Ford's MXR deal marks the big time for digital radio.(Brief Article)

The car giant's new venture is exactly what digital radio needs

Ford is going into the radio business, promising to soothe the pain of traffic jams by providing drivers with crystal-clear digital car radios. In taking a stake in the MXR digital radio consortium, Ford has declared that it plans to fit digital radios into all the new cars it sells in Britain by 2004.

That's not all, however. The car manufacturer will also be joining with MXR in pitching for digital radio licences. This adds up to another blurring of the line between advertisers and media owners. But the move is also a sign that digital radio is coming of age and Ford's involvement looks set to be a driving force in expanding the medium into the marketplace.

Sally Oldham, the strategy and development director at Capital Radio, believes that the move is a crucial trigger in the development of a new medium. She says: "The commitment by Ford probably represents one of the key milestones in the development of digital radio. We have always believed that some sort of vertical integration with either manufacturers or retailers is required to drive the take-up forward.

"Given that the consumer benefits of digital radio are greater when the listener is on the move--that is, no fading, hissing or re-tuning -- then the in-car market is an important one."

She is not alone in her beliefs. Jim Marshall, the chief executive of MediaVest, believes that the growth and health of digital radio will revolve around the car market. Duncan Sillence, the group head of radio and press at Starcom Motive, also agrees that Ford's move could, in itself, be enough to transform digital radio usage.

He says: "There can be a rapid growth in digital radio penetration through just one car manufacturer. If this wasn't happening, we would probably be waiting until the Government turns off the analogue system and then there would be a mad rush. Anything that speeds up the critical mass is good for the radio industry."