Virgin Radio International is set to cement its presence in the Middle East’s commercial radio industry with its first foray into Dubai.
President Ian Grace, who in September oversaw the company’s tie-up with Arabian Radio Network, explains his plans to capitalise on the emirate’s burgeoning radio scene.
He told Emirates Business that as the latest outpost for the Virgin empire, Dubai is an ideal place for the station to find traction, thanks to its quickening pace of business and booming economy.
Grace revealed the challenges of entering a radio sector that is yet to match Dubai’s other booming industries and the importance of finding a suitable venture partner for tapping into the region.
The international radio company recently launched stations in Italy and France and may expand into the Middle East over the coming years.
What’s your opinion of commercial radio in the UAE?
I think the standard of radio is reasonably high. But I wonder where the consumer is coming through in the equation and whether the stations are focusing on the listener, because it’s easy to let slip the fact the listener is the most important part of the whole equation.
Is the listener at the forefront of this or is the listener coming in behind the advertiser here?
The advertiser is very important but without supporters, you won’t stay around very long. The customer has to come first.
What do you think are the main challenges for the growth of the radio industry in the UAE?
At this point there are no accurate audience measurements.
It’s been much discussed and has been on the agenda for a number of years. In other mature radio industries in the world there are accurate objective measurements done on a weekly, monthly or quarterly basis.
It’s important because advertisers can monitor who is listening to a particular radio station, not only in numbers but age groups and so on.
You can find out whether you have a lot of listeners or not.
And if not, the station might not be appealing, then you have no other choice but improve yourself.
When someone comes with facts, which say you don’t have as many listeners as you should have – and it’s an objective view – you don’t have much choice, you just have to do better.
Therefore, the product gets better, you get more listeners, the advertisers are a lot happier and the radio industry’s standard also increases.
Therefore, I believe transparent audience measurements might have some part to play here.
What are the regulatory challenges for the radio industry in the region?
I don’t see any regulatory challenges written or in play; I don’t see anything that stands in the way of successful radio.
In fact, I think the regulatory regime in relation to radio in the UAE is far less severe and far less restrictive than many other countries.
We operate in a number of nations where the regulatory environment is far tougher than it is here.
I can only speak from our perspective and we have no issue with the regulatory environment at all.
I do not see any restrictions that may hinder our progress here.
Can you tell us a little about setting up Virgin Radio International and some of the major developments?
The company was set up in 2001.
We have six stations in Thailand, a national station in France and one in Italy, four stations in India and we’ve now come to the UAE.
The only challenge is the regulatory environment, interestingly enough, but not so much about what we can and can’t do on air.
In most countries in the world you respect the political situation, the industry and media ownership, media controls and so on.
Our greatest challenge here is not the process of actually setting up or operating the businesses, it’s finding the right kind of venture partners and being able to establish businesses alongside them.
We have to be very careful as we approach different territories and work very slowly to find partners whom we know we can build a long and fruitful relationship with.
And there’s no such thing as a standard approach; what we may do in the UAE may be totally different to what we do in Italy.
Why was it important for Virgin Radio International to team up with a local media company in Dubai?
It’s important because a joint venture partner in the region should have the local knowledge and understanding of not only the regulatory environment but the cultural landscape as well.
We’re not so bold as to just arrive in a particular country without knowing what the landscapes are.
As far as the UAE is concerned, we don’t want to be one of those radio stations that is very successful for one or two years and then disappears.
Many of the most successful stations around the world have been successful for 15 or 20 years – they’ve become part of the community.
So you need to look up to the partner, how it operates, how it brings strength to the partnership. For that reason, we have to take it very slowly, so we can be here for a long time.
What are your plans for a tie-up with Arab Media Group? What’s the timeline?
The station has been on air in its true form since January 30. All the presenters we have hired were added slowly to the station.
We integrate them in a period of three to four weeks.
Then at a point in time when we feel comfortable, we will begin marketing.
What can we expect to hear from Virgin Radio here?
The station is very different from Virgin UK or some of the other regions.
It is being designed and constructed in relation to what is happening in Dubai.
Everything other than the name and the philosophy – the way we approach the business model – is crafted exclusively for this market.
Which are the most profitable demographic segments in Dubai?
The most profitable demographic sector is the under 40s, it’s probably the 18-34 group. We’ve targeted them from day one.
Any concerns about digital competition and any plans to go online?
No, we’re involved in digital radio in some of the other markets but I don’t think digital radio will become a major force in Dubai for a period of time.
Our main competitors are anyone else on air to an extent; although we have tried to position Virgin Radio in a slightly different niche from other broadcasters.
Most of the music stations are our competitors, but we’re far more focused on the community.
The main concern is whether [the age group we’re targeting] would find our radio station appealing.
How did you decide on Dubai as the first Middle Eastern station?
We have had a number of media groups in various Middle East territories approach us over the years wanting us to partner with them.
We took a decision that we wanted to be here.
We can see the growth, we can see the dynamics of the city and the way the UAE is progressing at such a rapid pace and we felt to not be in Dubai first was almost like missing out.
We could have been in the Middle East two or three years ago but it was Dubai we wanted to be in first.
Virgin Radio Dubai
Virgin Group’s CEO Sir Richard Branson flew into Dubai late last year to officially announce the partnering of Arabian Radio Network (ARN), a subsidiary of Arab Media Group (AMG), with Virgin Radio International, to launch Virgin Radio Dubai. Sir Richard and AMG Chief Executive Officer Abdullatif Al Sayegh.
On November 19 announced the partnership at a gathering in Dubai Media City.
The Virgin and AMG partnership has resulted in the broadcast of Virgin Radio over ARN’s 104.4 frequency from studios in Dubai, making it the ninth station in ARN’s portfolio and the third English-language station.
The station, which has been on air since January 30, will be run as collaboration between Virgin and Arab Media Group, with Virgin providing input into programming, marketing and promotions.
Virgin Radio currently has 14 radio stations in five countries, including one in France, one in Italy and four in India and Thailand.
Grace has carved out his role as President of Virgin Radio International (VRI) with station launches in Thailand, India, France, Italy and now in the UAE.
Grace brings more than 25 years of experience in commercial radio in markets around the world.
This also includes one of America’s most renowned FM rock radio stations WHJY, in Providence, Rhode Islands, which was voted number two in the US in the prestigious Rolling Stone Awards under his direction.
Grace was also instrumental in helping create Australia’s national Triple M radio network, which continues to operate in all capital cities of the country today.
The network became Australia’s most dominant FM radio network with an annual revenue in excess of A$80 million (Dh263m).
Since 1993, Grace has advised Virgin Radio in the United Kingdom and Oui FM in Paris.
The Arabian Radio Network is a subsidiary of the Arab Media Group, the parent company of Awraq Publishing, publisher of Emirates Business and Business24-7.ae.
Virgin to capture Dubai's airwaves