Applications for the new Brisbane and Sydney commercial FM licences close at midnight tonight (AEST).
Auctions are expected to take place soon after today’s closing date, covering 95.3 FM for Sydney and 106.9 FM for Brisbane.
The earliest the Sydney licence could be auctioned is after Easter, when AFTRS Show Radio Broadcast has finished using that frequency.
The ABA has promised to publish the names of registered bidders and their ACN/ABN numbers in a media release, prior to auction.
The reserve price for each licence is $1m, but industry experts are speculating on a Sydney price ranging somewhere from $100m-$155m, the price paid by DMG for Nova 96.9.
DMG needs a second licence in Sydney to capitalise on its ratings and earnings potential in Australia’s richest radio advertising market. Several foreign networks are also said to be interested, as are various existing regional networks, although the bidding is likely to prove too rich for many regional players.
The Brisbane licence will attract the attention of ARN, which would like to get another FM frequency in that city, as well as DMG and Gold Coast company, Hot Tomato.
Wendy Harmer and even the legendary Doug Mulray are reportedly prominent targets for key on air roles on the new Sydney station. It’s reported that DMG is keen to set up a new station like the old 2Day FM, with feelers already going out to Harmer, the former 2Day breakfast star but, contractually, she can’t talk to another station until November.
Another prediction is that Hot Tomato could establish a classic hits station like the old 2WS format.
With the auctions fast approaching for the new stations in Sydney and Brisbane soon, and Melbourne later this year, financials for DMG and its UK parent company show they should still have some cash in the kitty to make the next round of bidding interesting.
Financial figures for DMG Radio Australia show the Australian subsidiary of Daily Mail and General Trust plc (DMGT), which is still in its expansion and consolidation phase, lost $15.3m for the year to 30 September 2003. The company has invested about $500m to date on new licence purchases, acquisitions and growth. If the cost of its long term licence investments is removed, DMG Radio Australia would record an operating profit in the 2003 financial year.
Australian revenue was up 13% to $101.7m on the previous year and, like other radio companies recently, DMG is “trading ahead of expectations” in recent months. Analysts expect DMG Australia to grab about 12% of the estimated $350m in the Sydney and Melbourne markets this year.