Capital and UBC to develop data services for digital radio

Capital Radio and UBC Media Group are to develop data services over the airwaves in a move that the companies said would give a boost to the development of digital radio.

The companies will combine their local and regional spectrum to create a national network for transmitting always-on broadband radio data to every major town in England and Wales, reaching 27 million people. The service will be aimed in particular at mobile phones and other portable devices and will complement the third-generation mobile network.

Simon Cole, chief executive of UPC, which holds 30 per cent of the joint venture, said: "There is no realistic chance of 3G operators being able to transmit 64 kilobits per second to a large number of users. We can and, for the first time, we are combining a national and regional network, so you can jump from one to the other."

Transmitting pictures, maps and films are some of the applications of the technology. Because it is a broadcast signal, it does not come up against capacity constraints in the way that mobile phone networks do. However, as radio does not offer a "return loop" – a way for the recipient to transmit information back to the sender – the technology needs to be combined with another system which does, such as 3G.

"The place where this really sings is mobile phones. People are starved of information when they leave their homes. This is the most efficient way of sending them large amounts of data," Mr Cole said.

Under regulations, 20 per cent of the capacity on each digital licence is reserved for data services but, so far, most attention has been focused on digital audio services, which make up the remaining 80 per cent. "The radio industry is at last waking up to the potential of data operations and the telecoms industry is interested," Mr Cole said.

Capital shares closed up 7 per cent to 687.25p, while UBC finished up 1p to 31p.

David Mansfield, Capital Radio's chief executive, said: "Our aim is to establish digital radio as a mainstream medium in the UK. We strongly believe that innovative content will help drive the awareness and take-up of digital radio and help achieve this objective."