the development of other strategies that need to be considered

for the sector. Life FM is one of the community radio stations constantly

confronted with the need for capital when embarking on new marketing ideas.

However, its association with a development marketing company called Yo2Go

has enhanced its sponsorship potential.

Life FM

Life FM is a community radio station broadcasting from the Gold Coast. It

generates its income from the selling of sponsorship announcements through

Yo2Go, which is a business development marketing company. Life FM is an

example of a station which believes that marketing is important for the survival of

the station and is actively exploring this channel. Life FM is a Christian-based

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station and was part of Rhema FM, originally a New Zealand network. Radio

Rhema community radio stations around Australia eventually formed a group,

United Christian Broadcasters (UCB), to be their governing body and that

remains the case.

The station manager says: “the first question that comes our way is what is the

demographic and how many listeners do we have. We cannot afford to do a

substantial survey to find out exactly. Most of our sponsors are through Yo2Go”

(Jim Seymour, 4 Dec 2002). Yo2Go was established by a former salesman at

Life FM who decided to form his own company. He maintained his relationship

with Life FM by purchasing airtime wholesale and selling it at a retail price

recommended by Life FM. Without a substantial budget, Life FM’s station

manager cannot employ a sales team. Any recruitment of a sales team would

have to be based on a commission agreement.

The station’s manager would ideally like to see the 5-minute sponsorship time

limit waived or at least increased to 8 minutes, thus reflecting a similar operation

to that of the overseas experiences highlighted in Chapter Two:

If the government would allow us to do what we do in a more commercial sense we could survive very well. For example, we are technically a community; we do not have to announce that we are community. Commercials do not announce that they are commercial. There is no dilemma between sponsorship as opposed to advertising. The restriction on the amount of sponsorship should be waived. There should be an element of protection for community stations or at least the government should state the parameters

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community groups are entitled to operate in. Commercial [radio] would object saying that we paid a lot of money for our licence and community got it for nothing, however they are entitled to deliver profits, community [radio] isn’t. Their focus is a money-generated focus. There are maybe a lot of very capable and sincere people operating within those organisations who want to deliver something of quality back to the community, however the reason [commercial radio] exists is to generate dollars, we exist to pay our bill but not to generate dollars. We are not-for-profit, and our focus is to give back into the community as much as we can for their benefit. That is where our dividends go, so it is a completely different focus. Once the two focuses are established, both should be able to get on with life and do what they have to do, and if this means that they have to compete with each other for that market, so be it! Commercial operators chose to get into their commercial environment and they should realise that commercial parameters change daily, and we have to live with that (Jim Seymour, 4 Dec 2002).

The station manager believes that if faced with an increase in sponsorship time,

he would enter into a commercial decision regarding the limit listeners would

accept, just like commercial radio does. Hence a comfortable balance would be

sought.

A former businessman, Life FM’s Station manager believes less sponsorship

time means applying more government funding which means more external

control:

If Government wanted to reduce the amount of commercial activity, they need to take on a role to ensure that the regulations they put in place are met by funding. Personally I would not want to go that way because that means control of the sector and that would be the worse thing for community radio (Jim Seymour, 4 Dec 2002).

However, as stated at the start of the thesis, there is a split in the sector

regarding the commercialisation of community radio. The President of the CBAA

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voices strong opposition to Jim Seymour’s opinion: “commercialisation - or at

least, the potential influence of commercial interests - is a threat to the sector. I

do not want to see commercial restrictions waived. But I would like to see bi-

partisan support to the sector in its objective of developing whole-of-community

support and operating in a business-like way” (David Melzer, 10 Dec 2002).

What is meant here by “business-like”, Melzer explains, is management practices

that are fundamental to any service that deals with the public. He states that in

broad terms, the business fundamentals include:

A focus on the quality of the service, by ensuring that training and

programming allow the best possible schedule to be broadcast;

Adequate and appropriate marketing; there are many low and no cost

marketing activities that are crucial and are ignored by

many stations providing relevant training for volunteers and staff; again,

people need the skills to be able to do an adequate job.

Diversifying revenue sources; many stations expect their community to value

them simply because they have a licence. All a licence does is provide them

with the means to provide (a range of) services that are valued.

Developing a co-operative work environment; this takes work and if

successful is reflected on-air and in the community.

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Ensuring volunteer and employee rights are respected; this also takes effort

to achieve but reduces staff turnover, improves on-air sound developing

productive and strategic partnerships.

This is an example of this split in the sector. Despite this split, there is a dire

need for more entrepreneurial approaches to be adopted. There are gaps in the

community broadcasting research literature that experienced business

consultants and marketers could fill by conducting studies on business

development to outline these entrepreneurial approaches.

In summary, marketing is a topic of growing interest to non-profit organisations

as these organisations confront new and complex marketplace problems.

Therefore, introducing new marketing strategies to non-profit organisations

should become an integral element for the survival of community radio stations.

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Chapter Eight Pathway 6: Training

Training could become a potential source of income for community radio, as

training is perhaps the most fundamental activity undertaken by community radio

stations. As mentioned in the fourth chapter, Radio Metro has become a

stepping-stone for future commercial broadcasters to train and gain on-air

experience. This example is not the only case in the sector of community radio

stations acting as a training ground for other media organisations. This function

of the sector has been formalised with community radio organisations gaining

Registered Training Organisation (RTO) status.

There is a concern among training coordinators and practitioners, however,

about the extent of government funding remaining for training courses. The

Australian Ethnic Radio Training Program (AERTP) is an example of a project

that is undergoing its final government funding stages and must now seek

alternative sources to continue the delivery of training. One suggested source is

the possibility of user-pays, where trainees pay a fee in return for the training.

However it is also debatable to what extent this could become a source of

income for the sector as fee-for-service training courses are usually run on a

cost-recovery basis. While this could assist a station’s cash flow it is questionable

that this income line could support other activities as well.

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This chapter will look further into training as a possible stream of income

generation by giving an overview of the current training environment and the

associated financial difficulties. Finally, an example of a funded training project

held at 3CR will be given to outline the case for funded non-fee paying courses.

There are many forms of training that take place within the sector. There are

community radio stations that conduct one-to-one informal training where an

experienced broadcaster trains a new volunteer. Other stations conduct

partnership training in association with universities, TAFE or schools. There is

also specialised training that takes place during industry conferences such the

CBAA annual conference. “Virtually all community radio stations (98.7 percent)

undertake some form of training whether formal (29.5 percent), informal (53

percent), or a combination of both (82.6 percent). In addition, a small proportion

of stations extend training to include the broader community (16.1 percent)”

(Forde et al, 2002: 61).

The Culture Research Education and Training Enterprise Australia (CREATE) is

the national training body responsible for the development of accredited radio

training programs that can be used “as a guide to designing courses or training

activities for different occupational outcomes” (CREATE Australia, 25 Feb 2004).

The community radio sector is using CREATE’s Film Television Radio and

Multimedia industry training package (Case Studies, 23 Jun 2004). Other

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accredited training projects currently operating in the sector, according to the

CBAA, include:

Australian Ethnic Radio Training Project (AERTP), which is mainly for

ethnic broadcasters but also delivered to other community stations. The

curriculum is available for all stations to use whether they run accredited

training courses or not.

The Australian Film, Television and Radio School (AFTRS), which

provides professional training to all industry sectors. It also includes a

fulltime Commercial Radio Broadcasters Course that is sponsored by the

Federation of Australian Radio Broadcasters (FARB).

Universities, TAFE colleges and schools, which often offer training

courses in association with a community radio station.

CBAA National Conference, where education is available for industry

broadcasters on latest developments such as digital broadcasting.

State and Regional Seminars, where associations have provided training

on issues such as media law.

Only 25 percent of community radio stations currently offer accredited training

courses in Australia (CBAA Handbook, Training, 3). As mentioned previously,

there has been an effort by the CBF to develop a training program in conjunction

with the major sector representative organisations, in the proposal to the Federal

government as part of the CBF’s preparation for the 2003/2004 budget. “The

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proposal has a number of elements, with training being at its core: a national

accredited broadcast skills training program; a national accredited radio

management training program and a regional and rural radio business incubator

project; a community radio establishment, recapitalisation and training

development fund” (John Martin, 10 Dec 2003).

Around 18 percent of community radio stations receive some training funds from

sources such as government training initiatives and educational institutions,

however the majority of stations find the need to subsidise the cost of training

with a course fee. This course fee could range from $30 to over $200 (CBAA

Handbook, Training, 2). Some community stations require that trainees become

station members to qualify for training. So “[w]hile three quarters (75.7 percent)

of stations do not charge a fee for such courses, most (58.1 percent) require

trainees to be paid-up station members” (Forde et al, 2002:68).

To estimate a potential income stream from training for community radio, it is

necessary to develop an understanding of what a training course entails.

Substantial human and station resources are needed to ensure the flow of a

successful training course. “The issues that arise in setting course fees include;

cost of providing the course, ability of community members to pay the fee, the

value of skills returned to the station, concession rates, quality of the course, the

need for more broadcasters... “ (CBAA Handbook, Training, 2). These resources

include the proper selection, training and recruitment of trainers that have

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significant broadcast experience. Only 5 percent of community stations employ

external trainers, and around 25 percent of community radio trainers are paid

(CBAA Handbook, Training, 1). These trainers often also coordinate the training.

Under the AERTP project, it costs around $1400 to train and certify a trainer with

a Certificate IV in Workplace Training in order to have an accredited trainer.

However in ad hoc training, trainers are encouraged to attend a Train the Trainer

course due to the vital impact a trainer has on the station’s training results. Other

requirements for a training course include certification, studio use, and portable

recording equipment.

The case studies done for this thesis provide give an idea of the forms of training

used in Australian community stations. For example, Radio Metro runs a radio

school with in-house training. The training is a free five-week course that covers

equipment familiarisation, voice projection, microphone techniques and

scriptwriting. The course also offers an introductory hour on community radio. At

the end of the course the trainees sit an exam to ensure discipline in attendance

because the numbers are limited per course. Running the training course are

four instructors, three of whom are volunteers and the fourth an experienced

broadcaster from the ABC (Jon Gardner, 16 Oct 2002). The radio station

develops the curriculum and training manual used. This is a free course, as most

of the trainers are volunteers and the main costs of training usually go to trainers.

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Training courses run at PBS are in-house, and prospective announcers must

complete the PBS Announcer’s Course. This is a five-week evening course and

costs $198, with discounts available for low income earners.

Training is provided for all 3ZZZ presenters for free. The Australian Ethnic Radio

Training Program (AERTP) is funded by the federal government in three grant

rounds per year, thus enabling 3ZZZ to run three courses annually with a

minimum of twelve students per course. There are two levels for every round: (1)

Certificate II, a beginners’ course includes various broadcasting skills such as

studio use and recording, interviewing for radio, broadcast law and editing; and

(2) Certificate III, which is an advanced course teaching techniques such as

program research skills, news and current affairs, bilingual broadcasting and

talkback (Training modules, 24 Oct 2002). The training is supervised through the

National Ethnic and Multicultural Broadcasters’ Council (NEMBC) and falls under

the training coordination of the Community Broadcasting Association of Australia

(CBAA). The instructors are trained and certified by the CBAA and are paid from

the AERTP grant that 3ZZZ receives. Therefore, the AERTP course is a well

developed, nationally recognised and government funded broadcast training

system.

However the AERTP’s future is uncertain as government funding for the project

is drying up. According to Forde et al, the CBAA proposed in 2001 “refinancing

the established and successful Australian Ethnic Training Project (AERTP) at

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around $250,000 per year” (Forde et al, 2002: 77). Since then the CBAA has

endorsed a new national registered training programme based on the AERTP,

which any station can use by signing a memorandum of understanding. Linda

Marson, who worked with the CBAA as a consultant and facilitator on the project,

states that a number of courses have been conducted since the establishment of

this training programme. The course provides basic training with learner

resources that cost the station $30 as a complete package, and which almost

every community radio station now has. The station can charge participants any

fee, although stations tend not to do that for ideological reasons (Linda Marson, 5

May 2004). But Marson believes that if participants “pay for the course, they can

value it – actually they might even turn up. The stations can charge whatever

they think the market can bear – stations pay a small fee, as the CBAA acts as

an umbrella of RTOs” ( Linda Marson, 5 May 2004).

Community radio stations will not only be acting as RTOs, but would also be able

to act as assessing bodies. Through the CBAA, recognition of prior training can

be considered whereby those seeking qualifications to match their skills can pay

and sit an assessment test. This project is an opportunity for community radio

stations to obtain funds that can cover training expenses, and perhaps develop

into additional income. However, there are certain situations that could prove

difficult in determining a fee in return for training, as in the case of migrant and

emerging communities, and in this case stations would need to seek government

funding.

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3CR

3CR is an example of a community radio station that is actively associated with a

training program for emerging communities. This is free training provided by the

Department of Immigration, Multicultural and Indigenous Affairs’ community

grants program which is available for groups who would like to broadcast in their

community language. There is a special grant of up to $1500 available to new

migrant and refugee community radio programs. The grant covers the program

material, equipment, specialised training, transport and other costs needed

(NEMBC, Radio for Emerging Communities Brochure). There is also the

availability of ongoing funding to communities with non-English language

programs.

This kind of training at 3CR is an important example of the need to maintain

funded training projects. It is important to ensure that new ethnic communities to

Australia have access to the airwaves and given the fact that they are mainly

small and emerging communities, it is difficult to ask them to sponsor their own

training. According to Indira Narayan, who is the Broadcasting Project Officer for

the New, Emerging and Refugee Communities – Outreach, Training and

Broadcasting at the NEMBC, it is not fair to ask future broadcasters who will

invest their time and effort in volunteering to pay for their training, as it

contradicts with the mission of community broadcasting (Indira Narayan, 20 Feb

2004).

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On the other hand, “around 70 percent of all community stations are engaged in

training involving external organisations... Training would make up a significant

element of the estimated $145 million dollars per year in labour costs provided by

community radio volunteers in Australia” (Forde et al, 2002: 76). With this

significant input that community radio gives other media establishments (as in the

example of Radio Metro that acts as a stepping stone for future commercial

broadcasters) the ability to finance training is an issue of major concern because

if community radio stations charged a fee in return for their training services,

training could become a potential source of income. However, Narayan indicates

that it could be difficult to know which participant intends to continue volunteering

for community radio and which participant plans to work in other media sectors

(Indira Narayan, 20 Feb 2004).

Whether or not training could prove to generate good returns in the future, the

process has its own costs that need to be covered. Therefore it is highly unlikely

that any income coming from training could be used to sustain other station

operations and needs.

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Chapter Nine Licensing

In this chapter licensing regulations will be examined. As stated at the start of the

thesis, the sector is experiencing a rapid expansion due to more and more

stations obtaining licences through the Australian Broadcasting Authority (ABA).

It is therefore necessary to address licensing procedures and distribution in order

to gain an understanding of the process that has led to this state of saturation. I

will then address methods of resource sharing as an economic strategy for

community stations through a youth community radio station in Melbourne called

SYN FM, that merged with another station in order to apply for a full time licence.

Community radio is the sole broadcaster that provides the opportunity for many

people to become producers and not just consumers of media content. While

there is a prevalent belief that the expansion of the sector is fatal, some believe

that expansion is an achievement as this allows for more diverse voices to be

heard. This is backed by the fact that local communities have demonstrated their

own initiatives by establishing additional radio stations.

To understand how community radio stations in Australia are licensed, licensing

procedures will be described in detail. The Australian Broadcasting Authority

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(ABA) is the independent federal statutory authority responsible for the licensing

and regulation of the broadcast industry in Australia.

The ABA is required by the Broadcasting Services Act, 1992, to ensure economic

and efficient use of the radio frequency spectrum for broadcasting purposes.

Since 1992 the ABA has been undertaking an extensive national planning

program to identify vacant radio and television channels and allocate new

licences. The planning process has three stages: (1) the determination of

planning priorities; (2) the preparation of a frequency allotment plan (FAP); and

(3) the preparation of licence area plans (LAPs).

In 1993 and 1994 the ABA made public its planning priorities and the frequency

allotment plan (FAP). The planning priorities are the order in which the ABA is

planning the broadcasting spectrum in different parts of Australia, generally

prioritising geographical areas least well served by existing services. The

frequency allotment plan (FAP) identifies channel capacity in particular areas of

Australia.

The ABA prepares licence area plans (LAPs) in accordance with its planning

priorities. The ABA defines a licence area as a population within a geographically

determined area and draws upon census data. The LAPs identify how many, and

what character of licences can be made available in each particular area of

Australia. Once each LAP is prepared, the ABA is able to make licences

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available. The nature of those licences are determined by available frequencies

and perceived public need. The ABA is required by the Act to make provision in

the planning of services for public consultation.

The ABA determines the coverage area for a proposed licence through its

planning process (described above). Technical specifications which are generally

non-negotiable are drawn from the LAP, including frequency and maximum

radiated power. Applicants include their own technical specifications intended to

provide the best coverage for the intended broadcast area in line with the

technical planning guidelines prescribed by the LAP. Community stations tend to

have lower effective radiated power levels than commercial and public stations.

This reflects both their desire to serve local communities and their financial

constraints. In addition to their broadcasting service licence all on-air stations

must hold a transmitter licence under the Radiocommunications Act, 1992. The

Australian Communications Authority delegates the power to issue transmitter

licences to the ABA. The transmitter licence effectively sets the technical

operating parameters for a service.

According to Section 84, Schedule 2 of the Broadcasting Services Act, 1992,

allocation of community broadcasting licences depends on the:

a. “the extent to which the proposed service would meet the existing and

perceived future needs of the community within the licence area of the

proposed licence; and

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b. the nature and diversity of the interests of that community; and

c. the nature and diversity of other broadcasting services (including national

broadcasting services) available within that licence area; and

d. the capacity of the applicant to provide the proposed service; and

e. the undesirability of one person being in a position to exercise control of

more than one community broadcasting licence that is a broadcasting

services bands licence in the same licence area; and

f. the undesirability of the Commonwealth, a State or a Territory or a political

party being in a position to exercise control of a community broadcasting

licence” (Part 6, Schedule 2).

Licences are awarded for a period of five years and renewals applied for no

earlier than one year and no later than 20 weeks before a licence expires.

The sector needs to encourage, protect, develop, and make financially stronger

those stations already permanently licensed. The sector must also support the

licensing of stations which will prove to be of most benefit to the community

through their ability to provide an effective community radio station.

SYN FM

SYN FM broadcasts from Melbourne’s RMIT campus. It has recently been

granted a permanent licence based on education and training for youth between

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the ages of 12-26. SYN FM is a result of a merger of two stations: 3TD, the

service jointly operated by the RMIT Student Union and radio department, and a

high school community radio station in Thornbury. The two stations merged in

order to apply for a full time licence.

SYN FM relies on the RMIT Student Union in supplying grants, and the Union

supplies this through the student’s compulsory non-academic fee. In return for

this support SYN FM guarantees that a minimum number of RMIT students

broadcast on air based on a five-year agreement. The Student Union owns a

transmitter that it leases to the station for very low rent. In addition, SYN FM

guarantees the university that it will not disappear off campus.

SYN FM relies on grants from other sources applied for by two teachers from the

Thornbury school, who have been seconded by the Department of Education to

work at the station to set up school-based programming to get other schools

involved in training. These grants include $22,000 from the Foundation of the

Young Australians, and $36,000 from the Harold Mitchell Foundation. SYN FM

aims to pursue grants from other teaching student unions like the one-off grant of

$30,000 from Deakin University in return for a minimum number of hours

presented by Deakin students, and the promotion of campaigns (Jo Curtin, 12

Feb 2003). While these are one-off grants, there are other grants that may

continue to flow.

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SYN FM is hoping that in the future the station will be able to receive similar

funding from other student unions, and that this would be continuous. SYN FM is

also planning to focus on sponsorship as a main source of income generation, so

the station does not rely on government grants. SYN FM offers a membership for

$5 a year for under-eighteens to encourage the involvement of young people.

SYN FM has also been associated with Youth Works Radio, a group supporting

young people involved in radio and focusing on youth at risk. This program has

proven to be an appropriate channel to apply for grants for SYN FM as there are

many grants offered in the area of youth development (Jo Curtin, 12 Feb 2003).

Volunteers are mostly university students and school students.

There are many successful examples in Australia of youth radio stations. A

community radio station called Triple B FM, broadcasting from the Barossa

region of South Australia (CB Online, 25 May 2004), has developed an

innovative program to help school children increase contact with the local

community. The program involves the participation of local primary and high

schools in the production and presentation of their own material through the

Radio Access Program, a specialist youth program broadcast on Triple B FM

(RAP FM, 24 Jan 2003). Primary students from small rural schools have

participated in planning and preparing this program for three years as part of a

media studies exercise. It is a good example of a community radio achieving

success at grass roots level, as it has recently won a CBAA award.

108

The project has included delivering teachers’ workshops on community

broadcasting. In addition, the station also participated in the South Australian

Certificate of Education (SACE) Radio Project at Radio Adelaide 5UV, which

involved setting up guidelines and processes for taking radio training into high

schools. The Radio Access Program now embraces 30 schools.

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Chapter Ten Summary and Conclusion

Although there were differing opinions within the sector voiced in this study

regarding the deregulation of sponsorship time for community radio, all

participants interviewed agreed that the sector was suffering financially and that

the current situation is not sustainable. There have been various alternative

sources of funding mentioned in this study, yet these funding alternatives need to

be accompanied by a secure mainstream of funding such as sponsorship, as

they are not sufficient on their own.

Examples from overseas such as Radio Popolare or community radio in Canada

prove that it is possible for a station to operate as a non-for-profit organisation

with unrestricted time on sponsorship announcements.

To secure sponsorship radio stations must concentrate on marketing strategies

that can secure awareness of their broadcast service. Even stations that are

currently enjoying strong listener support like PBS, are faced with the challenge

of cultivating their listener base due to the projected increase of expenses in the

future.

The main case studies used in this research (3ZZZ, Radio Metro, PBS and Life

FM), each illustrate different views regarding sponsorship. PBS was the only

station that self-imposed a limit on sponsorship time, as it is a station that relies

110

heavily on listener support as a result of its history and location. Yet the station

manager indicated that there were many potential listeners who were not aware

of the station’s existence. Other stations supported an increase in allowable

sponsorship time, although some were struggling to fill in the 5-minute

sponsorship limit already permitted. Yet the station managers were confident that

if targeted marketing schemes were adopted and listener surveys were

conducted, community radio stations would find it easier to secure sponsors.

Some stations struggle to meet all their overhead costs, just as Radio Metro

struggles to raise funds for the maintenance of its transmitter. Therefore there

are some challenges that continuously face community radio that would require a

reliable income stream to meet them.

The CBAA has recently developed a nationally accredited training framework and

has submitted to the government a $32 million dollar proposal to fund training in

stations across the country. This includes management training as well as

broadcast training. Training could prove to be an excellent source of funding for

community radio stations although there is also evidence that training may only

be viable on a cost-recovery basis, undertaken as part of the sector’s community

service remit. Many of the stations currently running in-house training courses

are offering it as a free service.

The ongoing corporatisation of government services in Australia, such as all

government-owned transmitter sites and infrastructure sold including Mount

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Dandenong to Broadcast Australia, has increased community stations’ expenses

as well as introduced a great deal of uncertainty about tax costs and

arrangements into the future. In the 1970s and 80s community broadcasting

operated on the principle of cooperative effort. Today, not only do community

radio stations no longer receive assistance and low rates, but are also faced with

additional expenses in the future.

Corporate sponsorship and philanthropic relations must be encouraged as they

could be instrumental in solving occasional financial problems for community

radio such as the purchase of equipment and maintenance of transmitters. Barter

systems have further proven to be financially beneficial to community radio, such

as Radio Metro’s agreement for advertising on taxis or through magazines in

return for airtime.

The merger of smaller stations into one consortium or the establishment of a

cluster of networked stations using certain specialised services could lower

expenses. When PBS was moving from St Kilda in Melbourne, finding premises

with affordable rent and adequate space was not easy. Port Phillip Council had

formed a study team to look into assisting arts groups that were leaving the St

Kilda area due to high rent. One of the solutions was to find large council-owned

properties and cluster the community/arts groups together. With clever planning

and architecture, facilities such as toilets, kitchens and conference rooms could

be shared.

112

PBS’s relocation timing did not correspond with another station’s move, the

classical music radio station 3MBS, which PBS had been appointed to share

facilities with by the Council. PBS would have reduced its overheads

substantially had it clustered with 3MBS. PBS’s management believes that the

next time PBS moves in 20 years, it will consider grouping with another

community radio station. As seen in the case study of Radio Metro, the station

shared facilities with an AM radio station. If this had not happened, Radio Metro

would have not been able to continue to broadcast. 3ZZZ also shares a building

with CBF and NEMBC. There are advantages that 3ZZZ enjoys as a result of this

closeness. A form of community radio society has thus evolved.

As it gets economically tougher to exist, the need for cooperation between

community radio stations emerges. Kurri station (3KMD), an indigenous station,

was recently granted a permanent licence in Melbourne. PBS was helping 3KMD

to launch the station by giving advice and fundraising for them; PBS also offered

3KMD use of their studios (Roger Jones, 17 Jun 2002). Community radio stations

have been co-operating in order to reduce costs and help each other survive.

During the Wangaraja Jazz festival held every November in Victoria, PBS and

3RRR use each other’s technical volunteers for outside broadcasting. Station

managers in Melbourne also meet irregularly and share common issues. Hence,

a network of relationships does exist between community radio stations.

113

Throughout the case studies produced in this research, the need for developing

marketing strategies to enhance community radio’s funding opportunities has

been evident. This was obvious in the need to raise awareness of the existence

of certain community stations, the need to find new and alternative ways of

income generation and the need to attract more sponsors. Life FM relies mainly

on its deal with Yo2Go to bring in sponsors. Introducing new marketing strategies

to non-profit organisations could become an integral element for the survival of

community radio stations.

In conclusion, then, strategies that may enhance the financial viability of

community radio in Australia are as follows:

The deregulation of sponsorship

To enable the community broadcasting sector to fulfil its intended role, the sector

needs adequate, more secure and consistent revenue streams to enable better

planning and to maintain its future operation. The elimination of restrictions on

sponsorship time can secure this. Easing restrictions on sponsorship should not

harm community radio as a non-for-profit organisation nor should it contradict its

ethos, as long as sponsorship announcements relate specifically to the

community that the station is licensed to serve.

114

The encouragement of the application of more entrepreneurial principles

Community radio leaders need to adopt a more entrepreneurial approach in the

operation of stations. Raising awareness of the existence of certain community

stations, finding new and alternative ways of income generation and attracting

more sponsors and listeners are fundamental to the successful operation of any

community radio station. An increased focus on marketing principles needs to be

promoted with the assistance of marketing experts and business strategy

consultants, who could be provided for the sector as a whole.

Sponsors need to be encouraged and not refused

As long as advertisers do not contradict the general rules regarding advertising

for the broadcast sector as a whole and are in line with the station’s

programming, sponsors need to be encouraged rather than refused. The

restrictions on who sponsors the station need to be eased.

Clustering of stations that share a geographical location

The promotion of sharing resources among stations that are licensed in the same

geographical location such as facilities, rentals and syndication can reduce large

costs that a station would usually bear on its own.

115

Promote the use of non-cash payments

Radio stations sell airtime as a business; therefore, the trading of airtime in return

for other services is a way of lowering expenses. Community radio stations need

to consider adopting such non-cash payments.

Promote long-term philanthropic relationships

Philanthropy is not very common between community radio and donors in

Australia. Although one-off grants have been successful in securing the purchase

of necessary needs for community radio, this is not a primary source of income

generation unless longer-term philanthropic relations are established. How this is

to be achieved would need to be studied and addressed with the assistance of

expert consultation.

Community radio needs to focus on quality of air output and programming

This is important in increasing listenership and ultimately more sponsors wanting

to secure spots on air. This can be achieved by focusing on training and

refresher courses for broadcasters and managers alike.

Stations relying on government funding should begin exploring alternative

income generating options

If government subsidies decrease in the future, stations depending on

government funding will need to rely on alternative income generation options, as

they are in danger of not being able to operate independently in the future.

116

Although all these alternative income generation options are essential, a vigorous

campaign in lobbying for an increase in government funding for community radio

must be pursued.

These strategies could begin to help community radio stations address the

difficulties the sector is currently facing. It is not the responsibility of community

broadcasting organisations alone to secure a future for community radio, but also

that of the stations themselves to focus their energy on pursuing new and

alternative sources of funding.

Community radio is well developed in Australia and is an asset to every

Australian. The preservation of such a service needs to continue to be a priority

to all policy makers.

117

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Interviews Curtin, Jo (2003) Manager, SYN FM, Personal Interview with author, 12 February. Gardner, Jon (2002) Manager, Radio Metro, Personal interview with author, 16 October. Jones, Roger (2002) Manager, PBS, Personal interview with Jo Tacchi, 17 June. Lorrai, Marcello (2002) Director, Radio Popolare, Personal interview with author, 5 May. Marson, Linda (2004) Training Consultant, CBAA, Personal interview with author, 5 May. Martin, John (2002) President, CBF, Personal interview with author, 10 December. Melzer, David (2002) President, CBAA, Personal interview with author, 10 December. Narayan, Indira (2004) Broadcasting Project Officer, NEMBC, Personal interview with author, 20

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