DAB for Wireless Multi-Media Content

6th May , 2004

Europe : The new venture is a digital multi-media broadcast operation – it will use digital radio capacity to transmit instantaneously, at high speed, substantial amounts of multi-media content, such as news, sports and entertainment, to handheld devices such as mobile phones and PDAs.

Inset above is Ralph Bernard, GWR Executive Chairman quoted below. The new operation will create services to transform mobile devices such as mobile phones or PDAs into an entertainment and information source with the content continually updated and always available.

The operation will develop services to complement and enhance existing telco mobile communications services and encourage interactivity.

The new entity will be operated by BT Wholesale with GWR representation on its management Board.

The business is expected to lead to a significant increase in the number of digital radios in the UK when DAB digital radio chips are incorporated into mobile devices.

It is expected to provide a significant new revenue stream for GWR. The business plan forecasts GWR’s first revenue share in the year ending March 2007 with an estimated annual pre-tax revenue share in excess of £5 million by the year ending March 2008.

Ralph Bernard, GWR Executive Chairman, said:

“We stated that we planned to exploit ground-breaking opportunities for interactive datacasting using digital radio broadcasting capacity when we initiated the GWR ‘Livetime project’. BT’s communications network, technology expertise and relationships with service providers make it the ideal partner to take this project forward.

“The introduction of DAB digital radio chips into mobile phones and PDAs will be a major boost for digital radio by significantly increasing penetration, particularly as these types of devices have a much shorter replacement cycle than traditional radios. This innovative convergence project will also provide GWR with an additional income stream.”

Chris Hutchings, BT Wholesale Markets Ventures Director, said:

“BT is very pleased to be partnering with GWR to create this new venture in the convergent area of broadcast and telecommunications. It represents BT Wholesale’s ongoing commitment to providing our customers with complementary, innovative new services designed to stimulate the market for all.”

The new operation will develop the capability to deliver a wide range of unique ‘one-to-many’ digital multi-media services in real-time to mobile phones and PDAs at a similar rate to broadband internet. The incorporation of DAB (Digital Audio Broadcasting) digital radios into these devices should also lead to a significant increase in the number of digital radios in the UK.

GWR is licensing its datacasting project to BT Wholesale and contributing a further £2.75 million over the next 18 months in exchange for a share of the venture’s annual revenues above £30 million. GWR expects its first revenue share in the year ending March 2007 with an estimated annual pre-tax revenue share in excess of £5 million by the year ending March 2008. Over the last four years GWR has invested £4.4 million in this project, including £2.5 million in the year to 31 March 2004.

BT Wholesale will be investing funds over the next eighteen months in deploying the business. The new venture will utilise Digital One’s digital broadcasting capacity, running alongside the eight national digital radio stations, for which Digital One will receive fixed and variable fees from the new venture. Digital One is 63% owned by GWR.

The new entity will create mobile broadcast services designed to complement existing mobile communications services. It plans to launch a service during 2005 when it expects to start broadcasting principally within the M25 area of the South East of the UK. Nationwide services are expected by the end of 2006.

The new venture will operate within BT Wholesale with GWR represented on the management board of the venture.

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