Burke plan gave Ireland radio like we'd never heard it before


It would be, said Century Radio cofounder James Stafford in 1989 of his broadcasting ambitions, "Irish national radio like you've never heard it before". After losses of £8 million in little over a year, extraordinary interventions by a government minister, a series of staff disputes and now an unprecedented tribunal investigation, who are we to disagree with this prediction?

The setting for Stafford's comments was the National Concert Hall in Dublin on a chilly January day in 1989. The occasion was the oral presentations made by the various parties bidding for the first national commercial radio licence to the members of the Independent Radio and Television Commission.

The ritzy if somewhat cheesy world of Irish entertainment was well represented - theatre impresarios, showband managers, disc jockeys, radio pirates and the like. But the men in dark suits were there in force, too - investors and financiers in search of a killing.

Commercial radio was the dot.com of its day. You couldn't throw a stone in these circles without hitting one of the big names of Irish business - Smurfit, Desmond, McEvaddy, Crean and, on his first big outing, Denis O'Brien. It was television that first earned the description of "a licence to print money," but commercial radio has always attracted the same get-rich-quick aspirations.

None of the bidders had to publish their applications and none did so, so their ownership and plans remained a mystery to the public. Cameras and radio microphones were excluded - this from a hearing concerned with the future of radio and television - and only selected print journalists were allowed attend. They were not allowed to ask questions.

Once the hearing began, the promises rained down like confetti. Century was no exception; it promised 250 jobs, two regional studios, education programmes, documentaries. The station would be "an alternative to RTE but would not duplicate RTE". There would be "a phrase a day" in Irish. Something for everyone in the audience.

The chairman of the IRTC, High Court judge Seamus Henchy, chipped in a question about ownership, and got a emollient answer from Mr Stafford. There was no mention, though, of the involvement in the company of John Mulhern, Charles Haughey's son-in-law, a fact which has only lately emerged.

Mr Stafford and his partner Oliver Barry promised to get their station on air by May 1st, but they were asked no questions about how this was to be achieved technically. For the truth was that Century had no transmission network of its own, and hadn't at that stage done any sums for getting RTE to rebroadcast the station's signal. This week we learned from the Flood tribunal that Century went into the hearings knowing that this awkward issue would not be raised.

Mr Barry, who built his career on managing the Wolfe Tones and promoting acts such as Michael Jackson and Frank Sinatra, is the man who delivered £35,000 in cash to the Minister for Communications, Ray Burke, in May 1989, four months after these hearings.

There were three other bidders for the licence: veteran pirate broadcaster Chris Carey; a consortium of former RTE journalists and their backers; and Radio 2000, chaired by Denis O'Brien. Carey's bid was first to go, and the IRTC decided between the remaining three at a meeting convened in Cork just a week after the oral presentations.

Many observers felt Century's presentation was not the most impressive of the four, and its bid was not the front-runner in an IRTC meeting held immediately after the hearings. However, at the Cork meeting, this sentiment was quickly overturned and a consensus decision was reached to award the licence to Century. A minority on the IRTC remains unhappy about the manner of this decision to this day, and has communicated this to the tribunal.

The decision was announced on January 18th. This week, we learned that it wasn't long before Mr Burke was giving Century's backers advice on how to proceed in its row with RTE. Go to the IRTC, and get them to come to me, and then I can make a directive fixing the transmission fees, he allegedly told Mr Stafford and Mr Barry.

Mr Burke made his directive in March, setting the fees at one-quarter the level agreed between RTE and his own officials and less even than the amount Century was seeking.

Any disappointment Denis O'Brien might have felt must have been short-lived as, shortly afterwards, he secured one of the two Dublin licences. His company Esat Television owned 70 per cent of Radio 2000, which broadcasts successfully today as 98FM.

However, this award quickly became mired in controversy when one of the unsuccessful bidders took a High Court action to have the decision overturned. It was pointed out that one of the IRTC members, Fred O'Donovan, had until a few months earlier been a shareholder of Esat. At the time, Mr O'Donovan's daughter had been seeing Mr O'Brien and the two men were close personal friends, it was alleged in court.

Queries were also raised as to why two Dublin licences were handed out, instead of a single award.

Mr O'Donovan, who was appointed by Charles Haughey as chairman of the RTE Authority in the mid-1980s, had arguably the greatest amount of broadcasting experience of any of the IRTC members.

He resigned as chairman and director of Esat in July 1988 and sold his shareholding to another shareholder, Paul Power. Curiously, Mr Power is the man who with Robin Rennicks delivered a £30,000 cheque to Ray Burke in June 1989. The money was a political donation paid on behalf of Fitzwilton, the investment vehicle backed Tony O'Reilly and associates.

Dr O'Reilly does not figure among the applicants for commercial radio licences. However, the success of companies to which he is linked in securing a large number of MMDS rebroadcasting franchises a few months later is likely to come under intense scrutiny when the tribunal examines this issue later in the year.

The legal challenge to Mr O'Brien's licence award failed. The judge pointed out that Mr O'Donovan had twice told the IRTC chairman about his interests. He ruled that Mr O'Donovan had successfully divested himself of his shares and there was no real likelihood of bias on his part.

Ironically, Esat was originally formed to provide services to Atlantic Satellites, a company that held an exclusive licence to provide an Irish satellite network. And its founder was none other than James Stafford.

Although Mr Stafford teamed up with the Hughes Corporation in the US, nothing much came of this ambitious project and Esat went elsewhere to bring the project to fruition.

Mr Stafford comes from a prominent Co Wexford business family, which has extensive interests in the shipping business and once ran the Gresham Hotel. However, his own business career has been chequered to say the least. Century, Atlantic Satellites and his early forays into property ended in failure. In 1980, he founded the speculative oil exploration company, Atlantic Resources, but later left after a disagreement with the chairman, Dr O'Reilly. A long-time friend of Charles Haughey, in 1988 he helped set up Conor Haughey in the mining business by investing £100,000 in Feltrim Mining.

The other Dublin licence was awarded to Capital Radio Productions, broadcasting today as FM104. The chairman of this consortium, Liam Conroy, has already figured prominently in the tribunal's deliberations.

Mr Conroy, who held a 9.8 per cent stake in Capital, was chief executive of the Murphy group until June 1988. This is the company that paid Mr Burke £30,000 in cash in June 1989. The payment, made by managing director James Gogarty, led to the setting up of the tribunal.

Mr O'Donovan ran the Gaiety Theatre for over a decade and sat with Mr Conroy on the board of Gaiety Theatre Productions, which was owned by the Murphy group. He told The Irish Times earlier this year that he did not participate in the vote on the IRTC on Mr Conroy's application.

What strikes one today about the process was the speed with which the commercial radio sector was set up. When Mr Burke became minister for communications in 1987, he bought into the existing consensus that private local radio stations should be established. There was no mention at this time of a national radio station designed to go toe-to-toe with RTE, and no studies had been carried out to see if such a service would be viable.

But once Mr Burke got it into his head to provide a national alternative to RTE, events moved quickly. The IRTC was set up in October 1988, the first hearing took place on January 12th and Century got its licence six days later. Dozens of other licences were awarded in the succeeding months.

The other members of the IRTC were Donagh O'Donoghue, a Galway businessman, Donal O'Sullivan, a Cork county councillor, the public relations executive Terry Prone, travel agent Gillian Bowler, trade union official and current chairman of the Labour Relations Commission Kieran Mulvey, Frank Cullen of National Newspapers of Ireland, and Liam Devally, a former broadcaster and Dublin circuit court judge.

Many, if not all, members have made statements to the tribunal and are likely to be called as witnesses.

Century lived a short and brutal life. The entire project was built around the personality of Gay Byrne, who was involved in early discussions. But when Byrne pulled out, it persisted with a schedule that mimicked RTE at every point in the day, without ever being more than a pale imitation. It was, in the words of one observer, a "sawn-off" version of the State broadcaster.

Terry Wogan and Chris de Burgh came on board to lend glitz, and Laurence Crowley was drafted in as chairman for his business connections. But the only way was down; none of the advertising projections were met, listeners stayed away, and the losses mounted. It took an initial investment of only £100,000 to secure the licence, but Century lost £8 million in only 14 months on air and closed in November 1991.

It was, indeed, "Irish radio like you've never heard it before".