4Digital Group set to launch first radio station next April

4Digital Group, the planned digital radio operator, is set to sign a deal to launch the first of its planned nine radio stations next April via established digital radio operator Digital One.

Faced with an Ofcom-imposed deadline of 22 August to detail its plans, added to the fact that transmission operator Arqiva has not yet signed up to supply the requisite infrastructure, 4Digital Group is expected to agree a deal that would allow its stations to launch via Digital One, which hosts just three stations:TalkSport, Virgin Radio and Classic FM.

Despite some opposition to the idea from within the 4Digital Group board, it is thought that Digital One will provide unused capacity for some of the planned stations, which include E4 Radio and Pure 4 radio.

The deal could see GCap - which is still operated as a separate entity while it awaits OFT approval for its merger with Global Radio - and Arqiva, which own a 63% and 37% stake in Digital One respectively, relinquish some of their share in Digital One to 4Digital Group shareholders, which include Bauer Media, UBC Media, UTV and BSkyB.

A source close to the companies involved said Digital One and 4Digital Group were "close to a deal", but that it depended on approval from Arqiva.

"4Digital has done a good deal by using its position as licensee of the second multiplex to negotiate with Digital One," said the source. "Equally, Digital One would never survive against 4Digital Group, so they had to do a deal, and this is the best deal they could have done."

But an Ofcom spokesman stressed any change to Digital One, such as its ownership or the radio services it carries, will require the consent of the regulator.

Channel 4, Arqiva, Global Radio and Digital One all declined to comment.

Media Week 19 August