ABA to auction new radio licence in Melbourne

 

   By Liza Kappelle

   SYDNEY, June 17 AAP - The Australian Broadcasting Authority (ABA) has kicked off a process that could end in a major battle for a new commercial radio broadcasting licence in Melbourne.

   The licence, on 91.5 MHz, is the last in a series of four new commercial FM radio licence allocations in Adelaide, Sydney, Brisbane and Melbourne.

   Companies interested in the Melbourne licence have until midnight on July 15, 2004 to apply ahead of an auction which is likely to be held in August, the ABA said today.

   The allocation of the four new licences was announced last June despite opposition from industry heavyweights including Australia's biggest radio operator Austereo Group Ltd, which owns the Triple M network, and APN News & Media Ltd.

   British-ow first new licence by snapping up the Adelaide offering with a $24 million bid in October 2003, thwarting up to five rival bidders including Australian Radio Network (ARN).

   In April 2004, DMG won the Brisbane FM radio licence for $80 million and the Sydney auction with a $106 million bid.

   CommSec media analyst Derek Francis said DMG was likely to try to win the upcoming August auction for the new Melbourne licence which he expected to go for between $70 and $100 million.

   "DMG want to replicate a two-station network similar to Austereo in the capital cities, so they'll definitely be the winners," Mr Francis said.

   "It would be a negative for Austereo in terms of market share," he said.

   Austereo already has two stations in Melbourne and under strict media ownership laws is unable to buy more.

   However it could seek ABA permission to take part in the auction if it was prepared to divest an existing station.

   DMG could face a battle for the licence from flamboyant UK billionaire Richard Branson who has teamed up with John Singleton's Macquarie Radio Network (MRN) in a bid to bring his Virgin Radio brand to Australia.

   The 50-50 joint venture lost out to DMG in the Sydney and Brisbane auctions.

   AAP lk/sjh