Part 3 of our 7-part series on the First Reading version of the Media Bill – Smart speakers to fall within the scope of media regulation

In this article we discuss Part 6 of the updated First Reading version of the Media Bill, “Regulation of Radio Selection Services”, and how it compares to Part 6 of the draft Media Bill published earlier this year.

Background

When the draft Media Bill was first published, we summarised the proposed obligation to be levied on certain smart speaker platforms to carry UK licensed radio stations at no cost to the radio provider, and the impact such changes might have on platform operators, UK radio, and Ofcom as the regulator.

Now the Media Bill has been updated and re-published, we discuss below what has changed from the first draft Bill, whether the Select Committee’s recommendations were accepted by the government and how this might impact stakeholders.

Select Committee recommendations

The first half of Part 6 has been subject to a substantial re-write in light of the Select Committee’s feedback, as well as feedback from the industry through their consultation.

As noted in our article on the Select Committee’s recommendations, the Select Committee recommended that the UK Government considered bringing in-car infotainment systems into scope.  While the UK Government has not formally announced its intention to include such systems in scope, it has included an explicit reference to vehicles as potentially being in scope and has “agreed to keep in-car infotainment systems under review”, paving the way for future inclusion.  The drafters have also taken on board the Select Committee’s recommendation to have the Secretary of State first consult with Ofcom prior to exercising its power to amend the definition of a radio selection service via secondary legislation.

However, the UK Government has seemingly ignored the Select Committee’s advice to include in scope on-demand and online-only content from UK licensed radio stations.

Other changes

There are many significant changes to this Part.  We have set out below what CMS consider to be the five key most important take-aways from the changes.

1. Designation criteria for radio selection services

For a radio selection service to be “designated” (note the change in language from “regulated”) under the old draft, the service had to be used by a significant number of the public in the UK.  This did not take into account whether or not the device was used to listen to radio.  The UK Government has therefore changed the criteria to be designated to be where “the level of use of the service in the UK to listen to internet radio is significant”.  This should limit the number of devices which are designated.  It arguably reflects the UK Government’s original intention but serves as a useful clarification.

2. Radio station playback preference

An internet radio provider may dictate the playback method under which its internet radio stations are to be played.  For example, the BBC may specify that its stations play through BBC Sounds.  This requirement on the designated radio selection service (or DRSS) is to take “all reasonable steps” to ensure that such playback preferences are followed. 

The explanatory notes also provide further information on this requirement, and suggest that a DRSS must comply with any such preference “unless it would be unduly burdensome to do so”.

3. Costs and charging

In a move that will be welcomed by providers of DRSSs, the prohibition on charging internet radio providers has been clarified.  Previously, the draft prohibited any charge that was directly or indirectly attributable to the obligations to make available and play an internet radio service.  In the updated draft, there is a subtle clarification that limits the prohibition on charging to “doing what the provider of an [DRSS] is required to do” under the must-carry device playback obligations.  The explanatory notes also make it clear that charging is prohibited only where a DRSS is “complying with its duties to provide access to [a radio] service”. 

Therefore, it will be left to the commercial negotiations between the parties as to whether there are charges for any other services, such as for user data or hosting of an internet radio stream.

4. Clearance of advertising on an internet stream

The updated draft has dropped the requirement for radio stations to take reasonable efforts to ensure that any advertisement included on an online stream of the radio station has been or is intended to also be included on the traditional broadcast of the radio station.  The previous explanatory notes explained that this was to ensure that advertisements on the online stream were subject to the same regulatory standards as those included on the traditional broadcast service (ie to ensure they are cleared using a service such as RadioCentre’s clearance service). 

This requirement has been dropped from the updated draft.  As such, there is no such requirement for advertisements to have been cleared for use on traditional broadcast radio before being used online.  This will likely mean very little in practice where the online stream is exactly the same as the traditional broadcast stream.  However, it may reduce compliance costs for radio stations where they intend to deliver bespoke, targeted advertising to users on their online streams.

5. Pre-roll obligations & stream interruptions

The previous draft made it clear that when a user requested an internet radio station to be played, the DRSS must only play that station.  The industry had concerns that this would undermine commercial negotiations between internet radio providers and DRSSs for monetisation (such as for pre-roll advertising), and might prevent a service from playing an audio sting to identify the service being launched (such as a message playing that a “TuneIn” app was launching to play the radio stream).  Therefore, the updated draft makes it clear that such pre-roll idents are permitted, as well as pre-roll advertising if it is permitted by the internet radio provider.

Finally, there were concerns that the requirement obligation on the DRSS not to interrupt a radios stream once playing would impact other uses of the DRSS (such as providing call or message alerts, or connected doorbell alerts).  Therefore, the draft has been updated to make clear that such interruptions are permitted where they are a user preference, and this is supported by an explicit call-out in the explanatory notes.

The CMS view

The changes to this part of the draft Media Bill are significant.  This is likely because its initial inclusion in the draft Media Bill was a surprise to many.   The update has taken on board feedback both from the Select Committee and the wider industry.  As perhaps is to be expected, we anticipate that radio selection services (in particular) are likely to still be dissatisfied with the provisions set out in the draft Media Bill.  However, the draft Media Bill has provided much needed clarifications on important topics such as charging, internet radio station playback preferences, and interruptions of radio playback for user-initiated alerts (such as call alerts).

We will be watching this Media Bill closely as it passes through Parliament, so keep an eye out for our updates on our dedicated CMS Media Bill webpage.  If you would like to discuss any aspect of the draft Media Bill or how it may affect you, please get in touch.